Shipulski On Design

Archive for the ‘Technology’ Category

When money is tight, it’s still important to do new work, but it’s doubly important not to waste it.

There are a number of models to increase the probability of success of new work.  One well known approach is the VC model where multiple projects are run in parallel.  The trick is to start projects with the potential to deliver ultra-high returns.  The idea isn’t to minimize the investment but to place multiple bets.  When money’s tight, the VC model is not your friend.

Another method to increase the probability of success is to increase the learning rate.  The best known method is the Lean Startup method.  Come up with an idea, build a rough prototype, show it to potential customers and refine or pivot.  The process is repeated until a winning concept finds a previously unknown market segment and the money falls from the sky.   In a way, it’s like the VC Model, but it’s not a collection of projects run in parallel, it’s a sequential series of high return adventures punctuated by pivots. The Lean Startup is also quite good when money’s tight.  A shoe string budget fosters radical learning strategies and creates focus which are both good ideas when coffers are low.

And then there’s the VC/Lean Startup combo. A set of high potential projects run in parallel, each using Lean’s build, show, refine method to learn at light speed.  This is not the approach for empty pockets, but it’s a nice way to test game changing ideas quickly and efficiently.

Things are different when you try to do an innovation project within a successful company. Because the company is successful, all resources are highly utilized, if not triple-booked.  On the balance sheet there’s plenty of money, but practically the well is dry.  The organization is full up with ROI-based projects that will deliver marginal (but predictable) top line growth, and resources are tightly shackled to their projects.  Though there’s money in the bank, it feels like the account is over drawn.  And with this situation there’s a unique and expensive failure mode lurking in the shallows.

The front end of innovation work is resource light. New prototypes are created quickly and inexpensively and learning is fast and cheap.  Though the people doing the work are usually highly skilled and highly valuable, it doesn’t take a lot of people to create a functional prototype and test it with new customers.  And then, when the customers love it and it’s time to commercialize, there’s no one home. No one to do the work. And, unlike the relatively resource light front end work, commercialization work is resource heavy and expensive. The failure mode – the successful front end work is nothing but pure waste.  All the expense of creativity with none of innovation’s return.  And more painful, if the front end was successful the potential failure mode was destined to happen. There was no one to pick it up from the start.

The least expensive projects are the ones that never start. Before starting a project, ask “What if it works?”

image credit – jumping lab

If you think something can’t be done, it won’t get done.  And if you think it may be possible, or is possible, it may get done.  Those are the rules.

If an expert says it will work, it will work.  If they say it won’t work, it might.  Experts can tell you will work, but can’t tell you what won’t.

If your boss tells you it won’t work, it might. Give it a try.  It will be fun if it works.

If you can’t make it work, make it worse and then do the opposite.

If you can’t explain the problem to your young kids, you don’t understand the situation and you won’t make it work.

If something didn’t work ten years ago, it may work now. Technology is better and we’re smarter.  More likely it would have worked ten years ago if they ran more than one crude experiment before they gave up.

If you can’t draw a one page sketch of the problem, it may never work.

If you can’t make it work, put it down for three days. Your brain may make it work while you’re sleeping.

If you don’t know the problem, you can’t make it work.  Be sure you’re trying to solve the right problem.

If your boss tells you it will work, it might.  If they tell you how to make it work, let them do it.

If none of your attempts have been fruitful and you’re out of tricks, purposely make one performance attribute worse to free up design space. That may work.

If you don’t know when the problem occurs, you don’t know much. Your solutions won’t work.

If you tried everything and nothing worked, ask someone for help whose specialty in an unrelated area.  They may have made it work in a different domain.

If you think everyone in the group understands the problem the same way, they don’t.  There’s no way they’ll agree on the best way to make it work. Don’t wait for consensus.

If you don’t try, that’s the only way to guarantee it won’t work.

