Report 103

Your newsletter on applied creativity, imagination, ideas and innovation in business.

Thursday 2 February 2011
Issue 181

Hello and welcome to another issue of Report 103, your twice-monthly newsletter on creativity, imagination, ideas and innovation in business.

As always, if you have news about creativity, imagination, ideas, or innovation please feel free to forward it to me for potential inclusion in Report103. Your comments and feedback are also always welcome.

Information on unsubscribing, archives, reprinting articles, etc can be found at the end of this newsletter.

IF YOU LIKE REPORT 103 ..

If you like Report 103, I expect you will enjoy my new book: The Way of the Innovation Master. Learn more at http://www.creativejeffrey.com/books/.

END TO END CREATIVITY IN THE INNOVATION PROCESS

When we think of the innovation process, we tend to see creativity being exerted mostly, if not entirely, at the beginning of the process. You start with a lot of ideas, identify those that have potential and implement them following the usual procedures. I confess that even our approach to the innovation process, which is based on creative problem solving combined with business analytics, would seem to suggest the same: creativity is only to be found in the early bits.

But think about it. When was the last time you ever launched a new project in which things did not go wrong at almost every stage of the way? What about bigger projects involving multiple people in multiple locations, lots of budget and the coordination of multiple business partners? Have you ever known such a project to progress without a hitch? Of course not!

Learning Curve

The truth, of course, is that every new project involves a learning curve as you run into unexpected problems and challenges. The bigger and more complex the project is, the bigger and more complex are the resulting problems. Innovative projects, by their very nature, involve adopting new techniques and approaches which inevitably result in unexpected challenges during the implementation phase.

The best way to deal with problems and challenges in innovative projects is, of course, to apply creative thinking. Unfortunately, this is not done to the extent that it should be. In the case of a new product idea, for instance, a lot of creativity goes into developing the concept and design. Very likely structured events such as brainstorming, focus groups and internal design competitions take place as people submit, collaborate on and develop ideas. Eventually, the product design is complete and handed off to the production team.

Inevitably, they run into problems. A component of the new product cannot be made on existing machine tools and requires a substantial investment in new tools, which would also require investing in additional factory space. That would blow the budget, so they would have to outsource the manufacturing of that component or change it so that it could be made on their own machine tools. Most likely only the production team will discover the problem and try to solve it quickly.

That’s too bad. Because if they took a more creative approach, posing their problem as an innovative challenge and inviting a diverse team of colleagues to brainstorm solutions, they might come up with unexpectedly innovative alternatives to using the problematic component.

Meanwhile, the legal department might discover that legislation in a key market would prevent the product from being sold as is. Here again is an opportunity to frame the problem as a creative challenge and brainstorm for solutions. But this seldom happens. Generally, the lawyers and the project manager look for a conventional solution. Perhaps the project is even dropped.

If you reflect on innovative projects you have worked on, you can probably think of similar instances. A new product idea is generated by some innovation initiative, perhaps on an idea management software. Perhaps in a brainstorming event. Perhaps through crowdsourcing. However, as the project is developed and runs into problems, the problem solving is limited to a very small group of people who look for quick fixes rather than creative alternatives.

Why is this? There are three reasons.

We simply tend to see the innovation process as using creativity primarily during the early stages of a project.
Managers are often not taught or encouraged to use creative thinking approaches to solving operational problems in the development of a project. Moreover, many a manager will fear that communicating a need for creative ideas to solve a problem would indicate a failure or lack of competence on her part.
Many innovation initiatives and idea management software products are only designed to capture ideas. So they are great for capturing the new product idea, but lack the functionality to focus on specific innovation challenges to defined groups.

Opportunities Knock

In addition to encountering problems in the development of a project, people doing the implementations will often discover opportunities. For instance, a software programmer might observe that a new software product she is working on could be easily integrated with popular email software, providing additional functionality at virtually no additional cost. A manufacturing person might notice that a product being made for a specific purpose could easily also be used for a completely different purpose, thus potentially doubling the market. And so on.

