Posts Tagged ‘less-with-far-less’

Improving What Is and Creating What Isn’t

There are two domains – what is and what isn’t. We’re most comfortable in what is and we don’t know much about what isn’t. Neither domain is best and you can’t have one without the other. Sometimes it’s best to swim in what is and other times it’s better to splash around in what isn’t.  Though we want them, there are no hard and fast rules when to swim and when to splash.

Improvement lives in the domain of what is. If you’re running a Six Sigma project, a lean project or a continuous improvement program you’re knee deep in what is. Measure, analyze, improve, and control what is. Walk out to the production floor, count the machines, people and defects, measure the cycle time and eliminate the wasteful activities. Define the current state and continually (and incrementally) improve what is. Clear, unambiguous, measurable, analytical, rational.

The close cousins creativity and innovation live in the domain of what isn’t. They don’t see what is, they only see gaps, gulfs and gullies. They are drawn to the black hole of what’s missing. They define things in terms of difference.  They care about the negative, not the image. They live in the Bizarro world where strength is weakness and far less is better than less. Unclear, ambiguous, intuitive, irrational.

What is – productivity, utilization, standard work. What isn’t – imagination, unstructured time, daydreaming. Predictable – what is. Unknowable – what isn’t.

In the world of what is, it’s best to hire for experience.  What worked last time will work this time. The knowledge of the past is all powerful.  In the world of what isn’t, it’s best to hire young people that know more than you do. They know the latest technology you’ve never heard of and they know its limitations.

Improving what is pays the bills while creating what isn’t fumbles to find the future. But when what is runs out of gas, what isn’t rides to the rescue and refuels. Neither domain is better, and neither can survive without the other.

The magic question – what’s the best way to allocate resources between the domains? The unsatisfying answer – it depends. And the sextant to navigate the dependencies – good judgement.

Image credit – JD Hancock

How To Create Eye-Watering Ideas

Rocket manWith creativity, the leading thinking says the most important thing is to create many of ideas.  When asked to generate many of ideas, the thinking goes, the team lets go of their inhibitions and good ideas slip through their mental filters.  I’ve found that thinking misleading.  I’ve found that creating many ideas results in many ideas, but that’s it. Before the session to create new ideas, you already had a pile of ideas you weren’t working on, and after the session is bigger, but not better.

What’s needed is several outlandish ideas that make your hair stand on end. The ideas should be so different that they cause you to chuckle to mask your discomfort.  These ideas should be borderline unbelievable and just south of impossible. The ideas should have the possibility to change the game and tip your industry on its head.

The “many ideas” thinking has the right intent – to loosen the team’s thinking so they generate good ideas, but the approach is insufficient.   To force the team to generated outlandish ideas they must be turned inside-out and put on the rack.  Heretical ideas don’t come easily and drastic measures are needed.  The team must be systematically stripped of the emotional constraints of their success using the Innovation Burst Event (IBE) method.

To prepare for the IBE, a reward-looking analysis is done to identify traditional lines of customer goodness (for example, miles per gallon for automobiles) and define how that goodness has changed over time (position it on the S-curve.)  If the improvement has been flat, it’s time for a new line of customer goodness, and if the goodness is still steadily increasing, it’s time to create a new technology that will provide the next level of improvement.  With this analysis the disposition of the system is defined and potentially fertile design space is identified.  And within this design space, design challenges are created that force the team to exercise the highly fertile design space during the IBE.

Everything about the IBE is designed to strip the team of its old thinking.  The IBE is held at an offsite location to change the scenery and eliminate reminders of traditional thinking and good food is served to help the team feel the day is special.  But the big medicine is the design challenges.  They are crafted to outlaw traditional thinking and push the team toward new thinking.  The context is personal (not corporate) and the scale of the challenge is purposefully small to help the team let go of adjacent concerns.  And, lastly, the team is given an unreasonably short time (five to ten minutes) to solve the problem and build a thinking prototype (a prototype that stands for an idea, not at functional prototype.)

Everything about the IBE helps the team let go of their emotional constraints and emit eye-watering solutions.  The design challenges force them to solve problems in a new design space in a way and does not give them a chance to limit their thinking in any way.  The unrealistic time limit is all-powerful.

Four design challenges is about all team can handle in the one-day IBE.  With the IBE they come up with magical ideas clustered around four new areas, new areas that have the potential to flip your industry on its head.  In one day, a team can define market-changing ideas that obsolete your best products and even your business model.  Not bad for one day.

