Recently, I read an article on moods and how they potentially effect our daily results at Knowledge@Wharton. You might need a free subscription to the site to access the article: “Waking Up on the Wrong Side of the Desk: The Effect of Mood on Work Performance.”

The research is interesting, as they investigate how our moods, before we set foot at work, could effect our productivity in the office. The conclusion of the research is as follows:

“Start-of-day positive mood spills over and affects positive employee mood during the day,” … “likewise, start-of-day negative mood spills over and affects negative employee mood during the day,…” “… Last, we show that daily mood at work can influence important work outcomes.”

Though Isaac Newton suggested that for every action there is an equal and opposite reaction, an action from your environment doesn’t have to result in a specific mood. Yes, maybe the traffic was really horrendous that day. But, don’t we have the choice on how to react? The article reminds me of the Saturday Night Live skit featuring “Stuart Smalley” - “I’m Good Enough, I’m Smart Enough, and Doggone It, People Like Me!”

Granted, I do believe everyone deserves to have a ‘bad mood’ day, if they choose to. But, as the article highlights, it would be worthwhile to ask yourself “if today is a good day to have the bad mood”, before you step onto that path.

You might have heard about the latest windstorm in the greater Seattle area that impacted about a million people by depriving them of their electricity. Well, we were among those impacted, with 65 hours to wait before our power came back on. We lost power before, but nothing like this. The experience clearly highlighted humanity’s lack of technology during emergencies, with plenty of time to think of examples.

During emergencies, our needs are quite basic and mostly about survival: is the power coming on in few hours, days, or weeks, what are the symptoms of carbon monoxide poisoning, where can I get more food, fuel, how do I keep the contents of my freezer from rotting, etc. Though our power company did have a hotline, and we did have phones, the information provided was non-specific, to say the least. It was ultimately updated, changing from a female to a male voice on the recording, but still saying the same thing. Though it sounded sexier, it was just as useless as before.

Today we have technology to keep track of our ‘buddies’ using our cell phones, we can change our cell phone ringer tones to personalize it to our moods, we can Google-map our photograph locations to share with others, or listen to Christmas music from hundreds of stations around the world via the Internet. Yet, somehow we haven’t incorporated these technologies to aid us during our time of need. Is it just due to the capitalist system frightened of the lack of profit, is it the lack of creativity, or the problems associated with our complex infrastructure? Maybe it is all of the above reasons, and more. Regardless of the reasons, here are some thoughts on technologies that could help during emergencies to enable better communication of information, resources, distribution of supplies, etc.:

• Utilizing power grid information, potentially combined with GPS technology, to provide customized information to the callers on where the breaks are in the system relative to their house, and based on the current repair rate, the likely time of resolution;
• Providing information on fuel supplies, instead of letting people drive around trying to find open stations;
• Information on the open grocery stores, including services they provide, such as selling perishables and drinking water;
• General blackout safety information distributed during the emergencies, such as instructions for safe food storage and handling, issues with drinking water, and how not to kill yourself from carbon monoxide poisoning;

The bottom line is that information availability, via phone, TV, Internet, radio, was almost none existent during the blackout resulting from the Seattle windstorm of 2006. We had a radio with fresh batteries, yet updates on system status or do’s/don’ts were not there. Even though this was no Katrina, people did die from running their generators indoors, not to mention many emergency-room visits due to smoke inhalation from charcoal being burned in the kitchen. Next time our family will be more prepared, but can the community learn from this emergency and put technology to use before it’s too late?

Have you ever had one of those moments where all you wanted to do is scream and ask for forgiveness? I had mine last night, after noting that yet another person has a title containing innovation. I felt a sudden fear that my message was lost in a sea of look-alikes, and it is difficult for the rest of you to separate the wheat from the chaff.

Don’t get me wrong: studying innovation and technology management is still my love and fascination, and I’ll continue to sweat over it as I have for the past decade. However, I have to stand back and question the current hype of the term, including the use of it in my title: “Innovation and Technology Management”.

