Why good ideas aren't adopted?

by Jeffrey Phillips

Do you remember the annual Christmas special about the island of misfit toys, where Rudolph ends up because he doesn't "fit in" with the other reindeer? The island is full of misfit toys that weren't acceptable for one reason or another.

A recent Accenture study on innovation found that there must be a mythical land of misfit ideas. Executives who were surveyed for the innovation study said that "opportunities to exploit underdeveloped areas/markets often die because they can never find a home to nurture them." Less than 15% of the executives surveyed disagreed with this statement. In other words, organizations can generate good ideas that are relevant to specific opportunities, but fail to find business lines or leaders who will adopt and nurture those ideas. So, those ideas must end up somewhere - our land of misfit ideas.

There are several reasons why good ideas aren't adopted and nurtured. In our experience I think I'd boil it down to three predominant reasons: prioritization, ownership and fear.

By prioritization I mean that a product or service development team within a line of business typically has more work than it can effectively complete. Even a very compelling idea that is generated and has merit must find its place in the priority stack. Often it is much easier to simply slip that "great new" idea at the bottom of the stack rather than reprioritize the work, so the opportunity slips by and little is done to advance the idea.

By ownership I mean that good ideas that are generated outside of a business line are often looked at with suspicion. Even if the idea is a good one and solves a significant problem, a business unit leader may think that since his or her team didn't generate the idea, they have little stake in the idea, or the idea may cannibalize the existing products and services. So a good idea is rejected or ignored.

By fear I mean that an idea may have great value but be so radical that implementing it will create significant change. In many organizations change is feared rather than embraced, and for some reason it is better to be forced to change through the actions of a competitor (reactive) than to create change and disrupt others (proactive). Since most firms reward consistency and reaction rather than change and proactive disruption, many new ideas will never see the light of day.

Perhaps what's needed is "local" innovation in a product or service line that is safe and relatively incremental, and "global" or corporate innovation that is relatively radical and disruptive. The challenge in this regard is moving the good idea from those who don't have the responsibility to develop the concept as a product or service to those that do, unless we simply spin off new product groups or businesses based on the radical ideas, rather than trying to force them into the existing businesses.

Otherwise many of the best ideas in your organization will end up on the island of misfit ideas, waiting for someone else to come along and discover them. Then, those ideas get released and implemented with a fury on those who ignored them initially.

InnoCentive - A Market for Ideas!

Reproduction of a recent article from The Economist on pioneering “innovation marketplace” that is making steady progress:

A PROBLEM shared is a problem solved: that is the belief that inspired InnoCentive, a firm that describes itself as the “world’s first open innovation marketplace”. Conceived in 1998 by three scientists working for Eli Lilly, a big drug company, InnoCentive was spun off as an independent start-up three years later. It is based on a simple idea: if a firm cannot solve a problem on its own, why not use the reach of the internet to see if someone else can come up with the answer?

Companies, which InnoCentive calls “seekers”, post their challenges on the firm’s website. “Solvers”, who number almost 180,000, compete to win cash “prizes” offered by the seekers. Around 900 challenges have been posted so far by some 150 firms including big multinationals such as Procter & Gamble and Dow Chemicals. More than 400 have been solved. InnoCentive reckons the approach can work for innovations in all sorts of fields, from chemistry to business processes and even economic development. It has formed a partnership with the Rockefeller Foundation, a charity, to help solve problems posted by non-profits working in poor countries, with some initial success.

Forrester, a consultancy, studied a pilot partnership between InnoCentive and SCA, a Swedish maker of personal-hygiene products with over 50,000 employees and annual sales of €10 billion ($14.6 billion). It found that challenges posted by the firm generated an average return on investment of 74%, with a payback period of less than three months. Forrester also found cost savings, a faster research process and a more innovative culture.

SCA was attracted by the fact that InnoCentive took great care in managing the intellectual-property issues that result from its approach, and that it paid for results rather than mere effort. According to one SCA executive, the firm piloted the relationship by posting several chemistry challenges, “some of which worked and some didn’t.” Phrasing the challenge turned out to be key. Rather than posting a problem specific to the firm, SCA got much better results when it posed a general problem (how to make a material more absorbent, say). That way the potential network of experts was wider. So far the challenges have been small: the largest prize paid was $25,000. But SCA now expects to expand its use of InnoCentive into the mainstream of its innovation process.

InnoCentive recently raised a second round of venture capital to pay for what it hopes will be rapid growth. Sceptics worry that its success on incremental, scientific challenges may not extend to broader, more substantial innovation because the research culture in most firms is incapable of posing the right questions or knowing what to do with the sort of answers produced by InnoCentive’s solvers.

