Looking for ideas in all the right places … different right places

Ken’s Take: Lots is written on how to be innovative. This is a nice checklist of frequently used methods …

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Extracted from WSJ, “In Search of Innovation”, Bessant, June  23, 2009

When companies try to come up with new ideas, they too often look only where they always look. That won’t get them anywhere.

If you want to understand why some companies lack innovative ideas, think about the man who can’t find his car keys.

His friend asks him why he’s looking for the keys under the lamppost when he dropped them over on the lawn. “Because there’s more light over here,” the man explains.

Innovative ideas, however, don’t really come from nowhere. Instead, they are typically at the edge of a company’s radar screen, and sometimes a bit beyond: trends in peripheral industries, unserved needs in foreign markets, activities that aren’t part of the company’s core business.

In other words, they have to look away from the lamppost.

None of this is easy to do. But companies that succeed may just recognize the next great opportunity, or looming threat, before their competitors do.

Here are nine examples of practices with the potential to produce a company’s eureka moment.

Many companies use teams of writers with diverse perspectives to create complex scenarios of what future markets may look like. The writers try to imagine detailed opportunities and threats for their companies, partners and collaborators. An oil company that wants to explore energy opportunities in cities of the future, for example, might want to work on scenarios with writers from construction, water and utility-management companies.

A few companies have created Web sites that act as literal marketplaces of ideas. InnoCentive.com is a site where people and companies look for help in solving scientific and business challenges. Posters of challenges sometimes offer cash rewards for solutions: Amounts have ranged from $5,000 to $1 million. Problem solvers can be professionals, retired scientists, students or anyone who can answer a problem that has stumped a company’s own researchers.

Ideas and insights from so-called lead users can be the starting point for new markets, products and services.

Lead users are innovators themselves. They tend to be people working in or using products in a specific market who are frustrated by the tools, goods or services currently available and yearn for something better. Many medical devices, for example, originate from sketches drawn by surgeons, surgical nurses and other medical staff who feel driven to experiment with new ideas because current products aren’t meeting their needs. They are often supportive, and tend to tolerate product failures as part of a process that helps bring about improvements.

Interest has surged in market research that uses detailed, firsthand observation to learn more about consumers’ needs or wants. Deep diving is one of many terms used to describe the approach, which resembles an anthropological study in the way researchers immerse themselves in the lives of the target consumers.

Such approaches can help uncover underserved or unserved markets and give clues to new directions and new frames in which to search for innovative ideas.

Some companies design probe-and-learn strategies that study opportunities in segments of markets the company isn’t active or strong in. This strategy goes further than deep diving by actively experimenting with new ideas in a new context. The experiments might not always work, but they will give valuable insight about future directions of markets.

By engaging more of its own workers in the search for innovation, a company can broaden its vision. For example, the duties of procurement, sales or finance groups can be expanded to include learning about trends they encounter that ordinarily might be considered not of primary interest to the company.

Innovation can bubble up inside a company as well—when the organization follows practices that favor it.

Clear policies that reserve blocks of time for scientists or engineers to explore their own ideas have worked well at some companies. At 3M Co., based in St. Paul, Minn., scientists can spend 15% of their time on projects they dream up themselves, and the company has set procedures to take bright ideas forward, including grants and venture funding. Google Inc. takes a similar approach, allowing researchers to devote 20% of their schedules to play time, pursuing their own ideas and projects.

It helps to have an established pathway to make sure the best new ideas get taken forward. In some cases, informal networking has pushed innovations to the forefront—below the radar screen of formal corporate systems.

Sometimes innovations arise when different departments talk to each other. But what’s the best way to start the conversation?

Many companies set up so-called communities of practice, which are typically internal Web sites where employees are encouraged to share knowledge and skills important to the company.

Close, long-term relationships—depending too much on the same customers, partners or suppliers for innovation ideas—can reinforce old ways of doing things and make changing a frame of reference difficult.

Some companies seek innovation partners with whom they wouldn’t normally work, and who might bring a fresh perspective. Some companies are also recruiting staff with very different perspectives to spice up their knowledge mix e.g.  experienced entrepreneurs. Such characters aren’t afraid to challenge corporate perspectives and to make waves. As one manager put it, they create a little grit to stimulate the oyster to produce pearls.

full article:

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One Response to “Looking for ideas in all the right places … different right places”

  1. Mike Says:

    This is a terrific summary of the many techniques that are used to drive innovation. I’ve had many successes with the lead user approach. For example, I try to find individuals that are pushing the boundaries, understand what they are doing, and make their techniques/methods/approach broadly and easily accessible. The best material on this approach can be found at Eric Von Hippel’s web site at http://web.mit.edu/evhippel/www/index.html. I highly recommend Eric’s materials and the videos on this site.

    I can also attest to the value of the “deep dive.” A few month ago, I spent two solid weeks working on a proposal which was outside of the scope of our traditional service offerings. We could have looked at the RFP and said “no bid.” Instead, I explored how we would deliver this service. Along the way, I made a discovery that will save our company about $1.25M annually. I am now involved in implementing this new idea. In my company, saving $1.25M/year in OPEX is the same as making a sale that brings in $25M in revenue every year.

    As a final comment, the problem with Google is they unleashed too much innovation. They have this huge cash generation machine which they used to fund all kinds of wild ideas. Google now needs to pick and choose the areas where they want to win and put their resources behind those areas. Remember Google Checkout? It’s easy to create a simple payment service, but it’s far more difficult to build a payment service that matches PayPal’s level of sophistication and reach.

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