Image credit – Simon Greig

The past has past, never to come again.  But if you tell yourself old stories the past is still with you.  If you hold onto your past it colors what you see, shapes what you think and silently governs what you do.  Not skillful, not helpful.  Old stories are old because things have changed.  The old plays won’t work. The rules are different, the players are different, the situation is different.  And you are different, unless you hold onto the past.

As a tactic we hold onto the past because of aversion to what’s going on around us. Like an ostrich we bury our head in the sands of the past to protect ourselves from unpleasant weather buffeting us in the now.  But there’s no protection. Grasping tightly to the past does nothing more than stop us in our tracks.

If you grasp too tightly to tired technology it’s game over.  And it’s the same with your tired business model – grasp too tightly and get run through by an upstart.  But for someone who wants to make a meaningful difference, what are the two things that are sacred? The successful technology and successful business model.

It’s difficult for an organization to decide if the successful technology should be reused or replaced.  The easy decision is to reuse it.  New products come faster, fewer resources are needed because the hard engineering work has been done and the technical and execution risks are lower.  The difficult decision is to scrap the old and develop the new.  The smart decision is to do both.  Launch products with the old technology while working feverishly to obsolete it.  These days the half-life of technology is short.  It’s always the right time to develop new technology.

The business model is even more difficult to scrap. It cuts across every team and every function.  It’s how the company did its work.  It’s how the company made its name. It’s how the company made its money.  It’s how families paid their mortgages.  It’s grasping to the past success of the business model that makes it almost impossible to obsolete.

People grasp onto the past for protection and companies are nothing more than a loosely connected network of people systems.  And these people systems have a shared past and a good memory.  It’s no wonder why old technologies and business models stick around longer than they should.

To let go of the past people must see things as they are.  That’s a slow process that starts with a clear-eyed assessment today’s landscapes. Make maps of the worldwide competitive landscape, intellectual property, worldwide regulatory legislation, emergent technologies (search YouTube) and the sea of crazy business models enabled by the cloud.

The best time to start the landscape analyses was two years ago, but the next best time to start is right now.  Don’t wait.

Image credit – John Fife

Is it disruptive? Is it innovative? Two meaningless questions. Two questions to stop asking. More strongly, stop using the words “disruptive” and “innovative” altogether. Strike them from your vocabulary and replace them with novel, useful, and successful.

Argument is unskillful but analysis is skillful. And what’s needed for analysis is a framework and some good old-fashioned quantification. To create the supporting conditions for an analysis around novelty, usefulness, and successfulness, I’ve created quantifiable indices and a process to measure them. The process starts with a prototype of a new product, service or business model which is shown to potential customers (real people who do work in the space of interest.)

The Novelty Index. The Novelty Index measures the difference of a product, service or business model from the state-of-the-art. Travel to the potential customer and hand them the prototype. With mouth closed and eyes open, watch them use the product or interact with the service. Measure the time it takes them to recognize the novelty of the prototype and assign a value from 0 to 5. (Higher is better.)
5 – Novelty is recognized immediately after a single use (within 5 seconds.)
4 – Novelty is recognized after several uses (30 seconds.)
3 – Novelty is recognized once a pattern emerges (10-30 minutes.)
2 – Novelty is recognized the next day, once the custom has time to sleep on it (24 hours.)
1 – A formalized A-B test with statistical analysis is needed (1 week.)
0 – The customer says there’s no difference. Stop the project and try something else.

The Usefulness Index. The Usefulness Index measures the level of importance of the novelty. Once the customer recognizes the novelty, take the prototype away from them and evaluate their level of anger.
5 – The customer is irate and seething. They rip it from your arms and demand to place an order for 50 units.
4 – The customer is deeply angry and screams at you to give it back. Then they tell you they want to buy the prototype.
3 – With a smile of happiness, the customer asks to try the prototype again.
2 – The customer asks a polite question about the prototype to make you feel a bit better about their lack of interest.
1 – The customer is indifferent and says it’s time to get some lunch.
0 – Before you ask, the customer hands it back to you before you and is happy not to have it. Stop the project and try something else.

