Idealog + AUT MSI BNZ HGM IRL DNA SKM = Guide (to)INNOVATIONWITH COMPLIMENTS
The Idealog Innovation Guide CONTENTS01 INTRODUCTION THE MOTHER OF INVENTION Rather than focusing on getting a single idea 04 EARLY STAGE INVESTMENT GET CAPE. WEAR CAPE. FLY out in the marketplace, the aim is to transform “When I was young I thought money was companies into innovation machines ready to the most important thing in life; now I am hoon our nation up the OECD rankings. old I know that it is.” Plus: “If you haven’t figured out how to get the Plus: Mo money, mo problems government to help you, you are an idiot.”02 LEADERSHIP AND INNOVATION 05 INTELLECTUAL PROPERTY PROTECTION CREATING A CULTURE I AM THE LAW OF INNOVATION If you are serious about being a business Leadership is not just a label others stick on you, operating on the bleeding edge, you need a it is a vital skillset for the successful innovator. quality professional specialist in IP protection. Crucially, it means listening to other people’s They will set the attack dogs on your thinking. ideas at least as much as they listen to yours. Plus: The life cycle of an idea, Reinventing the Plus: Greed ain’t good. wheel, and Defining intellectual property.03 GENERATING IDEAS 06 BRAND INSIGHTS AND DEVELOPMENT WHAT THEY WANT, WHAT THEY NEED BRAND, NOT BULLSHIT Ironically, the easiest person to lose sight of Too many business people still think of during commercial innovation processes is the a commercial brand as something you slap on most important person of all: the customer. at the end: the label, the packaging, the logo. Plus: The Watering Hole, Murderboarding, Plus: Brand basics for dummies. Nutshelling, and You can’t be mad to work here, it would screw everything up.
07 PROTOTYPING AND TESTING SURPRISE! IT 10 SUSTAINABLE INNOVATION IS THERE ANY OTHER KIND? WORKS/DOESN’T WORK! Unless you work in a business that uses What you thought was your prototype roller desks and cartridge pens, you will is just an elaborate paperweight have noticed that sustainability is more Plus: Crafty corner and Bag a boffin than just a fad Plus: Not being green is getting harder, Lohas and Resources 08 LAUNCH AND SALES: COMMERCIALISATION GETTING INTO THE MARKET Now comes the biggest reality check of them all: convincing some customers 11 CONCLUSION INNOVATE OR LEARN MANDARIN. IT’S YOUR Plus: Mind the Gap and Two of our favourite CHOICE launches Innovation is pretty much the only thing that can prevent New Zealand from becoming a second-class 09 KEEPING THE CASH FLOWING WITHOUT PASSING THE BUCK plantation nation Completely obvious thing business people somehow still manage to forget #92: Cash is the lifeblood of innovationProudly brought to you by
Innovation Guide L ast year IdealogThe Idealog published Cash for Ideas – The Idealog Guide to Commercialising Your Ideas. In its pages we brought together an expert panel from six of the top innovation support ﬁrms in the country. We enjoyed it so much, and learnt so much, that we’re doing it again. This time, rather than focusing on getting a single idea out in the marketplace, the aim is to transform companies into innovation machines The Idealog ready to help our nation hoon up Innovation Guide the OECD rankings. A tall order? Grenville Main, owner and managing director of research, digital and CHAPTER 1 branding agency DNA, says he’s heard the story before. “All my voting life we have heard governments talking about the fact THE MOTHER OF that we can’t just rely on primary products, because if commodity INVENTION prices tumble we are in real trouble – there is no backup. “But nobody has really pulled it oﬀ. The problem can be when nobody really gets that innovation is designed and engineered, it’s invested in over time. It’s no longer down to luck and it’s not always fast. We need to create an environment where visionary CEOs can get the support they need to build a second string to New Zealand’s bow.” Hamish Campbell, manager of investment services at the brand spanking new Ministry of Science and Innovation, is one of the key people charged with making it happen this time. “The government, from the prime minister down, is signalling that innovation is a key driver of the future economic growth of New Zealand,” he says. “We are talking about matching Australia’s GDP and we are not going to do that with business as usual. We need to encourage our companies and the next generation of entrepreneurs to invest in innovation and R&D. “We have to go beyond making our existing businesses more eﬃcient. We need to out-think our competitors and innovation is key to doing this.”
