The innovating power of ecosystems and platforms

Ecosystem 1Our whole understanding of innovation is changing; there are numerous shifts occurring.

We are moving towards a new management of innovation where ‘greater’ collaboration is fueling new business models built on platforms, formed around ecosystems of communities with vested interest, contributing and extracting value.

Today and in the future, the value is created outside the individual company and not within. It is far more working as a constellation, drawing from an evolving network effect seeking out combined solutions from this design.

This third post of an extended series on my thoughts on “moving towards a new way of managing innovation” that explores the potential for changing the management of innovation, this looks at the significant value of platforms and ecosystems.

We need to find a new way of doing things differently around innovation and its management.

This is based on a relationship-based, networked designed concept built for collective activities. Relationships where shared value leads to a value creation that no one single organization can provide.

This requires open collaboration and an environment seeking mutual promise from individual input, contribution and extraction, delivering an integrated set of services and solutions being constructed on the platform from a sharing of knowledge, for delivering into evolving value propositions, all benefiting from, both collectively and individually

I am proposing in this series a view that innovation management needs to radically adjust and will be based on the thinking around the shift from products to solutions, from transactions to growing far more value-adding ongoing relationships, from a supplier of product services into highly valued network partnerships, exploring innovation across all options, instead of delivering on discrete elements; this requires managing the whole ecosystem of the innovation design differently through technology where platforms dominate.

Moving towards a new innovation service model

Moving towards a new business model BalloonsThe realization that innovation goes way beyond product innovation is a massive hurdle for many of our existing organizations to overcome, certainly in what they are offering today as solutions.

We are also witnessing such significant erosion of long-standing practices, and established boundaries between suppliers and customers, you get this feeling that everything is blurring.

This is part two of an extended series on my thoughts on “moving towards a new way of managing innovation” that explores the potential for changing the management of innovation.

How can the innovation process capitalize on all the changes we are undertaking at present in new ways, in broader engagements and collaborations, to deliver more effectively on the promise within our innovation potential?

Well I would suggest we do need to refocus

There is a very strong case we need to rethink the whole management of our innovation activity, as innovation is failing to deliver on its potential promise in the current ways we are attempting to undertake it, highly constrained and under-resourced.

Shifting Radically the Innovation Business Model

Changing the innovation business model
Shifting Radically the Innovation Business Model

I have been spending some significant time questioning the current innovation business model, from both the customer’s (clients) perspective and the innovation consultants’ one.

Now we all know not all things are equal, many companies have invested significantly in improving their innovation capabilities.

Many of these have been heavily reliant on outside help in achieving this position yet all the effort has led to limited returns for many and still a work-in-progress.

Yet far more of our business organizations are continuing to really struggle on their innovation activity for a whole host of reasons that seem never-ending, disappointing in end result and stuck in management quicksand to ever really change.

For me, the process and management of innovation really does need to be definitely questioned.

Innovating: So What Is Possible?

Often we forget to frame what we want to really achieve in our innovation activity, instead, we simply dive in and start innovating. I believe until we know what solutions we feel we need or what the market wants, we will more often than not, end up disappointed in our innovative solutions. Simply generating ideas, for ideas’ sake, just does not cut it at all.

In recent years our innovation understanding and its management have significantly changed, due to numerous factors that have been happening. These have been advances in technology, methodology or design- thinking and we do need to stop and think about how we could do ‘things’ differently by asking “what is possible?” This should be asked not just on each occasion of an innovative concept design but within the total innovation system, we are presently operating under.

Perhaps by asking three critical questions on “what is possible?”  we might produce better innovative answers (and solutions) than simply not bothering to, at least, scope out the real possibilities, where we can miss so much.

The aim of asking is to reduce the constraints, free up resources, leverage the techniques available, and equally, push the boundaries of your thinking to want to generate “great” innovation, not just the mediocre, incremental stuff, so often produced and labelled “innovative” that we end up doing.

Making an impact on an organization’s innovation environment

Our Innovation EnvironmentWhere do you set about to intervene and begin to change the organization’s ability to innovate?