If you step back a second, you would think that with so many calling themselves the innovation something or another, our innovation scores and return on our investments should be so much better. Unfortunately that is far from the truth. Take a look at the BusinessWeek data from 2005 on industry innovation’s success rates: based on the article “up to 96% of all new projects fail to meet or beat targets for return on investment”. Fortunately for us innovation experts, it is also difficult to measure the success rates, as there is no one universal definition of success within and between firms. As such, the validity of all available data on the topic can be argued.

So, is innovation really hype? Only if you place the value of innovation on the same level as the downloadable cell phone ringer functionality, or maybe the Atkins diet. Lets face it, men have been inventing and innovating since the wheel. I am a big fan of Peter Drucker, and over a decade ago he published Innovation and Entrepreneurship. Since 1991 “Drucker Innovation Awards” have been given for nonprofit innovations. Given the ideas and challenges of innovation have been around quite a while, then why is the sudden silver bullet-like fad-ness of the topic?

It is certainly plausible to blame the management consultants that ride the tail of innovation, or the CEOs looking for ways to continuously deliver top line growth to ever more demanding shareholders. Either way, in some strange way, I should welcome the increased focus on innovation, as it does generate and circulate ideas, best practices and potentially simple solutions to complex innovation problems. Even so, I’m changing my title on my business card, but keeping the company slogan. After all, innovation is only as good as the value it delivers, and that requires effective innovation management.

As research from IBM and the Boston Consulting Group captures, in today’s competitive environment, CEOs are looking at innovation to bring top line growth. In my recent “Innovation and Profitability” article posted at KiteTail.com, I discussed how different innovation types could contribute to the bottom line of the firm. Granted, there are more innovation types than one can throw a stick at, and the terminology might be different from one to the other, but it does demonstrate the linkage between innovation and profitability. However, there is still the question of how does one measure innovation and innovation’s impact, and does innovation really pay off?

It is difficult to measure the impact of innovation. The challenges stem everywhere from agreeing on common definitions, such as what constitutes a new product, to the fact that it takes on average one year to commercialize an idea while the full life cycle of the innovation is anywhere from two to five years, and that innovation is a system and should be measured as such. As with any given measurement system, having the data and the metrics is not sufficient, there is a need to incorporate how the metrics relate and impact each other. Regardless, a proper measurement system will not only provide the current state, but also highlight the areas that need improvement.

As I mentioned before, innovation is about the implementation of a new idea for the purpose of creating value: value for the firm, and value for the consumer. Given that the innovation is a system, proper measurement of innovation should incorporate every phase in the innovation cycle: from ideation thru development, commercialization and life cycle management, along with supporting systems that enable innovation to be successful: management, people and culture. Without proper support, including management, funding and innovation networks (internal and external partners), many ideas fail to make it to the market. And others that do make it might fail to bring the expected returns on the innovation investment. Boston Consulting Group’s (BCG) 2006 Innovation Survey highlights that though companies are strongly committed to innovation, and recognize it as being critical to their success, there is doubt that they are earning sufficient return on their investment. Yet, research shows that effective innovation does pay off, as highlighted in BCG’s innovation research:

Companies are increasing their emphasis on innovation for good reason, it turns out. Innovation, our research shows, translates into superior long-term stock-market performance: the 25 most innovative companies (as defined by our survey respondents) had a median annualized return of 14.3 percent from 1996 through 2005, a full 300 basis points better than that of the S&P Global 1200 median. The driver of that outperformance was these companies’ ability to expand margins at a superior rate without sacrificing growth: innovators increased median profit margins by an annualized 3.4 percentage points per year over the ten-year period, versus 0.4 percent for the median Standard & Poor’s Global 1200 company. And they did this while keeping revenue growth on pace—9 percent per annum—with the index median.

Along the same lines, Booz Allen Hamilton’s “Global Innovation 1000” looks at the impact of R&D on corporate performance, and shares their findings on “high-leverage innovators”:

Analysis of the performance screens revealed that 94 companies within the Global Innovation 1000 – our high leverage innovators – consistently outperformed their peers over the five-year period, while spending less on R&D as a percentage of sales than their industry median.

In summary, though it is difficult to measure innovation, effective innovation does pay off. And this is definitely one area that starting with a few relevant metrics wins over finding the perfect mix: just do it! Continuously monitor and check on your metrics to determine what is working and what is not. With that, here are few thoughts on implementing your own innovation measurement system.

