Unfortunately I got one of those nasty bugs… And it has been miserable… I was thinking that I can’t remember if characters in Star Trek ever got a common cold. In the mean time, I have to deal with mine. I plan to be back as soon as possible.

There are many reasons that stand on the way to our ability to innovate. Here are some of the more frequently cited challenges and barriers to innovation. Unfortunately, I have experienced most.

• Organization and environment not supportive of innovation
• Traditional top-down management discourages front line empowerment and innovation
• Short term focus on execution with no time to think for the future
• Lack of resources, leadership and inadequate funding
• Organizational focus and value is on risk avoidance
• Lack of systemic innovation process
• Lack of end-to-end processes for bringing ideas to fruition
• Focus on immediate and unreasonable financial returns
• No incentives to innovate
• Inappropriate measures for managing innovations
• No common definition of innovation and how to measure success
• Lack of effective communication between individuals, managers, various disciplines, …
• Lack of understanding and interaction with the customers, market and industry
• Too much specialization, and lack the ability to cross-pollenate ideas or make connections
• Lack of focus, vision and direction from management and leadership ranks
• Lack of focus and support on innovation by senior management
• No infusion of new ideas, new problems or learning opportunities
• Resistance to change

Innovation is associated with growth, and technology advances are seen as having the most impact on growth and innovation. In today’s competitive global market, innovation and differentiation is a necessity for every firm. Innovation and technology management is focused to increase productivity by improving the efficiency and effectiveness of research and development, decreasing the time needed to realize a return on investment, and optimizing current and future technology investments. Without a structured process unmanaged innovation can be not only expensive, but also unpredictable.

So, where to start your innovation and technology management journey? As Sun Tzu recommends, that the starting point for any endeavor should be knowledge: knowledge of ourselves and knowledge of others (The Art of War: The Denma Translation).

Knowing the other and knowing oneself,
In one hundred battles no danger.
Not knowing the other and knowing oneself,
One victory for one loss.
Not knowing the other and not knowing oneself,
In every battle certain defeat.

So, here is a list of questions to contemplate on. If you are looking to improve your innovation process, read through the list, think about it, process it, take an inventory, visualize the ideal, internalize gaps, and start building an action plan. I plan to write more about these areas in the upcoming blogs. Send me a note on things that you see missing from the list, and I’ll continue to expand it and eventually turn it into a survey.

Think through your innovations and technology ideas. What are the sources of those ideas, how would you breakdown the internal vs. external idea rates? What is the process to take these ideas to market? Where do you start, and how do you proceed? How would you categorize the various innovation types: mostly incremental, process only, yet another better mouse trap?

How would you describe and rate your innovation capability? Think about your processes, leadership, funding, know-how, organizational ability to learn and explore… How are the teams pull together — multiple disciplines, backgrounds, experiences, or mainly specialized groups?

How well does your team work together, and with internal and external partners: marketing, sales, support, universities, technology partners, vendors, … How do the new ideas are born and nurtured?

How well do your innovation and technology directions support overall business goals and objectives? Does everyone in your team understand how they contribute to the top line and/or bottom line? What are the key attributes used for project prioritization, selection and funding, and how well are they aligned with the objectives of the business?

When was the last time your team came up with an idea that challenged the status quo? How was it nurtured and handled by the firm and senior management? What became of that idea? Does your organization have a immunity defense to new ideas that challenge status quo?

How is your innovation funnel and innovation portfolio performing? What are your key metrics and how are they performing against the baseline and the targets? How are you monitoring, measuring and communicating the innovation progress? How is risk defined and managed in your organization? Do you have a risk adverse culture?

How well do you understand your customers, market, industry and competitors? Do you have structured processes to regularly scan the environment and determine opportunities and threats? What do you do with those new learnings and insights? Would you say the organization is focusing on the most critical problems and exploiting the biggest opportunities?

How do your customers and the market react to your new products? Do they love them, hate them or are they neutral? What are the internal reactions and feedback from your customer facing teams: support, sales and services?

How well are you executing on your projects? Are projects performing on-time, on-budget and on-quality? Can you tell at any given point in time how the project is performing? How are the decisions being made? How well are the stakeholders identified and informed?

Where and how do you spend your time: in the present, fire fighting? Do you get the chance to think, plan and work for the future?

I’m sure that there are more to add. Drop me a note with your favorites.

Technorati Tags: barriers to innovation

One time or another, every firm struggles with the answer to this deceitfully basic question: what business are we in? Those that are successful at figuring out the answer continue to evolve, the rest become extinct.

