Seeking Innovation Productivity through Creative Destruction.

The whole issue of innovation productivity is getting more and more one of the key arguments for re-gaining economic growth. The problem becomes the real impact of ‘creative destruction’ that can often go with this.

I recently wrote in a blog (http://bit.ly/mXZjC3 ) called ‘the Risks of Dampening down Innovation Productivity” that with contracting economic performance, innovation performance suffers as well.

I’d like to look at a few of the hidden or even darker sides to this, not because it is simply a Monday blues sort of thing, but there are growing implications if we don’t clarify why ongoing innovation investment is really needed and what it can often cost on society.

The tough economic times we are presently facing

We are faced with some tough times; markets are contracting, business performance is struggling to maintain its previous levels, there is increasing argument we are heading for a double-dip recession, although I feel we are already in this. Jobs are tough to hold onto and even harder to find.

What are the new paradigms in innovation?

There are some huge shifts taking place across innovation activities, are these paradigm shifts?

The simple fact that innovation has been thrown open and organizations and individuals can simply explore outside their existing paradigms is offering us something we have yet to fully grasp and leverage. This is a W-I-P for us all.

Secondly innovation is simply getting faster, better is another story, but it is expected to move from idea or concept to final launch in ever decreasing compressed time

As they say ‘you can’t have one without the other’. Open innovation is potentially allowing for this compression of time but where we still ‘lag’ is within our organizations to reap the rewards. Why?

We are still stuck in the previous structures, systems and processes designed for internal developments that were designed for different times.

We need two really critical things really fast.

There are two distinct parts to any Innovation Funnel

I wrote in an earlier blog called “the new extended innovation funnel” (http://bit.ly/hQTEJz) my reasoning for thinking differently from our traditional view of how the innovation funnel should look like. I feel it should look more like this.

Extended Innovation Funnel – are we really listening?

The ‘classic’ innovation funnel talked about is wrong for todays job!

The Navigation of the Three Horizon Framework- An Emerging Guide.

I have planned to explore in three simultaneous blogs, a trilogy of blogs, the three horizon model more extensively. It is a most valuable one to build into your thinking about strategy and innovation.
This is the final blog of the trilogy on the Three Horizon Framework and offers my thinking on an emerging framing to help in navigating through this.
The need is to define your different horizons.

The dual forces within our cultural thinking

I lived for about fifteen years in Asia until a short while ago, and in the before and in the in-between period, I travelled there a lot and often felt the pull of different cultural thinking.

Participating in Asia, watching how Asia has evolved has been a real experience, that stays with you as something hugely valuable, as it partly shapes your thinking and how you look at things going on in the world.

Some events today set me thinking that resulted in this blog.

It was August 3rd 2010, exactly one year ago today,  I wrote one of my first blog entries for this site, entitled “The Yin and Yang of Innovation” (http://bit.ly/gXeWir)  and talked about the ‘fluidness’ in innovation that makes it hard to manage. How do you get the balance right in managing the innovation activity?

I described yin yang as polar opposites or seemingly contrary forces that are interconnected and interdependent in the natural world, and how they give rise to each other in turn. Opposites thus only exist in relation to each other.
Yin and yang are bound together as parts of a mutual whole

Renewing Innovation through the Social Innovation Agenda

The challenges are growing in their social dimension across Europe, the United States and a host of other countries, both developed and developing, that are needing new fresh responses.

Social demands will inevitably increase as nations are being confronted with budgetary constraints, increased deficits and mounting debts to resolve.

Social needs will become more pressing and innovation, social innovation, will increasingly explore opportunities to extract ‘more from less.

Innovation can play an increasing part in resolving social challenges that are increasingly confronting us.

Starting a new movement on social innovation in Europe

Recently I became a member of www.socialinnovationeurope.eu . I certainly feel this is going to offer something exciting and vibrant. It is a growing community of thinkers, creators and innovators with the knowledge and skills to change the way we face Europe’s most pressing issues.

Contributors to the site will take a strong hand in shaping the direction of social innovation across Europe, breaking down silos and raising a unified voice. I need to find my own part in this, as there are multiple ways for contribution, which I’m still presently figuring out.

Learning to absorb new knowledge for innovation

In a blog I wrote in November last year entitled “Moving-towards-a-more-distributed-innovation-model”( http://bit.ly/b38ixv)  I outlined some thoughts on the flow of knowledge in a distributed innovation model and discussed the Absorptive Capacities more from an internal organizational perspective.

Increasingly we are looking outside for new knowledge that needs internally managing.

As organizations seek increasingly outside their own walls, the appreciation of how they are managing knowledge, learning and interpreting this is becoming a critical aspect of open innovation to be successful.

There is a growing need to absorb, integrate and apply this in new and novel ways for accelerating innovation performance.

The more we seek, the more the knowledge increases in complexity as markets are rapidly changing. The more we are relying on knowledge flowing into the organization the more we have to strengthen our inter-dependence and collaboration efforts to extract the knowledge we are acquiring for it potential value.

Are organizations recognizing the value of structuring their knowledge flows? Do they have the right learning mechanisms to accelerate and exploit new potentials from this knowledge?

Organizations tend to be set up for incremental learning.

The importance of managing our intangible capital is the key for today’s innovating business.

Today, we are valuing organizations in completely different ways than some years back as intangible capital grows in importance. In the past we were valuing organizations purely on their tangible assets, the ‘hard’ (easier to) quantify assets, shown on the balance sheets as the basis for the value of the organization.

Today that is not the case; it is more the off-balance-sheet bound up in networks, relationships, connections and the ability to manage the fluidity that is occurring constantly around us, and the organization’s ability to respond appropriately in seeking out improved, new value through better innovative offerings.

Intangibles are providing the new value system equation to focus upon

The forming of new structures- the business innovation ecosystem

At present we are seemingly in a state of flux, we are learning to move from linear innovation models into more dynamic ones that are increasingly forming around innovation ecosystems to provide for new collaborative structures.

Our whole understanding of innovation is changing; we are evaluating and changing our existing focus from closed (internal orientation) into open (external orientation) thinking for accelerating and improving our innovation performances.

Regretfully we are not yet fully equipped to manage within these new innovation ecosystems. We need to give the factors an increasing focus and lead into a better emerging theory of leading or good practice.

Measuring innovation in different ways is becoming important

Looking beyond that certain innovation bleakness is hard.

I was appalled to read a summary of a recent report that nearly 50 metropolitan regions in the USA- or more than one in seven- are unlikely to bring back their regions to job levels lost in the recession until after 2020 which gives that feeling of real bleakness for all those caught in this.

Yes you read it right- 2020, nearly nine further years, well beyond this President further term of office, if he gets re-elected.

The report commissioned by the U.S Conference of Mayors are equally predicting 363 metropolitan areas would not generate enough jobs to get back to pre-recession peaks until 2014, based on current world economics.

When you add in that metropolitan regions account for 86 per cent of all jobs you realize how stark this is. So we are entering that twilight zone for millions that have a number of lost years ahead of them to face a difficult, uncertain future.

The issue is not just the economic job loss but the types of job losses are just not easily going to be replaced. Many are simply gone, moved somewhere else in the world or just vanished forever.

The level of re-skilling that needs to take place to move old-line factory jobs into technology-related, advanced manufacturing for protecting added value areas or service sectors is simply massive.

Can innovation as is often suggested simply take up the slack? I think it is unlikely. We need to think differently, we need to think radically and innovation plays its delivery part in this.

Across the pond, in the UK and much of Europe, I suspect it is no different