Innovation Guide “The government, from the prime minister down, is signalling that innovation is a key driver of the future economic growth of New Zealand” Hamish Campbell MANAGER INVESTMENT SERVICES, MSI Campbell believes it can be done. one, the Chinese can’t be paying all that direction, so the rest of the worldLook at Denmark and Sweden. money just for our cows, sheep and wants more of what we’ve got.Back in the 80s and 90s they were grass. So they must also be after the What all our experts agree on isrunning neck and neck with New intellectual property – what it is that that innovation is a Very Good Thing,Zealand in the ‘will farm for cash’ makes our dairy and meat taste and sell but it can be bloody diﬃcult. Theirstakes, but they’re now light years better than other countries’. job, and ours with this guide, is toahead. And mobile phone monster And two, a lot of the really make it a bit less bloody diﬃcult.Nokia somehow emerged out of a important innovation is not the “We aim to minimise the lucksawmill in the backwoods of Finland. weird and wonderful prototypes and involved, good and bad,” saysThese countries took their natural inventions, but rather the less showy Pryor. “There is always going to beadvantages and built a platform with business of just doing the simple things some good luck involved in gettingthem, which is what we need to do now better. It’s not just the startlingly something oﬀ the ground, but youif we’re going to catch up. new and Earth-shattering, it is also don’t want to be relying on it. The message from the the stripping of things back to their “There are the right connections,Scandinavians is that the next big essential core, or re-presenting them, the right meetings and the rightthing could come from anywhere. that is innovative business. deals. Our experience helps us see the “If you had sat down at a The challenge is to make things landscape when there are times whenwhiteboard 10 years ago and asked better, more eﬃcient and a little bit you can’t.what sort of New Zealand companies diﬀerent. It can’t just be about ﬁnding “It’s about having foresight,or industries should excel, cyber things that work overseas and trying understanding the commercialisationsecurity or digital animation may not them here, like with TradeMe. We process and then being deliberatehave come up on the list,” Campbell have to start pushing in the other about how you go about it.”says. “But we now have world-classcompanies in each of those areas.” Kevin Pryor, chief executive AUTEnterprises, is similarly optimistic. In our Cash for Ideas supplement (January/February 2010), the disgustingly “I don’t think we are bad at successful Derek Handley of Hyperfactory said: “If you haven’t ﬁgured outcommercialisation at all,” he says. how to get the government to help you, you are an idiot.”“Other countries have more critical The Ministry of Science and Innovation has just been created with themass, and much more money to expressed intention of helping Kiwi innovators in established businessesthrow around. Critical mass is to become world-beaters. It’s particularly keen to support three stagesimportant in getting high densities of development: emerging technology, companies that are active inof people. Big swathes of Asia are research and development, and the highest achievers with sophisticatednot innovative; they just copy R&D that also mentor and help other businesses.other people’s ideas. I think we just Manager of investment services Hamish Campbell describes the basicssuﬀer from all the things that small of the strategy: “I think as much as anything we are less about pickingpopulations and geography bring us. winners than backing winners. We have just made an investment of $92 “We’re an innovative nation. million over three years in 26 companies with proven track records, suchThere are Kiwi innovators doing as Fisher and Paykel Healthcare. This is about taking companies that arethings all over the place, especially already successful and helping them to accelerate their investment inwithin those primary industries.” innovation and that will drive future growth.” This seems right on two counts:
CHEERS TO A NEW BREWHome enthusiasts, companies and clubs can now make thefreshest draft beer on the planet, thanks to Nanobrewing LtdD rinking beer is possibly the most popular male “BRINGING THIS PROJECT TOGETHER HAS BEEN INCREDIBLY pastime in the world. Global annual beer sales exceed US$330 billion and the market is highly STRESSFUL. ALTHOUGH WE’VE HAD INVESTMENT FROM TWO competitive. But a group of Kiwi guys have just OUTSIDE SOURCES, WHEN MSI CAME ALONG IT WAS A BIGupped the ante with a revolutionary brewing system. ENDORSEMENT ANOTHER LEVEL OF BELIEF IN WHAT WE B Master brewer Ian Williams, food technologist Anders WERE DOING FROM AN OUTSIDE PARTY ” OMWarn and engineer Sam Wood have joined forces to createThe WilliamsWarn Personal Brewery – a product that theybelieve is the first all-in-one brewing appliance available. With a successful career and impressive resume, Williamswasn’t looking for innovation; it found him in 2004. Whilelamenting the poor quality of his own homebrew oneChristmas, Williams’ uncle remarked that whoever could solvethe problems with homebrewing would become a millionaire. The seed had been planted and over the next six and halfyears, Williams invested his time, money and passion into theproject. He convinced his friend Anders Warn to come on boardand together they set up Nanobrewing Ltd in 2006. With the help of Sam Wood from ATI Engineering, Danishangel investor Michael Hansen and the design skills of MurrayPilcher and Shane Inder, they set about developing TheWilliamsWarn Personal Brewery. Homebrewed beer is invariably overcarbonated, cloudy,smells of yeast and tastes bitter. The homebrewing processis fraught: the carbonation, fermentation and clarificationprocesses take too long, there’s no way to remove sediment,microbial contamination is common, as is oxidation of the beer. “Thirty-two percent of Kiwi guys have tried and abandonedhomebrewing,” says Williams. “We’re the number one countryin the world for ex-homebrewers.” Now after years of research, R&D, prototype development,patent applications, planning, and financial worries, the teambelieve they’ve found the homebrewing holy grail. “We finally got there: 90 minutes work and then cold, clear,perfectly carbonated, commercial-quality draft beer made inseven days,” he says. Williams has poured all his money into the project, and Hansenand Wood are also major investors. But a lack of funds is a major “It was obvious from the start that Nanobrewing had a greatstumbling block for many entrepreneurs, so the company applied business opportunity and that we could support them withfor and was awarded R&D project funding through the Ministry of their R&D,” says Brown. “They’d clearly done their research.Science and Innovation’s (MSI) TechNZ programme. I was drowning in information!” Having secured previous TechNZ funding for his business Brown liked the blend of beer industry, engineering, designATI Engineering, Sam Wood approached MSI regional business and commercialisation skills offered by the Nanobrewingpartner Jenny Brown at the Hawke’s Bay Regional Council. She shareholders. “These guys knew what they were doing,” she says.invited Sean Sharman from MSI to meet with them and view For Williams especially, being awarded $200,000 ofNanobrewing Ltd’s new product. Brown and Sharman liked TechNZ funding in mid-2010 has had a significant impact onwhat they saw. the venture. The money has been used to develop and test
prototype units, and carry out research into beer ingredients admits it’s been a steep learning curve. Ian Williams and Anders Warnand the brewing industry. “I found the innovation process very difficult, particularly have created what they say “More than anything, it’s been important psychologically. having spent all my money on it at the start. But the Henry is the first all-in-one brewingBringing this project together has been incredibly stressful. Fords, Ralph Laurens and Bill Gates who start big companies appliance available.Although we’ve had investment from two outside sources, aren’t any different to anyone else. It’s about having an ideawhen MSI came along it was a big endorsement – another level and going with it – you don’t need an MBA to do it.of belief in what we were doing from an outside party. To me, “The whole process takes four times longer and involvesthat support was worth 10 times more than the actual money. four times the expense that you’d imagine, so you need to beIt’s taken the pressure off all the investors.” ready for that. But we knew we’d get there eventually. You just While the guys have big dreams for their product, Williams have to believe in yourself and never, ever give up.”
