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  1. 1. innov 8 E I G H T S T A R T I N G P O I N T S O N I N N O V A T I O N
  2. 2. d e f i n i t i o n
  3. 3. d e f i n i t i o n INNOV 8 : 8 S TA R T ING P OIN T S ON INNOVAT ION Before starting on any journey, 2 INVENTION is the action of finding or common ground needs to be discovering something that has not established and this is no different been found or discovered. when we want to discover or talk about innovation. The common ground 3 INNOVATION is the thoughtful and that needs to be set is the definition of purposeful act of transforming three words: creativity, invention and creative ideas and inventions into innovation. These three words have tangible forms that create value. been used interchangeably and at the surface can seem to have the same 4 SYSTEMIC INNOVATION refers definition. To top that off, if one were to to innovation practices that are ask 100 people to define these words, structured, sustainable, pervasive more likely than not, one will get 100 and permanent. Systemic innovation different definitions. is accomplished by the setting up of frameworks, methodologies and Therefore a common definition is environments that provide structure needed for us to start this journey. for innovation to occur. As you think about innovation, you can agree with the definitions below, modify them to suit your needs or even create your own definition. However, for the purpose of this booklet the following definitions will be used: 1 CREATIVITY is the ability of individuals, teams and organizations to generate ideas that have value. Creativity can be rediscovered, enhanced and fostered.
  4. 4. oper ation = / innov ation
  5. 5. oper ation = / innov ation INNOV 8 : 8 S TA R T ING P OIN T S ON INNOVAT ION Most of us are familiar with Operation. The table below gives a brief comparison Operation refers to the process of Operating and Innovating. of doing things right in order for a product or service to be completed in O P E R AT I N G I N N O VAT I N G a timely manner. Operational steps are DOING THINGS RIGHT DOING RIGHT THINGS clear and for the most part are well- defined. Innovation on the other hand, STEPS ARE PRE-DEFINED STEPS ARE UNDEFINED is the polar opposite of Operation, like STEPS ARE MOSTLY LINEAR STEPS ARE MOSTLY UNCLEAR the yin to Operation’s yang. Yet, also like yin and yang, both need to exist in SINGLE ROUTE AND RESULT MULTIPLE ROUTES AND RESULTS order to have a harmonious system. DRIVEN BY FUNCTIONAL TEAMS DRIVEN BY CROSS-FUNCTIONAL TEAMS Without Operation nothing will get done, and without Innovation nothing REWORKING IS A WASTE REWORKING IS PART OF LEARNING new will be created. CLEAR FRONT END FUZZY FRONT END EASY TO MEASURE TOUGH TO MEASURE RICH HISTORICAL DATA POOR HISTORICAL DATA FORECASTING POSSIBLE FORECASTING ALMOST IMPOSSIBLE TRADITIONAL PLAYERS AND ROLES NEW PLAYERS AND ROLES
  6. 6. re a s on s to innov ate
  7. 7. re a son s to innov ate INNOV 8 : 8 S TA R T ING P OIN T S ON INNOVAT ION We should innovate because: 4 Change is happening at a lightning 8 Innovation enables the creation of rate and the only way to cope and new source of value and they drive a 1 Operational excellence alone is adapt to change is to innovate. In 1930 disproportionate share of growth. This no longer sufficient. Operational the average lifespan of an S&P 500 can be seen from Motorola’s RAZR to excellence gets something out the company was 50 to 70 years. In 2000 eBay online community auctions to door but does not create the next the average lifespan was down to 25 every one of Pixar’s animated movies. “new” thing. to 30 years. At this rate by 2020 75% of current S&P 500 companies will no 9 Increasing profit and market share 2 Cost control is not enough because longer exist. through acquisition rarely works cutting cost or controlling cost only and is complicated and messy. For prolongs the past and does not create 5 The competition is not waiting. example recent news has it that US the future. Airways 2005 merger with America 6 Innovation gives you a way to West might not achieve expected profit 3 In 2006, the top 25 most innovative differentiate yourself from your results. companies in the world were found to competitors. have a median margin growth of 3.5% 10 Companies that do not innovate will per year since 1995 as compared to 7 Customers are looking for the coolest fade away like MCI, Netscape, Napster just 0.4% for the median S&P Gbl 1200 new stuff – mobile phones, iPods, and Peoplesoft. companies. services, clothes, etc. Customers are shopping for innovation because they know that is where the value is in this modern area. Customers love innovation.