It may be popular wisdom that it’s best to create many new ideas, but it’s not the best way.  And it contradicts popular belief that a team can create three or four game-changing ideas in a single day.  But the IBEs work as advertised.

Don’t waste time creating a pile of ideas.  Spend the time to identify fertile design space and hold a one-day IBE to come up with ideas that will create your future.

Image credit – moonjazz

A most powerful practice – Try It.

Trying HardThe first question is usually – What’s the best practice? And the second question is – Why aren’t you using it?  In the done-it-before domain this makes sense.  Best practices are best when inputs are tightly controlled, process steps are narrowly defined, and the desired output is known and can be formally defined.

Industry loves best practice because they are so productive.  Like the printing press, best practices are highly effective when it’s time to print the same pages over and over.  It worked here, so do it there. And there. And there. Use the same typeface and crank it out – page by page.  It’s like printing money.

Best practices are best utilized in the manufacturing domain, until they’re not.  Which best practice should be used? Can it be used as-is, or must it change? And, if a best practice is changed, which version is best? Even in the tightly controlled domain of manufacturing, it’s tricky to effectively use best practices. (Maybe what’s needed is a best practice for using best practices.)

Best practices can be good when there’s strong commonality with previous work, but when the work is purposefully different (think creativity and innovation), all bets are off.  But that doesn’t stop the powerful pull of productivity from jamming round best practices into square holes. In the domain of different, everything’s different – the line of customer goodness, the underpinning technology and the processes to make it, sell it, and service it.  By definition, the shape of a best practice does not fit work that has yet to be done for the first time.

What’s needed is a flexible practice that can handle the variability, volatility, and uncertainty of creativity/innovation. My favorite is called – Try It.  It’s a simple process (just one step), but it’s a good one. The hard part is deciding what to try.  Here are some ways to decide.

No-to-yes. Define the range of inputs for the existing products and try something outside those limits.

Less-with-far-less. Reduce the performance (yes, less performance) of the very thing that makes your product successful and try adolescent technologies with a radically lower cost structures.  When successful, sell to new customers.

Lines of customer goodness.  Define the primary line of customer goodness of your most successful product and try things that advance different lines. When you succeed, change all your marketing documents and sales tools, reeducate your sales force, and sell the new value to new customers.

Compete with no one. Define a fundamental constraint that blocks all products in your industry, try new ideas that compromise everything sacred to free up novel design space and break the constraint. Then, sell new products into the new market you just created.

IBE (Innovation Burst Event). Everything starts with a business objective.

There is no best way to implement the Try It process, other than, of course, to try it.

Image credit — Alland Dharmawan.

The Lonely Chief Innovation Officer

lonerChief Innovation Officer is a glorious title, and seems like the best job imaginable.  Just imagine – every-day-all-day it’s: think good thoughts, imagine the future, and bring new things to life.  Sounds wonderful, but more than anything, it’s a lonely slog.

In theory it’s a great idea – help the company realize (and acknowledge) what it’s doing wrong (and has been for a long time now), take resources from powerful business units and move them to a fledgling business units that don’t yet sell anything, and do it without creating conflict.  Sounds fun, doesn’t it?

Though there are several common problems with the role of Chief Innovation Officer (CIO), the most significant structural issue, by far, is the CIO has no direct control over how resources are allocated. Innovation creates products, services and business models that are novel, useful and successful.  That means innovation starts with ideas and ends with commercialized products and services.  And no getting around it, this work requires resources.  The CIO is charged with making innovation come to be, yet authority to allocate resources is withheld. If you’re thinking about hiring a Chief Innovation Officer, here’s a rule to live by:

If resources are not moved to projects that generate novel ideas, convert those ideas into crazy prototypes and then into magical products that sell like hotcakes, even the best Chief Innovation Officer will be fired within two years.

Structurally, I think it’s best if the powerful business units (who control the resources) are charged with innovation and the CIO is charged with helping them.  The CIO helps the business units create a forward-looking mindset, helps bring new thinking into the old equation, and provides subject matter expertise from outside the company.  While this addresses the main structural issue, it does not address the loneliness.