• In determining your metrics, make sure to align them with your innovation strategy. I discussed this briefly in my “Innovation and Profitability” article. Manage your innovations as a portfolio process: know where you are spending across range of initiatives, how your resources are allocated, and using regular portfolio reviews determine if the investment is still aligned with the strategy given the latest market and business conditions. Metrics have a way to influence behavior and norms, so make sure you are walking the talk.
• Focus on all aspects of the innovation cycle from ideation all the way thru post-commercialization. Analyze your innovation cycle effectiveness both on idea generation, but also on the overall process effectiveness: idea selection, resource investment and allocation, cycle time for moving the ideas through the innovation cycle, collaboration with your innovation network (internal and external partnerships), time to market, number of new products launched, number of products that embed the idea, as well as number of ideas killed and where in the innovation cycle.
• Remember, the goal is to measure your innovation effectiveness, so focus on the metrics that matter: investment vs. the return on investment. Potential metrics could include your innovation investment’s impact on the margin (percent gross margin, impact to operating profit, innovation as percent of revenue), post-launch performance of expected vs. actual realized value of your innovation, and return on your patent portfolio.
• Don’t be self-centered: make sure you innovation metrics include measures to compare how well you do against your competitors or your industry.

With that said, don’t go metrics crazy: collecting and managing metrics takes effort, and there is a point of diminishing returns. At the same time too little may not provide the right insight. Though I don’t believe that there is a magic number for all situations, a range of four to eight is a good target. Here are additional articles on the topic of measuring innovation. Good luck!

• “Measuring Innovation 2006”, Boston Consulting Group
• “Measuring Profitable Growth and Innovation”, Accenture
• “Smart Spenders: The Global Innovation 1000”, Booz Allen Hamilton

Reading Moishe Lettvin’s blog on “The Windows Shutdown crapfest” brought back memories of my own war stories on surviving meeting madness during my life in the big corporation.

Here are few tools that worked for my team and me. You can find more about these and other leadership tools from Conversant. These tools helped us improve the overall effectiveness of our meetings and our decision-making process, and I hope you they will help you as well.

•Manage meetings with purpose – Everyone knows that no meeting invite should be sent out without a proper meeting agenda. However, an agenda in itself is not sufficient for conducting a successful meeting. Using the PMO (Purpose, Method and Outcome) framework sets up the proper context and expectations for your meeting.

o Clear purpose brings everyone into alignment as to why the meeting is being called;
o Spelling the outcome sets the proper expectations on what agreement and alignment will be achieved in the meeting;
o Properly stating the method that will be used indicates the how issues at hand will be discussed, who will be presenting what and the process for achieving the outcome;

In many ways, PMO helps you as the meeting owner to ensure you have done your homework on the Why, What, How and Who for conducting an effective meeting.

• Establish clear roles in your decision-making process – It is a common belief that decision by consensus is not an efficient decision making model, yet it is probably the most effective one for achieving alignments. Identifying the key stakeholders for a given issue and establishing clear roles for the decision-making process will improve the overall effectiveness of the process while achieving alignment. The RACI (Responsible, Accountable, Consultant, Informed) model can be used for role identification in a given issue.

o Identify one key person that is accountable for the decision. This person should not only be an individual with power, but should also have the responsibility and accountability for the results of the decision when it’s rolled out. If the group cannot reach a decision, this individual also has the power to make the ultimate call;
o Responsible individuals are basically the ones who will roll out the implementation of the decision. As such, they have more at stake on the final outcome.
o The role of the consultants is to ensure that all aspects of the issue are studied and considered objectively prior to making a decision. However, they usually are not as knowledgeable on the integrals of the issue at hand, or have the accountability for actual on-time, on-budget implementation of the decision.
o Finally, the informed group reflects all the individuals that should be notified of the decision, but are not in any way implicated by the outcome.

This role identification should be part of your decision-making process, as it is a good way to ensure right individuals are included, needed questions and alternatives analyzed, and appropriate accountability lines are clearly established. The Matheson and Matheson’s Decision Quality Chain captures the necessary elements required to achieve quality decisions (The Smart Organization: Creating Value Through Strategic R&D).

