Friday, 6 August 2010

Experts are killing innovation

We have seen significant changes in the global marketplace where traditional solutions no longer work and businesses are striving to deal with change in an unprecedented way.

There is no doubt that innovation is perceived as being a high priority business strategy to deal with these changes, however our approach to innovation is in need of a radical overhaul.

blackswan® compiled a structured survey of 5000 senior managers, directors and business leaders across a broad range of industries. The survey investigated how to implement successful business strategies that deliver results. The rationale for launching this survey was the rapid development of exciting, market-based knowledge practices, technologies, and business models that drive outcomes.

A key section in the survey was the identification of what clients felt would be valuable enhancements to the current structures in place that would help them be more effective in enabling their businesses to be more successful in delivering profitable results.

As we stand today, the approach to innovation across business, academia and government is fragmented, disjointed and delivering unsustainable returns. It is impossible to see real progress happening when over 90% of innovation spend is being thrown away in the pursuit of a silver bullet to revive organisational fortunes.

There are three commonly held beliefs about innovation spend that we have found to be invalid.
  1. The centralisation of innovation within organisations (within R&D or to an innovation line of business) can, by itself, significantly affect the bottom line of an organisation.

    R&D spend is delivering a return of less than 10% and has minimal impact on an organisation’s long-term bottom line or its new business development. Centralising activity without fundamentally changing the processes that govern it is doing nothing to increase these ratios.

  2. The current innovation environment is servicing customer needs.

    The current innovation environment is inward looking and not focussed on the wants and needs of customers. We can all point to an organisation like Apple and claim, based on their success, that a secretive, expert-led approach is the future of innovation, but let’s not treat an exception as the basis for a rule. Also let us also not forget that this was an organisation that has imploded more times in recent history than most organisations can handle.

    Where organisations like Apple now stand, there were others like IBM, DEC and Dell. All led the way, all have seen dramatic changes in fortune in the face of changing consumer whims. Want to build a PC from scratch, exactly to your own specification – THAT’S the future. Want to buy it off the shelf, ready to take home, to a predefined specification – THAT’S the future. Well what’s the next future?

    Organisations have become adept at shaping customer expectations in the short term, but disruptive leaps in technology change the landscape quickly, and businesses are unable to cope with the change in customer mood. Slick marketing may go some way to slowing the inevitable customer dissatisfaction, but it will come. And remember, we are now living in a world where we measure these changes with a stopwatch, not a calendar. Can your business react to the tick of a second hand rather than the turning of a page?

  3. Experts in the subject are the best people to manage innovation spend.

    87% of the survey respondents felt that many of the current development organisations, applied research agencies and academic bodies had personal agendas in relation to their domain expertise. Vested interests in pursuing some channels over others were apparent, and there was overwhelming evidence domain experts were often blinded their own capabilities.

    The alternative, an independent innovation standards body, was supported by 76% of the respondents if it could deliver:
  • International capability to establish how business can apply innovation more successfully given their position in the current business life-cycle.
  • Independence from domain experts and service providers
  • Scorecard identification and evaluation of ideas and proposals
  • Capability to transfer the knowledge on how to ‘turbo charge’ good ideas to market
  • Support for businesses to create bullet proof IP
  • A ‘Phoenix’ process for identifying initiatives that should have been funded or that need to be revisited because they were shelved prematurely
  • Key strategic investment insight based on global business evolution trends
  • A managed service for developing, recruiting and placing talent with the required breadth and quality of skills, in the target domain areas at the right time across academia and business

The findings from the blackswan survey clearly outlines that innovation needs to be managed in a more structured manner and removed from domain experts’ control if it is going to produce the results required.

In a situation where 76% of the respondents said they would support an independent institution, blackswan, together with its partners are now examining options as to how we can meet these new challenges.

Friday, 16 July 2010

What Job Descriptions Do Not Tell You about Great Leaders

Smart is an elusive concept. Asking lots of questions builds up our knowledge base. With knowledge comes a certain sharpness; an ability to absorb new facts. Knowledge and curiosity builds a certain creativity that allows you to be effective. Why then do we believe that job descriptions are necessary?