The CIO’s view of what worked is diametrically opposed to those that made it happen.  Where the business units want to do more of what worked, the CIO wants to dismantle the engine of success.  Where the engineers that designed the last product want to do wring out more goodness out of the aging hulk that is your best product, the CIO wants to obsolete it.  Where the business units see the tried-and-true business model as the recipe for success, the CIO sees it as a tired old cowpath leading to the same old dried up watering hole.  If this sounds lonely, it’s because it is.

To combat this fundamental loneliness, the CIO needs to become part of a small group of trusted CIOs from non-competing companies. (NDAs required, of course.)  The group provides its members much needed perspective, understanding and support.  At the first meeting the CIO is comforted by the fact that loneliness is just part of the equation and, going forward, no longer takes it personally.  Here are some example deliverables for the group.

Identify the person who can allocate resources and put together a plan to help that person have a big problem (no incentive compensation?) if results from the innovation work are not realized.

Make a list of the active, staffed technology projects and categorize them as: improving what already exists, no-to-yes (make a product/service do something it cannot), or yes-to-no (eliminate functionality to radically reduce the cost signature and create new markets).

For the active, staffed projects, define the market-customer-partner assumptions (market segment, sales volume, price, cost, distribution and sales models) and create a plan to validate (or invalidate) them.

To the person with the resources and the problem if the innovation work fizzles, present the portfolio of the active, staffed projects and its validated roll-up of net profit, and ask if portfolio meets the growth objectives for the company.  If yes, help the business execute the projects and launch the products/services.  If no, put a plan together to run Innovation Burst Events (IBEs) to come up with more creative ideas that will close the gap.

The burning question is – How to go about creating a CIO group from scratch?  For that, you need to find the right impresario that can pull together a seemingly disparate group of highly talented CIOs, help them forge a trusting relationship and bring them the new thinking they need.

Finding someone like that may be the toughest thing of all.

Image credit – Giant Humanitarian Robot.

 

Battle Success With No-To-Yes

no to yesEveryone says they want innovation, but they don’t – they want the results of innovation.

Innovation is about bringing to life things that are novel, useful and successful. Novel and useful are nice, but successful pays the bills.  Novel means new, and new means fear; useful means customers must find value in the newness we create, and that’s scary. No one likes fear, and, if possible, we’d skip novel and useful altogether, but we cannot.  Success isn’t a thing in itself, success is a result of something, and that something is novelty and usefulness.

Companies want success and they want it with as little work and risk as possible, and they do that with a focus on efficiency – do more with less and stock price increases.  With efficiency it’s all about getting more out of what you have – don’t buy new machines or tools, get more out of what you have.  And to reduce risk it’s all about reducing newness – do more of what you did, and do it more efficiently.  We’ve unnaturally mapped success with the same old tricks done in the same old way to do more of the same. And that’s a problem because, eventually, sameness runs out of gas.

Innovation starts with different, but past tense success locks us into future tense sameness.  And that’s the rub with success – success breeds sameness and sameness blocks innovation.  It’s a strange duality – success is the carrot for innovation and also its deterrent. To manage this strange duality, don’t limit success; limit how much it limits you.

The key to busting out of the shackles of your success is doing more things that are different, and the best way to do that is with no-to-yes.

If your product can’t do something then you change it so it can, that’s no-to-yes.  By definition, no-to-yes creates novelty, creates new design space and provides the means to enter (or create) new markets.  Here’s how to do it.

Scan all the products in your industry and identify the product that can operate with the smallest inputs.  (For example, the cell phone that can run on the smallest battery.)  Below this input level there are no products that can function – you’ve identified green field design space which you can have all to yourself.   Now, use the industry-low input to create a design constraint.  To do this, divide the input by two – this is the no-to-yes threshold.  Before you do you the work, your product cannot operate with this small input (no), but after your hard work, it can (yes).  By definition the new product will be novel.

Do the same thing for outputs.  Scan all the products in your industry to find the smallest output. (For example, the automobile with the smallest engine.)  Divide the output by two and this is your no-to-yes threshold.  Before you design the new car it does not have an engine smaller than the threshold (no), and after the hard work, it does (yes). By definition, the new car will be novel.

A strange thing happens when inputs and outputs are reduced – it becomes clear existing technologies don’t cut it, and new, smaller, lower cost technologies become viable.  The no-to-yes threshold (the constraint) breaks the shackles of success and guides thinking in a new directions.

