A really hard part of managing in larger organizations is in managing the layers and competing forces. Hierarchy dominates the speed of what we do.

Often we forget to reinforce the very design within our organizational structures, we leave role structures incomplete and uncertain and we set the deliverables in often ‘woolly’ ways so we can side step the often intransigence within our organizations way of working . This just further promotes uncertainly and it is not an adaptive organization but one left open so the leadership can side step when it suites their purpose.

In leaving this so open to ignoring one minute, using it as the ‘whipping boy’ the next they slowly immobilize those underneath. These create unnatural built-in tensions and often create a shearing effect.

They grind against each other, like tectonic plates that force further disruption and upheaval.

They ‘freeze out’ creativity unless it ‘arrives’ from the top of the organization. Eventually the organization dies as it is not generating new forms of creativity from within, this has been hollowed out by this imposing from the top.

Organization design needs to change. We need to ensure creative knowledge flows up and down organizations. We need to change our thinking from layers into a network of connected parts that we keep small, flat and focused but constantly aware their existence is dependent on others outside their mini ecosystem. Today these different layers actually require several levels of reconfiguration designed into the organization. We add layers onto our layers and each time we are constraining the organizations or the individuals to explore, they stay ‘trapped’ within their space.

Imposing the killer effect of time just because of a financial calendar is stupid – it hurts innovation significantly

Just look at how organizations impose time on us. One really critical one to address and to ‘kill off,’ is the pressure of time. Imposing time as a condition for innovation can be a real killer. Time horizons to achieve different tasks often cannot be ‘legislated’ or ‘dictated’ but sadly they are forced on reluctant innovators responsible for delivery of new concepts.

We need to re-establish the difference between goals – within a certain period covered (one year), objectives – attained later but are progressed within the period and finally ideals– those unattainable but clearly possible concepts, that progress at slower rates and go well beyond normal goals. Innovation works within this environment, actually it will thrive.

Not just the incremental, but the radical, disruptive and breakthrough innovation craved for by the top management, can finally have a ‘decent’ time horizon to be managed through. Planning needs to account for all three horizons and managing across these needs different mindsets, irrespective of the industry you are in, it does not matter if you are building planes or developing food products. Managing innovation across the three horizon methodology helps reduce tensions, design innovations that can be more radical or breakthrough.

Tacking the incompatibles to ease the tensions

We really should stop pretending that innovation is not so hard and actually state it is often incompatible to much of what we perform on a daily basis. The task of managing intangibles (unknowns) alongside the tangibles (known) needs greater appreciation of their complexities, and the difficulties of balancing the two for achieving  a ‘decent’ result.

Leadership, I believe, would need to understand innovation far more in this demanding environment of inquiry. No wonder it is often ducked and just vaguely talked about as much of innovation understanding is still poorly understood in its impacts and effect. We do need to address this lack of serious innovation management within our organizations.

Reducing activities and replacing these with outcome orientation

Innovation is no different from what we expect from efficiency or effectiveness; we want to see the outcomes.  Outcome orientation holds a precious key to think about far more.  We have struggled on many occasions to clearly establish the really good metrics for judging innovation. They seem to get lost within organizations. Part of the innovation activities has been assigned to some other cost centre, or the capacity was already established and we often don’t break these down and assign these clearly enough to the different activities, we should, but into outcome orientation ones. Were the activities contributing to efficiency or innovation? We judge these through effectiveness of the outcome.

We need to balance existing performance engines for repeatable everyday tasks with innovation delivery engines for new activities to make our organizations function more effectively. Vijay Govindarajan and Chris Trimble have offered some thoughts on this at the implementation stage, although these still need more examination and exploration.

Also Scott Anthony has pointed out in his article “Negotiating Innovation and Control’ on the different ways to balance tension there is one, in my opinion, that needs deeper investigation and development and that is the ‘ambidextrous’ one. This makes distinctions but links the parts of the whole organization by developing competing frames, not competing forces. Roger Martin suggests in one of his books “The Opposable Mind” that we need to develop “integrative thinking” as part of this need to change.

Innovation should be alongside as a equal partner to efficiency. It becomes efficient innovation and core to what you do and how you operate

Seeking constant efficiencies is actually slowing down our organizations. We need to do the opposite, to speed them up and capitalize on finding innovation opportunities quickly and then knowing how to scale them equally fast. We need to do this by developing the competencies and understandings of experimentation, piloting, prototyping in fast, discreet and measured ways

The worrying thing is any dynamics within the system are dominated by the slow components, and the rapid components simply have to follow along.