  8. 8. innov ation my th s
  9. 9. innov ation my th s INNOV 8 : 8 S TA R T ING P OIN T S ON INNOVAT ION Some of the common innovation myths 3 Myth: Financial analytics is the key are: criteria to approving new ideas and concepts. 1 Myth: Innovation is only about new products or limited to technology R&D. Truth: Trying to guess the financial elements in 5 years for something Truth: Innovation can be about totally new wastes time and is almost services, business models, and always wrong. Instead start putting customer experiences. For example, together quick, cheap and unrefined Starbucks is innovating in the space of prototypes of your ideas or concepts customer experience. to see what works and what does not. Making ideas tangible help!!!! 2 Myth: Innovation is expensive. 4 Myth: Innovation is reserved for the Truth: Not innovating is more lone creative inventor. expensive. Not innovating has caused the downfall of many companies. Truth: Innovation is a team sport. Southwest Airlines innovated on You will need people from various their business model while all the disciplines (business, engineering, other American airlines did not. Now social science, arts) and traits to Southwest is profitable and the rest collaborate radically to innovate. You are not and some have even filed for will need a collection of people that bankruptcy. can play the following personas: anthropologist, experimenter, cross- pollinator, hurdler, collaborator, director, experience architect, set designer, storyteller and caregiver (The Ten Faces of Innovation, Tom Kelly, 2005).
  10. 10. innov ation inhibitor s
  11. 11. innov ation inhibitor s INNOV 8 : 8 S TA R T ING P OIN T S ON INNOVAT ION 1 six sigma failing does not equal to innovation, like manner that people are not but if no mistakes are made and no given time to think, to explore, to Six Sigma has made business lessons are learned from mistakes, experiment, to play, to be human and operations and processes efficient you can be guaranteed that there ultimately to innovate. in the past and will continue to be an will be no innovation. What is needed important part of any corporation. is the banishment of fear and the 5 bureaucracy and hierarchy However, relying on Six Sigma solely encouragement of child-like curiosity is not enough and using Six Sigma and experimentation, a mindset If every time one wants to try out to manage innovation is not going to of not fearing failure but having a a new idea one needs to fill out 10 work. Six Sigma is inward-focused willingness to learn from the failure million permission forms and ask and thus does not help organizations and to move on. for permission from another 10 to fulfill the unmet, unarticulated and million people before one can start on unrealized needs of customers. Six 3 devil’s advocate something, then the chances of that Sigma cuts down on variations and idea even starting is close to zero, let mistakes. It makes processes sterile, How many times have we seen the alone having it progress to something robotic and predictable. Innovation on devil’s advocate rear its ugly head significant. the other hand has to be messy, open on ideas that are still in its infancy? and full of warts. So using Six Sigma How many times have we heard 6 common phrases that not only inhibit to manage innovation is going to kill someone say “let me be the devil’s but kill innovation: innovation. advocate” and proceed to pulverize a new idea to smithereens without > Yes, but ... 2 fear really understanding the new idea? > We’ve tried that before. We should give the new idea a chance > It won’t work. Fear kills innovation. Being highly to breathe, live and grow a little to see > Don’t rock the boat. focused on getting things perfect the where it goes before pounding it to the > The boss will never go for it. first time around, a lot of corporations ground. > If it ain’t broken, don’t fix it. instill in their employees a culture > We’ve always done it this way. of fear - fear of taking a chance, 4 productivity > That’s not what the customer said they fear of trying, fear of failing, and wanted. fear of making mistakes. Do not Corporations are so focused on > What’s so original about that? misunderstand, making mistakes and productivity in a regimented military-
  12. 12. t y pe s of innov ation
  13. 13. t y pe s of innov ation INNOV 8 : 8 S TA R T ING P OIN T S ON INNOVAT ION There are two main types of innovation: Radical/Disruptive Innovation Incremental/Sustaining Innovation • Revolutionary, breakthrough • Evolutionary, expected, sustaining • Game changing, disruptive • Rarely challenges established leaders • Challenges established market leaders • Addresses existing markets • Creates new markets • Predictable: desired outcome is prescribed • Exploratory: invites the elements of discovery & surprise Both types of innovation are needed for a corporation to be successful in the long run. Radical innovation will get you to the next curve and incremental innovation will sustain you while you search for the next breakthrough.