Once the prototypes are built, the work shifts to finding a market the novel concept can satisfy.  The good news is you’re armed with prototypes that do things nothing else can do, and the bad news is your existing customers won’t like the prototypes so you’ll have to seek out new customers. (And, really, that’s not so bad because those new customers are the early adopters of the new market you just created.)

No-to-yes thinking is powerful, and though I described how it’s used with products, it’s equally powerful for services, business models and systems.

If you want innovation (and its results), use no-to-yes thinking to find the limits and work outside them.

Innovation Through Preparation

Pack what you needInnovation is about new; innovation is about different; innovation is about “never been done before”; and innovation is about preparation.

Though preparation seems to contradict the free-thinking nature of innovation, it doesn’t.  In fact, where brainstorming diverts attention, the right innovation preparation focuses it; where brainstorming seeks more ideas, preparation seeks fewer and more creative ones; where brainstorming does not constrain, effective innovation preparation does exactly that.

Ideas are the sexy part of innovation; commercialization is the profitable part; and preparation is the most important part.  Before developing creative, novel ideas, there must be a customer of those ideas, someone that, once created, will run with them.  The tell-tale sign of the true customer is they have a problem if the innovation (commercialization) doesn’t happen. Usually, their problem is they won’t make their growth goals or won’t get their bonus without the innovation work.  From a preparation standpoint, the first step is to define the customer of the yet-to-be created disruptive concepts.

The most effective way I know to create novel concepts is the IBE (Innovation Burst Event), where a small team gets together for a day to solve some focused design challenges and create novel design concepts.  But before that can happen, the innovation preparation work must happen.  This work is done in the Focus phase. The questions and discussion below defines the preparation work for a successful IBE.

1. Why is it so important to do this innovation work?

What defines the need for the innovation work?  The answer tells the IBE team why they’re in the room and why their work is important. Usually, the “why” is a growth goal at the business unit level or projects in the strategic plan that are missing the necessary sizzle. If you can’t come up with a slide or two with growth goals or new projects, the need for innovation is only emotional.  If you have the slides, these will be used to kick off the IBE.

 

2. Who is the customer of the novel concepts?

Who will choose which concepts will be converted into working prototypes? Who will convert the prototypes into new products? Who will launch the new products? Who has the authority to allocate the necessary resources? These questions define the customers of the new concepts.  Once defined, the customers become part of the IBE team.  The customers kick off the IBE and explain why the innovation work is important and what they’ll do with the concepts once created.  The customers must attend the IBE report-out and decide which concepts they’ll convert to working prototypes and patents.

Now, so the IBE will generate the right concepts, the more detailed preparation work can begin.  This work is led by marketing.  Here are the questions to scope and guide the IBE.

 

3. How will the innovative new product be used?

How will the innovative product be used in new way? This question is best answered with a hand sketch of the customer using the new product in a new way, but a short written description (30 words, or so) will do in a pinch. The answer gives the IBE team a good understanding, from a customer perspective, what new things the product must do.

What are the new elements of the design that enable the new functionality or performance? The answer focuses the IBE on the new design elements needed to make real the new product function in the new way.

What are the valuable customer outcomes (VCOs) enabled by the innovative new product? The answer grounds the IBE team in the fundamental reason why the customer will buy the new product.  Again, this is answered from the customer perspective.

 

4. How will the new innovative new product be marketed and sold?

What is the tag line for the new product? The answer defines, at the highest level, what the new product is all about. This shapes the mindset of the IBE team and points them in the right direction.

What is the major benefit of the new product? The answer to this question defines what your marketing says in their marketing/sales literature.  When the IBE team knows this, you can be sure the new concepts support the marketing language.

 

5. By whom will the innovative new product be used?

In which geography does the end user live? There’s a big difference between developed markets and developing markets.  The answer to the question sets the context for the new concepts, specifically around infrastructure constraints.

What is their ability to pay? Pocketbooks are different across the globe, and the customer’s ability to pay guides the IBE team toward concepts that fit the right pocket book.

What is the literacy level of the end customer?  If the customer can read, the IBE team creates concepts that take advantage of that ability.  If the customer cannot read, the IBE team creates concepts that are far different.

 

6. How will the innovative new product change the competitive landscape?

Who will be angry when the new product hits the market? The answer defines the competition.  It gives broad context for the IBE team and builds emotional energy around displacing adversaries.

