My talk at IBM's ShareNet session on Project Management vs. Innovation. I explored how classical project management is ill-suited for managing innovative projects, especially Kaikaku or the Disruptive Innovation, and discussed how Lean Startup offers one such approach.
Project Management vs Innovation: Friends or Foes?
Project Management Vs. Innovation: Friends or Foes? Tathagat Varma, Sr. Director Business Operations Yahoo! India R&D
Discussion Topics! What is The Problem?! What is Project Management?! What is Innovation?! Can Innovation be Managed?! What are we Learning?
What is The Problem?! “Somewhere out there is a bullet with your companys name on it. Somewhere out there is a competitor, unborn and unknown, that will render your strategy obsolete. You cant dodge the bullet – youre going to have to shoot ﬁrst. Youre going to have to out-innovate the innovators .” - Gary Hamel
What does that mean?! We live in VUCA times – ! Volatility, Uncertainty, Complexity, Ambiguity! Mere “delivery against plan” is not enough. Businesses need to constantly INNOVATE!! But…can our processes deliver innovation???
Today’s Business Drivers Speed Innovation UX• “Move fast and • “Great just • “Focus on the break things” isn’t good user and all• “Done is better enough” else will follow” than perfect” • “Creativity • “Every Detail• Minimize total from every Matters” time through corner” “Build-Measure- • Pivot (or Learn” Loop Persevere)
Why is Innovation important?! “Our species exists thanks to four billion years of genetic innovation. Since time immemorial, life has been experimenting with new genetic combinations, through sexual recombination and random mutation. As human beings, we are the genetic elite, the sentient, contemplating, and innovating sum of countless genetic accidents and transcription errors. Thank God for screw-ups. If life had adhered to Six Sigma rules, we’d still be slime.” – Gary Hamel, What Matters Now, 2012
Do Processes really stiﬂe Creativity?! Process tells people what to do—the actions, the order, and the expected results.! If the results are not as anticipated, the process is analyzed and altered to bring its results back to acceptable values.! People are not rewarded for being creative with the process; in fact, the reaction is quite the opposite.! Process not only stiﬂes creativity, but also innovation, passion, imagination and creativity—as it should; otherwise, it would fail to serve a purpose.http://ecaminc.com/index.php/blog/59-generalblog/191-2010-03-22
Do Processes really stiﬂe Creativity?! Managing people and projects is the act of imposing process to gain predictability. Process gives us the tool to foretell an actions outcome. Without it, planning would fail. It gives us conﬁdence that we will achieve a given output. In addition, process comforts us. With it, we can manage, telling people to follow process and we have few concerns. If something goes wrong, either the person did not follow process or the process is wrong. Process tells people what to do—the actions, the order, and the expected results.! If you want open conversation, innovative thinking, and wild ideas, you drop the level of process and allow people to wander. People try new approaches, think outside the norm, and premier products and exemplary processes come into being.http://ecaminc.com/index.php/blog/59-generalblog/191-2010-03-22
Does Project Management help Innovate?http://www.projectmanagement.ie/images/assets/pdf/innovation.pdf
What is a Project?! A project is temporary in that it has a deﬁned beginning and end in time, and therefore deﬁned scope and resources.! A project is unique in that it is not a routine operation, but a speciﬁc set of operations designed to accomplish a singular goal. So a project team often includes people who don’t usually work together – sometimes from different organizations and across multiple geographies.! And all must be expertly managed to deliver the on-time, on-budget results, learning and integration that organizations needhttp://www.pmi.org/About-Us/About-Us-What-is-Project-Management.aspx
So, what is Project Management?! A framework that articulates way of working! to organize people and resources! towards one-time accomplishment of a pre-deﬁned task! within the speciﬁed constraints of scope, cost and time! by proactively managing risks and adapting to changes! and exercising control commensurate to project goals! and managing stakeholder expectations throughout the project
What is Operations?! Operations are an organizational function performing the ongoing execution of activities that produce the same product or provide a repetitive service.! Operations are permanent endeavors that produce repetitive outputs, with resources assigned to do basically the same set of tasks according to standards institutionalized in a product lifecycle.