The Successfulness Index. The Successfulness Index measures the incremental profitability the novel product, service or business model will deliver to your company’s bottom line. After taking the prototype from the customer and measuring the Usefulness Index, with your prototype in hand, ask the customer how much they’d pay for the prototype in its current state.
5 – They’d pay 10 times your estimated cost.
4 – They’d pay two times your estimated cost.
3 – They’d pay 30% more than your estimated cost.
2 – They’d pay 10% more than your estimated cost.
1 – They’d pay you 5% more than your estimated cost.
0 – They don’t answer because they would never buy it.

The Commercialization Index. The Commercialization Index describes the overall significance of the novel product, service or business model and it’s calculated by multiplying the three indicies. The maximum value is 125 (5 x 5 x 5) and the minimum value is 0. Again, higher is better.

The descriptions of the various levels are only examples, and you can change them any way you want. And you can change the value ranges as you see fit. (0-5 is just one way to do it.) And you can substitute actual prototypes with sketches, storyboards or other surrogates.

Modify it as you wish, and make it your own. I hope you find it helpful.

Image credit – Nisarg Lakhmani

Once you have a project to work on, it’s always a challenge to choose the first task.  And once finished with the first task, the next hardest thing is to figure out the next next task.

Two words to live by: Critical Path.

By definition, the next task to work on is the next task on the critical path.  How do you tell if the task is on the critical path?  When you are late by one day on a critical path task, the project, as a whole, will finish a day late.  If you are late by one day and the project won’t be delayed, the task is not on the critical path and you shouldn’t work on it.

Rule 1: If you can’t work the critical path, don’t work on anything.

Working on a non-critical path task is worse than working on nothing.  Working on a non-critical path task is like waiting with perspiration.  It’s worse than activity without progress.  Resources are consumed on unnecessary tasks and the resulting work creates extra constraints on future work, all in the name of leveraging the work you shouldn’t have done in the first place.

How to spot the critical path? If a similar project has been done before, ask the project manager what the critical path was for that project.  Then listen, because that’s the critical path.  If your project is similar to a previous project except with some incremental newness, the newness is on the critical path.

Rule 2: Newness, by definition, is on the critical path.

But as the level of newness increases, it’s more difficult for project managers to tell the critical path from work that should wait.  If you’re the right project manager, even for projects with significant newness, you are able to feel the critical path in your chest.  When you’re the right project manager, you can walk through the cubicles and your body is drawn to the critical path like a divining rod.   When you’re the right project manager and someone in another building is late on their critical path task, you somehow unknowingly end up getting a haircut at the same time and offering them the resources they need to get back on track.  When you’re the right project manager, the universe notifies you when the critical path has gone critical.

Rule 3: The only way to be the right project manager is to run a lot of projects and read a lot.  (I prefer historical fiction and biographies.)

Not all newness is created equal.  If the project won’t launch unless the newness is wrestled to the ground, that’s level 5 newness. Stop everything, clear the decks, and get after it until it succumbs to your diligence.  If the product won’t sell without the newness, that’s level 5 and you should behave accordingly.  If the newness causes the product to cost a bit more than expected, but the project will still sell like nobody’s business, that’s level 2.  Launch it and cost reduce it later.  If no one will notice if the newness doesn’t make it into the product, that’s level 0 newness. (Actually, it’s not newness at all, it’s unneeded complexity.)  Don’t put in the product and don’t bother telling anyone.

Rule 4: The newness you’re afraid of isn’t the newness you should be afraid of.

A good project plan starts with a good understanding of the newness.  Then, the right project work is defined to make sure the newness gets the attention it deserves.  The problem isn’t the newness you know, the problem is the unknown consequence of newness as it ripples through the commercialization engine. New product functionality gets engineering attention until it’s run to ground.  But what if the newness ripples into new materials that can’t be made or new assembly methods that don’t exist?  What if the new materials are banned substances?  What if your multi-million dollar test stations don’t have the capability to accommodate the new functionality?  What if the value proposition is new and your sales team doesn’t know how to sell it?  What if the newness requires a new distribution channel you don’t have? What if your service organization doesn’t have the ability to diagnose a failure of the new newness?