Why will they be angry? With the answer to this one, the IBE team has good perspective on the flavor of pain and displeasure created by the concepts.  Again, it shapes the perspective of the IBE team.  And, it educates the marketing/sales work needed to address competitors’ countermeasures.

Who will benefit when the new product hits the market? This defines new partners and supporters that can be part of the new solutions or participants in a new business model or sales process.

What will customer throw away, reuse, or recycle? This question defines the level of disruption.  If the new products cause your existing customers to throw away the products of your existing customers, it’s a pure market share play.  The level of disruption is low and the level of disruption of the concepts should also be low.  On the other end of the spectrum, if the new products are  sold to new customers who won’t throw anything away, you creating a whole new market, which is the ultimate disruption, and the concepts must be highly disruptive.  Either way, the IBE team’s perspective is aligned with the level appropriate level of disruption, and so are the new concepts.

 

Answering all these questions before the creative works seems like a lot of front-loaded preparation work, and it is. But, it’s also the most important thing you can do to make sure the concept work, technology work, patent work, and commercialization work gives your customers what they need and delivers on your company’s growth objectives.

Image credit — ccdoh1.

Don’t boost innovation, burst it.

Burst you balloonThe most difficult part of innovation is starting, and the best way to start is the Innovation Burst Event, or IBE. The IBE is a short, focused event with three objectives: to learn innovation methods, to provide hands-on experience, and to generate actual results. In short, the IBE is a great way to get started.

There are a couple flavors of IBEs, but the most common is a single day even where a small, diverse group gets together to investigate some bounded design space and to create novel concepts. At the start, a respected company leader explains to the working group the importance of the day’s work, how it fits with company objectives, and sets expectations there will be a report out at the end of the day to review the results. During the event, the working group is given several design challenges, and using innovation tools/methods, creates new concepts and builds “thinking prototypes.” The IBE ends with a report out to company leaders, where the working group identifies patentable concepts and concepts worthy of follow-on work. Company leaders listen to the group’s recommendations and shape the go-forward actions.

The key to success is preparation. To prepare, interesting design space is identified using multiple inputs: company growth objectives, new market development, the state of the technology, competitive landscape and important projects that could benefit from new technology. And once the design space is identified, the right working group is selected. It’s best to keep the group small yet diverse, with several important business functions represented. In order to change the thinking, the IBE is held at location different than where the day-to-day work is done – at an off-site location. And good food is provided to help the working group feel the IBE is a bit special.

The most difficult and most important part of preparation is choosing the right design space. Since the selection process starts with your business objectives, the design space will be in line with company priorities, but it requires dialing in. The first step is to define the operational mechanism for the growth objective. Do you want a new product or process? A new market or business model? The next step is to choose if you want to radically improve what you have (discontinuous improvement) or obsolete your best work (disruption). Next, the current state is defined (knowing the starting point is more important than the destination) – Is the technology mature? What is the completion up to? What is the economy like in the region of interest? Then, with all that information, several important lines of evolution are chosen. From there, design challenges are created to exercise the design space. Now it’s time for the IBE.

The foundation of the IBE is the build-to-think approach and its building blocks are the design challenges. The working group is given a short presentation on an innovation tool, and then they immediately use the tool on a design challenge. The group is given a short description of the design challenge (which is specifically constructed to force the group from familiar thinking), and the group is given an unreasonably short time, maybe 15-20 minutes, to create solutions and build thinking prototypes. (The severe time limit is one of the methods to generate bursts of creativity.) The thinking prototype can be a story board, or a crude representation constructed with materials on hand – e.g., masking tape, paper, cardboard. The group then describes the idea behind the prototype and the problem it solves. A mobile phone is used to capture the thinking and the video is used at the report out session. The process is repeated one or two times, based on time constraints and nature of the design challenges.

About an hour before the report out, the working group organizes and rationalizes the new concepts and ranks them against impact and effort. They then recommend one or two concepts worthy of follow on work and pull together high level thoughts on next steps. And, they choose one or two concept that may be patentable. The selected concepts, the group’s recommendations, and their high level plans are presented at the report out.

At the report out, company leaders listen to the working group’s thoughts and give feedback. Their response to the group’s work is crucial. With right speech, the report out is an effective mechanism for leaders to create a healthy innovation culture. When new behaviors and new thinking are praised, the culture of innovation moves toward the praise. In that way, the desired culture can be built IBE by IBE and new behaviors become everyday behaviors.