“Slow constrains quick, slow controls quick”.

The only way to ensure a speeding up is to be coherent on the purpose, clarify the bounds and governing principles that need to be enacted and evolve the organization design away from layers and hierarchy. We need to build up a series of inner networks that depend on each other but constantly reach out to connect, share and exchange but more within a organizational design that is flat but highly responsive and inter dependent to work well. This needs orchestration not hierarchy in its managing.

Simply by consciously working on all the dysfunction points within an organization will certainly reduce the tensions, reduce the ‘shearing effects’ and allow the organization in all its layers to ‘react’ and be allowed to come back into a balance, where innovation sits equally alongside efficiency, especially if both focus on outcome orientation and that certainly is not the current business way we often see today.

The post Innovation tension lies in our layers and structures first appeared on Building Your Innovation & Ecosystem Intelligence.

They lead this article with “one view of complexity that holds that it is largely a bad thing- that simplification generally creates value by removing unnecessary costs”. Certainly we all yearn for a more simplified life, structure, organization, approach to systems or just reducing complexity in our daily lives to find time for what we view as improving its ‘quality’.

Within the article they argue there are two types of complexity – institutional and individual.

The former concerns itself with the interactions within the organization, the latter is the way individuals or managers deal personally with complexity.

The real important take away from this article for me was when organizations treat complexity as something they must overcome, reduce or try to ignore they miss opportunities. Complexity, the authors argue, should be seen as a challenge to be managed, managed well, and its full potential exploited, not as a problem to be reduced or eliminated. It is through the nature of these complexities we achieve competitive advantage and can exploit more of the flow of knowledge for those new sources of new profit and wealth creation.

They suggest organizations need to decide on where to hold complexity within any design and build the right capabilities where they matter. I would argue innovation certainly matters, and it is complex and needs to be understood as exactly that, and managed accordingly not in piece meal fashion. Complexity matters in building the right processes, skills and culture but because they don’t behave in linear ways and any ‘messing’ with the complexity and relationships within this can have an awful lot of unintended consequences.

We have choices of complexity

There are different types of complexity to manage. Work conducted by Julian Birkinshaw and Suzanne Heywood suggested four types of complexity. I only summarize these here.  Imposed complexity, those interventions both internally and externally that require ‘higher’ insight. There is the inherent complexity found with any organization and presently managed through striving to be more efficient and effective. There is designed in complexity, where innovation needs to fit more. These are choices about how, where and why an organization sets about its operation. These can be constrained, under invested in, even jettisoned but do have lasting consequences for the future of the organization. This is the area of strategic consequence as these can limit competitive advantaged from the level of innovation intensity chosen as an example. The fourth is unnecessary complexity where increased misalignment resides, it is sometimes easy to recognize but often hard to let go as it sometimes makes up “the way things are run around here” and have a richness in history.

The challenge of complexity within innovation

If you can begin to identify complexity that hampers effectiveness you can begin to remove it. What you have to be very clear upon is having a complete understanding, or a well informed one on all the effects if the complexity part you are removing is not the route to value and often innovation. The more creative side certainly does get constrained and caught up in this often shorter term pursuit of effectiveness for effectiveness sake and you suddenly don’t have the bandwidth for innovation exploration and more.

Do recognize that innovation is complex, recognize it does have to be handled carefully but it needs to also be fully understood for what it is, a complex adaptive system. It cannot be treated in the same way as effectiveness or efficiency can. It  needs ‘actively’ managing differently, for all the future opportunities it holds by placing the emphasis on building greater innovation capabilities to make it ‘dynamically’ work. Otherwise you end up with unexplained consequences to poorer performance from your innovation activities and often at a loss to explain why.

We do need to relate more to complexity as it comes with the turf if you want really lasting innovation.

The post Cracking the complexity code first appeared on Building Your Innovation & Ecosystem Intelligence.

We need to think about recognizing the ‘combining effects’ of four foundation pillars; of value creation (vc), business models (bm), intellectual capital assets (ica) and innovation capital (ic). It is the dynamics within the multiple combinations that will generate the future wealth creation we need.