Rule 5: The only way to develop the capability to handle newness is to pair a soon-to-be great project manager with an already great project manager. 

It may sound like an inefficient way to solve the problem, but pairing the two project managers is a lot more efficient than letting a soon-to-be great project manager crash and burn.  After an inexperienced project manager runs a project into the ground, what’s the first thing you do?  You bring in a great project manager to get the project back on track and keep them in the saddle until the product launches.  Why not assume the wheels will fall off unless you put a pro alongside the high potential talent?

Rule 6: When your best project managers tell you they need resources, give them what they ask for.

If you want to deliver new value to new customs there’s no better way than to develop good project managers.  A good project manager instinctively knows the critical path; they know how the work is done; they know to unwind situations that needs to be unwound; they have the personal relationships to get things done when no one else can; because they are trusted, they can get people to bend (and sometimes break) the rules and feel good doing it; and they know what they need to successfully launch the product.

If you don’t know your critical path, you don’t know very much.  And if your project managers don’t know the critical path, you should stop what you’re doing, pull hard on the emergency break with both hands and don’t release it until you know they know.

Image credit – Patrick Emerson

Everyone likes patents, but few use them as a business tool.

Patents define rights assigned by governments to inventors (really, the companies they work for) where the assignee has the right to exclude others from practicing the concepts described in the patent claims.  And patent rights are limited to the countries that grant patents.  If you want to get patent rights in a country, you submit your request (application) and run their gauntlet.  Patents are a country-by-country business.

Patents are expensive.  Small companies struggle to justify the expense of filing a single patent and big companies struggle to justify the expense of their portfolio.  All companies want to reduce patent costs.

The patent process starts with invention.  Someone must go to the lab and invent something.  The invention is documented by the inventor (invention disclosure) and the invention is scored by a cross-functional team to decide if it’s worthy of filing.  If deemed worthy, a clearance search is done to see if it’s different from all other patents, all products offered for sale, and all the other literature in the public domain (research papers, publications).   Then, then the patent attorneys work their expensive magic to draft a patent application and file it with the government of choice. And when the rejection arrives, the attorneys do some research, address the examiner’s concerns and submit the paperwork.

Once granted, the fun begins.  The company must keep watch on the marketplace to make sure no one sells products that use the patented technology.  It’s a costly, never-ending battle.  If infringement is suspected, the attorneys exchange documents in a cease-and-desist jousting match.  If there’s no resolution, it’s time to go to court where prosecution work turns up the burn rate to eleven.

To reduce costs, companies try to reduce the price they pay to outside law firms that draft their patents.  It’s a race to the bottom where no one wins.  Outside firms get paid less money per patent and the client gets patents that aren’t as good as they could be.  It’s a best practice, but it’s not best.  Treating patent work as a cost center isn’t right.  Patents are a business tool that help companies make money.

Companies are in business to make money and they do that by selling products for more than the cost to make them.  They set clear business objectives for growth and define the market-customers to fuel that growth.  And the growth is powered by the magic engine of innovation.  Innovation creates products/services that are novel, useful and successful and patents protect them.  That’s what patents do best and that’s how companies should use them.

If you don’t have a lot of time and you want to understand a patent, read the claims.  If you have less time, read the independent claims.  Chris Brown, Ph.D.

Patents are all about claims.  The claims define how the invention is different (novel) from what’s tin the public domain (prior art).  And since innovation starts with different, patents fit nicely within the innovation framework. Instead of trying to reduce patent costs, companies should focus on better claims, because better claims means better patents.  Here are some thoughts on what makes for good claims.

Patent claims should capture the novelty of the invention, but sometimes the words are wrong and the claims don’t cover the invention.   And when that happens, the patent issues but it does not protect the invention – all the downside with none of the upside.  The best way to make sure the claims cover the invention is for the inventor to review the claims before the patent is filed.  This makes for a nice closed-loop process.