Innovation Guide the moment you turn your back.The Idealog The Idealog Innovation Guide The corrosive eﬀects of this kind of atmosphere will stiﬂe progress and cost you a fortune. And even if you have the money, chucking people CHAPTER 2 a bonus is no substitute for giving them meaning and excitement as a part of their everyday working lives. Numerous studies have shown LEADERSHIP AND that once people have enough cash to pay the bills, non-monetary INNOVATION considerations become much more important in keeping them motivated. Ask yourself these questions: What are you doing yourself that is not giving you the space to think creatively? Are you doing that to the people you are leading? Are you putting things onto them that they can’t manage? Are you hanging onto things that you should be giving to other people to deal with? The higher up you get in leadership the more people Fostering guide, Cash for Ideas, you notice and the less they tell you. How much are you really a culture of would have got the message that commercialising ideas is always a talking to them? innovation team sport. This is especially true if you work in a large organisation. You may have become accustomed to doing most of the work yourself. Here, successful leadership is about AUT’s approach is to build your Chances are, if you’re in the habit creating and maintaining a world- leadership on your strengths so you of coming up with innovative ideas, beating team that comes up with don’t end up a jack of all trades and you’re accustomed to leading people fresh ideas regularly. master of none. through unfamiliar territory. Being MSI’s Hamish Campbell says one “It’s really important in the ideas person can make you a thing really stuck with him recently leadership to know what you can leader by default. when he visited the Massachusetts and can’t do. You need to bring But leadership is not just a label Institute of Technology (MIT) in people in to cover your blind spots, others stick on you, it’s a vital Boston: “If you have the choice of and to watch you so they can learn,” skillset for the successful innovator. backing the A-grade idea with the says Drain. Crucially, it means listening to other B-grade team or the B idea with the The challenge is to let aspects of people’s ideas at least as much as A team, you back the A team every that work go and let others develop they listen to yours. time. Ideas are a dime a dozen. The with their individual talents, while It is through leadership, above best idea in the world without a great at the same time maintaining the everything, that you will create and team around it is next to worthless. all-important overview and vision. maintain a culture of innovation Investing in innovation is about You can get it badly wrong if you within your organisation. investing in people.” either fail to let go of things, or if Stephen Drain, director of Your staﬀ will be looking to the you abandon eﬀective management the AUT Centre for Innovative top dogs to see how they sniﬀ each and leadership by going back to the Leadership, warns of complacency other, and how they behave if there’s knitting of your own specialism. on this. a bone of contention. If you slam If you feel you’re not up to this “Not all innovators are leaders, your oﬃce door and summon folks challenge you may also ﬁnd yourself and not all leaders are innovators.” inside like a headmaster, expect reverting to micromanagement and an If you read our last innovation your staﬀ to act like schoolchildren overemphasis on deadlines and detail.
Innovation Guide As Bruce Lee said: “Concentrate authentic leader, if you meet them aton the ﬁnger pointing and you will them movies or when you’re out atmiss all the heavenly glory.” a social event, you won’t ﬁnd them particularly diﬀerent than the wayCreative spaces they are at work.”How many great ideas havesuﬀocated in unread notebooksand ﬁles in your oﬃce? Why do our children’s daycare Not knowing exactly what you wantcentres look heaps more creative than provides the space for your teamwhere we spend most of our time? to innovate and create. Tom Peters Why do we expect people to come put it this way: “Reward spectacularup with exciting products for vibrant failure. Punish mediocre success.”living while in solitary conﬁnementsurrounded by machines? It’s time to take ‘open plan’ “If your team are happy and you areliterally – do all your planning in happy,” says Drain, “you are going tothe open, where everyone can get achieve a lot more.”involved. Here are some interior Trust is the magic ingredient thatdesign tips to get your ideas out in theopen where they can grow. underpins all of these. According to the Deloitte 2010 Ethics & Workplace “Not all innovators Get away from the norm. Survey, 46 percent of workers say are leaders and not all Newsﬂash: a lot of creative a lack of transparent leadership people do not just sit at a communication will drive them to leaders are innovators” grey plastic desk, staring at a seek new employment opportunities. screen. Have portable seating and whiteboards so that If you ﬁnd yourself snooping on your team’s email or checking when – Stephen Drain breakout teams can create an they clock in and out, you are either environment that suits their terminally paranoid, have hired the needs. Think about using outside wrong people, or are in the wrong job. spaces, too. Personal space. As long as it Say goodbye to This just in – greed doesn’t create a health and Mr Know-It-All safety hazard, encourage people Business hierarchy used to be all about ain’t good to decorate their desks any way information control. The boss knew they like. It’s free to you, it’s fun, stuﬀ the shop ﬂoor folks didn’t and Just like Dr Evil in Austin Powers, if and it will improve the team’s would decide how much of this to pass your idea of innovation is ﬁnding creativity. on to his underlings. Meanwhile, the new and imaginative ways to kill Get it up on the wall: Idea shop ﬂoor folks knew what was really people and destroy the world, then banks – pictures, models, ﬂow going on where the rubber hit the you might struggle for quality sta . charts – should all go up on a road. The success of your structure wall wherever possible, and staﬀ used to be measured by how well the A STUDY BY THE LRN should be encouraged to spend information ﬂowed up and down. CONSULTANCY FOUND: some time checking them out Well, you can forget about all to stay in contact with other that. Information technology means it was ‘critical’ or ‘important’ projects. They will be inspired information is now ﬂowing all over that the company they work and feel able to contribute. the place. There are probably plenty for is ethical of people inside your organisation,Components of the not to mention the odd one outside, prefer to be paid less andinnovation culture who know as much as you do about work for a company with what you do. ethical business practices Today, the job of a leader is not to than receive higher pay but attempt to control information; that work at a company withHave the courage to be yourself, says horse has bolted. Your job is to lead questionable ethicsDrain. “When somebody reveals a conversation with your people thatsomething about themselves that identiﬁes what information is really Americans have left a jobis slightly surprising and deep, relevant and important, and how you for ethical reasonsyou start to trust them. A good should move on it.
