In this four part series, I mentioned that every CEO and business executives who intends to lead innovation as a strategic agenda will need to address four critical barriers to innovation. 

First barrier is the mindset to harvest ideas and manage those ideas as Venture Capitalists does not exist, second barrier is the inability to recognize how to align the abundance of resources available to large organizations for investment in innovation, the third barrier is to recognize the sheer size of the human capital assets that are under-utilized and disengaged from an organization’s creative capacity. The opportunity for most organizations is to dedicate talented “New Game Teams”, focused on harvesting the creative ideas and leadership competencies, to build new top-line growth capacity. 

The fourth and final barrier relates to the broad product and delivery capabilities that large-scale organizations possess. 

For example, since the mid-1980’s in the financial services industry, the typical company has gone from handful of delivery channels (Branches, Relationship Managers) to literally 15-20 channels (Branches, Direct Mail, Internet, National Sales Force, Business ATMs, Corporate Cards, Affinity Marketing, Wireless, etc.); all the while expanding its product offerings by ten-fold.  “Anytime, Anywhere” banking has become the price of entry across the industry as providers strive to meet the need of large and diverse customer bases. 

This has created a huge challenge, since those dedicated assets to serve the wide variety of customers are not fully leveraged for new innovation. The complexity of providing the right product to the right customer through the right delivery channel in real-time – in a way that doesn’t destroy the economics of the company – becomes a monumental challenge with each new innovation.  Add to this, the overwhelming issue of tying the employment brand to the product brand in the marketplace and the various components of talent acquisition. 

The bottom line: the accomplishment of end-to-end alignment between products, channels, and talent acquisition (employment offers) is the single largest challenge facing large companies today. The best organizations that can create smaller more nimble organizations while retaining to leverage strength of larger institution will be in the best position to out-compete in the future, enter emerging markets quickly, and adjust to external fast-pace factors. 

For complete details, please download full 23 page whitepaper on “Mastering Innovation –  Roadmap to Sustainable Value Creation by Mr. Jatin DeSai”

In my last post, I mentioned that every CEO and business executives who intends to lead innovation as a strategic agenda will need to address four critical barriers to innovation.

First barrier is the mindset to harvest ideas and manage those ideas as Venture Capitalists does not exist. This requires demonstrated confidence to consciously fail, experiment often, and win occasionally. Goal is to do more of it, so you can out-compete the markets. 

Second barrier I mentioned in the previous post was the inability to recognize how to align the abundance of resources available to large organizations for investment in innovation. Smaller and less nimble competition cannot, physically, out-compete you if you can leverage the resources you have.  This is the primary reason for new entrants who win big against existing mature businesses; example: Facebook, Google, Amazon, Skype, etc. 

The third barrier is to recognize the sheer size of the human capital assets that are under-utilized and disengaged from an organization’s creative capacity.  The opportunity for most organizations is to dedicate talented “New Game Teams”, focused on harvesting the creative ideas and leadership competencies, to build new top-line growth capacity.  Proctor and Gamble’s global research and development organization back in 2008, employed over 7,500 scientists; GE used to train 10,000 managers every year and performed over 5,000 detail performance reviews of its senior-most employees; and Cisco increased its engineering workforce by 300% since 2000 to 2008. 

The bottom line: developing a holistic and integrated human capital strategy for innovation is critical so it promotes “value creators” and rewards them to continue to create value while staying in workable compensation systems. Remember, innovation comes from ideas, ideas come from engaged employees, partners, and suppliers. 

For complete details, please download full 23 page whitepaper on “Mastering Innovation –  Roadmap to Sustainable Value Creation by Mr. Jatin DeSai”

In my last post, I mentioned that every CEO and business executives who intends to lead innovation as a strategic agenda will need to address four critical barriers to innovation. 

The second barrier is not recognizing and then not aligning the abundance of resources available to large organizations for investment in innovation. Even when overwhelming evidence shows that the companies who invest in innovation consistently outperform their peer groups, why haven’t most organizations taken innovation seriously? 

The challenge is not that an organization does not have resources to invest in innovation; rather it’s where to most effectively funnel those resources, and how to do it.