Innovation is a lot more than Innovation Burst Events, but they’re certainly a central element. After the report out, the IBE’s output (novel concepts) must be funneled into follow on projects which must be planned, staffed, and executed. And then, as the new concepts converge on commercialization, and the intellectual comes on line, the focus of the work migrates to the factory and the sales force.

The IBE is designed to break through the three most common innovation blockers – no time to do innovation; lack of knowledge of how do innovation (though that one’s often unsaid); and pie-in-the-sky, brainstorming innovation is a waste of time. To address the time issue, the IBE is short – just one day. To address the knowledge gap, the training is part of the event. And to address the pie-in-the-sky – at the end of the day there is tangible output, and that output is directly in line with the company’s growth objectives.

It’s emotionally challenging to do work that destroys your business model and obsoletes your best products, but that’s how it is with innovation. But for motivation, think about this – if your business model is going away, it’s best if you make it go away, rather than your competition.  But your competition does end up changing the game and taking your business, I know how they’ll do it – with Innovation Burst Events.

Image credit – Pascal Bovet

Your value proposition is dying.

old man and childYour value proposition is aging and will soon die. No matter your value proposition, this is truth – no value proposition has ever made it out alive.

Your value proposition – what you deliver, the goodness you provide – is what has made you what you are, and that’s why you center your existence on its principles and that’s why it’s sticky. And that’s also why it’s too sticky. Your successful value proposition makes you feel good so you cling to it all costs. And when it’s on life support, when it can no longer breathe on its own, you grasp more desperately for its long past goodness. And when it’s flat-lined you hysterically grab for the paddles to shock it back to life. This is unskillful, but it’s how it goes.

Value propositions are impermanent – they’re born, they grown, they die. It’s best to recognize this truth and work within the impermanence. When a successful value proposition is almost through adolescence and is thinking of heading off to college, that’s the time to bring another one to life. You may be looking forward to being an empty nester, but that works with kids, not with value propositions.

Value propositions have a long gestation period, and you never really know how they’ll turn out until they mature, or they don’t. You may think you have a good idea how they’ll turn out when they get to kindergarten, but life is uncertain, and you don’t really know how things will go. You can’t predict; you can only decide to try, or not. But there’s hope.

There are several important lenses to squint through to improve your odds, but, before that there’s one rule to live by – all infant value propositions must be disruptive. If you’re going to invest all that time and energy, the payoff must be worth the effort – think diapers of disruption.

The lens of cost of entry. To distrupt, look to radically reduce the cost of entry. If you make capital equipment, come up with a way to provide value without the capital purchase. It could be financing terms, renting, leasing, power by the hour. It could be smaller, lower cost machines that do the job, but lets the customer buy smaller chunks of capacity. It could be new technology that radically reduces cost. Or, it could be my favorite – eliminating functionality and features so the product does less and costs a whole lot less. Or, figure out some non-traditional yet powerful blockers of entry and make them go away.

The lens of user decisions. This is a big one. Eliminate all the adjustments on your so you can sell your product to people who, today, don’t have the technical savvy to run them. Eliminate all words from your product, which will let you sell them to folks that cannot read your language. Design your product with a green light and a red light, and when the red light is on, your product emails someone letting them know the failure mode and also automatically reorders the replacement parts. Add sensors to your product so it reconfigures itself so the user gets more value.

The lean lens. If you make big machines that create batching, right-size them. Look at your customer’s value stream and try to change your product to eliminate their processes with the longest cycle time. (These processes should be unfamiliar to you and should drive unfamiliar technology work.) Or, offer a new service to help them eliminate a problem supplier. Or provide them process data or information that helps them be more productive. Or, change how you make the product or how you stock/ship it to help your customer reduce inventory and respond faster.

Constrain the inputs. Reduce by 90% the required inputs to your product and reinvent it. The best example is electrical power. Give your engineers a radically lower power budget and tell them to provide as much goodness as possible. The result will be less goodness and a whole lot less power consumption. This could allow you to sell products to people with poor utilities (developing world) or help companies reduce their carbon footprint. (Isn’t that a nice value proposition these days.)

Make it more portable. If your product weighs tons, think pounds; if it weighs pounds, think ounces. If its size is measured in meters, think millimeters; if millimeters, think micrometers. The key here is to strip out functions and goodness so you can make it portable. Give ground on the crusty value proposition to sprout a new one.

