Posted by TimothyKastelle on April 28, 2010 | View Comments

 

In my MBA classes last year, I had the students analyse their own firm or organisation using the Innovation Value Chain model developed by Morten Hansen and Julian Birkinshaw.

There are two key points with this model. The first is that there are three stages in the process of innovation: idea generation, selecting and developing ideas, and diffusing ideas (getting them to spread). Critically, all three parts of that process have to be working well in order to innovate successfully.

One very common mistake that I see firms make is over-focusing on idea generation at the expense of execution, so I find this to be an extremely useful model. In particular, I have frequently observed organisations decide that they have to improve their innovation, and then sinking all of their resources and effort into idea generation.

This approach is flawed, and my MBA students demonstrated why. They came from a wide range of organisations – huge multinationals, small start-ups, government departments, and educational institutions. Despite these different backgrounds, their findings were remarkably consistent – only 3 of the 60 organisations that they work in are ideas-poor. The other 57 (that’s 95%!) have problems with either selecting or diffusing ideas.

Scott Berkun, the author of the book The Myths of Innovation, recently had this to say:

If there’s any secret to be derived from Steve Jobs, Jeff Bezos, or any of the dozens of people who often have the name innovator next to their names, is the diversity of talents they had to posses, or acquire, to overcome the wide range of challenges in converting their ideas into successful businesses.

That’s it. The problem is executing your ideas. Here’s an example – mousetraps. They’re a famous innovation example, in part due to famous quote from Ralph Waldo Emerson: “Build a better mousetrap, and the world will beat a path to your door.” But is this actually true?

The patent for the flip-trap mousetrap design was filed in 1899. That’s a better mousetrap, right? We’re still using that design over 110 years later, so it’s probably pretty good. And yet, since 1899, the US Patent Office has granted over 4400 mousetrap patents. They receive more than 400 new mousetrap patents every year. So there’s no shortage of ideas. But fewer than 20 mousetrap designs have led to products that have actually made money.

There is so much effort put into improving innovation by generating more ideas. But that’s not where firms are weak. As my MBA students demonstrated, the real problem is in selecting and executing good ideas, and diffusing them. The mousetraps tell the same story – there a whole lot of ideas, but not many that have come to anything.

Here’s more from Berkun:

The closest thing to a real secret is this: In my years studying and teaching all things innovation, there’s one fact that’s the hardest for people to swallow and it goes as follows – To invent or create is to take a bet against the unknown. No matter what you do, you are still betting you can do well in the face of many things that are out of your control. Don’t like that? Don’t want uncertainty? Then do something else. Comfort with risk and uncertainty is the real secret. Or at least acceptance of the fact you can work your ass off for uncertain rewards.

Where does this leave us? Here are some conclusions:

• If you’re going to get some help to improve innovation at your firm, don’t focus on generating ideas. Get help on selecting ideas, or on getting them to spread. Those are the hard parts.
• Innovation is a bet – you’re betting that your new idea will work better, that it will meet needs, that it will fit into the value network. All of these things have to happen for your innovation to work. Like Berkun says, this is a leap into uncertainty.
• Most of the innovation problems that organisations face are problems with innovation diffusion – the challenge is to get your new ideas to spread.

The new idea that I’d like you to accept is that you don’t need any more new ideas. Instead of generating more ideas, let’s develop some plans for getting better at executing our ideas. That seems like a good idea, doesn’t it?

What do you think?

Photo Credit: Mskogly

This entry was posted on Wednesday, April 28th, 2010 at 10:41 am and is filed under Collaboration, Innovation. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.