The McKinsey Quarterly recently had a good discussion on the topic of innovation management (might require free membership to access the content). As Gary Hamel summarizes, the discussion is about the changes that are occurring with management practices and organizational designs.

How do you build organizations that are as nimble as change itself? How do you mobilize and monetize the imagination of every employee, every day? How do you create organizations that are highly engaging places to work in? And these challenges simply can’t be met without reinventing our 100-year-old management model.

Managing creatives, knowledge workers, freelancers, …, is not an easy process. It requires a careful balancing of freedom to explore and directing energies in a productive way that ultimately profits the firm and society. From Lowell Bryan:

These thinking-intensive people are increasingly self-directed. In fact, they’re directed as much by their peers as they are by supervisors. The management challenge is akin to urban planning. The art of it is that you must enable people to make thousands and thousands of individual decisions about how to live and work, but you have to create the infrastructure to make it easy for them to do so.

Insight from Gary Hamel:

The outlines of the 21st-century management model are already clear. Decision-making will be more peer based; the tools of creativity will be widely distributed in organizations. Ideas will compete on an equal footing. Strategies will be built from the bottom up. Power will be a function of competence rather than of position. In terms of the future of management, we’re at the beginning of what will be a fairly long journey. You can see some of the pieces starting to come together, but we’re not there yet.

And finally, Gary Hamel’s questions to the CEOs that are serious about innovation, which should be asked and compared at all levels of the organization:

• “How have you been trained as a business innovator? What investment has the company made in teaching you how to innovate?”
• “If you have a new idea, how much bureaucracy do you have to go through to get a small increment of experimental capital? How long is it going to take you to get 20 percent of your time and $5,000 to test your idea? Is that a matter of months or is it very easy for that to happen?”
• “Are you actually being measured on your innovation performance or your team’s innovation? Does it influence your compensation?”
• “As you look at the management processes in your company, do they tend to help you work as an innovator or get in the way?”

Enjoy the article.

Technorati Tags: innovative management, Gary Hamel, Lowell Bryan, McKinsey

There is nothing so useless as doing efficiently that which should not be done at all.
- Peter Drucker

Innovation and risk goes hand in hand. Many initial attempts at trying something new fails. However, through those failures we learn, adopt and improve. As Thomas Edison said, “I have not failed. I’ve just found 10,000 ways that won’t work.”

Part of establishing an innovation culture is about emphasizing importance of taking risks, trying new things and learning from each failure that comes with the territory. However, to be agile and be successful, you need to be quick at evaluating new ideas, and either moving them through the innovation funnel or killing them.

Tools and methods for performing quick validation of your ideas are the focus of this blog. Here, quick means anywhere from a couple of hours to a couple of days, and at most a couple of weeks.

One page project summary and/or press release

Start with refining and focusing your idea. A one page project summary and/or an imaginary press release are a great way to highlight your idea’s benefits and value. Your product pitch should include:

• Description of the product and service;
• Description of what customer problem it solves;
• Key customer benefits and features;
• Identification of key performance vectors;
• Positioning statement and value proposition;
• Indication of the logical customers and markets;
• Estimates of market potential, profitability and price;
• Fanciful customer comments and raves;

Your goal is to generate interest and excitement with your sponsors and potential customers. Any reaction less than an interest is a good indication of either needing to rework your product pitch or your idea.

Build your idea pre-screening criteria

Evaluate each of your ideas against your pre-screening criteria. The goal is to identify and ditch poor ideas early in the innovation life cycle process. You should evaluate all ideas based on business and technical criteria, such as below.

• How well the idea fits within the firm: vision, mission, objectives, core competencies, resources, …
• How well is the idea protected: IP, any barriers to entry to discourage competition, …
• What is the competitor landscape and do they have an alternative solution;
• What is the impact of the idea on existing technology and resources;
• What are the profit goals and metrics, what is the ROI;
• What is the market size and growth;

As a note of caution, you should monitor your pass/fail idea metrics here. Too many passes, i.e. ideas moving forward in the innovation funnel, could highlight a poor pre-screening criteria. Along the same lines, too many fails, ideas dismissed, could indicate you are dismissing potentially good ideas and being too conservative.

