do_matic

Non sequitur: You're either starting or quitting

(Deliberation courtesy of kamshots. Check out his amazing London and Tehran street scenes.)

It's occurred to me recently that you're either starting or quitting.

There's really nothing true about the idea of "standing still." If it feels like you're standing still, it's just that you're starting slowly or quitting slowly.

If you feel trapped, figure out where you're pointing and step on the gas. Either way you should accelerate.

It's a bit like Red said in Shawshank: "Get busy living, or get busy dying."

Rita McGrath: Organize for growth and innovation

Rita McGrath has a great post on the HBR blogs on organizing for growth. This quote stood out:

One of the most important jobs a growth group can do is create an opportunity inventory — both of ideas that are floating around in the organization but don't have critical mass, and of ideas that are currently being resourced but perhaps not managed explicitly. Without an organizational home, these critical jobs tend not to get done, hampering the organization's ability to grow.

Check the full article out here:

http://blogs.harvardbusiness.org/hbr/mcgrath/2009/10/create-a-special-unit-to-drive.html

Crunk Juice Mills: Small-run, integrated design and manufacturing to support product innovation

This one popped up when I was thinking about what we do and reflecting on the fact that a client had told me his company was planning to launch 50 new SKUs (probably off of a base of a thousand or so) in the coming year, with one or two completely new brand platforms among that number...

I wonder if there's the opportunity to have an integrated conceptualization, design and small-batch manufacturing business to accelerate the piloting, evaluation and scaling of innovative consumer packaged goods?

The pitch would be: We'll help you design, research and conceptualize new products for this, our local, market (e.g., North America, developing Africa, Western Europe, etc). We'll handle the manufacturing, piloting and testing. They'd say:

"Handling new formats and small runs is our specialty. If things get big, we'll help you transition the business in-house or to another third-party. We're full-service, so no handoffs. We get you to the end and beyond."

The offering would be local to allow for local development and minimize transaction costs / friction involved in integration of capabilities (such as overseas manufacturing). The users would be corporate design, innovation and venturing businesses. Over time, two or three big players would emerge a la contract manufacturers or the big trading companies.

The company would actually be a consortia of smaller players and capabilities, a network of sorts, with a primary integrative client relationship structure. Think big advertising, or better yet, video game publishing. The strength and effectiveness of this network would be critical to the performance of the company.

"Brand in a box offerings" are out there, but there isn't an integrated offering with refinement and production. Fast-moving consumer good companies are looking to maintain relevance and grow through new users and offerings. Meanwhile, these industries are really prone to fast-moving, smaller entrants. Why not in house?

Over time, large companies follow or combine one of two growth strategies. One cohort builds a shared innovation capability to support its various business units. The group comes along with the corresponding overhead while striving for, and falling short of, world-class performance.  The other cohort relies on M&A, often paying a premium in the market for the acquisition. Such clients tell us "we don't build businesses anymore, we buy them." When one strategy doesn't seem to be working, they start emphasizing the other. Meanwhile, smaller players don't do either. They're too focused on execution, scale and building out the channel.

This idea sort of flies in the face of the notion that a company's innovation process is a competitive advantage. Huh. Here's an article about that:

http://blogs.harvardbusiness.org/hbr/restoring-american-competitiveness/2009/10/the-us-is-outsourcing-away-its.html

Yet, this idea also recognizes that there are multiple ways to skin a cat. The point is to skin the cat.

Is quality a commodity?

(Yes, I'll take that one.)

Tim Manners at Reveries points me to this article in the NY Times by Bill Vlasic. The article describes the brand promiscuity that has evolved in the US automotive market. This image makes the point:

Tim at Reveries highlighted this quote:

“Brand loyalty has shrunk because of widespread improvements in the products,” said James Farley, Ford Motor Company’s head of marketing. “The ‘trust factor’ is more or less the same for most cars.”

So is quality a commodity?

Not hardly. Professor Chuck Holloway taught me to be really careful when I used the word "quality." It means all manner of things: availability, reliability, meeting specifications, just plain working as expected, etc.

With an expansive definition of quality, there are all kinds of opportunities for differentiation and excellence. With universally-better or common components, you have the opportunity to focus on quality all along the value chain and in all aspects of the consumer experience. This is happening in consumer electronics where integration is one of the primary drivers of value and consumers are starting to demand less from their goods, rather than more.

My stomach really turned when considering the notion that the 'trust factor' for cars was somehow equal because most brands warrant and make similar claims of reliability.

