Archive for May, 2017

What’s an innovator to do?

Disruption, as a word, doesn’t tell us what to do or how to do it.  Disruption, as a word, it’s not helpful and should be struck from the innovation lexicon.  But without the word, what’s an innovator to do?

If you have a superpower, misuse it. Your brand’s special capability is well known in your industry, but not in others. Thrust your uniqueness into an unsuspecting industry and provide novel value in novel ways. Take it by storm. Contradict the established players. Build momentum quickly and quietly.  Create a step function improvement. Create new lines of customer goodness. Do things that haven’t been done. Turn no to yes.

Don’t adapt your special capability, use it as-is. Adaptation is good, but it’s better to flop the whole thing into the new space.  Don’t think graft, think transplant.  Adaptation brings only continuous improvement.  It’s better to serve up your secret sauce uncut and unfiltered because that brings discontinuous improvement.

Know the needs your product fulfills and meet those needs in another industry.  Some say it’s better to adapt your product to other industries, and to achieve a reasonable CAGR, adaptation is good.  But if you’re looking for an unreasonable CAGR, if you’re looking to stand things on their head, try to use your product as-is. When you can use your product as-is in another industry, you connect dots only you can connect and meet needs in ways only you can.  You bring non-intuitive solutions. You violate routines of accepted practice and your trajectory is not limited by the incumbents’ ruts of success. You’ll have a whole new space for yourself. No sharing required.

But how?

Simply and succinctly, define what your product does.  Then, make it generic and look to misapply the goodness in a different application. For example, manufacturers of large and expensive furniture wrap their products in huge plastic bags to keep the furniture dry and clean during shipping. Generically, the function becomes: use large plastic bags to temporarily protect large and expensive products from becoming wet.  Using that goodness in a new application, people who live in flood areas use the large furniture bags to temporarily protect their cars from water damage.  Just before the flood arrives, they drive their cars into large plastic bags and tie them off.  The bags keep their car dry when the water comes.  Same bag, same goodness, completely unrelated application.

And there’s another way.  Your product has a primary function that provides value to your customers. But, there is unrealized value in your product that your existing customers don’t value. For example, if your company has a proprietary process to paint products in a way that results in a high gloss finish, your customers buy your coating because it looks good. But, the coating may also create a hard layer and increase wear resistance that could be important in another application. Because your coating is environmentally friendly and your process is low-cost, new customers may want you to coat their parts so they can be used in a previously non-viable application.  There is unrealized value in your products that new customers will pay for.

To see the unrealized value, use the strength-as-a-weakness method.  Define two constraints: you must sell to new customers in a new industry and the primary goodness, why people buy your product, must be a weakness.  For example, if your product is fast, you’ve got to use unrealized value to sell a slow one. If it’s heavy, the new one must be light. If small, the new one must be large.  In that way, you are forced to rely on new lines of goodness and unrealized value to sell your product.

Don’t stop continuous improvement and product adaptation.  They’re valuable. But, start some discontinuous improvement, step function increases and purposeful misuse.  Keep selling to the same value to the same customers, but start selling to new customers with previously unrealized value that has been hiding quietly in your product for years.

Evolution is good, but exaptation is probably better.

Image credit – Sor Betto

How To Reduce Innovation Risk

The trouble with innovation is it’s risky.  Sure, the upside is nice (increased sales), but the downside (it doesn’t work) is distasteful. Everyone is looking for the magic pill to change the risk-reward ratio of innovation, but there is no pill.  Though there are some things you can do to tip the scale in your favor.

All problems are business problems.  Problem solving is the key to innovation, and all problems are business problems.  And as companies embrace the triple bottom line philosophy, where they strive to make progress in three areas – environmental, social and financial, there’s a clear framework to define business problems.

Start with a business objective.  It’s best to define a business problem in terms of a shortcoming in business results. And the holy grail of business objectives is the growth objective.  No one wants to be the obstacle, but, more importantly, everyone is happy to align their career with closing the gap in the growth objective.  In that way, if solving a problem is directly linked to achieving the growth objective, it will get solved.

Sell more.  The best way to achieve the growth objective is to sell more. Bottom line savings won’t get you there.  You need the sizzle of the top line. When solving a problem is linked to selling more, it will get solved.