Prototyping and Fast Prototyping

Prototyping is a great way to explore the idea on hands-on way.

• Provides quick validation of the concept, and identification of risks and uncertainties;
• Gives insights into new competencies to be developed and cultural changes that need to occur;
• Enables a tangible way to explore the problem space with others;
• Becomes a vehicle for demonstrating your idea, possible product design and feature set with your customers;

Killer Innovations’ Phil McKinney takes this a step further and introduces the concept of fast prototypes: hours and at most days (vs. weeks). Please remember, these fast prototypes are not functional, as the goal is to get early feedback on the idea.

Tom Kelley in the The Art of Innovation has a great section on the value of prototyping and its application in real-life stories. He summarizes prototyping clearly:

“Prototyping is problem solving. It’s a culture and a language. You can prototype just about anything – a new product or service, or a special promotion. What counts is moving the ball forward, achieving some part of your goal.

Not wasting time.”

Get in the head of your customer

Focus on what problems you are solving with your product and how it benefits your customers. Does it save time or money, enable new revenue stream or improve the quality of their existing solution? Describe your ideal customer, and where possible engage in exploration and validation activities with them. You can explore through in-depth reviews and open-ended questions, or just observe them in their own environment doing day-to-day activities. These observations can help understand in what ways your idea would benefit the customer, as well as identify any unarticulated needs and problems.

If real-life exploration is not possible, create a storyboard of your typical customer through brainstorming, associations and role-playing. As crazy as this sounds, it will give you a sense of whom you are targeting: what they are worried about, what they care about and what they would pay for. In return, this becomes a platform for you to test your ideas: Would Susie pay extra for that feature?.

Co-Design with your customers

Involve your customers in your innovation process. Simple UI mock-ups, web-conference discussions on their impressions and insights can clarify any potential issues in advance. You can also rely on your customers to help make the needed tradeoffs in product functionality.

Connect with the experts: inside & outside the company

In identifying and understanding possibilities, risks and uncertainties, tap into the experts. Just like opinion polls, these experts could provide insights and observations based on their experiences and knowledge. They can also help craft scenarios and perform scenario analysis.

Note of caution, the inputs from the experts are their best guestimation and judgment based on what is known. To reduce the bias and improve the results you can utilize tools such as the Delphi method.

Final thoughts…

• Teams tagged for validation need to have the time to focus on this activity. If full time availability is not an option, enable the employees to spend 15-30% of their working time on innovative projects and research.
• Establish a cross-functional team. Technology is an enabler, and sole focus on technology will not ensure product success in the market.
• Nothing is certain in life, except death. So, if after all the validation a failure occurs (and it will occur) in another stage, that is part of life and the learning process.

Technorati Tags: idea pre-screening, quick idea validation

Today is the Blog Action Day and this year’s topic is the environment. As technology managers, we are in a position of influence to reduce our impact on the environment. How we develop our innovations and technologies have just as much impact on the environment as the type of innovation and technologies we are working on. Here are few ideas on how we can incorporate more environmentally friendly decisions into our day-to-day technology management activities.

• Design decisions: environmentally friendly material selections, architectures that specifically focus on less power usage, equipment selection that is energy efficient;
• Project management methodologies: reduce paper usage for reports, etc., invest in collaborative technologies to reduce travel as well as enable individuals to work from home;
• Development and testing tools: virtualization tools to help reduce the number of needed servers for development and testing;
• Programs and promotions: recycle older products and parts, reduce packaging waste, use greener materials for sales brochures;

Yes, going green and the environment requires a shift in our thinking. However, it is not an either/or type of question. Going green will improve your customer relationships, and ultimately save money for your firm and your customers.