The traditional study of leadership leads one to believe that the role of leaders is to set a course and stick to it whilst standing tall at the helm of their business, following the tried and tested rules of engagement, guiding their teams tirelessly through the storm. Using time-honoured job description methodology, which is often very effective, leaders attempt to keep the organisation stable, predictable and on course. What I cry out is, “Off course, off course is where the innovation and fun begins!”

This very issue strikes panic into the hearts of most of us charged with assuring the sustainability of our businesses. The challenge for leaders is contradictory: manage for stability while at the same time creating chaos that will present new opportunities and innovations. These mutually exclusive and contradictory goals are at the heart of the best organisations. Leaders capable of supporting the invention of new products and services, creating multi-layered networks, and casting off the ballast of withered management practices while carefully retaining the best ones, achieve lasting results. And, since leadership and management are largely non-linear undertakings, these are often uncharted waters with no apparent “one right way” and no absolute formula for success. Great leaders see beyond the horizon, but know they will have to adapt along the course as opportunities and obstacles come into view.

The following ten contradictions are offered only as a starting point in re-thinking a job description for new age leaders; leaders need to do all these things and do all these things together.
•Follow a structured roadmap and know that a roadmap is just a suggestion
•Know the customer does come first and that the customer does come second
•Have a systemised employee base and lose the job descriptions
•Listen to what customers say and pay attention to only 20 percent of customers’ opinions
•Build a corporate culture and stand in contradiction to the corporate culture
•Make it both business and personal
•Apply both/and, not either/or thinking
•Don’t worry what you don’t tolerate, worry about what you do tolerate

Let’s face it, when under pressure to grow, organisations of all kinds look to their roots and their previous successes for answers. Rekindling business growth inside an organisation often represents the toughest challenge to a maturing organisation. Can it regain its entrepreneurial spirit and continue to thrive despite its mature culture?

By turning to intrapreneurs, the company hopes it can have the best of both worlds. Intrapreneurs, by definition, embody the same characteristics as the entrepreneur, conviction, passion, and drive. They tend to be the leaders who have no job description, or the people who know that job descriptions inhibit success and limit thinking.

Monday, 5 July 2010

Can Apple be trusted?

We run a lot of workshops on the subject of trust.  As part of the standard lead in to get people to understand the importance of trust, we run a simple exercise that asks them to choose the most trustworthy company from a list.

Now, I'll readily admit there are some ringers in the list.  We usually place some 'hot topics' in there to keep things interesting, and no-one ever expects Toyota, BP, Enron, or the latest villain of the peace to come out on top, however the winner is surprisingly consistent.... over the last couple of years it's always Apple.

Now, I'm no Apple-basher, not in the slightest.  I like them and am intruiged by the business.  I read a fascinating book about them recently (Return to the Little Kingdom by Michael Moritz) which fuelled the intrigue even further.  I believe they make truly great 'stuff'.  I have an iPod.  I'd like an iPhone.  I'd like a go on an iPad!  But it staggers me the degree of almost 'blind' trust people have in them as a business.

On the last group workshop we ran, I challenged the group who had (once again) put Apple top of the pile.  I'll admit that my main intention was to be combative and ramp up the conversation, but I was genuinely interested to see the reaction.  I'll be interested in what you make of these challenges too.

3 Reasons why we shouldn't trust Apple:

1) We shouldn't trust companies that don't talk to their customers.  Apple talk AT us, with no interest in shaping their products to our needs, rather they shape us to their products.

2) We shouldn't trust companies that don't trust us.  They don't trust us to (truly) choose our own apps, customise our phone, or even change our own batteries.  They don't even trust us to hold our phones correctly!

3) We shouldn't trust companies who don't act with transparency.  Apple have publicly 'embraced' open standards, but then privately created new, closed standards that limit transparency and openness.

So, can Apple really be trusted?

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