Archive for the 'Opinions' Category

Why Outsourcing Innovation is a Management Cop-Out

July 09th, 2008 | Category: Innovation direction,Open Innovation,Opinions

I’ve been following a discussion across a number of blogs, where the arguement is being put that because companies find it hard to stay focused on innovation they should outsource their entire innovation pipeline. In a posting called You should outsource innovation if…¬† Jeffrey Phillips says:

“Too many firms have the right people, good ideas and senior management commitment, but simply cannot find the time to innovate. Obviously this suggests a misalignment of the focus and engagement of the teams and the goals of management, but there it is. I’ve worked in several firms where there is clear commitment from the top – demonstrated in people resources and in dollar resources – but innovation gets shoved aside because people can’t be pulled away from their day to day tasks.

So it’s time to consider a completely different model – if you can outsource your payroll, outsource manufacturing and other key elements of your business, why not outsource innovation?”

Am I alone in smelling a rat here? What is going on in these organisations that is stopping people from doing the innovation job, the job which, if the organisation has been aligned properly, should already be “their day to day task”? Anyway, lets put that to one side for now and explore the argument a bit further. Lets say we outsource the entire innovation pipeline as Jeffrey suggest we already do for payroll and manufacturing. What happens next? Well…the first problem that can be encoutered is the famous NIH (not invented here) reaction to innovations from outside, but maybe you can organise and reward to encourage people to bring in ideas from outside the organisation. The next issue is that every company has a unique culture, values certain elements of it’s business differently (e.g. attitude to capital investment can vary enormously), operates specific business processes and revenue generation models. In order for the organisation to remain competitive into the future, some of the elements will need to stay and some will need to change. Some of the specialist areas of the business¬†could be critical future areas of innovation which might create exceptional, differentiated value for the customer. Also there are critical decisions with regard to the best ways to exploit emerging market trends.

For the “outsourcing” solution to stand a chance, you need to have people inside the organisation with the vision to know where the business factors (culture, financial models, values etc.) and future market conditions converge so your external innovation people can begin to have a view of where to aim. I’ve often seen external consultants coming into an organisation and being so wide of the mark that it’s painful, and not realising what drives the business mindset.

I think the whole notion of outsourcing innovation in it’s entirety is misguided. When we talk about innovation we aren’t simply thinking, in my view, about some new products to bolster up sales, we should be thinking about the future direction of the company and integrating our innovation activities into that. While it is OK, or actually good, to outsource¬†elements of innovation, in the “connect and develop” way that, say, P&G does, the proposal to outsource all innovation activity to an outside organisation is wrong and, if it were to happen, it would constitute a serious cop-out on the part of the leadership of the business.¬†

ÔŅĹ

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James Dyson on Engineering, iPhones and Blackberries

July 05th, 2008 | Category: Consumer centred,Innovative products,Opinions

I’ve picked up some more from James Dyson on TechCruch. This time he seems to have fewer anger issues but in the video clip it’s a bit hard to hear him at times. I did make out that he is worried by the mismatch in engineering graduates in the West vs. the East. He said there are now 600,000 new engineering graduates in China and 400,000 in India¬†per year. Both these figures are on the increase while there are only 70,000 new engineering graduates in the US and the number is going down. James reckons we need engineers if we are going to stand any chance of increasing prosperity and solving some of the big issues we face such as global warming and energy shortages.

James was also interviewed about the iPhone and the Blackberry. He loved the look of the iPhone but disliked the screen functions and he hated the Blackberry look but loved it’s function. If you could somehow combine the two devices you might have a really good product.

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PC – TV convergence, searching for the “sweet spot”

I recently picked up an article on the knowledge at Wharton website about the topic of bridging the chasm between the computer and TV. There are a number of players targeting this transition and what is clear is that all three elements of the “sweet spot” strategy are being explored, business, market and technology. Companies such as Netfix and Amazon.com are looking at their current businesses and have realised that the need to start looking to the next generation of media format. They both see potential for increased revenues and profits through the switch from DVD rental by mail to digital media direct to consumers homes. Other players, such as HP,¬†are looking at the opportunity from the hardware and technology side. On June 10th Hewlett-Packard¬†unveiled a $349 digital receiver that brings video and audio content from the PC or Internet to any high-definition television set.

 

In May Netflix unveiled a $99 set-top box that directs movies and TV shows from the Internet to its subscribers’ TVs. Meanwhile, Apple has been building out the services connected to its Apple TV product,¬†signing a deal with HBO in May to bring shows like “The Sopranos” from its iTunes store to widescreen televisions. Companies such as Netflix, Disney, Amazon.com and Apple are expanding the digital distribution of media.

