When you look at all the (broken) parts within innovation it takes some time to figure out how you can piece it all together to make it a better whole improving on what you had
Innovation and its management is just this place this needs to be pieced together. It often cries out for it.
Most people that work in our business organizations are spending their increasing time in piecing their part of the innovation equation together to make innovation work and trying to improve on the existing conditions to deliver new products and services.
People are spending a greater part of their time have to work on fixing the system and its many faulty parts, let alone finding time to work on any new concept or learn differently. Is it not about time we stepped back and really thought through the design of innovation and its managing? Why is this so hard to do?
Keeping our global leaders safe, behind the barbed wire of Davos.
So the annual meeting in Davos is currently taking place. Those of us who are peering through the barbed wire trying to understand and pick up on current thinking by many of our global leaders are scratching our heads, wondering
We hope we can deepen our understanding of these trends, wanting Global leaders to turn their talking into real action and also be ready with applicable supporting solutions or at least readying ourselves for these possible changes. Our leaders do need help.
Listening and watching you do question who is actually tuned-in to the current trends or not. Oh yes, Davos is back full of conflicting signals and potential promises.
PwC have produced their annual global CEO survey (download here) and lead with this as the suggested conclusion from interviewing 1,344 CEO’s across 68 countries:
“The global economic recovery continues to be fragile, but with immediate pressures easing. CEO’s are feeling more optimistic and gradually switching from survival mode to growth mode.
As the latest PwC Annual Global CEO Survey shows, the changes they’re making within their organisations now have less to do with sheltering from economic headwinds and more to do with preparing for the future”
Ten years ago I was in a collaborative effort with one of the major consulting firms on a concept called button and threads.
This concept caught my imagination and a number of important people in the Singapore authority the Economic Development Board , as well, as those responsible for providing the focal point in economic development where business, innovation and talent are nurtured. The “button and thread” concept was considered, partly for its simplicity in concept but its significant underlying value.
Regretfully the proposal died around the boardroom which was such a pity as it would have been years ahead of others. The idea was the more buttons you had connected, the more threads were created. It was through the integration of technologies and market creation, the missing ingredient is the means of designing them to help shape (and speed up) more effectively business evolution.
The idea was working on harnessing the intelligent use of the growing connections through better ‘adaptive’ agents to co-evolve, building connected relationships, adding to better judgement and decisions, positioning the organization into far more adaptive enterprise working in a thriving ecosystem. Continue reading “A time for new innovating buttons and threads”
When you stop and think about how innovation has been managed and understood over the years you soon realize how much has changed in this time. It is very significant, yet there is still much to do. Innovation understanding is changing, certainly for the better and as it shifts our perspectives on where knowledge resides as this is altering.
Today I think we are yet again at yet another crossroads in this innovation understanding and perspective. That is to extract the leading edges required from their innovation activities within organizations. This will require fresh innovation consulting business models to exploit the growing complexity of managing emerging innovation practice to support and extend their understanding.
I’m attempting to get my head around it, let me share some of my thinking here.
There has been a continual shift of where innovation knowledge resides. The external provider, who was the main source of latest insight, hands on practice and leading ideas in the past, I think have been significantly falling behind in recent years, on their contribution and value to organizations. Continue reading “Are we getting real value out of innovation consultants?”
Back in 1776 Adam Smith in his book “The Wealth of Nations” discussed the concept of the work to be done and this applies so much to innovations need of where to focus our future efforts.
This has fascinated me for what we need to do for achieving any new innovation, it is the ‘work to be done’ that generates and pushes boundaries beyond the existing. This ‘classic’ book has become regarded as the one that described the birth of modern capitalism as well as economics.
Adam Smith also introduced the concept of ‘the Invisible Hand’as a core part of his thesis, that man’s natural tendency toward self-interest – in modern terms, looking out for No.1 – results in prosperity, not just for the individual but for society. ‘The invisible hand’ is essential for free markets and capitalism, through how it generates wealth in competition for scarce resources.
By maximizing their own interest as the direct intention, this ‘invisible hand’ also stimulates those around you and in the society you belong. As you seek to leverage your own assets, you are promoting society as a whole. Today this can be more by design, or through an unintended consequence of how knowledge flows.