BRIGHTFORECASTA smart AUT inventionis predicting the futureA s the architects of New Zealand’s future prosperity PHOTOGRAPHY: ALYSON YOUNG eye agricultural technology as a key export opportunity, an AUT University research group is well down the development track with a device thatperfectly fits the bill. Horticulturalists in nine countries are using a sensing systemthat tracks more than a dozen climatic and environmentalmeasurements, which is the product of the university’sGeoinformatics Research Centre. The device is a second-generation prototype whose origins auspices of AUT Enterprises. Photos, clockwise from left:go back to work begun by research leader Professor Philip Geosense will act as a broker between system users and threeSallis in 2007. equipment makers the company has partnered with. A robot equipped with a microclimate wireless sensor Professor Sallis, an expert in mathematical modeling and “The research effort will continue through the Geoinformatics node collecting data whilenumerical computing, had his interest in collection of microclimate Research Centre and the company will essentially broker navigating through canopiesvariables – and forecasts that could be made from arrangements between the commercial providers and the in the Kumeu vineyard.their analysis – piqued by Chilean researchers whom he met in his end-users,” Sallis says. Stationary agro-monitoringformer role of AUT deputy vice-chancellor. What that means for AUT in terms of clipping the ticket or a station and on-robot mobile Sallis was in the process of signing a research collaboration consulting fee is unknown. Sallis wants any income to come back microclimate station loggingagreement with a university in South America when he met up to Geosense and thereby back to the university. data in field testing.with people doing similar work to his in geocomputation. “This is about trying to maximise the return to the university Interested in the kind of variables that could be used to do for the investment made through the operations of the centre.” The Mark II prototype of solar-power enabledprediction work, he talked to them about vineyard applications. The system’s secret is the algorithm that analyses the matrix wireless sensor node “It seemed to me that if you could somehow correlate a lot of environmental data and makes sense of it. It’s so cutting edge for the microclimateof factors around climate, atmosphere, plant conditions, soil that Professor Sallis has had the work reviewed internationally monitoring system, designedconditions and so on, we could build up a matrix of data that could and accepted for presentation and publication. Where to next? and assembled in the Geoinformatics Researchbe useful for predicting various events in nature.” “My interest is in how can we get into the area of precision Centre’s Instrumentation He reasoned that such fine-grained information would be agronomy, what tools and techniques we have that could assist. Laboratory.a valuable supplement to the macro data supplied by weather “Just to get a little lofty for a minute, the reality is we’re facingforecasters. Indeed, that’s what users of the sensing system at a major challenge for the planet in terms of food for the world. A researcher configuring27 trial locations around the world are telling him. Dealing with wine and things sounds all very grand but the a robot’s auto navigation and communication “The people on the ground – in the vineyards and orchards bottom line is if we can use these methods for growing corn and setting of the wirelessthat are using it – are reporting that it is very useful, that the rice, we can bring something to the party.” sensor node for collectinginformation is so much more precise than they are getting from To that end, AUT has signed a memorandum of understanding environmental data.the weather forecast,” Sallis says. with India’s largest IT company, Tata Consultancy Services The information can help with frost protection, preparing for (TCS), under which TCS will use the AUT researchers’ applicationdry or wet periods and helping decide when to use pesticides. programming interface to the sensor data. The Mark II prototype of the Microclimate Monitoring System, The Mumbai-based head of TCS Innovation Labs, Dr Arunassembled in the Geoinformatics Research Lab, has 17 sensors Pande, says micro-region weather forecasting is “the need of thethat upload data in real time to servers at AUT. hour” for farmers, especially in India, where agriculture is heavily There it’s analysed and turned into meaningful information, dependent on the seasonal monsoons.and made available to the growers via the internet. “Professor Sallis’ approach of using technology for capturing The next step is commercialisation. With the cost of system the local weather data and building a micro-region weathermanufacture beyond the resources of Professor Sallis’ research forecasting model is a step in the right direction to improvegroup, spinoff company Geosense has been set up under the agricultural productivity.”