• Separate facts from opinions – Perhaps this is the hardest aspect of the decision-making process: determining what is fact vs. what is fiction, ie. opinion. However, a good decision requires analysis of the facts, and acknowledging opinions to achieve a common view of the group for gaining alignment and agreement. So, even if the process is slow, start by identifying the common facts that everyone agrees with, and determine how those impact the issue at hand. From there, address the opinions and their relevance to the decision process.

As a departing thought, don’t forget to watch for deja vu. Revisiting decisions and issues that you thought were closed is a common phenomenon, especially in larger firms. If you find yourself experiencing this, go back and review your historical records to ensure the correct stakeholders were included in the decision process. At the end of the day, you want to address the root cause problem and not the symptoms. It’s not only tiresome, but also very unproductive to play the whack-a-mole game.

Wishing you a season full of efficient and effective meetings. ☺

If you ever wondered whether you have what it takes to be a VC, then surf to Guy’s blog and check out his VCAT test. I especially appreciate his advice:

Venture capital is something to do at the end of your career, not the beginning. It should be your last job, not your first.

As I was conducting a post-mortem our Thanksgiving dinner experience, I realized a dash of project management goes a long way for a successful holiday dinner.

- Plan, re-plan and be flexible: Plans change with new information. The key is to stay flexible and re-plan as needed. In my case, realizing nothing really fits into my small oven after the turkey goes in required complete re-planning of the cooking schedule;
- Establish your baseline: You can plan as much as you want, but if you don’t have a baseline to build your assumptions, such as the duration required for cooking, your dishes will come out at odd times, and may not even make to your dinner table;
- Know your key metrics: Cooking the turkey to an internal temperature of 180o F ensures quality and healthy dinner for everyone;
- Test and retest: Just because the temperature reads 180o F for the turkey doesn’t mean it is done. It took us three tries to ensure the thermometer was positioned correctly.
- Tools and components: The right tools and good ingredients certainly make the experience of cooking more enjoyable, and not to mention make the results tastier.
- Resources: The right level of resources with right expertise contributes to the full cooking and dining experience. Remember the adage of “too many cooks”. With thanks to everyone who contributed and helped, our dinner dishes and all the pots/pans were completely cleaned up with plenty of time before desert. I toast to that!

Finally, success for this project is measured with the number of happy smiles and overly satisfied tummies. Happy holidays everyone!

Patents, copyrights, trademarks, trade secrets and defense publications are methods utilized to protect innovation. In your intellectual property strategy, you should utilize them effectively, and when possible, use them concurrently.

Patents can be the ‘Golden Goose’ for your firm. However, they are expensive: expensive to apply, expensive to maintain, and not to mention, they are time consuming. With all that, they don’t necessarily guarantee defensibility in the face of litigation, which is also expensive. Recently Guy Kawasaki’s blog included a discussion on “Counterpoint: Patents and Defensibility” which is compiled by three patent attorneys. The blog provides a good, broad introduction on using patents in the defense of innovation, particularly focused on the needs of start-ups. Make sure to check it out.

If patents are the cornerstones of your intellectual property strategy, you should follow a few guidelines to ensure they are also your ‘Golden Goose’ in order to get your return on your investment.

1. Determine the intellectual property protection strategy that would best support your business goals. Also establish a cross-functional (not just R&D) patent review committee that will evaluate your ideas and innovations accordingly to identify the best protection for them. Potential factors to consider when making the decision should include: benefit of patenting vs. other protection strategies, commercialization potential of the invention, business strategy alignment, as well as the economic potential from the use or licensing of technology.

2. Prior to filing your patent, determine the necessary scope for your innovation. In many cases, the claims presented the in the patent application correspond to the current application area for your innovation. Your goal should be to achieve “broad coverage” without infringing on “prior art”. If your coverage is narrow, it opens itself up for “design around”, if it is too broad it will probably be rejected due to prior art. Before filing your patent, reviewing your competitors’ products and patents should be part of your scope determination process.

3. If you have specific business goals, such as licensing of your innovation for building new revenue stream, do your homework carefully. Build your business case for licensing strategy, outline the various use cases and scenarios, map out your innovation’s value chain, understand your market and potential customers, and make sure to cover incremental variations of your core technology to prevent potential design arounds.