Arguably the ‘invisible hand’ can today be seen as realizing all our potential, individual and collective, exploiting all available existing assets for benefit and gain. We call these our tangible and intangible assets. Often overlooked, or under-appreciated are those more intangible assets, that can significantly differentiate, are surely today’s ‘invisible hand?’ Continue reading “Work to be done is innovations invisible hand”
Julian Birkinshaw, the London Business School Professor for Strategy and Entrepreneurship wrote in his book “Reinvention Management” about the failure of management. He is a strong advocate of reinventing and broadening out the awareness and need for a more disciplined and up to date practice of management
Working through a kind of contingency theory of management
Julian points out different situations demand different kinds of management. To be effective, a manager needs to adapt to the demands of the situation. Managerial behaviour is mapped on four dimensions: bureaucracy-to-emergence, hierarchy-to-collective wisdom, alignment-to-obliquity, and extrinsic-to-intrinsic motivation.
The principles of emergence, collective wisdom, obliquity and intrinsic are newer ways of thinking about management. I must say I like these as I do his framework as a really good way to think about the approach we need to explore that fits with the strategy and the way we want to develop a business and its environment.
Innovation needs to exploit all the ‘opposing’ principles across the four dimensions
Most of our existing organizations are searching for the mechanisms to reinvent their business models, through identifying, designing and executing differently from the existing ones, where they tend to simply be ‘locking themselves into’ repeating patterns, possibly opening themselves up to new forces of disruption.
There is a sense of urgency that is growing at the corporate level, to master this ability to design different business models and then set about executing them, to combat the multiple ‘disruptive forces’ swirling around in the present and near-term business environment.
Reinventing the Business model is such a big ask in the complexities to overcome, the legacies, the vested interests, the distribution of created wealth (dividends, bonuses, performance) are all ‘locked into’ the existing business. Many of those necessary bolder decisions get caught up in horrible compromise. Parallel managing is both an art and a science but it always needs clarity.
Addressing the current dilemma within business models
So we all know a standard company balance sheet has three parts: assets, liabilities and ownership equity. The accounting equation states assets and liabilities are known as equity or net worth and this net worth must equal assets minus liabilities. The balance sheet summarises the present position or last audited position.
Well in the Business model canvas we have the cost side, the back-end, made up of the activities, resources and partnership aspects and a revenue side, the front end, made up of customer segments, channels and customer relationships. It is the ‘net worth’ of all these blocks that makes up their contribution to the Value Proposition.
It is the nine building blocks when we put them together, tells the complete story, a little like a business model balance sheet. Balancing this out thoughtfully does need that bringing it all together, so as to give others the compelling story and begin to mobilise around and attract the necessary resources.
My question though is this: “is the BMC understated at the back-end today and should we strike a different balance for more established organizations?”
Balancing the BMC BMC model is by Osterwalder & Pigneur. Visual source: Steve Blank
What happens when one side perhaps gets over emphasised?
Very much the orientation of the business model canvas is presently skewed towards the front end – the market facing part and rightly so. You are in search of a new business model, you will never find it in the building. As Steve Blank rightly stated “you have to get out of the building” to validate your assumptions or hypothesis, to search for the value in the real marketplace.
Business models both in new designs and it management have become centre stage in many of our existing organizations’ thinking. The need is not just too simply find new growth through new business models but to ‘react and adapt’ those existing business model designs that are in place, to catch-all the emerging possibilities that are around, hopefully before others do. Are we doing a good job of this at present?
BMC- Osterwalder & Pigneur. BMC Visual source: Steve Blank
Juggling Innovation Is Hard image via Michael Grills
There seems a lot at present going on around the Business Model and formulating its design. Following on from the Business Design Summit held in Berlin in April of this year there seems to be a gathering of momentum surrounding the Business model.
There is an awful lot of designing going on, actually it is hard to juggle with it all, even for me that has a 100% focus on innovation.
The Business Design Summit had as its primary question: “Are the Business Tools you are using relevant for today’s world?”
It went on to ask “If you want to teach people a new way of thinking, don’t bother trying to teach them, instead, give them a tool, the use of which will lead to new ways of thinking”. “Your business ideas deserve better than PowerPoint and Excel”