There are seemingly so many intervention points it can get bewildering.

The innovation environment can be made-up of how well you collaborate and network, the level of the group and individual interactions, the presence and commitment of leadership towards innovation, as well as the organizational set-up and structures.

You can explore the make-up of the innovation environment in so many ways.

So what makes up the environment to innovation?

It is the culture, management and its people who have a mutual dependency. Culture can enhance or inhibit the tendencies to innovate, it certainly has a profound influence on the innovative capacity and provides the rich nutrients to nurture innovation or kill it. Culture has always been regarded as a primary determinant of innovation.

Changing the workplace environment for innovation?

Creating the Conditions to InnovateYou can’t escape the reality that having the right environment for innovation means different things to different people.

What we should be all able to agree upon is that the environment for innovation houses many of the conditions that connect innovation in people’s minds.
The environment needs to be connected to the vision around innovation, it needs to be translated for each of us to relate to and want to contribute.

The environment provides the right growing conditions for your organization to foster its unique environment to prosper and grow.
Deny those growing conditions and any innovation initiative is going to struggle and eventually die from the lack of the essential feeding of its roots.

The Compelling Value of the 3H for Innovation Management

The Value of the Three Horizons of Seeing Beyond
The Value of the Three Horizons of Seeing Beyond

Following on from my suggested Common Language approach to the Three Horizons, I would like to outline here its significant value, within any innovation management thinking.

Clarifying our options requires multiple thinking horizons – seeing beyond for all possibilities by listening to the different voices

For me, the three horizons have great value to bring together and  map all the different thinking and possible innovation options over changing horizons.

You can frame innovation in alternative ways by using this approach. Innovation has multiple evolution points and working with this framework allows you to significantly improve all of your innovation contributions.

It goes well beyond the present value of ‘just’ fitting your existing innovation portfolio and directional management into a typical one-dimensional view of just working in the present.

The Three Horizons – Providing a Common Language in its Innovation Use

Forming a common view of 3H
Forming a common view of the Three Horizon for Innovation

As you may know, I have been writing significantly around the Three Horizons in relationship to innovation.

Initially drawing on the foundation within the McKinsey initial papers, updated here under their enduring ideas, and in particular based on by its original authors of the book “The Alchemy of Growth” by Mehrdad Baghai, Steve Coley, David White and Stephen ColeyThen I discovered the work of the International Futures Forum, based in Scotland, where a group of members have extended the 3H significantly, well beyond McK’s initial work from my perspective, into a broader, more robust methodology tackling complex problems.

It was this IFF work that excited me, it opened up my thinking to find better ways to deepen the innovation connections and framing that could be suggested in the use of this three horizon frame in exploring and expanding different techniques and approaches.

Connecting the innovation thinking dots

Most Innovation is Becoming Business Model Innovation

As we consider the interplay between innovation, business models and change, it becomes clear that many companies have a definition of innovation that’s far too narrow.

Increasingly we need to rethink the scope, depth and breadth of innovation possibilities, as well as the secondary implications of innovation.

Ignoring this broader definition of innovation means we can never achieve all of the possible benefits innovation has in store.

We believe ignoring the breadth and depth of innovation can also allow competitors and new entrants to disrupt your position or industry.

Fortunately, some of these definitions have been created for us.

Our responsibility is to understand the definitions and their implications, not stay constrained but seek and explore the broader options this can provide.

The Interplay in 3 Essential Change Points for Innovation

The Critical Interplay 2There is always a certain impact that innovation brings, it should change habits, alter perceptions, improve our lives or alter the way we work and think.

Each change brought about by innovation does have different impact effects upon three important market constituents: customers, the markets and the industries themselves but also and often totally under-appreciated, internally on the innovator driving the change.

We need to understand the broader scope of our innovation

Until we understand the scope and impact of innovation we can’t fully grasp the nature and amount of change that innovation can unleash. It can alter businesses, shift markets and challenge customers to move away from their existing thinking into adopt this new product or service.