4. Don’t forget to analyze your technology’s life cycle and plan it into your patent strategy. Technology life cycle, which follows a simple S curve, describes the stages that a technology goes through during its lifetime: emerging, growth, maturity, and decline. With that, your intellectual property protection strategy should reflect the stage that your technology is in. As an example, be cautious on doing full blown patent investments during emerging stage, look for areas of process innovation to support your maturing technology, while searching for new markets or industries to enter to during the decline phase. Given the importance of timing with patents, your patent strategy should reflect the timing of necessary actions. Check out the Open Business Models: How to Thrive in the New Innovation Landscape by Henry Chesbrough for more information on aligning your IP strategy with technology life cycle.

In summary, your patent strategy should be reflective of your business goals and objectives. Building an intellectual property strategy and determining the role patents play within it, and following few guidelines, such as establishing a patent review committee will help increase the chances of better returns for your investments.

Here is a post by Gordon Graham on eight definitions of innovation he collected during his research. I especially appreciated his categorization of these definitions, as each of these definitions reflect that author’s own perspective and take on innovation:

• the economic/market/value-creating aspect of innovations;
• the diffusion/adoption/demand-side of innovations;
• the implementation/push of innovations;
• the role that attitude/energy plays in implementing innovations;

Enjoy the blog!

When it comes to product development, think of a three-legged stool: scope, schedule and resources. Quality should be the foundation that you build your business upon, not the façade that is applied at the end. Remember, “Churn, Baby, Churn” by Guy Kawasaki (Rules For Revolutionaries: The Capitalist Manifesto for Creating and Marketing New Products and Services)? We are all allowed to deliver a crappy product initially, “… but this doesn’t mean you should stay crappy.”

But, what defines quality? At minimum, it should be defined from the eyes of the customer. I recently found the following quote on the Internet. Although this quote is very widely used, its origins are a mystery to me. I would appreciate if you let me know any pointers to its source. But, I digress…

“Quality is never an accident; it is always the result of high intention, sincere effort, intelligent direction and skillful execution; it represents the wise choice of many alternatives.” Willa A. Foster or William A. Foster

As I said before, quality should be defined from the eyes of the customer; it is about having happy, or better yet, delighted customers. It is not only about delivering to the needs and benefits of the customers, it is also about the product’s conformance to those specifications, and especially how the product handles the cases of unexpected conditions. How many times you have had an application unexpectedly disappear on you without a sign? How about if you had a question for customer service, or really needed to get in touch with customer support to fix a problem, how many hoops did you jump through to make that happen?

Thinking about quality from the perspective of the customer starting at the very beginning of your product development cycle will also result in a better product design. Yet, so frequently, quality is an afterthought, and just becomes a checklist item instead of a philosophy of the development organization. Unfortunately this can result in a very poor customer experience from their first interaction with your product or service, leaving a poor first (and lasting) impression of your company.

I recently attended the NWEN. During the speaker sessions, one of the discussion points was the three-legged stool that the VCs utilize for their funding decisions: management, market development and technology. The reality is that the technology is becoming less consequential in their decision as the cost of acquiring technologies has fallen, thanks to globalization. Think about this, IF the technology is no longer a differentiation factor, and cannot create the barrier to entry for your competitors, what would? How will you build and grow your loyal customer base, which has more choices of products and services than ever before?

Your marketing, your brand and how your customers relate to your brand are now key to your success. In its simplicity, brand is defined as a promise, reputation and idea, but brand is the sum of your customer’s experience with your product, service and your company. Creating that initial ‘Wow’ factor is about having that insight into your customer needs and wants: great first usage experience that consists of usability, functionality and its interaction with the greater ecosystem. However for loyalty to occur, you need to be consistent in everything you do. This initial ‘Wow’ factor needs to spill over into the long-term satisfaction, so that not only they purchase more products and services, but also become your word-of-mouth advocates.

Yes, the first impression is important, but it should be built on the quality foundation to deliver the lasting value. And remember, the customer needs and expectations continuously change and evolve, so stay close to your customers to continue to deliver that ‘Wow’ factor. One final note, everything matters, so ensure you are focusing on quality on every possible touch point with your customers: from initial purchase all the way through the end of life for that product. Innovate with quality!