We are in need of having a better understanding of the integrated value focal points of these four pillars combining, they need connecting so we can build the supporting structures and place the roof of need, our wealth creating one, to give us a new potential of harnessing our innate abilities to be creative. These four pillars offer perhaps a new core, a new transforming power, they make our activities connected and dynamic.

Unlocking all our potential is the job needing to be delivered upon

Our job today is to unlock the potentials from knowledge, harnessing our capitals to focus more on releasing our resources to work on their dynamic capabilities that combine vc + bm + ica + ic to make this a ‘room’ that gives us the potential to reside and generate new wealth potential.

A transforming one, where the make-up of value creation, articulated through business model designs by knowing the capitals that ‘feed into’ and build our stocks and flows for new innovation that does have the greater potential for wealth creation to occur.

The post Combining four foundation pillars. first appeared on Building Your Innovation & Ecosystem Intelligence.

The emphasis needs to be placed upon building distinct capabilities for innovation success.

“the dynamics within the existing capabilities need to be fully understood and then you need to design the new capabilities on clear understanding of the direction, vision and mission required from innovation to be more successful in meeting the strategic needs”.

Irrespective, there are big, consistent growing questions still nag away in the CEO’s mind on innovation

Q: “What and where do I place my limited (and scarce) resources to maximise the impact of our innovation efforts and how can I be sure?”

“What are those capabilities that generate differential advantage?” How can the CEO or CIO identify the links and connections they want to make their innovation activity align more with the overall capabilities system they have in place? Where does the CEO place his ‘bets’ to get the limited resources he has available aligned to gain this better return on the investments in innovation?

Can we identify a common set of critical innovation capabilities?

Yes, I believe we can.

Something that is not as it is presently a systematic in approach yet it can be by reducing the scattered and piecemeal approach today in building ad hoc innovation capabilities. To build distinct, consistent and well-defined tailored capabilities to the innovation challenges at hand is what the CEO wants to achieve and those responsible need to deliver.

If the organization is knowing the capabilities that matter most to their particular innovation strategy and then in this awareness of what and where to place the organizations innovation fitness programme so they can set about building them.

A fitness regime designed to improve, focus and execute upon these distinct capabilities needed in a highly focused manner  – sound too good to be true? I don’t think so, why not talk to me to understand this better. It has real value if you can constantly ‘orchestrate’ and build innovation capabilities to meet the challenges constantly emerging.

The post Establishing Distinct Capabilities for Innovation Success first appeared on Building Your Innovation & Ecosystem Intelligence.

A really hard part of managing in larger organizations is in managing the layers and competing forces. Hierarchy dominates the speed of what we do.

Often we forget to reinforce the very design within our organizational structures, we leave role structures incomplete and uncertain and we set the deliverables in often ‘woolly’ ways so we can side step the often intransigence within our organizations way of working . This just further promotes uncertainly and it is not an adaptive organization but one left open so the leadership can side step when it suites their purpose.

In leaving this so open to ignoring one minute, using it as the ‘whipping boy’ the next they slowly immobilize those underneath. These create unnatural built-in tensions and often create a shearing effect.

They grind against each other, like tectonic plates that force further disruption and upheaval.

They ‘freeze out’ creativity unless it ‘arrives’ from the top of the organization. Eventually the organization dies as it is not generating new forms of creativity from within, this has been hollowed out by this imposing from the top.

Organization design needs to change. We need to ensure creative knowledge flows up and down organizations. We need to change our thinking from layers into a network of connected parts that we keep small, flat and focused but constantly aware their existence is dependent on others outside their mini ecosystem. Today these different layers actually require several levels of reconfiguration designed into the organization. We add layers onto our layers and each time we are constraining the organizations or the individuals to explore, they stay ‘trapped’ within their space.

Imposing the killer effect of time just because of a financial calendar is stupid – it hurts innovation significantly

Just look at how organizations impose time on us. One really critical one to address and to ‘kill off,’ is the pressure of time. Imposing time as a condition for innovation can be a real killer. Time horizons to achieve different tasks often cannot be ‘legislated’ or ‘dictated’ but sadly they are forced on reluctant innovators responsible for delivery of new concepts.

We need to re-establish the difference between goals – within a certain period covered (one year), objectives – attained later but are progressed within the period and finally ideals– those unattainable but clearly possible concepts, that progress at slower rates and go well beyond normal goals. Innovation works within this environment, actually it will thrive.