The Paper Clipc. 1871By, er, someoneThe paperclip is famously clever. Yet nobodyknows who created it. We won’t let this be you.If you’ve created a novel product, solved acomplex problem or generated a breakthroughidea, then this is your moment to shine.The New Zealand Innovators Awards.Celebrating genius. www.innovators.org.nz email@example.com
The Idealog casualty’s eye view of the experience. Innovation Guide If you are looking at kitchen utensils, you could shadow a top chef, or spend a day with someone with arthritis, toCHAPTER 3 really get a handle on what they need. The problem is actually the solutionGENERATING The purpose of gaining insight is to identify a problem, either out in the world or within your own business.INSIGHTS AND And according to Main, thingsIDEAS usually really get going when the problem aﬀects both. “Ideas that stick are usually driven by need and opportunity,” he says. “A lot of people have discussions around the notion of innovation and where they could beneﬁt from it. But if you’re not in real pain, that can be as far as it goes. Even if you feel you will be in pain soon, the urgency is not quite there for many businesses.” The pain usually comes in the form of dwindling sales, low morale and/or an inability to hold onto research, digital and branding agency top staﬀ. Once it strikes, there is What they DNA Grenville Main says you have a temptation to shut it oﬀ quickly want, what to work out what really matters to people. “There is nothing new, there is by rushing to a solution without exploring the territory. This is as they need only better, stronger or more vital. If you can improve your importance to risky as charging into battle without sending out scouts beforehand. a customer, you can sell more. Innovation is all about scouting, Ironically, the easiest person to “If you can improve the service exploring choices and opportunities. lose sight of during commercial experience you provide them, you’ll Getting too focused on a speciﬁc innovation processes is the most also keep them longer.” application early on is a sureﬁre way important person of all – the To ﬁnd out about people’s to limit what you come up with. New customer. needs and desires, get up close applications for something are found Bill Wilmot of SRI International is and personal. Stefan Preston, along the way, or bits of an idea can emeritus professor at the University entrepreneur and advisor to the be used for something other than of Montana, director of the Better by Design programme at New what was originally intended. Collaboration Institute, and author Zealand Trade and Enterprise, knows Bad ideas fail to solve a problem, or of Innovation – Five Disciplines for all about this. He is a former CEO of solve it by means that are too complex, Creating What Customers Want. Bendon lingerie, and you don’t get expensive or uncool for anybody to be He believes most people don’t do much more up close and personal bothered with. It is vital to understand a good job of identifying customer than that. that it doesn’t matter at all that you needs. “They tend to just ask “You can’t learn it intellectually,” have solved a problem if nobody customers what they want, but he explains. “The way you learn how actually wants your solution. There customers cannot always tell them. to ride a bike is to ride a bike.” may be easier or cheaper solutions to They think they do a focus group and You are not selling a product, you the problem already around that people that answers the question. You can’t are selling an experience. So your are satisﬁed with, even if they are not really see what people need unless ideas have to be all about experiences, necessarily better. Or it may be that you shadow them and follow them.” not gadgets, features and technical people simply don’t care enough about A lot of great ideas start with a stuﬀ. If you want to improve, say, the problem you chose to address. simple insight, and those insights someone’s experience of arriving at an It seems obvious that if nobody are nearly always ﬁrst and foremost accident and emergency unit, maybe needs or wants your idea, even it’s about people. you need to put a camera on a trolley the most ingenious thing in the Owner and managing director of in the emergency department to get a world, it won’t sell. But you would be
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Innovation Guidesurprised how many businesses are Approach. Deﬁne the ‘goldenwasting huge amounts of money and nugget’ or the unique advantagetime clinging to a clever new piece of of your approachtechnology that nobody wants. Maybe Beneﬁts. Outline the beneﬁts tothey’ll get lucky and a market will the customer, your partners inemerge before they submerge, but it’s the market ecosystemmuch more likely that they won’t. Competition. Pinpoint the Great ideas – the ones you stake competition and systematicallyyour future on – solve a problem in compare your approach withsuch a neat way that it changes the competitive products or serviceswhole experience. Or it solves aneven bigger problem that may be A Watering Hole session runs like this:diﬀerent to the one you started outwith. Preferably it will also solve other The person putting forward theproblems we never even knew we had. idea does a one-minute pitch. Sometimes the problem can be theentire sector you are in; what next for They get 20 minutes of feedbackthe DVD rental business in the era of from the group during whichthe download? Or they can change the they are not allowed to speak. Overlyworld; what is the future of the car if negative people are given green hats,oil becomes scarce? and told they can only say something It is no coincidence that some of positive; the relentlessly positive getthe biggest companies in the world red hats and can only be negative.sell food, fuel and medicine. One way Some people are given big plasticto make big money is to generate spectacles called the Eyes of theideas for things people really feel Customer, so they must givethey need. Another is to create non-technical feedback fromproducts or services that people a customer point of view.want very badly indeed. Using the feedback, the idea’sHow to get ideas going advocate is coached to produceObviously, you are not going to get far if a new, improved, four-minute pitch.everyone is sitting in silence scratchingtheir chins and going “erm …” Repeat the process until THE DYSON Idea generation is seldom a something really good comes out AIRBLADEcompletely linear process. You can’t of it, or you put a duﬀ idea out of its INSIGHT Most hand dryersjust work through a to-do list and misery and save everybody a lot of don’t actually dry hands,have an innovative idea pop out at the time, money and eﬀort. making them almostend. Ideas turn, like clay on a potter’s completely pointless.wheel, responding to the controlledpressures placed on them. This was designed by Nilofer SOLUTION The Dyson There are as many ways to get Merchant, author of The New How – AirBlade forces unheatedthings turning as there are unread Creating Business Solutions through air through an aperturebusiness innovation books in your Collaborative Strategy, as a way to the width of an eyelash ataverage corporation, but here are combat the tendency for brainstormssome of the most eﬀective out there. to create more ideas than any one high-velocity blade of airThe best approach is to use lots of organisation can pursue. that wipes hands dry indiﬀerent approaches to get the best It essentially works through four just 10 seconds.out of your team. stages: CHANGED EXPERIENCE Decide what matters. This You walk out of BritomartThis process was developed by Bill involves setting out the criteria station toilets, start toWilmot. The key is to work through by which decisions will be evaluated, wipe your hands on yourthe following mnemonic: NABC. and what problems or issues you jeans and realise youThis means: intend to deal with. These criteria don’t need to. Genius. Need. Identify your product or are then displayed so that they can be service’s marketplace need referred to in discussions.