Right now there is some serious debate going on about the likelihood of convergence of the compute, on-lin digital media and the TV. David Hsu, a management professor at Wharton, says “Theoretically, it should be the case that there’s a lot of convergence between the PC and TV and content evolution. But on the demand side, it’s unclear what consumers want.” Hsu thinks the solution is to try many different business models. Wharton marketing professor Peter Fader says the digital living room analogy is off-base in many respects. “The whole digital living room idea misses the point. A nice analogy is, ‘What am I going to do for dinner tonight?’ I can go to a fancy restaurant. Or just get a burrito. It’s all about convenience and control. The microwave burrito is watching video on your PC. The fancy restaurant is the big screen in your living room and the immersive experience. You’ll do both.” There seems to be evidence of some serious techno-push as well. “Everyone is too beholden to their boxes,” Fader notes. “Companies are a little more fixated on the technology and gadgets than the services when they should instead be focusing on making it easier to consume content on any device.” At the moment a lot of the services being offered are closed, that is you buy the box and you only get one specific content. People seem to be following the Apple iPod/iTunes model. One reason these digital living room technologies are closed to each other is because companies are trying to reproduce Apple’s so-called “halo effect,” where one device or service stokes demand for other products from the same company. There is still a lot of experimentation going on in the area as the different companies focus on find the “sweet spot”.

“The value for companies will emerge when they come up with something that cannot be replicated by Comcasts in the world. Netflix has made some strides here by allowing subscribers to manage their movie queue online. But I would say it has to go beyond that,” says Hsu.

For now, however, companies targeting the digital living room are more often than not emulating what the cable companies already do. The more successful models are subscription based or pay-per-view and involve a set-top box. “The rationale for all these set-top boxes is that consumers want to interact with devices in a way they already know,” Hsu notes.

Indeed, one of the biggest hurdles for these new entertainment delivery business models is consumer behavior, he adds. Consumers are not used to combining the functions of a TV and PC and sharing content between them. Hsu expects more innovation and experimentation to come. “Technology is getting sophisticated and there will be some meld of the PC, TV and Internet. But what’s going to get people to switch over to interacting with these appliances and machines? There will have to be something that’s fundamentally different than what’s on TV.”

Of course there are other issues facing these innovators, on top of potential proliferation of set top boxes, the thorny issue of bandwidth rears it’s head. “Most of these set-top boxes use cable broadband as a separate distribution channel, but it’s not quite as separate as it seems because it’s all coming over a cable modem,” Faulhaber says. “This could become an issue if Internet TV really takes off. If streaming video over broadband networks becomes popular, there may be limitations placed on it because the networks may not be able to carry it all. Some accommodation will have to be made because there will be 20 pounds of content in a three-pound bag. When we start pushing TV down the broadband channel, there will be issues.”

Interesting article, demonstrating the struggle companies often have when a logical emerging technology theme (in this case very much in line with the TRIZ evolution law of transition to the super-system, following the mon-bi-poly line) is not sufficeintly rooted in business model of market value.

Personally I think it will come. In the UK we already have something called BBC iPlayer. This new free service provides on-line access to BBC programs from the last 7 days. It has been phenomenally successful, with more that 1 million downloads per day, so much so that the UK internet providers have started to restrict iPlayer bandwidth at certain times of the day. Although downloading can be a real pain, I’ll put up with it because I can get great content for free. The only remaining problem I have is that I have to watch it on the PC, when I’d really like to watch it on the TV. So the demand is already there. If the process could be made faster and easier I reckon it could even start to make a lot of money for the right company. In the UK, Sky television make an absolute fortune out of their Sky+ system already and¬†while that is good, a decent PC based system with context sensitive background information, could provide a far more involving multi-media service.¬†¬†¬†

ÔŅĹ

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Future topics for this blog

I thought it would be interesting to get some feedback on subjects for future blog posts so I asked a question on Linkedin, as you do. So far, the relevant points I’ve got are:

From Siamack Salari – “Understanding the difference between innovation and evolution. Also, unarticulated needs – where do you even begin to disentangle those from everyday life behaviour?” I’ll need to get some clarification on the innovation vs evolution point, but the second point about unarticulated needs is crystal clear and really relevant to targeted technology innovation. Expect some stuff on this.

