Innovation in Practice

Divide and Conquer

"Divide and Conquer" is:  a. classic military strategy, b. a computer algorithm design paradigm, c. a collaborative problem solving approach, d. an innovation tool, or e. ALL THE ABOVE

The answer, of course, is all the above.  Division is one of the five templates of innovation in the Systematic Inventive Thinking method.  The others are Subtraction, Task Unification, Multiplication, and Attribute Dependency.  Templates were developed by recognizing the same consistent pattern over many products so that the pattern could be applied to create innovative new products.  The method works by taking a product, concept, situation, service, process, or other seed construct, and breaking it into its basic component parts or attributes. The templates manipulate the components, one at a time, to create new-to-the-world constructs for which the innovator finds a valuable use. The notion of taking the solution and finding a problem that it can solve is called "function follows form" and is at the heart of the systematic inventive thinking process.  It is innovation by working backwards.

The Division Template works by taking a product or a component of it and dividing it physically, functionally, or what is called preserving where each part preserves the characteristics of the whole.  Rearrange the parts, then work backwards to find a use or benefit for this new form.

Here is an example from my workshop last week at Duke's Fuqua School of Business.  The product is dryer sheets (gauze-like tissues about the size of a Kleenex, put into clothes dryers to eliminate static cling, soften clothes and add artificial fragrance.)  Now divide these into much smaller parts, perhaps after the whole sheet is thrown into the dryer.  Imagine these smaller parts get all over the clothes and cling to them.  Why would this be useful?  What could be the benefit?  Here's an idea.  Perhaps the smaller pieces stay on the clothes to continue softening, brightening, or adding a design element, waterproofing, smell-proofing, allergy free, anti-itch, etc.  Perhaps the clothes are pre-treated with something that interacts with the small dryer pieces to extend the performance of the clothes, reducing cleaning, wear and tear, or wrinkles.  Perhaps the small bits are transparent (thanks, Yoni!) so they are invisible on the clothing.  This simple Division takes a seemingly dull product and re-frames how we think of it to discover new innovative uses and benefits.

Division is also a collaboration approach.  One of the Duke MBA's, Tom Powell, emailed me about crowdspirit.com, kluster.com, and ideabahn.com.  These new sites form communities that take an idea and iteratively improve it with suggestions from members.  These sites are also examples of Division (preserving) - taking the larger problem and dividing it among many people.  Idea collaboration is an old idea, but what could be a more innovative approach is to divide a problem using the other two methods: physically or functionally...focus members on the problem in a different way.  As these beta sites evolve, we will watch to see how innovative they can become at dividing and conquering.

Measuring the Immeasurable

Innovation, like most other things in business, gets caught in the trap of "how do we measure results."  Innovation managers at Fortune 100 companies find themselves confronted with this question in their efforts to raise innovation capabilities.  In the end, measuring innovation doesn't matter.  Measuring innovation methods is where the focus needs to be.

The typical approach to measuring innovation is revenue from new products.  The usual question is: "Show me a product generated from an innovation workshop and its first year revenues.  My response to this might be: "And let's compare that to the revenue NOT produced from ideas NOT generated because of a lack of innovation."

Some aspects of innovation are immeasurable.  During an innovation workshop several years ago, an engineer in the group had a depressed look on his face.  It struck me as odd particularly because we had just completed a vibrant round of ideation with many new possibilities.  The entire group was energized except this one individual.  Out of concern, I asked him if he was feeling sick or in pain.  What he told me struck me hard.  He said, "No, I'm feeling fine.  It's just that I NOW realize, after this round of ideation, that an idea that I have been holding onto for a long time...won't work."

I remember thinking, "Wow!  What is the value of giving UP a failed idea so that you can now direct your full focus and energy to new pathways?"  This ideation session freed this individual's mind AND motivation to move in new directions.  He would no longer waste his productive time pursuing a pet idea in favor of better possibilities.  He would begin creating value not from an idea generated, but rather from an idea given up.

How do you measure THAT?

The question is not: "Let's measure innovation to decide whether we should do it."  Rather the question should be: "Which innovation method gives us the most results to improve our business?"  Companies should compare methods using simple metrics like: total ideas generated.  From this tally, break it down further to: new ideas versus ideas we already had; ideas actually pursued; ideas likely to be pursued; ideas never to be pursued.  The key is to compare apples to apples.  I once asked a colleague how she liked using a particular method by an innovation consultant in the local area.  She said that she loved it.  I asked, "Compared to what?"  No response.

The best practice from Fortune 100 companies is to build and measure innovation competency...the inputs of growth, not the outputs.

Innovation Follows Strategy

Innovation that is done in the context of business strategy tends to be more focused, efficient, and business-model relevant.  Innovation should not be viewed as a way to take the organization off its strategic track and in new directions.  Rather, innovation should be applied in a way that makes the current strategic track more successful and profitable...true growth.

Yet the tendency is to view this approach as incrementalism and not disruptive enough in the Christensen sense.  Some would say that starting with your current situation is not bold and is risk adverse.  "We're not thinking outside the box" is the usual incantation at this point.  Instead, there is a preference to chasing "white space" and "open source" innovation as a source of growth.  Some executives prefer the lure of white space and opportunity spotting, and they readily acknowledge that it is "low yield by design."  The Scarcity Principle tends to make these opportunities seem more valuable than they really are.  White space chasers position themselves as fighting the heroic fight.  Resources come pouring in.

The best Fortune 100 companies pursue high yield, organic innovation efforts... not "low-yield-by-design" efforts.  High yield innovation comes from tying innovation directly to the strategic marketing context of the firm.  Ideas generated this way help the organization stretch its model in a way that is achievable and internally-sellable.

How do you tie innovation to strategy?  Professor Christie Nordhielm from the University of Michigan has developed what I consider the best single contribution to marketing thought since the 4P's.  Her Big Picture framework of the marketing management process provides the context for innovating across the entire business model.  Applying systematic innovation tools to each aspect of her Big Picture model can yield amazing insights at both the strategic and tactical levels of the business.  It is the intersection of these two ideas...Big Picture Strategy and Systematic Inventive Thinking...that will yield consistent, profitable results.  Innovation follows strategy...not the other way around.

The Not-So-Fuzzy Front End

A best practice at Fortune 100 companies is to see the front end of the pipeline not as fuzzy, but as crystal clear.  A systematic approach to innovation using an effective process can take away the mystery of the front end and create a sustainable growth engine. 

What is the “fuzzy front end” and why has this notion become so popular?  Calling the front end “fuzzy” perpetuates the myths of innovation.  “Fuzziness” is the term coined to suggest that innovation has lots of risk, is not systematic, and is more of a “eureka” moment.  One can schedule work, but you cannot schedule invention.

This is simply not true. You can schedule innovation.  A company like GE, for example, that is seeking 8% growth on a base of $207billion in sales, needs $17 billion in new revenue a year from innovation to achieve that. GE will not tolerate fuzziness at its front end of innovation.

For some, fuziness is more about how to select projects from among the ideas generated at the front end.  There are many tools available to help managers select the most appropriate projects.  The best of those use some form of weighted linear model. 

My advice: Create an innovation schedule.  Hold people accountable for generating new business opportunities.  Sharpen the focus, and reward teams that bring forward an exciting portfolio of current and future growth opportunities.  Accepting fuzziness in the front end is accepting slow growth.