When a novel technology has the potential to provide useful benefit to a customer, engineers turn those technologies into prototypes and test them in the lab.  Since engineers are minimum energy creatures and make prototypes for only the technologies that matter, if the patent claims cover the prototype, those are good claims.

When the prototype is developed into a product that is sold in the market and the novel technology covered by the claims is what makes the product successful, those are good claims.

If you were to remove the patented technology from the product and your customer would notice it instantly and become incensed, those are the best claims.

Instead of reducing the cost of patents, create processes to make sure the right claims are created.  Instead of cutting corners, embed your patent attorneys in the technology development process to file patents on the most important, most viable technology.  Instead of handing off invention disclosures to an isolated patent team, get them involved in the corporate planning process so they understand the business objectives and operating plans.  Get your patent attorneys out in the field and let them talk to customers.  That way they’ll know how to spot customer value and write good claims around it.

Patents are an important business tool and should be used that way.  Patents should help your company make money.  But patents aren’t the right solution to all problems.  Patent work can be slow, expensive and uncertain.  A more powerful and more certain approach is a strong investment in understanding the market, ritualistic technology development, solid commercialization and a relentless pursuit of speed.  And the icing on the top – a slathering of good patent claims to protect the most important bits.

Image credit – Matthais Weinberger

There’s a special type of confusion that has blocked many good ideas from seeing the light of day.  The confusion happens early in the life of a new technology when it is up and running in the lab but not yet incorporated in a product.  Since the new technology provides a new flavor of customer goodness, it has the chance to create incremental sales for the company.  But, since there are no products in the market that provide the novel goodness, by definition there can be no sales from these products because they don’t yet exist.  And here’s the confusion.  Organizations equate “no sales” with “no market”.

There’s a lot of risk with launching new products with new value propositions to new customers.  You invest resources to create the new technologies and products, create the sales tools, train the sales teams, and roll it out well. And with all this hard work and investment, there’s a chance no one will buy it.  Launching a product that improves on an existing product with an existing market is far less risky – customers know what to expect and the company knows they’ll buy it.  The status quo when stable if all the players launch similar products, right up until it isn’t.  When an upstart enters the market with a product that offers new customer goodness (value proposition) the same-old-same-old market-customer dynamic is changed forever.

A market-busting product is usually launched by an outsider – either a big player moves into a new space or a startup launches its first product.  Both the new-to-market big boy and the startup have a far different risk profile than the market leader, not because their costs to develop and launch a new product are different, but because they have not market share.  For them, they have no market share to protect any new sales are incremental.  But for the established players, most of their resources are allocated to protecting their existing business and any resources diverted toward a new-to-market product is viewed as a loss of protective power and a risk to their market share and profitability.   And on top of that, the incumbent sees sales of the new product as a threat to sales of the existing products.  There’s a good chance that their some of their existing customers will prefer the new goodness and buy the new-to-market product instead of the tried-and-true product.  In that way, sales growth of their own new product is seen as an attack no their own market share.

Business leaders are smart.  Theoretically, they know when a new product is proposed, because it hasn’t launched yet, there can be no sales.  Yet, practically, because their prime directive to protect market share is so all-encompassing and important, their vision is colored by it and they confound “no sales” with “no market”.  To move forward, it’s helpful to talk about their growth objectives and time horizon.

With a short time horizon, the best use of resources is to build on what works – to launch a product that builds on the last one.  But when the discussion is moved further out in time, with a longer time horizon it’s a high risk decision to hold on tightly to what you have as the market changes around you.  Eventually, all recipes run out of gas like Henry Ford’s Model T.  And the best leading indicator of running low on fuel is when the same old recipe cannot deliver on medium-term growth objectives.  Short term growth is still there, but further out they are not.  Market forces are squeezing the juice out of your past success.