Sort. This looks at all the available options and sorts them, THE BLUNTbased on the ‘decide what matters’ UMBRELLAcriteria you have chosen. Ideas thatare weak when compared with the INSIGHTcriteria are dropped. There is also Most umbrellasan option to add to the criteria if ﬂap madly, turnnecessary. inside and/or break at the merest Testing. To what extent are any hint of wind. Wind of the remaining ideas viable and rain oftenfor the organisation? Getting the go together.answer may mean looking beyond the SOLUTIONparticipants in the original process. The Blunt Umbrella uses a patented Choose. Ruthlessly and tensioning system dispassionately decide which and is tested toideas warrant further work. function at wind speeds of up to 100km/h.The more complex an idea becomes, EXPERIENCEthe harder it is to tell if it will work, Next time it getsand the greater the chances that it Identify the ‘ifs’ in your idea and strong proposition. It gets at least wet and windy,won’t. So there is enormous value in eliminate as many as possible. one ‘if’ weaker if your sunscreen only you can actuallysimplifying your thoughts to see if The fewer the number of ‘ifs’ in an works for children under eight. stay dry. You ﬁndthe core is sound. idea, the greater the market for it yourself taking This can be done in a number is likely to be. For example, ‘If you Attempt to explain your ideas your umbrellaof ways: don’t want skin cancer, and if you using concepts a three-year- out in stormy don’t want to wear clothes that cover old would understand. Preferably, conditions even Try to sum up the idea in the your whole body whenever you are actually try to explain it to a three- when you don’t fewest words possible. Then see outside, and if you have about $15, year-old. You will be amazed at how need to.if it is still new and makes sense. you should get sunscreen’ is a fairly little bullshit survives this process. You can’t be mad to work here, because it would screw everything up As companies get bigger the sheer weight of the bureaucracy unless they are highly creative types too. needed to keep the behemoth going tends to create rigid This requires a high level of trust on the part of the boss, and structures that squeeze out people’s creativity. a high-quality team to get results. You can’t paper over the cracks AUT’s Kevin Pryor, explains: “By deﬁnition you are asking with a really tight brief and more milestones than a marathon, as them to behave counter-culturally.” that defeats the very freedom you are looking to engender. This means if you are in a big corporate you need to think The other option is to get out your chequebook and buy your outside of your cubicle to get the ideas ﬂowing, probably with creativity from outside, which creates opportunities for smaller some kind of spin-o project team or department. innovators to get paid. Ideally, you want to get this outside the building and away For example, Google may be seen as a powerhouse of from the normal hierarchy. innovation, but according to Wikipedia, it has acquired no less Creativity often means acting weird and ignoring the rules, than 93 smaller businesses since 2001 and incorporated their so you probably don’t want to do it right under the boss’ nose, innovations into its own service o erings.
Innovation Guide people, their time is worth a lot more money than yours and they are not The Idealog going to waste it listening to your Innovation Guide elaborate vision for a brighter future. All they want or need to know is what the new idea is, exactly how CHAPTER 4 much money you need to make it work, a pretty accurate estimate how much money it will make and whenEARLY STAGE they can take their share of it and run. “One of the big questions investors have is who is the team that is running the business?” says StephenINVESTMENT Drain, director of the AUT Centre for Innovative Leadership. “Who are they, do they have the goods? If not, who are you going to get in on the board of advisors, who can take on a leadership role?” Your one-line answers to these questions are what they are going to be saying to themselves over and over as they try to decide whether to trust you with their money. Then once they do sign, theyWhen I was young But the rest of the time you will be lucky if you can think about or their people will follow up on the detail and all the paperwork inI thought money was anything else. painstaking detail, often includingthe most important The ﬁrst customers for your idea are going to be the people holding patents and insurances you don’t think you need.thing in life; now I am the money that can make it happen But you want to have this niceold I know that it is for everybody else, whether they are external investors or your bosses. comfortable bed of paper ready to nestle their money into. It is vital– Oscar Wilde You may be a salaried part of a big to get professional help in looking organisation. But unless you are in at budgets and contracts to avoidGet cape. Wear cape. Fly one of the ﬂabbiest big corporates in nightmares later on.In his book Rules of Thumb, Alan M New Zealand (in which case you are But remember, initially you areWebber, founder of Fast Company going to have other problems trying selling a dream by convincing peoplemagazine, puts it this way: “Nothing to be innovative) the same principles it can be a reality.is real until somebody hands you a for getting money into your ideacheque. Until then you could have a apply as they would for a ﬁrst-time No such thing asgreat idea or a mediocre one, an idea entrepreneurial startup. a free launchthat will reshape an entire industry DNA’s Grenville Main puts it like In case you hadn’t noticed, Newor disappear without a trace. this: “Access to capital comes down to Zealand does not have as much “You’ll never know until money how smart you and your idea are, and money in it as, say, the US. Forchanges hands. Then you get to how well connected you are.” example, as well as sheer scale andﬁnd out.” To get this right, there are two population density, US innovation Stating the bleeding obvious? important things to remember: beneﬁts from a vast militaryIt’s amazing how often it can be the people with the money need industrial research and developmentoverlooked. If you are lucky enough to believe in your idea, but not complex. The Defence Advancedto come up with innovative ideas necessarily the way you do. Research Projects Agency alone hasthere will be moments when money is Keep It Simple Stupid, at least to a staﬀ of about 250 and a budget ofthe last thing on your mind. You can begin with. If you haven’t nutshelled US$3.2 billion to spend on emergingget caught up in the buzz of the new your idea (and you should have), now technologies with a militaryand the thrill of providing something is the time to do it. You may not have application. Of course, companiespeople love. This can be a particular the classic ‘elevator pitch’ moment, beneﬁtting from DARPA largesse arerisk if you are a salaried part of a big but if you are lucky enough to land free to commercialise the productsorganisation. a proper meeting with the right produced in other ways, too.