A business partner who manufactures parts to order may identify ways to make their parts less expensive, lighter or available in a wide range of colours. But unless they are involved in your innovation process, they will likely build to order rather than suggest alternatives – at least once the project has been initiated.

Again, we see that such creativity is often not encouraged and so such ideas are seldom elevated to decision makers who can authorise them. Admittedly, in the case of product development, such ideas may be identified too late in the production process to enable them to be implemented immediately. But most products need to be improved and upgraded from time to time. Collecting creative suggestions from the implementation people is a great source for product improvement ideas.

Lost Opportunities

What all of this means is that while many products and projects start off as the result of heavy-duty creative thinking, that creative thinking is not applied throughout the lifetime of the implementation process. Managers and others involved in the process are typically neither encouraged nor given the tools to apply diverse creative thinking to problem solving. Likewise, there are seldom tools or processes for people involved in implementation to suggest or try out ideas once the implementation process is started.

Fortunately, the solution is not that difficult. Rather than focus creative thinking and the use of creative tools exclusively to the development of new product and project ideas, apply creative thinking techniques at every stage of the process and invest in innovation tools that allow managers to focus ideation on specific challenges.

PRODUCTS AS SERVICES

Developed countries’ economies are becoming increasingly service oriented over time. This is not a secret. In 2005, services comprised 76% of the USA’s gross domestic product (GDP) and 70% of Europe’s¹. Even itemx that were once considered products that we bought from shops are becoming more like services.

Take the car, the single biggest product (aside from a house) that most of us will ever buy. Actually, that may not be true any more. Fewer and fewer people are actually buying cars. Here in Belgium, for instance, a large number of cars on the road are leased by companies which in turn provide the cars to their employees. The leases comprise not only the car, but also insurance, regular servicing and even fuel. In exchange, the companies which lease the cars pay a monthly fee to the leasing firm.

Some big cities, however, are taking this one step further. In Paris, London and elsewhere, you can sign up to a car sharing scheme in which you pay a monthly fee. Then, whenever you need a car, you log onto a web site, find a car nearby and order it for a period of time, ranging from an hour to a few days. Once you’ve ordered the car, your membership card acts as a key for that vehicle. For city dwellers who only need a car occasionally and who don’t want to have to deal with the hassles of parking and maintaining a car, this is an ideal scheme.

Or consider the iPhone or Google’s Android operating system for mobile phones. Much of the excitement surrounding these products is not the products themselves, but rather the services you can acquire through the telephones, the so-called “apps” (short for applications). Actually, when you think about it, most mobile telephones are given away or sold for a sneeze in exchange for a service contract with a mobile telephone operator – yet another example of the servicification (my word) of products.

My parents need not own a lawnmower, snow shovel or rake. That’s because they subscribe to a lawn care service that sends someone round regularly to cut the grass, rake the leaves or shovel the snow, depending on the season and weather. For this, they pay a regular subscription. And they are not alone. During the summer, you can see a slew of trucks, belonging to competing services, parked on their road.

Turning Your Products into Services

If you are one of the few people employed by the manufacturing industry or involved in selling products, it is clear that this trend towards selling products in the form of services is likely to continue. Moreover, it has its advantages. For example, it is my understanding that the heavy vehicle industry was less affected by the economic downturn than the passenger car industry largely because many trucks are bought as contracts that include service, maintenance, and so on. As a result, the industry continued to receive steady income from existing contracts during the recession. However, people simply stopped buying cars.

An excellent creative exercise which can lead to some very innovative results is to explore how you might sell your physical products as services. Ask yourself questions, such as: is it possible to sell your product as a subscription that includes related services? Rather than selling your product as a product, could you sell it as a service? If, for instance, your company sells industrial cleaning equipment, might you offer an industrial cleaning service to your clients, rather than just the equipment? Long term contracts would result in more consistent cash-flow and, having your people using your equipment, should provide a steady steam of user feedback that would enable you continuously to improve your equipment, always an innovative thing to do!