From Reut Schwartz-Hebron: “Innovation is not just about having a great idea– it’s about implementation and buy in. I think one of the topics technology innovators need are around:
– motivating people to adopt change
– how learning is a teacher’s job (in other words what change facilitators can do to increase learning)”

I think the subject of innovation and change are very closely linked together. Often market breakthrough product implementation first of all requires a mindset shift within the organisation before the end product can be successful. More on this in later posts.

From Brian Cambell: “Why doesn’t TRIZ sell? Why does UK plc pay lip service to innovation? Why do innovation consultants ignore TRIZ?” All good questions, I reckon there¬†should be¬†some good posting to come on this lot. I’ve already had some good debate on the first TRIZ point¬†in comments on my previous post on TRIZ certification.

Finally, from Ellen Domb: “Why “Technology Innovation?” I see lots of situations where it is innovation in marketing or packaging or business processes (be innovative about who the customer could be, rather than the technology of the product.) Technology innovation is a very small % of successful innovation, but it gets a lot of attention already.”

I agree with some of this, in that innovations in marketing, business process or packaging design on their own can¬†deliver significant market impact.¬†There is a place for this type of innovation – for example in the UK the P&G brand Ariel¬†was positioned as an innovative 30 degree Centigrade washing powder even though the product remained unchanged. Suddenly it was very good for saving¬†Polar Bears with nothing more than a new marketing message and packaging design. ¬†In P&G speak, I think this is known as Commercial Innovation. However, while there is a place for this¬†type of innovation, this blog is not that place! This blog is about creating market breakthrough products through targeted technology innovation. What do I mean by targeted? Building on insightful business strategy, combinations of new business models and deep market understanding to scope and direct a systematic process to eliminate the shortfall in today’s technology. This final bit can be done pretty well through combinations of advanced TRIZ thinking, Open Innovation and good old fashioned networking, but there is room for improvement and this is where this blog comes in. This blog is about learning how to target and deliver breakthrough innovation better, with more repeatability and greater vision. In my view this is the sort of innovation which doesn’t get the attention it deserves.

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James Dyson is trying to break his products – anger issues?

Having a better day? 

I saw this on Techcrunch and I thought you might enjoy it. It seems that James Dyson is keen to emphasise the robustness of his latest vacuum¬†cleaners. In my book, this has to be a good thing – my current¬†Dyson vacuum cleaner has continued to self-dissassemble (if that’s a verb) over the last couple of years but I’m just too tight to go out and buy a new one, so I’ve jury rigged it. Anyway, on the video¬†you can see that James clearly has some frustrations to work off as he roundly abuses one of his products. My hypothesis is that he may have been having a bad day. In terms of his robustness strategy, he is on the right track when he mentions rigorous testing, which is a good first step but he doesn’t mention any of the other good stuff you can and should do to get a fully robust product and not compromise time to market. I know it can be a bit dull but FMEA is still a very powerful tool and TRIZ can also help to identify functional areas of a product which can go wrong. In addition I use a proprietary Critical Parameter tool to investigate and assure robustness of new technologies. It really works! More on this another time.

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Also there is a link to a video on his new hand dryer which uses a small brushless motor running at 100,000RPM to blow air at 400MPH in a thin blade at your hands. very whooshy! No heater too, which is good for energy consumption. There is a problem, however, for me as a user of the Airblade. Although it was good at drying my hands quickly, am I alone when I say there is a really worrying thing about putting¬†your hands¬†completely into something with a name containing the word “blade”? Call me a soft if you like but it gave me the shivers.

I do admire a couple of things about James Dyson though:

1. he is not afraid of making mistakes

2. he targets technology to solve user problems, just like I’ve been saying¬†in my blog!ÔŅĹ

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UK Council bans brainstorming – for the wrong reason

June 22nd, 2008 | Category: Innovation tools,Opinions,Problem solving,TRIZ tools

I saw this article in the Times today. It appears that Tunbridge Wells borough council in Kent has banned the term “brainstorm” and replaced it with the term “thought shower” because of concerns that the term might be offensive to people with epilepsy. Amid all the controversy about political correctness etc. a bigger question occurred to me – why do brainstorming/thought showering at all any more? The whole process of randomly generating ideas in the hope that one of them will provide the ideal solution seems to me to be little more than guesswork or gambling. I don’t know if it’s just me but I used to get a real sinking feeling when faced with sheets of flipcharts full of ideas still needing to be teased through. These days there are far better ways of targeting the required solution and approaching the problem situation systematically. In this blog I’m aiming to¬†show you powerful¬†thinking tools and processes which can help you to ditch the guesswork and identify close to ideal solutions every time.