  14. 14. are a s of innov ation
  15. 15. are a s of innov ation INNOV 8 : 8 S TA R T ING P OIN T S ON INNOVAT ION When people think of innovation, 3 service innovation 5 management innovation they tend to think only of product innovation. Unfortunately, this is a description: How a company provides description: How managers perform very limited view of innovation. Below value to customers and consumers their tasks. are some examples on other areas of beyond and around its products. innovation: example: DuPont first introduced the example: An international flight on any use of ROI calculation as a means 1 business model innovation airline will get you to your intended to compare the performance of its destination. A flight on Singapore product departments. Today, various description: How a company makes Airlines however, nearly makes you variants of this index have been used money. forget that you are flying at all, with to assess investment potential. the most attentive, respectful, and example: Dell revolutionized the pampering pre-flight, in-flight and personal computing business post-flight services you can imagine. model by collecting money before a customer’s PC gets built or shipped. 4 platform innovation 2 process innovation description: How a company can provide platforms for multiple description: How a company creates products. and adds value to its offerings. example: Microsoft Office bundles example: Walmart continues a variety of specific products (Word, to grow its profitability via core Excel, PowerPoint, etc.) into a platform process innovation such as using designed to deliver productivity in the a real-time inventory management workplace. system and other systems that give store managers the ability to identify changing buyer behavior and respond quickly with new pricing and merchandising configurations.
  16. 16. w hat’s nex t ?
  17. 17. w hat’s nex t ? INNOV 8 : 8 S TA R T ING P OIN T S ON INNOVAT ION Here are some tips on where to start: 1 getting resolve and commitment from > Is the organization allowing time for 4 space the top people to think? > As an organization, do we know Yes, look at office space. If it is made The senior management has to not enough about innovation techniques or up of uniform gray cubicles, do you only support innovation, push for do we need to seek outside help? think creativity will be promoted in innovation, mandate innovation, make > As an organization do we know what such an environment? Liven things up! innovation a priority but they also have an innovation culture is like and are Make the office lively and fun, engage to show it, live it and breathe it. Senior we promoting it? people’s visual senses to feel that they management will need to walk the are in a creative environment. Also talk so every layer of the organization Once an organization knows where it remember to evaluate if your office will know that innovation is really is starting, it can then begin to chart space is promoting collaboration important. Innovation strategy has to its innovation course. However, always because innovation is a team sport. be driven from the top. keep in mind that the innovation course needs to be flexible and self- 5 culture 2 innovation audit learning and correcting. • Have innovation as part of the Know where you are in terms of 3 process and methodology organisation’s value system. innovation. Ask questions: Once an audit is done the • Adopt a suitable innovation > Is there a mechanism to collect organization needs to start putting framework, including a system to people’s ideas? the right processes, methodologies, measure progress. > Is there a mechanism to encourage environment and culture in place. idea generation? For example, an organization needs • Encourage and reward innovation and > Is there an incubation place for ideas? to evaluate whether or not they need risk taking and even failure. > Are there mechanisms for filtering to modify the reward system to ideas? encourage innovation, and possibly if > Does the reward system encourage they should develop the concept of an risk taking? idea bank to capture the ideas of the > Is the organization encouraging people. experimentation?
  18. 18. 6 time 8 start small • Give employees time to experiment • Get innovation champions. Look for and do things outside their mandated a few people in your organization project work. that are believers of innovation to be champions. Give them the authority • Give time for yourself away from to promote innovation, to talk about meetings, presentations and emails innovation, to lead it and to champion to think, to go out of the office and to it. observe the individuals using your product or system, to take a breath • Set up a small multi-disciplinary and to evaluate where your team is team to explore innovation. This team going and where you want them to go. will be your pioneers in innovation. Innovation definitely does not happen Give them the flexibility and authority in meetings or through emails. to try innovation techniques. Really let them loose and let them be an 7 open innovation innovation brush fire for you. Let them go out to learn and explore then All of us need to realize that innovation let them bring back their learnings happens top down, down up, in out into your organization and spread and out in. We need to realize that them. It is extremely important that innovation cannot be bottled up only senior managers be an umbrella within one single organization. With that shields this pioneer group from these realizations, organizations need the devil’s advocates, the naysayers, to put mechanisms in place to not only and corporate antibodies that are out manage this but also to promote this. to kill anything new that they do not understand. This will only be needed at the beginning because once the brush fire becomes a forest fire no amount of rain will stop it.
  19. 19. Innovation is an art won by training and habituation. We are what we repeatedly do. Innovation then is not an act but a habit. A R I S T O T L E [ PA R A P H R A S E D ]
  20. 20. KWERKUS SIX SDN BHD 746476-A e-mail web i g n i t e t h e f i r e o f i n n o v a t i o n