What business are we in is an important question as it guides an organization at ever facet of its decision making: who its customer is, what needs it meets, what benefits it provides, how it’s organized, how its organizational culture formed and what competencies it develops to deliver this value. Fundamentally, it orchestrates how the value is created and delivered, for the firm, its customers, employees and shareholders.

Knowing what business you are in, and more importantly not in, helps the firm focus on what to pay attention to, what to ignore and what to learn: customers, markets, competencies, technologies, trends… Ultimately, this all contributes to the firm’s profitability, its top line and/or bottom line growth.

It is also important to note that the industry, market and customer dynamics are constantly evolving and changing. Being aware of those changes is crucial for a firm’s ability to evolve, and to refine the answer to the question: what business are we in. At the same time, our thought models, our day to day context constrains and limits our thinking. Therefore, building awareness of the complex environment we operate in, and becoming mindful is a key to survival of the firm. Scenario planning, forecasting techniques and SWOT analysis are tools that can help break the boxed thinking and force us to look beyond what is obvious. The challenge for managers is how to design these agile organizations that can evolve and respond to the changing needs.

Railroads are a classic example from the pages of history books. Once the growth engines for the country, now mostly extinct. The ones that survived, like Union Pacific, redefined their business as transportation and not just railroads. Henry Ford introduced the concept of mass production to automobile industry: you can have any color, so long as its black. But, it was GM that recognized the changing trends in the customer desires and realized that semi-customized designs could be delivered at minimal cost to the customer: a car for every purse and purpose.

What started as a test and measurement business in the late 1930s for Hewlett Packard, became computing and peripherals in the 1990s, and today is moving “to integrate content across the home, whether it’s emanating from the Web, from satellites, from cable, or the PC, and bring that to the consumer’s touch.” (The Wall Street Journal, The Weekend Interview with Mark Hurd The Un-Carly by Michael S. Malone, April 14-15, 2007)

Amazon is not in the business of selling books or groceries for that matter. For Amazon to be successful, to be profitable, they built the needed competencies for logistics, warehousing, distribution and fulfillment: the shipping business. Starbucks is not a service provider, they are all about experience. Experience that brings us the “third place” beyond home or work, a place that has a feel of a friendly sidewalk cafe in Europe, and a place where you can order a double tall not fat extra dry cappuccino with a dense, caramel-like sweetness and smooth, satisfying finish consistently every time.

I mentioned that we recently visited LegoLand. Take a look at these shots I captured; what business do you think they are in: annual subscription? Park hours were 10am-6pm during our visit. On a positive note, with so many interesting things to look at, we were able to avoid most of the rides. Our son, like a kid in a candy store, was quite happy with just being there, and enjoyed every minute of the visit.

So, what business are you in?

Technorati Tags: what business are you in

Last week was Spring break, and we decided to leave sunny Seattle for cloudy San Diego for a little family vacation. Yup, while we were in San Diego wishing for some sun, Seattle was warm and sunny… It figures All in all, we had a great time, especially our 9-year-old in LegoLand, at least up until our return flight.

Given the aging airline fleet, and the higher demands on air travel, it is becoming more common to witness late departures or cancelled flights. However, this experience clearly shows the innovation gap in the airline industry, and numerous opportunities to improve the overall customer experience. Plus, this made it to my top three worst-ever non-weather-related airline experiences, so it is worth sharing.

Here is the timeline of events that led to the cancelation of our Alaska flight from San Diego to Seattle. We were originally scheduled to depart Sunday at 6:24pm, but ended up leaving 12:24pm on Monday. Note, these are all approximate times.