Innovation in most organizations should be a mandate that cuts across functional areas. Problem with that in most organizations is the current organizational structures makes effective resource allocation decisions very difficult - which no one has time to deal with. It requires tremendous top-down courage and political savvy. 

The few common themes that arise are: prioritizing effectively for the same competing resources across business units, designing solutions that may be ideal for a single business unit but not for the corporation as a whole, and balancing between the need to build markets while servicing existing customers. 

The bottom line: resources are available, but the allocation and ownership for innovation is fragmented responsibility across most companies. There are three options to quickly overcome this barrier:

1)    Develop a central innovation structure – including funding to help internal businesses quickly welcome innovation in their areas. Once initial ideas

2)    Develop a hybrid innovation structure – which centralize core capabilities, but shares accountability and risks between corporate and lines of business.

3)    Develop a Center of Excellence structure – centralizes core innovation capabilities and resources for business areas based on their respective needs.

For complete details, please download full 23 page whitepaper on “Mastering Innovation – Roadmap to Sustainable Value Creation by Mr. Jatin DeSai”  

In our experience working with other CEOs and senior executives, they have realized that the markets are very unforgiving and will always continue to be unfriendly, and that embracing innovation is not an option, the next logical question they generally pose may be obvious. 

What must CEOs do to embrace innovation while managing the associated risk and overcoming the barriers? 

Before I share with you the four barriers, let me say that the answer lies in developing a clear Innovation Mandate - a strategic statement that describes innovation in the context of your business, the value it promises to generate for growth and disciplined process by which to get there. 

Innovation Mandate must be vividly clear for everyone in your organization; it must be concise to help drive alignment to business unit initiatives, and it must help articulate specific employee behaviors necessary at all levels for innovation climate to take root.  When designed correctly, it is clearly linked and driven by the business strategy. 

Additionally, keys to become innovative are highly dependent on your ability to address four critical barriers that are incumbent in most organizations.  When not addressed together, the journey towards sustainability and value creation invites a higher risk of failure, potentially minimizing the results of innovation investments. 

The first barrier is that most organizations do not have the mindset to harvest ideas and manage those ideas as Venture Capitalists do. This requires demonstrated confidence to consciously fail, experiment often, and win occasionally. Goal is to do more of it, so you can out-compete the markets. 

The sole role of Silicon Valley was to quickly take the best ideas and apply entrepreneurship and agility to turn those ideas into commercial ventures.  Silicon Valley did this because they recognized that large corporations are unwilling to abandon the tightly-knit safety net of resource allocation. 

It is clear that the amount of “innovation opportunities” available to large companies dwarfs the potential available to small companies.  So the myth that only small, nimble businesses can be most agile and innovative is completely false.  In fact, here’s case in point (not to mention hundreds of other such examples): Medtronic, a Fortune 500 Minneapolis based global leader in medical technology, on average used to earn 70% of its sales from products introduced in the previous two years alone.  This resulted in long term sustainable growth of 20% and created a high barrier for its competition to enter into Medtronic’s markets. 

The bottom line: new ideas are easy to find in every corporation; it’s the distinctive capability of turning them into commercial ventures that most companies fall short on. This requires leaders to role-model what innovation means to them and the company.  First step to address this barrier would be to develop an appropriate funding strategy and structure that will quickly demonstrate your commitment to innovation.

For complete details, please download full 23 page whitepaper on “Mastering Innovation – Roadmap to Sustainable Value Creation by Mr. Jatin DeSai”.

 

  By setting time limits, things get done. Time is one of five most critical resource. Protect it with passion - no matter the size of the challenge.

Put a large clock in every meeting room and make it your team's best friend for every meeting. Some of our client's estimate that they spend almost 75% of their time in meetings - and half of them are unproductive and not needed.

In our work, we have found innovators who love to experiment all day, just for the sake of learning and broadening their insights. This is a critical activity, but when compounded with other innovators who also love to learn, the team may collect lots of insights and new knowledge, but no results.

Make sure all innovation is tied to strategic results - hard or soft. Hard being financials such as revenue, profit, EBITDA, etc. Soft goals can be customer satisfaction, knowledge of new technology, lessons learned from a pilot project, market variables that worked or did not work, etc.