Innovation Guide Similarly, there is money washingThe Idealog around all over the world for the right idea. Unfortunately, it is really Mo money, mo problems hard enticing that money over here Believe it or not, it is also possible to have too much to New Zealand where we can play money – just look at Charlie Sheen. with it. “People talk about capital not If you strike on something that really gets people travelling,” says AUT’s Kevin Pryor. excited, everybody is going to want a piece. That’s “It can travel, but it usually doesn’t travel very far or in great quantities.” number of things can go very badly wrong – even worse Pryor says he recently attended than taking porn stars home to meet the wife. a conference in America where the This is another particular risk of attempting to speakers were talking about the innovate in large organisations with decent-sized diﬃculties in getting investment research and development budgets. funding out of the Silicon Valley for technologies developed on the east Stay hungry coast, let alone out of the country. Too much cash too soon can take the edge o your And even the investment money original idea. If you already feel like you have the gold, that is here can be a bit risk-averse human nature says you won’t do the extra yards to get says Mike Aitken, incubation things spot on. Pick your least favourite movie sequel manager at AUT’s Business as an example of this one. Innovation Centre. “Entrepreneurs need to be kept hungry,” says AUT’s “It’s a bit of a catch-22 – investors Kevin Pryor. “Sometimes quite literally!” are required to help fund startup development and generate early Uncomfortably numb revenue, but investors want to see Not getting any cash is the surest sign there is clients and customers on board something wrong with your idea. Running out of cash before they invest.” is the surest sign there is something wrong with the The money also often comes with business model you have attached to it. Wallowing in signiﬁcant strings attached. investment dough can be like putting masking tape over “You almost never get all the the warning lights on your dashboard – it won’t stop you money you need,” says Wayne from crashing or blowing up if you are careless. Hudson, partner at specialist intellectual property lawyers Hudson Too many cooks Gavin Martin. “It’s more often that The more stakeholders you end up with, the more they will give you half, so you have to people you have to answer to. You can end up spending go to them for some more. And then so much time talking to them and lose sight of all the they’ll put all sorts of extra clauses other work you need to do. in their agreements so you end up with an underfunded project where, You want buy-in, not a sellout at best, its success has to be deferred Nobody hands over investment cash for nothing. Each while you ﬁnd extra funding.” time you land a new investment you should expect to lose a slice of ownership and control of your company. And the rest If you get carried away you can end up selling the goose You want people to invest more than that lays the golden eggs. money. In getting the right people on It is also not unheard of for people to get booted your board, you are also looking for: out of the business they founded. Steve Jobs was out of a job for a while there, and Je rey Hollender founded innovative cleaning product company Seventh Can you piggyback on other ﬁrms 2009. “Being ﬁred from the company you founded is get and keep this sort of money hard for any entrepreneur/founder to deal with,” says without knowing a thing or two Hollender. “If I had a piece of advice for entrepreneurs, I’d say, ‘Don’t give up control. And if you do, do it in a thoughtful, methodical fashion.’”
Innovation Guide beyond the very early stages. It is all The Idealog too easy to overlook things and all Innovation Guide too hard to overcome your vested interest in your own ideas in order to make a proper assessment of how CHAPTER 5 innovative they may or may not be. Your IP person will do a ‘landscape search’, covering any existing patents and trade marks, scour trade journalsINTELLECTUAL and scientiﬁc literature, root through Google and more. What they arePROPERTY looking for is prior art: any material in the public domain that shows someone else has published this idea, or anything like it, before.PROTECTION They will also think laterally. What if somebody used similar technology or thinking in a completely diﬀerent industry, to solve a completely diﬀerent problem? This process helps you establish whether you are trying to eat someone else’s lunch, and how much eﬀort they will put into defending it. It can also be an invaluable way of discovering applications for your idea that you may not have thought of otherwise. Forgive us ourI am the law ton of cash developing a bad idea or spending the worst years of your trespasses life ﬁghting with someone else’s IP Let’s assume you ﬁnd some evidence lawyers. that, shock horror, somebody,What has been will Here’s the ﬁrst thing someone should do if they think they have a somewhere, sometime, miraculously thought of something similar tobe again, what has good idea, says HGM partner Wayne ‘your’ idea. And, taking into accountbeen done will be Hudson. “Check that it is really new. People are spending way too much that patents are country-speciﬁc, you believe their patent may be active anddone again; there is money on the protection without valid in a country where you want tonothing new under spending on researching whether they actually have something to protect.” do business. There is encouraging news fromthe sun What this comes down to most of fellow HGM partner Jason Rudkin-– Ecclesiastes 1:9-14 NIV the time is checking to see how old Binks. “Just because something isn’t your ‘new’ idea is and if anybody else novel doesn’t mean you can’t makeIt’s an odd quotation to open any is really using it in any country you money out of it,” he says.chapter on business innovation. want to trade in. A popular next step among highBut one of the best approaches to rollers with plenty of lawyer-lollyintellectual property protection is to Making sure the coast knocking around is to use these samebelieve this statement with religious is clear research techniques to challengeintensity, because the best way to If you are serious about being a the blocking patent in the courts,waste a lot of time and money on an business operating on the bleeding essentially by trying to prove thatidea is to believe you have something edge, you need a quality professional somebody else got there before thenew when you don’t. And you specialist in IP protection. They patent holder.probably don’t. will set the attack dogs on your HGM partner Simon Martin puts That’s the sort of wake-up and thinking, speciﬁcally by attempting it this way: “The only way to protectshape-up call you get from running to establish whether the ideas you intellectual property is to enforce youryour ideas past specialist intellectual come up with have already been rights. The ability to do that comesproperty lawyers like Hudson Gavin commercially exploited. down to how well you are funded.”Martin. It can save you wasting a You should not do this yourself Rudkin-Binks agrees. “The real