Not just the incremental, but the radical, disruptive and breakthrough innovation craved for by the top management, can finally have a ‘decent’ time horizon to be managed through. Planning needs to account for all three horizons and managing across these needs different mindsets, irrespective of the industry you are in, it does not matter if you are building planes or developing food products. Managing innovation across the three horizon methodology helps reduce tensions, design innovations that can be more radical or breakthrough.

Tacking the incompatibles to ease the tensions

We really should stop pretending that innovation is not so hard and actually state it is often incompatible to much of what we perform on a daily basis. The task of managing intangibles (unknowns) alongside the tangibles (known) needs greater appreciation of their complexities, and the difficulties of balancing the two for achieving  a ‘decent’ result.

Leadership, I believe, would need to understand innovation far more in this demanding environment of inquiry. No wonder it is often ducked and just vaguely talked about as much of innovation understanding is still poorly understood in its impacts and effect. We do need to address this lack of serious innovation management within our organizations.

Reducing activities and replacing these with outcome orientation

Innovation is no different from what we expect from efficiency or effectiveness; we want to see the outcomes.  Outcome orientation holds a precious key to think about far more.  We have struggled on many occasions to clearly establish the really good metrics for judging innovation. They seem to get lost within organizations. Part of the innovation activities has been assigned to some other cost centre, or the capacity was already established and we often don’t break these down and assign these clearly enough to the different activities, we should, but into outcome orientation ones. Were the activities contributing to efficiency or innovation? We judge these through effectiveness of the outcome.

We need to balance existing performance engines for repeatable everyday tasks with innovation delivery engines for new activities to make our organizations function more effectively. Vijay Govindarajan and Chris Trimble have offered some thoughts on this at the implementation stage, although these still need more examination and exploration.

Also Scott Anthony has pointed out in his article “Negotiating Innovation and Control’ on the different ways to balance tension there is one, in my opinion, that needs deeper investigation and development and that is the ‘ambidextrous’ one. This makes distinctions but links the parts of the whole organization by developing competing frames, not competing forces. Roger Martin suggests in one of his books “The Opposable Mind” that we need to develop “integrative thinking” as part of this need to change.

Innovation should be alongside as a equal partner to efficiency. It becomes efficient innovation and core to what you do and how you operate

Seeking constant efficiencies is actually slowing down our organizations. We need to do the opposite, to speed them up and capitalize on finding innovation opportunities quickly and then knowing how to scale them equally fast. We need to do this by developing the competencies and understandings of experimentation, piloting, prototyping in fast, discreet and measured ways

The worrying thing is any dynamics within the system are dominated by the slow components, and the rapid components simply have to follow along.

“Slow constrains quick, slow controls quick”.

The only way to ensure a speeding up is to be coherent on the purpose, clarify the bounds and governing principles that need to be enacted and evolve the organization design away from layers and hierarchy. We need to build up a series of inner networks that depend on each other but constantly reach out to connect, share and exchange but more within a organizational design that is flat but highly responsive and inter dependent to work well. This needs orchestration not hierarchy in its managing.

Simply by consciously working on all the dysfunction points within an organization will certainly reduce the tensions, reduce the ‘shearing effects’ and allow the organization in all its layers to ‘react’ and be allowed to come back into a balance, where innovation sits equally alongside efficiency, especially if both focus on outcome orientation and that certainly is not the current business way we often see today.

The post Innovation tension lies in our layers and structures first appeared on Building Your Innovation & Ecosystem Intelligence.

They lead this article with “one view of complexity that holds that it is largely a bad thing- that simplification generally creates value by removing unnecessary costs”. Certainly we all yearn for a more simplified life, structure, organization, approach to systems or just reducing complexity in our daily lives to find time for what we view as improving its ‘quality’.

Within the article they argue there are two types of complexity – institutional and individual.

The former concerns itself with the interactions within the organization, the latter is the way individuals or managers deal personally with complexity.

The real important take away from this article for me was when organizations treat complexity as something they must overcome, reduce or try to ignore they miss opportunities. Complexity, the authors argue, should be seen as a challenge to be managed, managed well, and its full potential exploited, not as a problem to be reduced or eliminated. It is through the nature of these complexities we achieve competitive advantage and can exploit more of the flow of knowledge for those new sources of new profit and wealth creation.

