Platt Perspective on Business and Technology

Keeping innovation fresh – 15: opening up the innovation center to more fully capture creativity and value

Posted in strategy and planning by Timothy Platt on April 14, 2012

This is my 15th installment in a series on innovation, and on finding and developing paths to bring it to productive fruition within an organization (see Business Strategy and Operations – 2, postings 243 and scattered following for parts 1-14.)

As noted at the end of Part 14: calculating in production and marketplace costs, I have been developing this series in terms of in-house research and development centers, and how they can be better connected into the larger organization so as to more effectively capture and retain value.

• It can in many respects be easier to define, organize and defend an ongoing research and innovation capability in-house, and in the face of ongoing here-and-now fiscal and other pressures, having this organized into a specific area on the table of organization.
• It can, I add, be easier to develop and maintain clear and consistent processes and approaches for bringing new and emerging innovation from the researcher into marketable product and service development and to the marketplace, with formal structures and systems in place for managing this – and that means both at the industrial research and innovation center level, and at the transition committee level where decisions are made on what to move forward upon.
• But I come back here to a point that I have raised in this series at least since I first outlined what a transition committee is – a need for real world insight on the marketplace and on actual consumer needs and preferences. Insight from the lab to the production side of a business can be invaluable in sharing word as to what is possible and practical in developing the business to its next step in its competitive evolution. But feedback from production back to the lab is at least as important for providing researchers, inventors and innovators with the real world grounding they need if their ideas are to mesh with the marketplace and offer real, and wanted value there.
• Innovation cannot and will not however, simply occur exclusively in separate walled-off settings and even when businesses devote a lot of resources and effort into building dedicated research centers. The pressures and demands of the marketplace and of meeting its needs through product and service development, production and distribution cycles can and will lead to innovative insight too. And this sourcing of new value should be tapped into and developed too.

My goal in this posting is to outline an approach for adding production-side innovation into the supported innovation flow. And I will add that one goal of any such system of processes and approaches should be to identify and encourage innovation insight wherever it arises in the organization, and to promote innovators in their efforts to create new sources of value for the organization in doing this.

Google provides an excellent case study example here. Every employee has work responsibilities with ongoing performance goals and assigned-task completion priorities, as is usual for virtually all businesses and organizations and for essentially all employees. But at Google, employees are also encouraged to devote a proportion of their paid work time towards working on projects of their own design and choosing too. And they can and do develop and present their project ideas and the results they have achieved as Google innovations, that if approved would go live as part of Google’s commercial offerings. I simplify the basic processes followed here, but the idea is fairly simple.

• Individual employees and self-organizing teams develop innovative new ideas into possible additions to what Google does as standard practice. This has included a number of features that have become basic parts of the Google experience for all users and Google Maps comes to mind as a working example there.
• Employees present their ideas with prototype code and supporting data as required and the ideas and innovations that are accepted for follow-through get shared with the public as possible new mainstream products and services, as beta test project releases.
• The ones that pass this test go live on the main Google site and/or through other appropriate Google channels.
• And the innovators who came up with this new source of value gain from holding a share in it with return on investment going partly to them as well as to the company.

A business might or might not have a formal research and innovation center. But I stress that tapping into the production side of a business for innovative potential need not preclude or even compete with having a more dedicated research and innovation staff and facilities too. These seemingly diverse sources of innovation can complement and even support each other.

• Having a research facility in place can mean having dedicated test-bed equipment and other resources in place for developing and prototyping new innovative ideas, reducing their up-front costs and the time needed to initially validate their potential by reducing time and costs to build and rebuild infrastructure for that.
• Having production-side innovation and innovators and encouraging them and rewarding them in this can be a great way to source people for the research and innovation center- and if not full-time and long-term, then through the duration of specific research projects that show great promise.
• One of the functions of a transition committee in this would be to help identify those employees who should be given significant and at times even full-time opportunity to work on an innovation that they are developing.
• That last point, I add, can be particularly important in fast-paced highly competitive industries where new innovations can at most hold special market share capturing value briefly before they are supplanted by that next innovation.

And this brings me to a set of points that is very important:

• If an innovative idea looks promising enough, one of the strategic goals of the business should be in getting the employees who can create this new source of value vetted to be able to switch to work on it full time if need be, transferring them at least for that project into a dedicated research arm of the business if that would be needed.
• And these employees should be given the resource access and support needed to realize the potential of their innovative idea, with both their regular line manager and a manager from the innovation center working together and with the transition committee to evaluate progress and manage all of this.
• And this is definitely a situation where having a system in place adds real value. Ad hoc approaches create problems and conflict, and increase the rate of lost opportunity.

I am going to continue this series in my next installment, connecting the system I have been outlining here to the topic of crowd sourcing. One of the issues I will be discussing is that of what types of innovation a business would source from in-house and what would perhaps best be sourced from the outside and the crowd – and how to coordinately manage and develop these sources of value and their productivity.

You can find this and related postings at Business Strategy and Operations – 2 (and also see Business Strategy and Operations.)

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