Turning Your Services into More Comprehensive Services

Very likely your company already offers services. In this case, it is worth asking if you could enhance your services by including products as part of the services. For instance, if you run an IT consultancy supporting small businesses, perhaps you could go one step further and provide computers and software to your customers’ employees, thus freeing them from having to purchase computers themselves. The cost of the computers would be absorbed in the service fee you charge your customers.

The advantages here are not only do you serve your customers better, but you can purchase computers in bulk and by using a limited range of computers from a single manufacturer, you limit the range of computers your employees need to service, simplifying their work and thus making your service more efficient.

If you run a restaurant, why not offer regular meal services to people who live nearby. For a monthly fee, you could deliver meals to neighbours three days a week (for example). This regularises your income and allows you to make more efficient use of your kitchen, without needing to increase the number of tables.

The list goes on. Indeed, there are many opportunities to deliver products as services and to improve your services by adding products in ways that make life easier for your customers (the lawn care service, for instance, alleviates the need for my parents to buy a lot of gardening equipment).

It also often offers you a chance to out-innovate your competitors with relatively little risk. Services seldom require the capital expense of manufacturing equipment, storage or showrooms necessitated by the sale of goods.

So what are you waiting for? Get brainstorming!

References

1. Source: World Resources Institute ()

THE WAY OF THE INNOVATION MASTER: MY NEW BOOK

If you need to implement an innovation process in your company, read my latest book: The Way of the Innovation Master. You will learn how to prepare an innovation strategy and plan as well as how to implement each step of the plan in order to turn it into a viable and functioning innovation process for your company.

Moreover, the Way is not your usual dry business tome. Rather it is a creative approach that combines a journey, a dialogue and a series of lessons to deliver a message about organisational innovation.

If you enjoy Report 103, I am sure you will also enjoy my book. Learn more here or order it from Amazon US here!

IDEA MANAGEMENT IS BORING!

Let me tell you a secret: idea management is boring. I should I know, I’ve developed and have marketed for seven years an idea management software. But the truth is, as exciting and sexy as innovation is, idea management is little more than an administrative process, rather like bookkeeping or any of a dozen business processes.

If you are considering launching idea management in your company, whether through buying software, building your own software or using an existing tool, it is important to bear this in mind: idea management is an administrative process that can facilitate innovation in your company.

Because once you realise that idea management is a process, you can get past the hype and focus on relevant needs. And let me tell you, there is an absurd amount of hype and misinformation in the field!

Bookkeeping as an Example

Let’s look at bookkeeping as an example of a business process every businessperson will be familiar with. Traditionally, you use a ledger to keep accounts. You enter your costs into one column of the ledger and your income into another. By adding up the two columns, you can work out cash-flow, the profit and loss of your company.

Of course, unless your company is a small one, there are added complexities. Some costs need to be amortised over a period of time. Tax reporting requirements add additional complexity. In many countries, VAT has to be calculated and dealt with as well.

Indeed, the bigger your business, the more complex the bookkeeping is. Moreover, you often need to keep multiple books as the accounting for tax purposes is different to the accounting for an annual report.

Fortunately, there are a number of bookkeeping software products on the market today that simplify the process. They allow employees to enter expenses and relevant information into fields. The software, which is programmed to deal with a variety of accounting functions, performs the necessary calculations and provides the end user with bookkeeping reports that can be used for internal monitoring of cash-flow, tax returns and more. It’s boring, but it’s effective.

Fortunately, bookkeeping software purchasing decisions are typically made by people with accounting knowledge who are able to identify the features they need in to order to perform the process.

Innovation Process

Likewise, innovation is a process that starts with strategy and business needs. Business owners identify problems and goals. They then generate and develop ideas that solve the problems or achieve the goals. These ideas are combined, evaluated for viability and developed further into concepts. Those that show real potential are implemented, perhaps as products, perhaps as process efficiency improvements, perhaps as business models.

Just as bookkeeping software facilitates the accounting process, idea management software should facilitate the innovation process. Unfortunately, most idea management solutions focus on the ideas rather than the process. As a result, they actually hinder the process! To understand why, let’s look at bookkeeping again.