They suggest organizations need to decide on where to hold complexity within any design and build the right capabilities where they matter. I would argue innovation certainly matters, and it is complex and needs to be understood as exactly that, and managed accordingly not in piece meal fashion. Complexity matters in building the right processes, skills and culture but because they don’t behave in linear ways and any ‘messing’ with the complexity and relationships within this can have an awful lot of unintended consequences.

We have choices of complexity

There are different types of complexity to manage. Work conducted by Julian Birkinshaw and Suzanne Heywood suggested four types of complexity. I only summarize these here.  Imposed complexity, those interventions both internally and externally that require ‘higher’ insight. There is the inherent complexity found with any organization and presently managed through striving to be more efficient and effective. There is designed in complexity, where innovation needs to fit more. These are choices about how, where and why an organization sets about its operation. These can be constrained, under invested in, even jettisoned but do have lasting consequences for the future of the organization. This is the area of strategic consequence as these can limit competitive advantaged from the level of innovation intensity chosen as an example. The fourth is unnecessary complexity where increased misalignment resides, it is sometimes easy to recognize but often hard to let go as it sometimes makes up “the way things are run around here” and have a richness in history.

The challenge of complexity within innovation

If you can begin to identify complexity that hampers effectiveness you can begin to remove it. What you have to be very clear upon is having a complete understanding, or a well informed one on all the effects if the complexity part you are removing is not the route to value and often innovation. The more creative side certainly does get constrained and caught up in this often shorter term pursuit of effectiveness for effectiveness sake and you suddenly don’t have the bandwidth for innovation exploration and more.

Do recognize that innovation is complex, recognize it does have to be handled carefully but it needs to also be fully understood for what it is, a complex adaptive system. It cannot be treated in the same way as effectiveness or efficiency can. It  needs ‘actively’ managing differently, for all the future opportunities it holds by placing the emphasis on building greater innovation capabilities to make it ‘dynamically’ work. Otherwise you end up with unexplained consequences to poorer performance from your innovation activities and often at a loss to explain why.

We do need to relate more to complexity as it comes with the turf if you want really lasting innovation.

The post Cracking the complexity code first appeared on Building Your Innovation & Ecosystem Intelligence.

This is my adopted approach to work through this in a systematic way.

No question, this is designed to make sure those involved take their time working through the different levels of understanding needed. A journey where you ‘transform’ your innovation capabilities is likely to be realistically over twelve months or more. So much does get in the way to deflect you, to block you, to divert you. This is the nature of organizations, any approach to making ‘transformational’ change, and this is what this is, needs to go at the right speed and deal with the obstacles and constraints in thoughtful, well designed and clear ways.

Why is this potentially a long journey?

Well to appreciate what you require you must firstly need to understand not only what you have but what it currently provides.

Then you need to construct a clear strategic position of where you want to go in your innovation activities and these are totally different and unique to each organization.

Any journey like this needs to be well thought through, considered for all its implications and potential impact and disruption to what is existing.

It is a journey you have to want to travel and your fitness levels need to be progressively built up.

So these steps may have ‘individual wrinkles’ to them but most probably follow the same innovation discovery pathway.

1. Getting Started – Understanding the Needs & Imperatives of Innovation Fitness

• Why we must travel this critical path for Innovation.
• The meaning of dynamic capabilities and innovation fitness landscapes
• Merging  the theory with practical reality to produce new outcomes and positive results.
• Focusing on resources and performance – why is this important
• The problem is knowing what we have and what we really need

2. The Fuel of Innovation Performance – the dynamics of innovation

• A sharper, clearer focus on innovation resources to meet strategic need
• What is known about resources to sustain, enhance performance
• Knowing and aligning  your strategic criteria – for sound innovation approaches
• Getting innovation within the right context of your business
• Moving your resources in the right direction

3. Getting even more specific – quantification and qualification

• Recognizing the building of scale, change rates and dynamics that happen over time and why we need to constantly build our innovation capabilities.
• Developing the resources to meet the need – structured, focused, clarified by bringing out the necessary discussion.
• An illustrative scenario for a directional innovation fitness landscape map
• Recognizing resources can come beyond the firm and bringing these in successfully. Managing within a more open environment.
• Achieving  mutual dependencies to support; recognizing the hindering ones
• Being aware of  the impact of different scenarios in the management of innovation