• 6:15pm: The prior Seattle flight boarded our plane due to mechanical problems they experienced with theirs.
• 7:15pm: We are informed that the part needed to fix the broken plane is in transit, and we should be well on our way by 10pm.
• 9:40pm: We are told they are not able to fix the problem. However, they are diverting another plane, and our expected departure time is now 10:45pm.
• 10:20pm: The pre-boarding process starts. After 10 mins of waiting for the doors to open, we are notified that there is a mechanical problem with a circuit breaker on the replacement plane, and they need to do further testing.
• 10:50pm: Our only gate agent disappears, leaving us wondering…
• 11:00pm: Everyone notices the blue screen of death, and smiles as the terminal screens reboots at precisely 11pm (but we also note that their clocks are set to midnight).
• 11:05pm: The gate agents walk out of the jet-way, reminding me of the slow motion heros walk in the movies. As they say, there is safety in numbers. They inform us that the flight is canceled and they start the rebooking process.
• 11:15pm: An unhappy customer throws crumbled paper towards the agents. One of the Alaskan gate agent walks away due to the hostile situation. Neither behavior was appropriate, needless to say. Btw, the crumbled paper was Alaska’s customer relationship number.
• 12:00am: Our luggage arrives at the baggage carousel, almost a full hour after the flight was cancelled. There was much confusion about which baggage delivery device the bags would appear on, probably confused by the fact that this luggage was not being delivered to its destination, but rather its source.
• 12:05am: We finally walk out of the airport and arrive at the hotel shuttle service waiting area. It turns out that the hotel shuttle service does not operate after midnight, and the hotel is sending a town car for 80+ people.
• 12:10am: We beg & pleat a taxi driver to take us less than 2 miles to the airport hotel (he is sure that there is a hotel shuttle). As we approach the hotel, he cracks up with laughter watching all the taxis pull over to the hotel entrance.
• 12:20am: As we are checking into the hotel, the person tells how surprised they are to see all the people showing up. The hotel was not notified of the canceled flight and the flood of new customers.
• 12:25am: We are the first of the flight to actually make it to our hotel room. We left a long line of checkins at the counter, and more at the airport. It is now that we notice that the dinner certificate handed out by the airlines cannot be used, as the restaurants stop serving food after 12:30am.
• 11:45am: After a nice rest and a great breakfast (where the dinner certificate had to be combined with the breakfast certificated, and still barely covered the cost), we started boarding our new, new flight on time. As we were boarding the flight, we heard the announcement “The 9am flight that was delayed due to mechanical problems should be fixed and ready to depart by 1pm.” Yikes! It seems that the broken plane from the night before still hadn’t been fixed by morning. Good thing we decided to sleep in and go on the second flight out.
• 3:10pm: As we are waiting for our checked luggage in the Seattle airport, we note that the 9am flight that was scheduled to depart by 1pm was now scheduled for 4:30pm arrival, over an hour after our flight landed. As a note, most of the passengers from the previous night were booked on that 9am flight, to get them to Seattle as soon as possible……..

Delays and cancelations are inevitable. However, better operations and risk management will certainly ease the pain that the airline and the customers feel. There are plenty of thresholds that an airline could watch for that could trigger a set of actions.

• Detection of mechanical failure: Automatic initiation of wait-listing customers to the next available flights. Today, this is manually initiated by the customer.
• Service triggered events: Usage of a given part, its previous history or trends on the given airplane could trigger automatic recall for service.
• Grounded airplane or customers: After certain hour of waiting, say about 3hrs, it should be obvious whether the given flight is a go/no-go. Based on available planes, the airline should be able to decide to cancel the flight.
• Notification of partners in the ecosystem: Cancelation in the system should automatically notify the required partners from airport baggage handling, to shuttle services and hotel personnel.
• Cancelation triggered activities: I always wondered why airline agents type so much on the computer, even for small queries. The rebooking process literally took 10-15mins per person. This should be as automated as possible, and even before the cancellation is announced the needed information (hotel, reservations, …) should be printed and handed to the customers.

As a note, it is obvious that the airlines are not equipped to handle crisis, as displayed in the behavior of the Alaska gate agents. Maybe this is an opportunity for a firm focused on handling small-scale crisis to get into the picture to improve customer experience.

Thank you for letting me whine/vent/fume. Your regularly scheduled blog will return later this week. Stay tuned.

This week was the 5th episode of the Business of Innovation series from CNBC. So far the program covered topics on: Innovators & Iconoclasts, Revolution & Evolution, New Tricks & Old Dogs, People & Technology and Loners & Teammates. The show seems to be targeted for executives and senior managers who are trying to understand what innovation is, and why they should care.

Though the show doesn’t give definitive answers, as innovation is not an exact recipe, it does highlight the varying views on innovation through interesting featured guests, interviews and discussions throughout the show. At times, the guests might leave you wondering why & how, but they are thought provoking nevertheless… Some highlights of the discussions include:

• Are innovators born or made?
• Can you really innovate through your customers, and to what degree?
• Is revolution a better approach to innovation over evolution?
• Who really innovates: one person or a team?
• What are the different types of innovations?
• Do CEOs have the incentive to innovate?

At times energetic, the show demonstrates how one person’s evolution is another’s revolutionary innovation. As far as the show’s resident innovation expert, Roger Schank, is concerned, I guess someone needs to play the devil’s advocate. He is obviously biased towards his internal definition and classification of innovation, types of innovation as well as the type of innovators.

If you haven’t seen the show, you can watch the episodes on the CNBC’s Business of Innovation site, and form your own opinions.

Technorati Tags: Business of Innovation, CNBC, innovation, Roger Schank