A recent innovation may help. Called InnoCentive@Work, this replicates the solver network inside a firm, so that challenges are first offered to “seeker” companies’ own employees. Only if they cannot help is the outside network brought into play. “Companies often don’t know how much they already know,” says Dwayne Spradlin, InnoCentive’s chief. An early challenge at one firm was to find a source of some data, which, it turned out, had already been acquired by another division.

One of the first firms to test the @Work model was InnoCentive’s mother ship, Eli Lilly. That firm is struggling: on September 14th it announced plans to shed 5,500 jobs. The fact that Eli Lilly is making ever more use of InnoCentive to drive innovation even as it is making cuts elsewhere proves that it pays, says Mr Spradlin.

Innovation: Getting beyond the breakthrough

Corporations need to stop looking for the silver bullet...

Takeaway from the Deloitte’s Shift Index report (refer post dated September 29, 2009) as per the Blog Posted by Stephanie N. Mehta, Assistant managing editor, FORTUNE -

New research by the Deloitte Center for the Edge, part of tax and consulting firm Deloitte, paints an ominous picture: The return on assets for U.S. firms has fallen to almost a quarter of 1965 levels despite continued improvements in labor productivity.

And according to John Hagel III, co-chair of the center and one of the study's authors, the declines are taking place in all sectors of business — not just in maturing corporations. "The bottom line," he tells Fortune, "is that in every industry there has been erosion of return on assets."

Hagel and his fellow researchers are in the process of writing a follow-up study that will offer some detailed prescriptions for reversing the trend, but he shared some early insights with us. Two of his observations in particular stood out: 1) He says corporations need to move away from the idea of breakthrough innovation and 2) companies need to find a way to harness new kinds of information flows.

Hagel contends that U.S. companies' innovation efforts tend to focus on home runs — big, honking inventions that can, out of the gate, produce hundreds of millions of dollars in revenue and transform entire industries. In other words, products such as Apple's iPod.

But Hagel is fond of pointing out that even the iPod wasn't exactly an overnight breakthrough for Apple. Rather, he notes, the device has its roots in a company called PortalPlayer, which had been developing an operating system for digital music players for several years before it ultimately teamed with Apple on the iPod.

He offers one explanation for the home-run oriented mindset: 20th century corporations have operating and cost structures that need their products and innovations to succeed at a large scale, and so there's great pressure to produce big breakthroughs.

But Hagel feels a shift to high-velocity but smaller breakthroughs may ultimately produce the same result: "We tend to underestimate the value of rapid, incremental innovations, which actually begin to look like breakthroughs over time," he suggests.

New source of information

Hagel's other prescription — culling information from new and different sources –also calls for a shift in corporate thinking.

Deloitte's study, "The 2009 Shift Index," is actually a look at three different indices that help measure business change. The "flow index" is an effort to capture the value of so-called knowledge flows – information flowing into and out of the organization.

Hagel maintains that companies tend to be focused on internal and adjacent flows: information from within their organization, and knowledge gleaned from those closest to the company, such as suppliers and customers.

But to stay competitive, U.S. companies are going to have to adopt new ways of gathering information – a big shift that will itself require companies to innovate. For example, companies are simply going to have to figure out what information is valuable to track, and which flows are not helpful, Hagel says.

Hagel has done extensive work with Indian and Chinese organizations, and he believes U.S. executives can learn from the way companies in these emerging markets operate. He points to Chinese conglomerate Li & Fung Group as an example of a company that effectively tracks and applies knowledge from a variety of sources.

One of Li & Fung's businesses is garment manufacturing. Rather than act as an integrated one-stop-shop for its retail customers, Li & Fung uses multiple contractors who come together for certain projects, then disband after the task is completed.

By tapping into its various contractors – including those who aren't currently employed on a job – the company is able to get perhaps a more complete view of the world than competitors who only listen to direct suppliers.

When Li & Fung launched in the 70s, Hagel says, it gleaned knowledge from, say, materials manufacturers, and passed that information on to its apparel designer customers.

Today, Hagel says, companies have to rethink the way they gather information – and from where – in order to tap all the most important direct and indirect sources of information.

But they probably don't need a breakthrough innovation to do it.

The Ten Faces of Innovation - Find out which is yours!

Tom Kelley, the author of "The Art of Innovation", followed up with his next book, The Ten Faces of Innovation, which looks at the different roles people can play within an organization to promote a culture of innovation. Here is a summary of various Personas, in his own words:

The Learning Personas
Individuals and organizations need to constantly gather new sources of information in order to expand their knowledge and grow, so the first three personas are learning roles. These personas are driven by the idea that no matter how successful a company currently is, no one can afford to be complacent. The world is changing at an accelerated pace, and today's great idea may be tomorrow's anachronism. The learning roles help keep your team from becoming too internally focused, and remind the organization not to be so smug about what you “know”. People who adopt the learning roles are humble enough to question their own worldview, and in doing so they remain open to new insights every day.