4. Building the Innovation Fitness Machine – reinforcing feedback, identifying needs

• Recognizing the current status, spotting emerging patterns, seeing spaces and gaps and identifying solutions.
• Beginning the ‘adaptive walk’ to get to higher fitness points needed to compete.
• Clarifying the complementary resources, looking to embed new routines quickly and set up follow through approaches.
• Introducing natural tensions into the system to trigger ‘step change’
• Resource dependence climate, culture, diversity, intensity and uniqueness
• Reinforcing feedback – watching for dangers, managing the machine capacity, removing the brakes selectively
• Shifting your resources need not deplete or force other people to compete for them – working through the tensions within teams and silos.
• Matching resource dynamics with the innovation value chain & life cycle stages
• Simulation modelling the ‘what ifs’ and ‘why’

5. The Strategic Architecture – designing the system to perform as needed

• The step process for designing and executing the architecture design
• Diagnosing performance challenges and road blocks – resolving, moving on
• Lining up the solutions is not a linear process and needs careful management
• Addressing the effects of intangibles in the Strategic Architecture.

6. The Hard Face of Soft(er) factors – the hidden power of intangible resources

• Clarifying the impact of the intangibles and recognizing time, climate and conditions are significant contributors to innovation activities.
• The different rivalry types: internal and external, inter department, inter projects and working through resolutions to these.
• Reflecting feelings and expectations, addressing all the different needs
• Measuring the tougher parts of intellectual capital
• The real value of your intangible resources
• Recognizing the value of hidden innovation and spotting its occurrence

7. Entering into Competitive Battle – the Dynamics of Rivalry, the Uniqueness of You

• Recognizing, developing, capturing, transforming, avoiding and out – manoeuvring
• Your point of choosing what, where, how and when to compete.
• Building capabilities that are unique to you and hard to replicate
• Building sustainability into the innovation equation as ongoing
• Extending the turf, exploiting the situation, pushing beyond, seeking partners.

8. Building and Testing Capabilities to Perform

• Measuring capabilities through different fitness levels and scale.
• Learning to build capabilities as ‘ongoing’ and evolving for changing needs
• Re-Structuring the process for dealing with the dynamics of change
• Knowing the points of impact on performance to enable recognition and reality
• Managing innovation performance progressively across the spectrum of business need through testing and extending capability learning.
• Building from personal to team to organizational learning in measured steps
• Recognizing the role of leadership, achieving strategic alignment and working on broadening out innovation competence at different organizational levels.

9. Keeping the innovation fitness wheels turning, keeping your eyes on the road

• Resolution of conflicting goals, control and structure
• Dissecting conflicting positions, resolving impasse
• Knowing the limits of human engagement
• Goals, controls and measurements can dominate and strangle
• Keeping the measurements simple and clear
• Managing innovation as a critical strategic resource
• Merging the results into a greater alignment to Strategy and Approaches

The end result is looking to generate your fitness landscape

As you can see this is applying a very comprehensive approach, a fairly ‘intensive’ one.  This might alter individually after some clear piloting, learning and experimentation undertaken.  Building innovation capabilities takes time; they are complex, highly structured and multi-dimensional. Any structured approach to tackling innovation takes time and considerable commitment.

Looking for a clear end result

Any learning involves sensing, seizing and then transforming. We are searching for what makes up the present system and what needs to be part of the future to create a ‘best’ innovation capability environment that is sustaining into the longer-term. Those that can be continually ‘orchestrated’ and constantly adapted to meet the strategic need.

We are striving towards a true ‘innovation coherency premium’ in design, knowing what makes up your core dynamic components. The outcomes are to know where to invest, what to dampen down and what aspects can evolve naturally and be ‘taken along’ as you focus upon the ones that are more dynamic and relevant to your innovation needs.

No journey is without pitfalls.

Finding the dynamic capabilities of innovation that ‘fit’ with the strategic needs of each organization will be different based on their own respective challenges and position. We need to stop simply copying others and create our own ‘dynamics’ to strengthen our own unique advantage points for sustaining our future. Do you want to become innovation fit?

The post Nine steps leading to understanding your dynamic innovation capabilities first appeared on Building Your Innovation & Ecosystem Intelligence.

These dynamics are made up of the capabilities and competencies that reveal and clarify what is required as the relevant traversing points needed to achieve improving innovation success, to move you more effectively towards your strategic innovation goals and build a fitter, more responsive and dynamic organization around its needed innovation capacities.