Ultimately, out of desperation, the used-to-be market leader will launch a new-to-market product.  But it’s not a good idea to do this work only when it’s the only option left.  Before they’re launched, new products that offer new value to customers will, by definition, have no sales.  Try to hold back the fear-based declaration that there is no market.  Instead, do the forward-looking marketing work to see if there is a market.  Assume there is a market and build some low cost learning prototypes and put them in front of customers.  These prototypes don’t yet have to be functional; they just have to communicate the idea behind the new value proposition.

Before there is a market, there is an idea that a market could exist.  And before that could-be market is served, there must be prototype-based verification that the market does in fact exist.  Define the new value proposition, build inexpensive prototypes and put them in front of customers.  Listen to their feedback, modify the prototypes and repeat.

Instead of arguing whether the market exists, spend all your energy proving that it does.

Image credit — lensletter

At every meeting you have a chance to move things forward or hold them back.  When a new idea is first introduced it’s bare-naked.  In its prenatal state, it’s wobbly and can’t stand on its own and is vulnerable to attack. But since it’s not yet developed, it’s impressionable and willing to evolve into what it could be.  With the right help it can go either way – die a swift death or sprout into something magical.

Early in gestation, the most worthy ideas don’t look that way.  They’re ugly, ill-formed, angry or threatening.  Or, they’re playful, silly or absurd.  Depending on your outlook, they can be a member of either camp. And as your outlook changes, they can jump from one camp to the other.  Or, they can sit with one leg in each.  But none of that is about the idea, it’s all about you.  The idea isn’t a thing in itself, it’s a reflection of you. The idea is nothing until you attach your feelings to it.  Whether it lives or dies depends on you.

Are you looking for reasons to say yes or reasons to say no?

On the surface, everyone in the organization looks like they’re fully booked with more smart goals than they can digest and have more deliverables than they swallow, but that’s not the case.  Though it looks like there’s no room for new ideas, there’s plenty of capacity to chew on new ideas if the team decides they want to.  Every team can spare and hour or two a week for the right ideas.  The only real question is do they want to?

If someone shows interest and initiative, it’s important to support their idea.  The smallest acceptable investment is a follow-on question that positively reinforces the behavior.  “That’s interesting, tell me more.” sends the right message.  Next, “How do you think we should test the idea?” makes it clear you are willing to take the next step.  If they can’t think of a way to test it, help them come up with a small, resource-lite experiment.  And if they respond with a five year plan and multi-million dollar investment, suggest a small experiment to demonstrate worthiness of the idea.  Sometimes it’s a thought experiment, sometimes it’s a discussion with a customer and sometimes it’s a prototype, but it’s always small.  Regardless of the idea, there’s always room for a small experiment.

Like a staircase, a series of small experiments build on each other to create big learning.  Each step is manageable – each investment is tolerable and each misstep is survivable – and with each experiment the learning objective is the same: Is the new idea worthy of taking the next step?  It’s a step-wise set of decisions to allocate resources on the right work to increase learning.  And after starting in the basement, with step-by-step experimentation and flight-by-flight investment, you find yourself on the fifth floor.

This is about changing behavior and learning.  Behavior doesn’t change overnight, it changes day-by-day, step-by-step.  And it’s the same for learning – it builds on what was learned yesterday.  And as long at the experiment is small, there can be no missteps.  And it doesn’t matter what the first experiment is all about, as long as you take the first step.

Your team will recognize your new behavior because it respectful of their ideas.  And when you respect their ideas, you respect them.  Soon enough you will have a team that stands taller and runs small experiments on their own.  Their experiments will grow bolder and their learning will curve will steepen.  Then, you’ll struggle to keep up with them, and you’ll have them right where you want them.

image credit — Rob Warde

Innovation isn’t a thing in itself, and it’s not something to bolster for the sake of bolstering.

Innovation creates things (products, services, business models) that are novel, useful and successful.  It’s important to know which flavor to go after, but before that it’s imperative to formalize the business objective.  Like lean or Six Sigma, innovation is a business methodology whose sole intention is to deliver on the business objective.  The business objective is usually a revenue or profit goal, and success is defined by meeting the objective.  Successful is all about meeting the business objective and successful is all about execution.