Is trust solely the realm of product performance? Absolutely not.

Innovation elasticity (or why things get killed)

(Remember these games?)

At some point during an innovation project you ought to wake up in the middle of the night, eyes wide open, screaming into the void: "We're thinking of doing what?"

Although scary to you and your neighbors, this is a great moment. If you aren't waking up in the middle of the night, you might not be pushing hard enough. The trick is to embrace that fluttering feeling and to understand the situation. If you don't, you risk incrementalizing or even killing some really great ideas.

Usually, the business opportunity or experience is stretching "too far" along one or more six key dimensions of growth:

Users: needs, contexts, behaviors, mindsets, jobs, etc
Offerings: product/service, value proposition, pricing, positioning, channel, etc.
Positioning/GTM: how you go to market
Business Model/Culture: margin model and prioritization scheme
Process & Organization: how you get things done
Scope: the business you're in

Your brand, your management and your investors are the "anchors" that snap you right back to what you know you can do today. Business designers should be working with their teams to design novel approaches and strategies to navigate and maintain the right level of tension, balancing growth, opportunities and risk.

Some companies and organizations are capable of stretching more than others; they have higher innovation elasticity. Similarly, certain organizational and innovation governance strategies, like heavyweight teams, help provide slack in the system.

You shouldn't stretch just for the sake of stretching. Nor is it realistic or strategic to stretch infinitely in any direction. People that suggest as much, while often alluring, usually don't know what it takes to get things done. There ought to be some tension in the system. But understanding how nimble you are along each of these key dimensions can help you systematically foresee and deal with the hurdles over time.

I'm going to...

http://metacool.typepad.com/metacool/2009/10/what-are-you-going-to-do-today.html

... prototype some business scenarios.

... prototype a business plan.

... finish a paper.

Not a windmill, but important to me.

Thanks Diego for the link. It was inspiring and a good reminder to check myself against the cult of done:

http://www.brepettis.com/blog/2009/3/3/the-cult-of-done-manifesto.html

Innovation Measure: Time Since Last Contact (TLC)

(A complete contact from slimmer jimmer, flickr and creative commons.)

Inspiration is fuel for innovation and design.

For most challenges, the primary source of your inspiration should come from understanding or being inspired by users, customers and other influencers. Yet, most of us chain ourselves to our desks or hide behind self-imposed and self-erected barriers. I'm no exception. I can get focused on a design challenge and lose sight of what my users and customers need when I'm not careful.

The point is, the questions, needs, answers and inspiration are all out there, not in here. So, I'd like to propose another innovation measure.

Time Since Last Contact (TLC): The duration in calendar days since a meaningful, inspiring contact with a user(s) or customer(s)

So, what's a good number for TLC?

As an entrepreneurial individual, I'd like the number to be less than five days (basically a work week). Some hard-core entrepreneurs out there are likely giggling. Five days? Try five hours. Inspiration has a short half-life.

As the leader of an innovative organization, I'd strive to have my entire organization have meaningful, inspiring contact with my users and customers quite frequently. Sometimes, we rely on certain roles, like sales, as a proxy for the rest of the organization. While this seems efficient, I'd argue such compartmentalization is not effective for systematic innovation. There's something about seeing things for yourself that gets your creative juices flowing. You might spend a modicum of time considering what somebody else tells you, but I'm guessing you'll spend lots of time thinking about what you saw or heard firsthand.

To illustrate how challenging this is for large organizations, consider a hypothetical organization with 1,000 employees. Thirty people see a user every day, seventy see a user every ten days, a hundred see a user every fifty days and the rest, 800, see a user every hundred days:

The weighted average TLC for the organization is roughly 86 days! Sounds pretty bad, huh?
 
To attack this challenge, you might hold a structure inspiration day or do what Southwest does when it rotates its executives through the frontline to serve customers. (It's seemingly easier to achieve this in a service business.)

Not to complicate things too much, but there is a hierarchy of contact quality. Arbitrarily, let's say there are three tiers.

Tier 1:
Firsthand empathy or intensely using a product, service or experience yourself
Firsthand, in-context dynamic conversations
Firsthand observation, ethnography and shadowing
Time spent with extreme users
Co-collaborative prototyping

Tier 2:
Passive monitoring of online communities
Interpreting data from a survey you didn't design
Focus groups, especially behind glass walls
Cocktail party banter

Tier 3:
Interpreting data from a survey you didn't design that everybody else has access to
Listening to someone else's cocktail banter