The lead explorer to walk you across this innovation terrain is Paul Hobcraft

By exploring and modelling the mutual dependencies you get to see how the existing and alternative future innovation system  will behave as you begin to map out and recognize the different emphasis points that make up your innovation system. You can begin to identify what are the more important dynamic ones that require a more dedicated focus and placing more of your resources behind, while others can evolve at their own pace or simply improve as they are far more dependent on the dynamic ones than you realized initially. These can get simply get ‘pulled along’ and rise equally in their performance.

There is a complementary set of forces; improving one often triggers improvement in another. What you have to guard against is possibly ignoring one might equally impact negatively on others. Recognizing dependencies is critical and their triggering effect makes innovation evolution even more dynamic.

We are looking for the ‘combination’ effect of a dynamic set of capabilities and competencies that generates improved performance. The issue is to know what and which ones?

The combination effect to gain a greater innovation fitness effect comes from managing this over four stages shown in the above visual of the journey of innovation fitness dynamics.

The four stages will be described in more detail in future blogs but briefly are:

1. The goal within these stage is to identify the key dependencies relevant for improved innovation within your organization to discover
2. what are the mutual dependencies that will have a more dynamic impact on your innovation system so you understand
3. what consequences come from this and how the changing environment will behave so as to consider the effect, that then leads to
4. what recognition and implications this has so as to put in place an ongoing, evolving set of innovation dynamics that keep you fit to perform innovation on a sustaining higher performance basis.

Again I want to emphasis here, this is an evolving journey but the critical recognition here is, for innovation to continue to be the driver of future growth and wealth, it clearly does need to have a greater understanding and recognition of its management potential within organizations.

This site www.innovationfitnessdynamics.com is determined to push beyond today’s accepted, often ‘lagging’ performance from innovation activity, and raise the innovation performance engine up within organizations. I feel we do have this critical need to have in place a growing clarity of the factors needed to consistently deliver a more ‘leading’ position of knowing what does actually have real dynamic impact, both on an organizations innovation performance and the individual contributions that contribute towards the required strategic goals and objectives.

This I feel states our journey and how we are planning this out to traverse across the terrain towards better innovation solutions, that make up the dynamics of innovation and provide a ‘fitness’ solution that is unique to your needs. Care to share and join the journey?

Paul Hobcraft

Mail to : paul*AT*agilityinnovation.com

www.paul4innovating.com

www.agilityinnovation.com

The post Moving along the path to innovation fitness first appeared on Building Your Innovation & Ecosystem Intelligence.

Understanding Absorptive Capacity and how it works

“Absorptive capacity” is a term introduced through some academic research by Cohen & Levinthal, back in 1990 to describe an organizations “ability to recognize the value of new, external information (knowledge), assimilate it, and apply it to commercial ends”. Since then there has been significant academic contributions for exploring and validating this, in order to improve innovation performance and competitive advantage, yet it is still not well integrated into our innovation process. Why is that?

What we do need is to do is improve our HR management and network systems to build a more efficient transfer of knowledge throughout the organization so as to acquire and leverage new knowledge . This is part of applying the principles of absorptive capacity as we increasingly use more networks, external partners and collaborate with others we are accessing wider skills, inputs and competencies. We need to invest and learn what this does provide, to aid the innovation process. The theory goes that the more we understand, the more the innovative behavior and capability does goes up in potential and the more we have available a richer innovation choice .

The Model of Absorptive Capacity explores potential and realized knowledge.

The need for a distributed organization innovation knowledge system

In some studies by Van den Bosch et all (2003) they suggested the need for three combined capabilities to manage and absorb the flow of knowledge coming into the organization

1. System capabilities that are used to integrate explicit knowledge
2. Co-ordination capabilities that build upon teams that establish the routines for structuring communications
3. Socialization capabilities that begin to share a ‘certain’ ideology, understand the potential of new paradigms and work towards interpreting tacit information for the good of the community.

When organizations are acquiring new insights, new knowledge that is not as closely related to their existing knowledge base there needs to be a very active set of efforts to manage this new incoming flow. The aim here is to extract all its potential value, to absorb it and disseminate it across the relevant parties within the organization. Having the three capability parts structured clear helps establish different areas of capability focus and embed it more fully as an organizational approach to learning and gaining understanding.