Businesses today run on a ‘profit engine'. Everything in business is about profits only. Wall Street rewards profits. Executive compensation is tied to profits. Unless corporate profits increase, shareholders are not happy. Boards are motivated to make sure their companies are profitable.

This is a ferocious engine that has created the current financial crisis. The U.S. Government (and many other countries) are bailing out the very same engine that has brought this crisis in the first place. - without solving the real problem. It is impossible to improve the future with only historical thinking. We cannot use existing thinking(rooted in the past experience only) and use it to create future. That is like an engineering teacher certifying a group of students as excellent engineers, but then asking the same teacher to suggest that all the students should also learn American History and Business Management. This type of thinking would be incomplete. In fact, we never notice how incomplete and inadequate it is.

This suggests that most of our societal thinking(and other types of thinking) is completely wrong if the only way we think is from the past.

For businesses, they think, the easiest way to increase profits is to increase efficiency and to reduce costs. They generally do this by reducing employment and laying off workers, instead of driving innovation and grow the top-line (much harder to do). So, they resort to making ‘quick profits'. Why? Because that is how they are incented. This ‘underground' motivation - to gain personal profits have driven business leaders to be greedy - the fundamental root cause of the world's sad situation today - in all sectors, in all issues.

So what can be done? What can be done in our thinking?

We need a new more humanistic approach and out of the box radical thinking to this problem. I don't know of anyone thinking along these lines. Why? Maybe because it is too hard? Of course.

Solution I propose is to change the rules of the game. What if a corporation is allowed a specific profit per head for everyone employed? There would now be an incentive to employ as many people as possible. These people would still need to be employed productively because otherwise there would be no profit. The skill and thinking of executives would now be used to increase employment rather than to decrease employment.

What do you think?

-Jatin DeSai

The global financial crisis has led many companies to slice payrolls, but many employers are staying loyal. Meet 9 of this year's Best Companies that, as of mid-January, have never had a layoff. Click here to read more.

Today's managers and leaders think of "creativity" rather than"creativeness". Our corporate culture has trained us to immediately think of results rather than seeking to be the kind of people who achieve them, which is little like putting the cart before the horse. We, too often, look for something which can be measured and therefore controlled. We use the word "Creativity" with the underlying intent that it can be a measurable quantity, whereas creativeness is not. It is a quality of the person.

Creativeness is something entirely natural, like the budding of a plant from a seed. Because it is natural, it cannot be forced to produce, commanded or demanded.

There are no recipes for creativeness. It happens in one's presence at the spur of a moment.

For organizations to compete for the critical "talent war" ahead of us, they must rethink cultivating creativity, but more importantly creating an environment for people to naturally bring out their latent creativeness -which exists in all human beings. Organizations who figure out how to do that will be able to attract and retain the best talent.

So how can one develop this competency of "creativeness" in day-to-day work?

Develop greater awareness of situations and problems, viewing them with bare attention. In this way they will be seen with clarity.

• Look at situations with sincerity and detachment (very hard to do). This means recognizing and admitting to yourself your own involvement.
• When you have observed the problem in this way, do not put it on one side, but bear it in mind for however long is necessary. Don't force to seek the solution- let it come to you.
• Take care to notice the intuitive signals, whatever these happen to be in your case. Eventually a solution will occur to you - anytime, anywhere.
• Look at the solution you have discovered with clear comprehension of purpose and suitability. Not all intuitive and creative ideas you get are necessarily right or practical.
• Validate its value if it was realized, shop it around, lens it from varieties of perspectives - customers, peers, leaders, suppliers, markets, etc.
• Finally, act on it. Ideas and solutions are of no use, if they are only confined to private realities.

Thanks,

-Jatin

Recommended books on creativity (accessible online):

- Handbook of creativity - Robert J. Sternberg

- Cracking Creativity: The secrets of Creative Genius - Michael Michalko

- Creativity: Unleashing the forces within - Osho

 

In our findings for the last 25 years in business, we have discovered that innovation, at a personal level, is as different as the definition of spirituality. It can be very personal for people. Within organizations, our play arena, most of our customers have no idea about what innovation is, and most cannot agree on a definition.

For me, Creativity is generating original, novel ideas. Innovation is putting those ideas to work and getting results.

