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Idea management systems for innovation

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An extract from one of my lectures on idea management systems. The content of these slides is based both on current research and insights from companies I collaborated with.

Published in: Business

Idea management systems for innovation

  1. 1. IDEA MANAGEMENT SYSTEMS FOR INNOVATION Michela Beretta Postdoctoral researcher in Innovation Management at Aarhus University
  2. 2. INTRODUCTION ● Innovation can be defined as “the generation and implementation of new ideas” (Van de Ven, 1986) ● Ideas as the starting point of any innovative effort (Bjork and Magnusson, 2010) ● Organizations need to generate a sustainable flow of ideas to feed the innovation process
  3. 3. WHERE DO GOOD IDEAS COME FROM? ● Open innovation: access to sources of innovation outside the traditional R&D lab › Customers, suppliers, universities.. ● Knowledge is unequally and widely distributed among individuals and firms (Hayek 1945; Von Hippel 2005) ● The diffusion of IT and Internet has led to the emergence of various online platforms and tools to access knowledge and ideas of widely distributed individuals
  4. 4. SOME EXAMPLES
  5. 5. MAIN CHARACTERISTICS ● These online platforms enable access to the collective intelligence of distributed individuals: › Share ideas with everyone › Provide solutions to innovation challenges › Collaborate with other people (create communities) › Vote ideas ● Among these platforms, idea management systems have gained increasing importance ● Idea management systems as online platforms utilized by companies internally to collect and mature ideas coming from distributed employees › Exploit the creativity of all employees
  6. 6. WHY ARE THEY IMPORTANT? ● Employees as a crucial source of innovation: most innovations still come from employees ● Organizations as knowledge-distributed systems (Tsoukas, 1996): a lot of diversity in terms of knowledge and competences can be accessed internally ● Medium-large organizations: widely distributed employees working in different geographic locations, functions and at different hierarchical levels. ● Idea management systems respond to the need to fully access this broad diversity, which is still not fully exploited in many organizations
  7. 7. IDEA MANAGEMENT SYSTEMS (IMS) ● An idea management system can be defined as “a formalized system that captures, examines, nurtures and develops ideas proposed within the organization” (Nilson, 2002). ● They work as catalysts for the innovative spirit of employees within organizations, inviting virtually all employees to be involved (Fairbank et al. 2003). ● Enable to support and provide structure to the early phases of the innovation process (the fuzzy front-end)
  8. 8. ● How idea management systems can support the early stages of the innovation process (Nilsson, 2002)
  9. 9. HISTORY OF IMS Source: (Gorski 2004, Bjork and Sandstrom 2010)
  10. 10. BENEFITS OF IMS ● Empowerment → opportunities for employees to contribute in new ways to their organization ● All ideas are collected in one place (centralized) ● Enables to store ideas until they are ready for further development ● Enables collaboration and communication among widely distributed employees to mature ideas → build a culture of collaboration and knowledge sharing
  11. 11. ..BUT MOST IMS TEND TO FAIL WHY MANAGEMENT SUPPORT CULTURE ENGAGE EMPLOYEES MANAGEMENT/ IMPLEMENTATION OF IDEAS SCOPE
  12. 12. HOW TO DEFINE THE IDEATION STRATEGY?
  13. 13. IDEATION WITHOUT FOCUS Advantages ● Provide freedom and autonomy to employees ● Lead to higher quantity Key problems ● Quality → may lead to many irrelevant or not implementable ideas ● Managers often do not consider consequences on the evaluation process (more costly and time-consuming)
  14. 14. STRATEGIC DIRECTION AND FOCUS → It seems to have a positive effect on the implementation of ideas › Lower quantity but, overall, higher quality of ideas → more valuable and strategically relevant ideas Alignment with current strategy and needs Thematic fields of search (topics, themes, organizational areas..) Challenges Competitions
  15. 15. IDEATION SCOPE ● A more open strategy → larger crowd and higher diversity of inputs › …But complexity increases → needs to be coupled with a formalized process for handling ideas ● In some circumstances a closer approach may be better › When firms know the knowledge domain in which to look for the solution and the right people in that field (i.e. best experts) (Pisano and Verganti, 2008)
  16. 16. PROVIDING SUPPORTING TOOLS ● Typical communication approach ”Submit an idea to our ideation system” ● Supporting tools are needed to educate employees › What is an idea › Degree of elaboration › How to frame an idea › Next stages (idea evolution) ● Roles such as mentors/coaches?
  17. 17. EMPLOYEE ENGAGEMENT
  18. 18. ● How to motivate employees to participate to idea management systems? How to sustain their participation over time?
  19. 19. WHAT WE KNOW SO FAR.. ● Monetary rewards are not sufficient alone ● Social and personal factors as more important (Birkinshaw et al. 2011, Boeddrich 2010) › i.e. appreciation by peers and superiors, learning, collaboration, helping.. ● Importance of providing recognition to employees ● Allow time for ideation ● Provide feedback to employee for their contributions
  20. 20. FEEDBACK ● Feedback should be provided in a constructive, informational way, and in a timely manner › Explain how to improve an idea › Explain why it is accepted or rejected › Negative feedback can have negative consequences on employees’ motivation ● Increases the likelihood that employees will participate in ideation again
  21. 21. RECENT TRENDS: GAMIFICATION ● Make participation fun and attractive for employees ● Gamification consists on applying game elements and game design techniques to nongame activities to change people’s behavior (Deterding et al. 2011) ● Most common game mechanic → Points-based system and badges
  22. 22. Source: Deterding et al. 2011
  23. 23. HANDLING IDEAS
  24. 24. EVALUATION AND SELECTION ● Selection and evaluation of ideas represent a critical challenge for organizations: how do you handle the large amount of ideas submitted into an idea management system?
  25. 25. EVALUATION MECHANISMS Possible evaluation mechanisms: ● Expert assessment: experts selected for their expertise and competences in specific areas ● Peer-assessment: evaluation by individuals who do not participate but have similar knowledge as the participants. ● Voting system: community Single or multiple stages of evaluation?
  26. 26. INVOLVING THE CROWD ● It can be used as an initial stage to filter ideas and make the screening process less time-consuming ● Use of the voting system to understand which ideas are considered more relevant/are more popular in the community ● Empower employees by allocating decision-making authority › A way to further engage them
  27. 27. PROBLEMS ● Problematic if the crowd does not possess the right expertise ● Voting might not reflect the real quality/business value of an idea ● May reflect the efforts of employees in marketing their ideas rather than quality ● Impact on people who did not get a lot of votes? → Rating rather than voting? → Design the voting system to force choices between ideas?
  28. 28. Thank you! ☺

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