These are just a few of the lenses, and you should use your deep knowledge and context to come up with the right ones for you. Here’s a neat exercise – ask your sales people how they’d sell your product without using your existing value proposition, then reimagine the product so they can sell it that way.

Your existing value proposition isn’t bad – it pays the bills and it’s what got you here, and, it’s what pays for creating the next generation of value propositions. What’s unskillful is thinking it will last forever.

Now is the only time you can shape your future. It’s time to disrupt yourself.

Are you doing innovation?

Bizarro SupermanIf you’re not thinking differently, you’re thinking the same. And if you’re thinking the same, you’re going to get the same. Same may feel safe, and at some level it is. But when sameness festers into staleness, too much of a good thing isn’t wonderful.

In our fast moving Bizzaro World, safe is dangerous; repeatable is out and remarkable is in; improving what is is displaced by creating what isn’t; more capacity is outlawed and new capability is the only way; growing existing markets is wasteful because it gets in the way of creating new ones.

Ask your company leaders if they’re doing innovation, and the answer is yes. It’s a loaded question, and nothing good can come of it. “No, we don’t do innovation.” is a career-limiting response. Here are two better questions: What are you doing that’s different? What are you doing differently? These questions are effective because they require answers that are relative – relative to what you used to do. And because innovation starts with different, these questions are a good start.

Our assembly process is different and we increased productivity 0.3%; our product design is different and we made it stronger by 2.1%; our customer service tools are different and we decrease waiting time by 1.7%; our plastics are different and we reduced product cost by 0.6%. The difference is clear, but it didn’t really make a difference. Innovation starts with different, but all different isn’t created equal. Instead of shades of gray, think binary, think black to white, think no to yes.

Here are some better questions:

  • Have we stopped distracting ourselves by focusing on growth of our biggest markets?
  • Did we change the value proposition with our new product?
  • Have we increased sales people in the undeveloped markets at the expense of sales people in our biggest markets?
  • Do our new technologies change the argument?
  • Are we working on the new products that will obsolete our most profitable product?
  • Does the new product do less of anything so it can do more of something else?
  • Are we working on the technologies so we can sell into Africa?
  • Are we hiring experts in mobile technology?
  • How about experts in data science?

There’s no hard and fast definition of what makes for the right no-to-yes thinking but their telltale sign is their wake of oblique problems. If your organization doesn’t know how to do something, then it could be an indication of powerful no-to-yes behavior. For example, if your translations group doesn’t know how to translate into a new language requested by sales, it could be because a new region of the world is now important. If your sales managers want to use a new search firm because your longstanding one can’t find the right new candidates, it may be because your new product demands a new flavor of sales people. If your compensation structure doesn’t let you make an acceptable offer to an engineer you really need, it could be because you need to hire for new specialties from different industries with radically different compensation norms.

“Are you doing innovation?”, as a question, is not skillful.  Instead, do the work so you must sell where you haven’t sold; use materials you’ve never used; use technologies you’ve never heard of; hire people you never had to hire; and create problems related to new geographies and new languages.  And when someone asks “Are you doing innovation?”, tell them you used to, but you’ve found something better.

Image credit – JD HANCOCK PHOTOS

Innovation’s Mantra – Sell New Products To New Customers

bull's headThere are three types of innovation: innovation that creates jobs, innovation that’s job neutral, and innovation that reduces jobs.

Innovation that reduces jobs is by far the most common. This innovation improves the efficiency of things that already exist – the mantra: do the same, but with less. No increase in sales, just fewer people employed.

Innovation that’s job neutral is less common. This innovation improves what you sell today so the customer will buy the new one instead of the old one. It’s a trade – instead of buying the old one they buy the new one. No increase in sales, same number of people employed.

Innovation that creates jobs is uncommon. This innovation radically changes what you sell today and moves it from expensive and complicated to affordable and accessible. Sell more, employ more.

Clay Christensen calls it Disruptive Innovation; Vijay Govindarajan calls it Reverse Innovation; and I call it Less-With-Far-Less.

The idea is the product that is sold to a relatively small customer base (due to its cost) is transformed into something new with far broader applicability (due to its hyper-low cost). Clay says to “look down” to see the new technologies that do less but have a super low cost structure which reduces the barrier to entry. And because more people can afford it, more people buy it. And these aren’t the folks that buy your existing products. They’re new customers.