The Anthropologist is rarely stationary. Rather, this is the person who ventures into the field to observe how people interact with products, services, and experiences in order to come up with new innovations. The Anthropologist is extremely good at reframing a problem in a new way, humanizing the scientific method to apply it to daily life. Anthropologists share such distinguishing characteristics as the wisdom to observe with a truly open mind; empathy; intuition; the ability to "see" things that have gone unnoticed; a tendency to keep running lists of innovative concepts worth emulating and problems that need solving; and a way of seeking inspiration in unusual places.

The Experimenter celebrates the process, not the tool, testing and retesting potential scenarios to make ideas tangible. A calculated risk-taker, this person models everything from products to services to proposals in order to efficiently reach a solution. To share the fun of discovery, the Experimenter invites others to collaborate, while making sure that the entire process is saving time and money.

The Cross-Pollinator draws associations and connections between seemingly unrelated ideas or concepts to break new ground. Armed with a wide set of interests, an avid curiosity, and an aptitude for learning and teaching, the Cross-Pollinator brings in big ideas from the outside world to enliven their organization. People in this role can often be identified by their open mindedness, diligent note-taking, tendency to think in metaphors, and ability to reap inspiration from constraints.

The Organizing Personas
The next three personas are organizing roles, played by individuals who are savvy about the often counter-intuitive process of how organizations move ideas forward. At IDEO, we used to believe that the ideas should speak for themselves. Now we understand what the Hurdler, the Collaborator, and the Director have known all along: that even the best ideas must continuously compete for time, attention, and resources. Those who adopt these organizing roles don't dismiss the process of budget and resource allocation as “politics” or “red tape.” They recognize it as a complex game of chess, and they play to win.

The Hurdler is a tireless problem-solver who gets a charge out of tackling something that's never been done before. When confronted with a challenge, the Hurdler gracefully sidesteps the obstacle while maintaining a quiet, positive determination. This optimism and perseverance can help big ideas upend the status quo as well as turn setbacks into an organization's greatest successes—despite doomsday forecasting by shortsighted experts.

The Collaborator is the rare person who truly values the team over the individual. In the interest of getting things done, the Collaborator coaxes people out of their work silos to form multidisciplinary teams. In doing so, the person in this role dissolves traditional boundaries within organizations and creates opportunities for team members to assume new roles. More of a coach than a boss, the Collaborator instills their team with the confidence and skills needed to complete the shared journey.

The Director has an acute understanding of the bigger picture, with a firm grasp on the pulse of their organization. Subsequently, the Director is talented at setting the stage, targeting opportunities, bringing out the best in their players, and getting things done. Through empowerment and inspiration, the person in this role motivates those around them to take center stage and embrace the unexpected.


The Building Personas
The four remaining personas are building roles that apply insights from the learning roles and channel the empowerment from the organizing roles to make innovation happen. When people adopt the building personas, they stamp their mark on your organization. People in these roles are highly visible, so you’ll often find them right at the heart of the action.

The Experience Architect is that person relentlessly focused on creating remarkable individual experiences. This person facilitates positive encounters with your organization through products, services, digital interactions, spaces, or events. Whether an architect or a sushi chef, the Experience Architect maps out how to turn something ordinary into something distinctive—even delightful—every chance they get.

The Set Designer looks at every day as a chance to liven up their workspace. They promote energetic, inspired cultures by creating work environments that celebrate the individual and stimulate creativity. To keep up with shifting needs and foster continuous innovation, the Set Designer makes adjustments to a physical space to balance private and collaborative work opportunities. In doing so, this person makes space itself one of an organization's most versatile and powerful tools.

The Storyteller captures our imagination with compelling narratives of initiative, hard work, and innovation. This person goes beyond oral tradition to work in whatever medium best fits their skills and message: video, narrative, animation, even comic strips. By rooting their stories in authenticity, the Storyteller can spark emotion and action, transmit values and objectives, foster collaboration, create heroes, and lead people and organizations into the future.

The Caregiver is the foundation of human-powered innovation. Through empathy, they work to understand each individual customer and create a relationship. Whether a nurse in a hospital, a salesperson in a retail shop, or a teller at an international financial institution, the Caregiver guides the client through the process to provide them with a comfortable, human-centered experience.

Source: http://www.tenfacesofinnovation.com/tenfaces/index.htm