There is significant difference between creativity, invention, and innovation. Creativity arises from deep personal beliefs. Beliefs are shaped by one's character and values. We use creativity, rooted in our beliefs, assumptions, and passions, to find meaning in our work. When an organized group, with the same passion and beliefs work together for something much larger than themselves, they are capable of generating ideas that can be ventured for commercialization and help grow the top-line or impact the bottom-line of the group/business - that is Innovation. The actual product or service brought to a market, that makes a difference in the marketplace or in people's life, is Invention.

 

Therefore, Innovation is all about "Harvesting the deep insights of an organization's human spirit and knowledge, generating a pipeline of ideas that can be evaluated, selected, and ventured using disciplined tools, methods and processes that advances growth objectives for an organization."

Finally, for a business to succeed and thrive, a business cannot accidentally or occasionally be innovative. It must innovate at a rate faster than current (or future) competitors - with a high degree of predictability. So, in that sense, innovation must be positioned as a strategic tool to improve organizational agility to stay alive and grow. There are only 3 companies still in business on the DOW list from 70's - and soon maybe even less.

For organizations, Innovation is no longer a choice - it should be the primary goal.

Here are some latest articles on Innovation:

- Click here to read the article 'Innovation in America- A gathering storm' from Economist.com

- Click here to read what Google's CEO Eric Schmidt has to say about Innovation.

Thanks,

- Jatin

P.S. If you want to download our latest paper on innovation, feel free to go to http://desai.com/Resources and download the whitepaper on "Strategy-Driven Innovation". Enjoy.

If you want to see a real disruptive innovation since the Internet, get ready for Social Networking and Web 2.0

If you are completely new to Social Networking , go check it out now. If you are a visual learner like me, then you can watch this simple video on YouTube as well:

For example Linked-In is one of my favorite Social Networking sites. There are plenty of others such as FaceBook, MySpace, etc. You will be surprised how many Fortune 1000 companies have pages on these sites. These trends are currently turning the industrial marketing complex upside down. If you have not figured out a way to leverage these new innovations to grow your business, to find talent, to generate leads, your business is about to hit the wall in a very near future.

For example Linked-In is one of my favorite Social Network. I spend hours and hours on it every week. Here is a post from a great Blogger Mickael Nadeau who has summarized the benefits of LinkedIn on his Blog:

• LinkedIn is a social network where you can interact freely with millions of people;
• Like other social networks, it relies on viral marketing to grow: you basically invite your contacts to join your network and are, in return, granted to contact theirs;
• What differentiates LinkedIn from other platforms is that it is primarily intended for businessmen and professionals, recruiters and job seekers… So, you won’t be able to post a picture of your dog there;
• You can think of it as a virtual board of commerce;
• It is very straightforward and easy to use.

And some advantages…

o It’s quicker. You don’t have to travel the country to attend conferences, lunches and never ending meetings to get acquainted with people. It is there and full of activity 24/7, no matter why you need it.

o It’s international. Want to speak with a decision maker in India, China or London? No problem: it’s just a matter of a few clicks. A lot of people around the world will learn about you and what you do without ever spending a dime.

o It’s useful. On LinkedIn, you have access to many of the best experts on any given subject. I have had some of my questions answered very intelligently within 2 minutes. In fact, that is how I came to use WordPress for this Blog.

o It’s profitable. There are a lot of leads and opportunities to be discovered on this network. Build your business and your connections at the same time!

o It’s free. Most of us wouldn’t invest in our own personal branding. Because of its scale and because its free, this tool could give you a real competitive advantage when branding your name and accomplishments.

Once you create a LinkedIn account, the best way of grow it is to leverage your current network (which should be growing everyday if you are looking at your new connections everyday already) with the capacity of time and resources you have to devote to growing it. If you are a recruiter for a firm, it might be ok to grow it for the sake of growing it. But if you are like me, using LinkedIn to find leads or find knowledge, quality of contacts are much more important.

So, I suggest you declare your ‘network growth strategy’ first. Once you know this, do everything possible to find update your profile to support that strategy, then answer every questions and pose every question that supports that strategy, and then to open meaningful conversations using external tools (your CRM system, Outlook, Blogs, Company Website, etc.). More qualitative conversations you are having in Linked-In and outside of Linked-In, you will grow your network and achieve your ‘network growth strategy’.