Reduce, Reuse and Recycle is the familiar 3Rs focused on producing less waste by the environmentally aware consumers. As a family, we include a 4th R: Refuse: refuse to clutter the environment with unnecessary waste.

Apply the 4R philosophy (Reduce, Reuse, Refuse, Recycle) into your projects. Remember, every little step counts.

Technorati Tags: blog action day, blogactionday

I previously wrote about technology management, its definition and areas where a technology manager often struggles. In high-tech companies, especially startups, the technologist also plays the role of a product manager. Regardless, a firm’s success depends on how well its technology and products are managed.

The two functions bring opposing perspectives to the table. The technology manager believes that the technology will drive excitement, generate royalties and create new markets: technology push. The product manager believes that the market should dictate the product and technology directions: market pull. However, to be successful the firm needs both. It needs to effectively manage and bridge the gap from technology idea to product commercialization.

Note: product marketing and product management functions tend to be quite blurred depending on many factors, such as the size of the firm, if it is a startup, or a service vs. technology firm. For the purpose of this article, I’m focusing on product management as the aspect of defining a product and driving its commercialization process.

Dr. Jolly (Commercializing New Technologies: Getting from Mind to Market) defines technology as a capability that is embodied in one or more products. As a capability, technology enables the company to compete in different dimensions: higher value products, cost advantage, attract new markets and customers. Technology development and commercialization is multifaceted. It is not only about the product’s end-customer. It incorporates shareholders that are interested in embedding the capability to other products, or licensing the technology fully or componentizing and selling aspects of it to partners and in some cases competitors.

Products are targeted to an end-user (the customer), where it satisfies a market want or need. The main concern of product management is to identify the best way to realize value from the product’s commercialization process. It is also keeping the features at bay; saying ‘no’ to developers and sometimes the customers, that feature bloat is bad.

Product managers are a constant in the lifecycle of a product. They own the product completely from conception to market launch and beyond. As new projects relating to a given product are launched, the product manager continues to define the project goals and guide the cross-functional teams to achieve the business and market objectives. Ideally, they know their customers and market better than their customers know themselves. In a way, they are the soul of the product, keeping us true to its vision.

For both, change is constant. Managing change, selling new ideas, relieving people’s fears and managing risk is big part of the job. After all, opportunity lies between the cracks of the problem and potential solutions. And, the successful product manager goes beyond just answering the articulated needs/problems of her customers.

A firm drives competitive advantage from innovations that clearly deliver breakthrough value to their customers. However, in order to enable such breakthrough potential, the technology manager needs to have insight into not just technology capabilities, but its application, as well as customer and market needs.

At the end of the day, it is the job of the technology and product manager to turn what is complex into something simple, bringing value and benefit to its users. Unfortunately, through the process, what is extraordinary becomes ordinary. So, it is their job to keep the spark, the excitement and never ending possibilities going.

Technorati Tags: technology vs. product management, product manager, technology manager

It has been a year since I started blogging. It has certainly been a fun and at times frustrating creative experience. Some weeks, it is quite a challenge to come up with a captivating topic that I am motivated to write about. Overall, it has been a great experience. And I hope some of my thoughts have sparked new ideas and possibilities for you as well.

So, here is the top 5 content of the year:

• Strategy 101: Revisiting low-cost leadership with Dell — Interestingly enough, this article has been at the top of the reading list from day one. Not sure if it is due to Dell or there is more interest in achieving differentiation via low cost leadership. Either way, average time spent is little over 4mins on this article. Wow!
• How to identify forces impacting your innovation
• Metrics gone bad? and steps to recovery
• Best practices: SWOT analysis revisited
• Effective strategies for surviving culture tax

Thank you for your support! As always, drop me your thoughts and ideas for what you like to see on this blog for the upcoming year. Here is to a brand new year of blogging!