Can you imagine where we  have the need for rapid learning of leading-edge knowledge that is required to be absorbed within the company, these require dedicated structured learning, and these cannot be left to individuals or ad hoc measures. When you are learning anew you are searching for cognitive structure, managing implicit, often un-codified knowledge (tacit) that is difficult to transfer and also increased complexity, where you need to absorb a greater range of ‘components’ and apply new‘ architectural’ knowledge. The difficulties multiply if you do not recognize the needs to structure knowledge as well as organize it so it can be explored in more open unbiased ways that you gain from, in diversity of thought.

The ability to use external knowledge has three sequential processes.

A)     Exploratory Learning– recognizing and understanding the potential value of the new knowledge that lies outside the organization

B)      Transformative learning– dispersing and assimilating the valuable new knowledge

C)      Exploitative learning– using the assimilated knowledge to create something different in knowledge or product and seek to exploit this in commercial ways.

The more open Absorptive Capacity Process leading to understanding and outcomes

The call for managing the effective use of knowledge

One of the central drivers of the competitiveness of organizations is its effective use of knowledge. It is the generation, acquisition, integration and application of (new) knowledge needs managers to manage learning. Knowledge underpins innovation, the more it changes, the more it becomes complex to discover, the more we have of this real need to upgrade how we experience, experiment and absorb learning. This needs structuring.

As we absorb more external knowledge from our collaborators the need is to organise this increasingly. We need to sort information into knowledge that becomes useful and actionable.   Absorptive capacity needs to be looked upon as something that should go beyond good theories into increased application through its application.

Absorptive capacity is an integral part of an organizations innovation capabilities and its healthy development is a real significant dimension of innovation management. I suggest we all need to consider its place within our fitness regime to achieve a growing  more ‘dynamic’ set of fitness capacities.

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We need to cultivate Absorptive behaviour and allow it to flow.

We need a system to capture and allow knowledge to flow. For me the adoption model seems to be one worth investigating. If we want to achieve the goal of distributed innovation we need to have in place this possible framework around absorptive capacity to encourage different learning behaviours.. Nesta (www.nesta.org.uk) produced a useful report some time back called “Innovation by Adoption” and I feel this has a good framework that support distributed innovation.

The report argues in a place with a strong absorptive capacity three main outputs subsequently result from the flow of external or distributed knowledge: (1) the creation of new innovation; (2) the creation of new knowledge; and (3) that it does lead to new economic and social value.

Innovation by adapting the adoption model within your distributed innovation needs.

If we agree that most innovations happen outside often self-imposed boundaries then we have to extend out all our boundaries and go beyond our present levels of innovation building. Go outside our box to expand it.  We have to open up. We certainly understand that today innovation is not confined with the walls of one particular company. The world ‘absorbs’ more innovation than we can turn into greater value but we need to attempt to capture this and see if and where its value might lie. This is going to be achieved more likely within a distributed approach asking everyone to contribute to innovation ideas and providing them on a consistent basis the likely content and context fit that they need to look for .

We need to continue to push innovation created often locally, back up through the organization so it can potentially turn these insights into  innovation that will find a place in our world that improved on the existing that was something that we contributed too, that can be highly motivating. For this to happen organization have to recognise the inter-dependency and reliance that a diversified, distributed engaged group of people can bring to accelerate innovation to share, explore and work on turning ideas into new solutions .

What we need to find is ways to absorb this flow of daily knowledge, quickly recognise where it might meet our needs and then fit these to the wider audiences available that search for innovative solutions. There is an awful lot that can derive from a more distributed innovation network that allows a greater flow across a networked organization.

Approaching absorption in two ways

Absorptive capacity captures and enables this flow in each direction. Nesta through its research into this absorptive need  also suggested a model called the AC/DC model where they argue you need to develop two broad sets of capacities: the absorptive capacity (AC) to identify, value, and assimilate and the development capacity (DC) of places to develop and exploit such knowledge.

AC/DC Model

We need to adopt a more distributed innovation model in our thinking

Applying these two models into your thinking to achieve a more distributed innovation model would help to capture, anchor and diffuse all the innovation that lies not just within the ‘walls’ of your organization but just beyond where your local people can see it, value it and bring it into the organisation as one of their contributions to innovation.

Permit people to ‘see’, to ‘engage’, to become ‘deeply involved’ then organizing around distributed innovation can lead to greater empowerment and sustaining your innovation engine and knowledge. Fortune will favour the connected mind not just the brave lonely few. Absoptive capacity has a clear role to play in building capacity to innovate.

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