Customers are the only people that buy things.  If you want to sell more, you’ve got to sell it to customers. And customers buy novel usefulness.  When solving a problem creates novel usefulness that customers like, the problem will get solved.  However, before trying to solve the problem, verify customers will buy what you’re selling.

No-To-Yes.  Small increases in efficiency and productivity don’t cause customers to radically change their buying habits.  For that your new product or service must do something new. In a No-To-Yes way, the old one couldn’t but the new one can. If solving the problem turns no to yes, it will get solved.

Would they buy it? Before solving, make sure customers will buy the useful novelty. (To know, clearly define the novelty in a hand sketch and ask them what they think.) If they say yes, see the next question.

Would it meet our growth objectives? Before solving, do the math. Does the solution result in incremental sales larger than the growth objective? If yes, see the next question.

Would we commercialize it? Before solving, map out the commercialization work. If there are no resources to commercialize, stop.  If the resources to commercialize would be freed up, solve it.

Defining is solving. Up until now, solving has been premature. And it’s still not time. Create a functional model of the existing product or service using blocks (nouns) and arrows (verbs). Then, to create the problem(s), add/modify/delete functions to enable the novel usefulness customers will buy.  There will be at least one problem – the system cannot perform the new function. Now it’s time to take a deep dive into the physics and bring the new function to life.  There will likely be other problems.  Existing functions may be blocked by the changes needed for the new function. Harmful actions may develop or some functions will be satisfied in an insufficient way.  The key is to understand the physics in the most complete way.  And solve one problem at a time.

Adaptation before creation. Most problems have been solved in another industry. Instead of reinventing the wheel, use TRIZ to find the solutions in other industries and adapt them to your product or service.  This is a powerful lever to reduce innovation risk.

There’s nothing worse than solving the wrong problem.  And you know it’s the wrong problem if the solution doesn’t: solve a business problem, achieve the growth objective, create more sales, provide No-To-Yes functionality customers will buy, and you won’t allocate the resources to commercialize.

And if the problem successfully runs the gauntlet and is worth solving, spend time to define it rigorously.  To understand the bedrock physics, create a functional of the system, add the new functionality and see what breaks.  Then use TRIZ to create a generic solution, search for the solution across other industries and adapt it.

The key to innovation is problem solving. But to reduce the risk, before solving, spend time and energy to make sure it’s the right problem to solve.

It’s far faster to solve the right problem slowly than to solve the wrong one quickly.

Image credit – Kate Ter Haar

Before you can make a million, you’ve got to make the first one.

With process improvement, the existing process is refined over time.  With innovation, the work is new. You can’t improve a process that does not yet exist.  Process creation, yes.  Process improvement, no.

Standard work, where the sequence of process steps has proven successful, is a pillar of the manufacturing mindset.  In manufacturing, if you’re not following standard work, you’re not doing it right.  But with innovation, when the work is done for the first time, there can be no standard work. In that way, if you’re following the standard work paradigm, you are not doing innovation.

In a well-established manufacturing process, problems are tightly scoped and constrained. There can be several ways to solve it and one of the ways is usually better than the others. Teams are asked to solve the problem three or four ways and explain the rationale for choosing one solution over the other. With innovation it’s different.  There may not be a solution, never mind three.  With innovation, it’s one-in-a-row solution.  And the real problem is to decide which problem to solve.  If you’re asked to use Fishbone diagrams to solve the problem three or four ways, you’re not doing innovation. Solve it one way, show a potential customer and decide what to do next.

With manufacturing and product development, it’s all about Gantt charts and hitting dates.  The tasks have a natural precedence and all of them have been done before.  There are branches in the plan, but behind them is clear if-then logic.  With innovation, the first task is well-defined.  And the second task – it depends on the outcome of the first.  And completion dates?  No way. If you can predict the completion date, you’re not doing innovation.  And if you’re asked for a fully built-out Gantt chart, you’re in trouble because that’s a misguided request.