There are a lot of things that must come together for an innovation to be successful. For an innovative product here are the questions to answer:  Can you make it, certify it, market it, sell it, distribute it, service it, reclaim it?  As it happens, these are the same questions to answer for any new product.  In that way, innovative products are not different.  But because innovation starts with novel, with innovative products the answers can be different.  For an innovative product there are more “no’s” and for each no there’s a reason that starts with a C: constraint, capacity, capability, competitor, cooperation, capital.  And the business objective cannot be achieved with closing the gaps.

After successful, there’s useful.   Like any work based on a solid marketing methodology, innovation must deliver usefulness to the customer.  Innovation or not, strong marketing is strong marketing and strong marketing defines who the customer is, how they’ll use the new service, and how they’ll benefit – the valuable customer outcome (VCO.)  But with an innovative service it’s more difficult to know who the customer is, how they’ll use the service and if they’ll pay for it.  (That’s the price of novelty.)  But in most other ways, an innovative service is no different than any other service.  Both are successful because they deliver usefulness customers, those customers pay money for the usefulness and the money surpasses the business objective.

Innovation is different because of novelty, but only in degree.  Continuous improvement projects have novelty.  Usually, it’s many small changes consistently applied that add up to meaningful results, for example waste reduction, improved throughput and product quality.  These projects have novelty, but the novelty is the sum of small steps, all of which stay close to known territory.

The next rung on the novelty ladder is discontinuous improvement which creates a large step change in goodness provided to the customer.  (Think 3X improvement.)  The high degree of novelty creates broader uncertainty.  Will the customer be able to realize the goodness?  Will the novelty be appealing to a set of yet-to-be-discovered customers?  Will they pay for it?  It is worth doing all that execution work?  Will it cannibalize other products?  The novelty is a strong divergence from the familiar and with it comes the upside of new customer goodness and the downside of the uncertainty.

The highest form of novelty is no-to-yes.  No other product on the planet could do it before, but the new innovative one can.   It has the potential to create new markets, but also has the potential to obsolete the business model.  The sales team doesn’t know how to sell it, the marketers don’t know how to market it and the factory doesn’t know how to make it.  There new technology is not as robust as it should be and the cost structure may never become viable.  There’s no way to predict how competitors will respond, there’s no telling if it will pass the regulatory requirements.  And to top it off, no one is sure who the customer is or if anyone will it.  But, if it all comes together, this innovation will be a game-changer.

Innovation is the same as all the other work, except there’s more novelty. And with that novelty comes more upside and more uncertainty.  With novelty, too much of a good thing isn’t wonderful.  Sufficient novelty must be ingested to meet the business objective, and a bit more for the long term to stay out in front.

Be clear about business objectives, deliver usefulness to customers and use novelty to make it happen.  And call it whatever you want.

Image credit – Agustin Rafael Reyes 

Immediately after there’s an elegant solution to a previously intractable problem, the solution is obvious to others.  But, just before the solution those same folks said it was impossible to solve.  I don’t know if there’s a name for this phenomenon, but it certainly causes hart burn for those brave enough to take on the toughest problems.

Intractable problems are so fundamental they are no longer seen as problems.  Over the years experts simply accept these problems as constraints that must be complied with.   Just as the laws of physics can’t be broken, experts behave as if these self-made constraints are iron-clad and believe these self-build walls define the viable design space.  To experts, there is only viable design space or bust.

A long time ago these problems were intractable, but now they are not.  Today there are new materials, new analysis techniques, new understanding of physics, new measurement systems and new business models.. But, they won’t be solved.  When problems go unchallenged and constrain design space they weave themselves into the fabric of how things are done and they disappear.   No one will solve them until they are seen for what they are.

It takes time to slow down and look deeply at what’s really going on.  But, today’s frantic pace, unnatural fascination with productivity and confusion of activity with progress make it almost impossible to slow down enough to see things as they are.  It takes a calm, centered person to spot a fundamental problem masquerading as standard work and best practice.  And once seen for what they are it takes a courageous person to call things as they are.  It’s a steep emotional battle to convince others their butts have been wet all these years because they’ve been sitting in a mud puddle.