Silly Bookkeeping Software

Imagine you are looking for a bookkeeping software product for your business. One product is a rather dull software with an ordinary, business-line interface. It allows you to enter expenses in various ways, identify what kind of expenses they are and so on. It also allows you to log sales and other income and it generates reports on everything. Not very exciting, but very functional.

Another product, on the other hand, has an exciting user interface. Anyone in your company can add any number at any time. It does not matter if the numbers have anything to do with expenses or income. Indeed, the salesperson tells you that the great thing about her software is that it can collect more numbers than the competition’s software. In addition, people can give a thumbs up or a thumbs down according to how much they like the numbers. So, you know that the numbers that get a lot of votes must be really good numbers.

Actually processing those numbers in any meaningful way is not so easy because the numbers are not necessarily relevant to business needs. In fact, your accountants will need to print out all the numbers and do the books manually just like they did in the old days – because the software does no processing at all. But, the salesperson assures you, you can really collect lots and lots of numbers with her software and you can make them bigger and change their colours and so much more.

Which software would you choose, the functional one that facilitates bookkeeping or the sexy one that generates a lot of numbers but nothing more?

Silly Idea Management Software

Sadly, a lot of idea management software products are like the second accounting software product. They allow anyone to submit any idea, but provide no underlying process. You cannot focus idea generation on business needs, you cannot batch process the evaluation of ideas and you cannot develop ideas. Their only selling point is that they collect a lot of ideas and make those ideas look pretty.

Hence, just as the silly bookkeeping software ultimately requires that accountants print out all of the numbers generated and try to fit them into bookkeeping forms, so too does a silly idea management software require evaluators print out ideas in order to fit them into company needs and evaluation methods.

Just as the silly bookkeeping software makes more work for accountants, because so many irrelevant numbers are submitted (remember, the salesperson said this was a key benefit to her software), so too does a silly idea management software make more work for subject experts who have to sift through irrelevant ideas in order to identify relevant ones. (by irrelevant ideas, I mean ideas which have absolutely no connection with actual business activities).

Sadly, many silly idea management products compete on the sexiness of their interfaces and the ability to do things with ideas, like vote on them, format them, add things to them and so on. This is not surprising. All of this stuff is technically very easy to do. That’s why there are so many silly idea management products on the market today. It is also why many firms decide to build their own. They think not of the process, but only of capturing the ideas.

12-18 Months

By not supporting the innovation process, most idea management systems stagnate after 12-18 months, not because they lack ideas. But rather because they lack the process.

Whether you are buying a software, building your own or facilitating the process without specialised software (in companies with fewer than 50 people, the software is not necessary), it is important to bear in mind that innovation is a process.

Sadly, of the numerous idea management software products on the market today, only three (to my knowledge) actually address the innovation process. Ours is the best of the three. The other two are good. The rest simply do not address the innovation process at all.

Yes, idea management is boring and the software that facilitates it is really no more exciting than bookkeeping software. But, thank goodness, the innovation that idea management facilitates, from formulating innovation challenges, to collaborating on ideas to evaluating, improving and implementing ideas is exciting stuff. That’s why I am in the business. That’s why I get excited by our clients’ innovation successes.

JENNI INNOVATION PROCESS MANAGEMENT SOFTWARE

Jenni innovation process management software combines

massive on-line brainstorms
powerful evaluation tools
idea management

in order to provide a comprehensive innovation process for your firm. But there’s more:

You, as the innovation master of Jenni, can authorise as many of your company’s managers as you wish to act as “idea managers” who can launch and manage their own massive on-line brainstorms.
Every idea manager can precisely control who participates in their brainstorms, from a single team to the entire company.
Brainstorms can be private. If so, only eligible participants can brainstorm, ensuring confidential innovation actions remain confidential.
Jenni’s evaluation suite is the best in the world. That’s because we’ve been developing it since 2004.
You get my and my colleagues’ expertise. Jenni is not simply a software, but a service.

Learn why Jenni is not a pretty face, but a highly efficient innovation process management software that puts you in control of your innovation process. Learn more at http://www.creativejeffrey.com/jenni – or reply to this newsletter and someone will get back to you in a hurry!