Systems in manufacturing can be complicated, with lots of moving parts.  And the problems can be complicated. But given enough time, the experts can methodically figure it out. But with innovation, the systems can be complex, meaning they are not predictable.  Sometimes parts of the system interact strongly with other parts and sometimes they don’t interact at all. And it’s not that they do one or the other, it’s that they do both.  It’s like they have a will of their own, and, sometimes, they have a bad attitude. And if it’s a new system, even the basic rules of engagement are unknown, never mind the changing strength of the interactions.  And if the system is incomplete and you don’t know it, linear thinking of the experts can’t solve it.  If you’re using linear problem solving techniques, you’re not doing innovation.

Manufacturing is about making one thing a million times. Innovation is about choosing among the million possibilities and making one-in-a-row, and then, after the bugs are worked out, making the new thing a million times.  But one-in-a-row must come first.  If you can’t do it once, you can’t do it a million times, even with process improvement, standard work, Gantt charts and Fishbone diagrams.

Image credit jacinta lluch valero

See differently to solve differently.

There are many definitions for creativity and innovation, but none add meaningfully to how the work is done. Though it’s clear why the work is important – creativity and innovation underpin corporate prosperity and longevity – it’s especially helpful to know how to do it.

At the most basic level, creativity and innovation are about problem solving.  But it’s a special flavor of problem solving.  Creativity and innovation are about problems solving new problems in new ways.  The glamorous part is ‘solving in new ways’ and the important part is solving new problems.

With continuous improvement the same problems are solved over and over. Change this to eliminate waste, tweak that to reduce variation, adjust the same old thing to make it work a little better.  Sure, the problems change a bit, but they’re close cousins to the problems to the same old problems from last decade. With discontinuous improvement (which requires high levels of creativity and innovation) new problems are solved.  But how to tell if the problem is new?

Solving new problems starts with seeing problems differently.

Systems are large and complicated, and problems know how to hide in the nooks and crannies. In a Where’s Waldo way, the nugget of the problem buries itself in complication and misuses all the moving parts as distraction. Problems use complication as a cloaking mechanism so they are not seen as problems, but as symptoms.

Telescope to microscope. To see problems differently, zoom in.  Create a hand sketch of the problem at the microscopic level.  Start at the system level if you want, but zoom in until all you see is the problem.  Three rules: 1. Zoom in until there are only two elements on the page. 2. The two elements must touch. 3. The problem must reside between the two elements.

Noun-verb-noun. Think hammer hits nail and hammer hits thumb.  Hitting the nail is the reason people buy hammers and hitting the thumb is the problem.

A problem between two things. The hand sketch of the problem would show the face of the hammer head in contact with the surface of the thumb, and that’s all.  The problem is at the interface between the face of the hammer head and the surface of the thumb. It’s now clear where the problem must be solved. Not where the hand holds the shaft of the hammer, not at the claw, but where the face of the hammer smashes the thumb.

Before-during-after. The problem can be solved before the hammer smashes the thumb, while the hammer smashes the thumb, or after the thumb is smashed.  Which is the best way to solve it? It depends, that’s why it must be solved at the three times.

Advil and ice. Solving the problem after the fact is like repair or cleanup. The thumb has been smashed and repercussions are handled in the most expedient way.

Put something between. Solving the problem while it happens requires a blocking or protecting action. The hammer still hits the thumb, but the protective element takes the beating so the thumb doesn’t.

Hand in pocket. Solving the problem before it happens requires separation in time and space. Before the hammer can smash the thumb it is moved to a safe place – far away from where the hammer hits the nail.

Nail gun. If there’s no way for the thumb to get near the hammer mechanism, there is no problem.

Cordless drill. If there are no nails, there are no hammers and no problem.

Concrete walls. If there’s no need for wood, there’s no need for nails or a hammer. No hammer, no nails, no problem.

Discerning between symptoms and problems can help solve new problems. Seeing problems at the micro level can result in new solutions. Looking closely at problems to separate them time and space can help see problems differently.

Eliminating the tool responsible for the problem can get rid of the problem of a smashed thumb, but it creates another – how to provide the useful action of the driven nail.  But if you’ve been trying to protect thumbs for the last decade, you now have a chance to design a new way to fasten one piece of wood to another, create new walls that don’t use wood, or design structures that self-assemble.

Image credit – Rodger Evans

Mike Shipulski Mike Shipulski
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