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How a new interface technology could transform your brand communication

I’ve just come across the latest on an emerging technology which I think has great potential to deliver major¬†improvements to the user experience for a broad range of products and usage situations. The technology in question is Multi-Touch Screens. If you have seen the movie, Minority Report or used an iPod Touch you will already have some insight about the new way this technology might engage your senses in future.

One company, Perceptive Pixel Inc. has seriously researched the way light interacts with with the users fingers when they touch an acrylic screen and can use this information to identify finger position and even detect different pressures exerted onto the screen.

To create a signal, LEDs bounce light through the acrylic sheet. No light escapes. But if a finger is placed against the face (below), light will scatter off it toward the sensors. Also, a pressure-sensitive coating flexes when pressed firmly or lightly, making the scattered fingertip signal appear slightly brighter or dimmer, which the computer interprets as more or less pressure.

This¬†technology is now being used by early adopters in information and interaction intensive activities such as intellence gathering and processing for the CIA and by news anchors at¬†CNN news to help explain detailed information on the Presidential primaries. Looking ahead, the¬†technology is expected to find a home in graphically intense businesses such as energy trading and medical imaging. Perceptive Pixel don’t seem to talk about price at this stage, which means the technology is currently still quite niche. Here is a demo video of the system in use. It does seem to be quite cool.

On the other hand, there is Microsoft Surface, a kind of interactive table. This system is being used in hotels and bar complexes to create in Microsoft’s words “uniquely personalized and engaging social experiences”. Their most ambitious is “flirt” which is all about¬†basically flirting and chatting up semi-remotely.¬†There are other applications, such as interactive games and a mixology package which helps you to design your own coctails. Customers will be able to order food and drink by using the interactive display. Other retail applications will allow customers in T-Mobile USA‚Äôs retail stores to compare different cell phone models by simply placing the phone¬†on top of¬†a surface screen; tags on the undersides of the phones will cue the system to display price, feature and phone plan details. Other Microsoft software will allow a wireless-enabled digital camera, when placed on a surface computer, to upload its photographic content to the computer without a cable.

First-generation surface systems are priced from $5,000 to $10,000. As with most electronic items, the company expects the price to decline as production volume increases. Microsoft says Surface computers should be available at consumer prices in three to five years. This means this sort of technology could be making regular appearances in people’s homes by then.

This is where things start to get interesting, as the price comes down, application and use of the system will inevitably become more widespread, in my view allowing consumers and users easy access to far more information than is possible now. This could have a profound impact on the retail and point of delivery experience for consumers and will really open up the way that brands communicate and interact.

This means that if your business has anything to do with creating consumer experiences, you need to start considering the impact this technology might have on your future business. Although in some ways this technology seems still to be a solution seeking a problem, I can already think of a number ways it could be used to enhance brand communication and I would seriously recommend prototyping potential applications now rather than later.

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The dangers of engaging with your consumer – Is P&G really listening at all?

June 17th, 2008 | Category: Consumer centred,Opinions

I just found this article from the LA Times about how to make social networking technologies work for you. As I see social networking tools as having quite a role to play in engaging consumers in product co-creation in future, I had a good read through. However, the part of the article which caught my attention described how consumers had complained repeatedly about the packaging on the Tide.com message board and yet didn’t seem to have been listened to. I might be being a bit niaive but this is P&G we are talking about here and I was shocked that the¬†Tide message board didn’t contain any response from the company. I thought P&G was supposed to be good at listening to¬†it’s customers. I thought the consumer was their boss. I’ve had a look on¬†Tide.com myself and¬†it seems to be full of unanswered complaints and customers¬†“itching and switching” (just made up that¬†phrase – perhaps a career in advertising awaits)¬†away from¬†Tide.¬†If you look carefully there is an occasional positive comment but in the ratio of about 1 in 30. I’m not quite sure what the P&G plan is for the site but it doesn’t seem to have worked in terms of engaing consumers in the Tide brand. As an innovator, I couldn’t help myself so I¬†started to pick out some potential breakthrough areas which might¬†resonate¬†for a lot of consumers (what about a Tide product which avoided animal testing for example?). I think P&G actually could have a very useful innovation and brand building resource here with their website but only when they start to show the world that they can listen.ÔŅĹ

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Innovation Motherhood from A.G. Lafley?

June 12th, 2008 | Category: Opinions

I’ve just seen a reference to a 7-step Innovation process outlined in a book from A.G. Lafley called “The Game Changer”. I hope the book gives a lot more detail that the summary because, when you boil the process down to those 7 steps it just turns into the worst kind of motherhood. Even though the review has put me off the book a bit, I’ll read and feedback¬†in due course.

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