Innovation GuideThe Idealog “People are spending way too deal with them later. This is also a popular tactic employed by some big much money on the protection players, especially those who see no particular reason to play nice. without spending on researching “There are lots of ways to protect IP,” says AUT’s Kevin Pryor says. “But whether they actually have sometimes you just don’t bother. You something to protect” just go to market. One of the reasons we spend so much time on it is because investors want to see it.” Wayne Hudson If someone is trading on an idea similar to yours and doesn’t appear to be making money from it, it may simply be a bad idea. It is also worth remembering that big companies big movers have massive spend an oﬀer – just like when someone can aﬀord to spend millions on some on IP protection. They will use owns but isn’t using a internet pretty wacky concepts in order to a sledgehammer to crack a nut.” domain name you want. develop new technologies and test Of course, if your entire Even if somebody is trading on an potential new markets. proposition is based on a speciﬁc idea and making money, you could If you get past all these hurdles technical ﬁx, then you need to protect try to buy a licence from them for it. and still reckon its worth a trip to the this in order to sell it. This is why, for This may cover a particular process patent oﬃce, timing your visit may example, Apple has teams of lawyers you want to use, or a particular be very important. Ironically, the ready to slap a perfectly crafted writ market. If they agree it’s possible for public disclosure to secure a patent on anybody infringing its rights to everybody to win, you get to go to might be what gives the game away if the particular ﬁnger-scrolling system work and they get money for their you ﬁle it before you are ready to take is has on its computers. idea without having to. This is the advantage of your chosen market. But if you don’t have something way a lot of very big companies do “The important thing is the result, unique it can often be cheaper and a lot of very big business. not the process that gets you there,” easier to be businesslike, to put your Alternatively, if you think there says Hudson. “So there is a risk that pride back in its box where it belongs, is money to be made, you can people will see your patent and use it and try to do a deal. If the other party ignore the opposition and hope you to ﬁnd a diﬀerent way to get the same isn’t actually trading with the idea generate enough money and market result. For example, I had a client who this may be as simple as making them presence to ﬁght it out or do a better had created a unique product. The The life cycle of an idea When not peddling IP advice, Wayne Hudson of IP those dates.” law ﬁrm Hudson Gavin Martin is often pedalling his Game over, then? bicycle. So I am not surprised when he illustrates the “Because of all those expired patents, you can pretty IP-checking process with a couple of examples from much discount any patents granted in the past 20 years, the world of two wheels: because they should never have been granted in the ﬁrst place.” “I had an idea about putting an indicator light on my Ah ha! So you are on! Being an IP lawyer you can exploit gloves for when I was cycling.” this forgotten ground! It sounds great to me. It’s one of those ‘why hasn’t “But you have to ask yourself, why don’t we then see anybody thought of it before?’ ideas. “I checked and found an existing patent for that good idea. The lights from a car will obscure your light. Oh. Somebody had thought of it before. “Then another one going back to 1915.” Apart from the obvious one of not making any money, A long time before. another deﬁnite sign of a bad idea is that nobody is “With about 30 other similar patents between trying to copy it.
Innovation Guide REINVENTING Deﬁning intellectual THE WHEEL property It’s worth remembering that some ideas may already be out there, patents – these are deﬁned by but only become law and your ability to enforce commercially viable them when the technology or economics are right. other people don’t For example, you make sure other people Sinclair launched don’t take your know-how the Sinclair C5 electric tricycle to in you, who have resources popular ridicule and that can help your business. commercial disaster. Whatever you have in your In 1992, he hit product line that is unique. back with the folding Early on in the creation of electric Zike Bike, an idea, this may be all you which sold even less than the C5, and is plug into the manufacturing soon to launch the and distribution system you X-1. Now here in New create to get your idea into Zealand we have the the market. And as Bill Gates Yike Bike, a three- pointed out, “Intellectual wheel electric folding property has the shelf life of tricycle and, well … a banana,” so you had better we’ll have to wait move fast. and see. In the meantime Honda, representing the big boys, has also just created its U3-Xprocess by which it was made was not Personal Mobilityevident just by looking at the product Prototype that isitself, but in lodging a patent it had essentially a movingto be disclosed, so other businesses electric barstool thatcould take a look at the patent, you stow in your carsee how it was done, and change it door.suﬃciently and get round the patent.” In a future where Pryor is a touch more scathing. everyone in the“Some entrepreneurs don’t industrialised worldunderstand the nature of competition. can’t a ord petrol andYour competitor is the person who is is too obese or lazy tochasing the same dollar. It is not about walk anywhere, thingshow similar your product is. A horse like this may sell likeand a car are very diﬀerent but if the the hot cakes thatcustomer is using them for the same helped incapacitatething, they are in competition. us in the ﬁrst place. “There’s no point saying, ‘But minehas four wheels and theirs has fourlegs.’ The customer doesn’t care.” In the intellectual propertybattle of wits, you need to have yourstrategy ready, and the team toimplement it, because you can bet Top: Honda’s U3-X Personal Mobility Prototypethe opposition will. Bottom: New Zealand’s Yike Bike