Once they see the mud puddle for what it is, they must then believe it’s actually possible to stand up and walk out of the puddle toward previously non-viable design space where there are dry towels and a change of clothes.  But when your butt has always been wet, it’s difficult to imagine having a dry one.

It’s difficult to slow down to see things as they are and it’s difficult to re-map the territory.   But it’s important.  As continuous improvement reaches the limit of diminishing returns, there are no other options.  It’s time to solve the intractable problems.

Image credit – Steven Depolo

All innovation projects take longer than expected and take more resources than expected.  It’s time to change our expectations.

With regard to time and resources, innovation’s biggest enemy is waiting.  There.  I said it.

There are books and articles that say innovation is too complex to do quickly, but complexity isn’t the culprit. It’s true there’s a lot of uncertainty with innovation, but, uncertainty isn’t the reason it takes as long as it does.  Some blame an unhealthy culture for innovation’s long time constant, but that’s not exactly right.  Yes, culture matters, but it matters for a very special reason.  A culture intolerant of innovation causes a special type of waiting that, once eliminated, lets innovation to spool up to break-neck speeds.

Waiting? Really?  Waiting is the secret?   Waiting isn’t just the secret, it’s the top three secrets.

In a backward way, our incessant focus on productivity is the root cause for long wait times and, ultimately, the snail’s pace of innovation.  Here’s how it goes.  Innovation takes a long time so productivity and utilization are vital. (If they’re key for manufacturing productivity they must be key to innovation productivity, right?)  Utilization of fixed assets – like prototype fabrication and low volume printed circuit board equipment – is monitored and maximized. The thinking goes – Let’s jam three more projects into the pipeline to get more out of our shared resources.   The result is higher utilizations and skyrocketing queue times.  It’s like company leaders don’t believe in queuing theory.  Like with global warming, the theory is backed by data and you can’t dismiss queuing theory because it’s inconvenient.

One question: If over utilization of shared resources delays each prototype loop by two weeks (creates two weeks of incremental wait time) and you cycle through 10 prototype loops for each innovation project, how many weeks does it delay the innovation project?  If you said 20 weeks you’re right, almost.  It doesn’t delay just that one project; it delays all the projects that run through the shared resource by 20 weeks.  Another question: How much is it worth to speed up all your innovation projects by 20 weeks?

In a second backward way, our incessant drive for productivity blinds us of the negative consequences of waiting.   A prototype is created to determine viability of a new technology, and this learning is on the project’s critical path.  (When the queue time delays the prototype loop by two weeks, the entire project slips two weeks.)  Instead of working to reduce the cycle time of the prototype loop and advance the critical path, our productivity bias makes us work on non-critical path tasks to fill the time.  It would be better to stop work altogether and help the company feel the pain of the unnecessarily bloated queue times, but we fill the time with non-critical path work to look busy.  The result is activity without progress, and blindness to the reason for the schedule slip – waiting for the over utilized shared resource.

A company culture intolerant of uncertainty causes the third and most destructive flavor of waiting. Where productivity and over utilization reduce the speed of innovation, a culture intolerant of uncertainty stops innovation before it starts.  The culture radiates negative energy throughout the labs and blocks all experiments where the results are uncertain.  Blocking these experiments blocks the game-changing learning that comes with them, and, in that way, the culture create infinite wait time for the learning needed for innovation.  If you don’t start innovation you can never finish. And if you fix this one, you can start.

To reduce wait time, it’s important to treat manufacturing and innovation differently.  With manufacturing think efficiency and machine utilization, but with innovation think effectiveness and response time.  With manufacturing it’s about following an established recipe in the most productive way; with innovation it’s about creating the new recipe.  And that’s a big difference.

If you can learn to see waiting as the enemy of innovation, you can create a sustainable advantage and a sustainable company.  It’s time to change expectations around waiting.

Image credit – Pulpolux !!!