Project-Operations Continuum High Disruptive Rewards Operations Innovation Sustaining Projects Innovation Low Rewards Low Risk High Risk
Kaikaku and Kaizen relationshiphttp://www.centrodecompetitividad.com/img/kaizen.jpg
Kaikaku 10 Commandments by Hiroyuki Hirano, Creator of 5S, Author “5Pillars of the Visual Workplace”! Throw out the traditional concept of manufacturing methods! Think of how the new method will work, not how it wont work! Dont accept excuses; totally deny the status quo! Dont seek perfection; a 50% implementation rate is ﬁne as long as its done on the spot! Correct mistakes the moment they are found! Dont spend money on Kaikaku! Problems give you a chance to use your brains! Ask "Why" ﬁve times! Ten persons ideas are better than one persons knowledge! Kaikaku knows no limits
So, what is Innovation?! Innovation is the development of new customer value through solutions that meet new needs, unarticulated needs, or old customer and market needs in new ways.! Innovation differs from invention in that innovation refers to the use of a better and, as a result, novel idea or method, whereas invention refers more directly to the creation of the idea or method itself.! Innovation differs from improvement in that innovation refers to the notion of doing something different rather than doing the same thing betterhttp://en.wikipedia.org/wiki/Innovation
How are Innovation Projects different?! Innovation projects tend to start with loosely deﬁned, sometimes even ambiguous objectives that become clearer as the project proceeds. The processes used are more experimental and exploratory and seldom follow strict linear guidelines.! Teams need to be more diverse and have a higher level of trust as they explore new territory where failure is a possibility.! With failure as a built-in possibility, innovation teams are more actively involved with risk management and need to learn to fail fast and fail smart in order to move on to more attractive options.! Also, innovation projects generally need to be sold to project sponsors and funding committees, a responsibility usually not required from normal project teams.http://www.innovationtools.com/weblog/innovationblog-detail.asp?articleid=303
Stage Gate Product Innovation Process ! A Stage-Gate Process is a conceptual and operational roadmap for moving a new- product project from idea to launch. ! Stage-Gate divides the effort into distinct stages separated by management decision gates. Cross-functional teams must successfully complete a prescribed set of related cross-functional tasks in each stage prior to obtaining management approval to proceed to the next stage of product development.http://www.stage-gate.com/knowledge_pipwhat.php
So, can Innovation be ‘managed’?! “Innovation is a bottoms-up, decentralized, and unpredictable thing, but that doesn’t mean it can’t managed. It can, but to do so requires a new management discipline…”! Let’s examine one such approach…
The Lean Startup – Eric Ries ! The Lean Startup method teaches you how to drive a startup-how to steer, when to turn, and when to persevere-and grow a business with maximum acceleration.
Lean Startup Principles! Entrepreneurs are everywhere! Entrepreneurship is management! Validated Learning! Innovation Accounting! Build-Measure-Learn
Concept of ‘Pivot’! Are we making sufﬁcient progress to believe that our original hypothesis is correct, or do we need to make a major change? That change is called a pivot: a structured course correction designed to test a new fundamental hypothesis about the product, strategy, and engine of growth.! Pivot or Persevere
What are we learning?! Old methods are ineffective in VUCA times! We need strengths of kaizen at kaikaku scale!! Lean Startup offers one good way to manage innovation by bringing in principles of PDCA, Lean, and Agile to New Product Development
References! The Ten Commandments of Kaikaku, http://www.superfactory.com/articles/featured/2004/0412-bodek-ten-commandments.html! Project Management and Innovation, http://wiki.nasa.gov/cm/blog/waynehalesblog/posts/post_1236033108908.html! Project Management vs. Managing Innovation Project, http://www.innovationtools.com/weblog/innovationblog-detail.asp?articleid=303! Innovation and Project Management, http://www.projectmanagement.ie/images/assets/pdf/innovation.pdf! Apple Product Cycles, http://www.splatf.com/2011/10/apple-product-cycles/