Vijay says growth over the next decades will come from the developing world who today cannot afford the developed world’s product. But, when the price comes down (down by a factor of 10 then down by a factor of 100), you sell many more. And these folks, too, are new customers.

I say the design and marketing communities must get over their unnatural fascination with “more” thinking. To sell to new customers the best strategy is increase the number of people who can afford your product. And the best way to do that is to radically reduce the cost signature at the expense of features and function. If you can give ground a bit on the thing that makes your product successful, there is huge opportunity to reduce cost – think 80% less cost and 20% less function. Again, you sell new product to new customers.

Here’s a thought experiment to help put you in the right mental context: Create a plan to form a new business unit that cannot sell to your existing customers, must sell a product that does less (20%) and costs far less (80%), and must sell it in the developing world. Now, create a list of small projects to test new technologies with radically lower cost structures, likely from other industries. The constraint on the projects – you must be able to squeeze them into your existing workload and get them done with your existing budget and people. It doesn’t matter how long the projects take, but the investment must be below the radar.

The funny thing is, if you actually run a couple small projects (or even just one) to identify those new technologies, for short money you’ve started your journey to selling new products to new customers.

Less Before More – Innovation’s Little Secret

8634449207_861ed9ddbd_zThe natural mindset of innovation is more-centric. More throughput; more performance; more features and functions; more services; more sales regions and markets; more applications; more of what worked last time. With innovation, we naturally gravitate toward more.

There are two flavors of more, one better than the other. The better brother is more that does something for the first time. For example, the addition of the first airbags to automobiles – clearly an addition (previous vehicles had none) and clearly a meaningful innovation. More people survived car crashes because of the new airbags. This something-from-nothing more is magic, innovative, and scarce.

Most more work is of a lesser class – the more-of-what-is class. Where the first airbags were amazing, moving from eight airbags to nine – not so much. When the first safety razors replaced straight razors, they virtually eliminated fatal and almost fatal injuries, which was a big deal; but when the third and fourth blades were added, it was more trivial than magical. It was more for more’s sake; it was more because we didn’t know what else to do.

While more is more natural, less is more powerful. The Innovator’s Dilemma clearly called out the power of less. When the long-in-the-tooth S-curve flattens, Christensen says to look down, to look down and create technologies that do less. Actually, he tells us someone will give ground on the very thing that built the venerable S-curve to make possible a done-for-the-first-time innovation.  He goes on to say you might as well be the one to dismantle your S-curve before a somebody else beats you to it. Yes, a wonderful way to realize the juciest innovation is with a less-centric mindset.

The LED revolution was made possible with less-centric thinking. As the incandescent S-curve hit puberty, wattage climbed and more powerful lights became cost effective; and as it matured, output per unit cost increased. More on more.  And looking down from the graying S-curve was the lowly LED, whose output was far, far less.

But what the LED gave up in output it gained in less power draw and smaller size.  As it turned out, there was a need for light where there had been none – in highly mobile applications where less size and weight were prized. And in these new applications, there was just a wisp of available power, and incandesent’s power draw was too much.  If only there was a technology with less power draw.

But at the start, volumes for LEDs were far less than incandesent’s; profit margin was less; and most importantly, their output was far less than any self-respecting lightbulb.  From on high, LEDs weren’t real lights; they were toys that would never amount to anything.

You can break intellectual inertia around more, and good things will happen. New design space is created from thin air once you are forced from the familiar. But it takes force. Creative use of constraints can help.

Get a small team together and creatively construct constraints that outlaw the goodness that makes your product great. The incandescent group’s constraint could be: create a light source that must make far less light. The automotive group’s constraint: create a vehicle that must have less range – battery powered cars.  The smartphone group: create a smartphone with the fewest functions – wrist phone without Blutooth to something in your pocket , longer battery life, phone in the ear, phone in your eyeglasses.

Less is unnatural, and less is scary. The fear is your customers will get less and they won’t like it. But don’t be afraid because you’re going to sell to altogether different customers in altogether markets and applications. And fear not, because to those new customers you’ll sell more, not less. You’ll sell them something that’s the first of its kind, something that does more of what hasn’t been done before. It may do only a little bit of that something, but that’s far more than not being able to do it all.

Don’t tell anyone, but the next level of more will come from less.

Mike Shipulski Mike Shipulski
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