The critical role of innovation is without question needed for the future growth, wealth creation and organisations potential survival.

Who is to drive the human change required here within our business organisations?

I believe within our human resource groups they must provide the people solution to building innovation capacity, they should contribute to providing lasting design impact and central engagement role in building innovation into the core fabric of the organisation. They become central to helping deliver, distinctive, radical, even game-changing innovation and that needs clear, distinct capabilities, capacities and competencies to be design into and innovation management system.

Those in human resources should be good facilitators, the catalysts of leading change required to make innovation more centrally the core of our organisations. They need to  play a pivotal role in the needs to facilitate and underpin top-line growth with establishing the organisation design and deliver the resources for bottom-line impact, determining why people are the essential essence of innovation and how they are going to deliver this ‘resource’ into the innovative mix.

HR needs to make sure all the necessary structure and appropriate resources are designed into the organization, in every activity for making innovation the ‘way of life’ One that it is well understood as corporately vital, fully integrated in outcomes, that have definitive metric and measurement designed in ,resources well support and consistently trained and ensuring there is this ongoing, sustaining enhancing in building the innovation capabilities and capacities. They can help deliver the dynamics needed in innovation.

To take innovation into the organisations core needs HR

If HR took innovation into the core of organisational design, then a mandate for each person becomes a required necessity so as is to get fully involved and engaged in innovation activity. An essential part of this is to ensure the valuable experience is built-in, on an ongoing basis, that enhances the desired capabilities for the future of the organisation and themselves, to grow in confidence and experiences. If innovation is seen as core, you begin to break down the present barriers and mindsets that restrict innovation today by current behaviours, blocking innovating activity or placing constraints in allocating the required resources to ‘allow’ innovation to flourish.

HR can find clear ways to foster innovation in more open ways, it can cut across borders, discourage silo’s and promote collaboration. HR can become a powerful connector, platform provider for building networks, relationships and being a key component to building the learning that innovation requires.

Future leaders will be different

Future leaders need to emerge not from managing existing assets well but in managing in increased uncertainties, being more adaptive, agile and responsive to changing needs. CEO’s are demanding creativity, flexibility and speed to size up, quickly seize and grab breaking opportunity. These newer demanded skills come from knowing how and where to go, to be well-connected across platforms of knowledge, having close client connectivity and being able to extract all the essentials, resources and commitments to enable execution. Adaptability to constant change has a very different mindset to be developed in our future leaders.

HR- being on the cutting edge of innovation

HR does need to step up and define a new mandate for innovation and become essential in delivering a new cutting edge to innovation. If innovation is ever going to achieve a core place within organisations it has to be deliberately designed in for skill definitions, leadership development and knowledge and experiences gained. HR needs to cultivate, mobilise and capitalise the future design of innovation and then deliver this as part of the top team within organisations.

If this means employing external mentors, coaches and innovation expertise to bring HR up to speed, to help them to deepen their knowledge and the people connection, then it is well worth it. Care, of course, is in finding those that have the depth and breadth of required experience to work alongside them, to build up and transfer the appropriate understanding of those innovation needs.

I believe HR can determine where the true innovation premium lies, in the people and set about ensuring that the daily fabric of the organisation becomes innovation as a new core, well supported and constructed to deliver sustaining invention, creativity and innovative solutions to aid the growth organisations clearly need today.

HR clearly needs to take on a more pivotal role for innovation.

They can become central for a lasting place to plan and significantly contribute to building innovation capability and capacity, or stay more passive and operate always in the outer periphery of today’s business needs and watch as this role diminishes in the future corporate relevance, as it is one where innovation does need to play, to become core.

Building capabilities and capacities for innovation are essential to our organisation’s future well-being and for me, the HR groups within our organisations do need to step up and become far more engaged in constructing this innovation design through building the capacities needed.

Can HR step up to the challenge of laying out a clear organisations design for innovation and then deliver all the parts this means?

The post The role Human Resources can play in Innovation and its needed Design first appeared on Building Your Innovation & Ecosystem Intelligence.

I think Patrick’s business model lends itself to this constant focus on value. Patrick runs fluidminds, based in Zürich, Switzerland. fluidminds helps its customers to think by challenging existing business rules, offer structured thinking and different perspectives on the strategy process and support the execution.

Patrick wrote his thesis about Business Model innovation in the digital age and from this emerged his unique ‘take ‘on working through the business model. Patrick has been dealing since 1997 with questions around how the web changes Business Models and how Business Model innovation should and could look in the digital economy.

fluidminds wants to create new businesses and to shape industries with business model innovation, with a large part of Patrick’s practice centered  on German speaking markets but he has consulted across numerous English speaking ones as well.

So in my guest post I put forward this three point view of value.

Knowing where to start in designing a business model or simply just even trying to describe it to others can be difficult. You need to explain its value. The great advantage of explaining this through a business model canvas that looks for value constantly does help.

fluidminds approach to exploring and explaining the business model does just that- it focuses on focusing the mind –  on the value within the business model.

The first value point is in the Value Proposition

Naturally we all look to the Value Proposition to explain the business model but like a car you should always look ‘under the hood’ to see the engine and what gives a car its performance. Equally you should stand back from the proposition and ‘take in’ all that makes this up. For a car it is the styling, the design, the promise and what or who is behind it. We look to buy on a given ‘promise of value’ and in having the benefits explained it allows us to believe and ‘see’ the potentials. A business model, well designed and described, does just that. It confirms the (new or existing) value that makes up the new business model.
The value proposition shapes much; it identifies and defines where this business model is providing new offerings that advance on existing benefits to customers. The fluidminds business model canvas seeks out the customer and the customer benefit- it is looking to provide value by identifying where there is a clear fresh, new proposition.
We do have to recognize a value proposition is not just looking to resolve the known jobs-to-be-done. In many new business models can be bringing together often fragmented parts of existing offerings and combining them in new ways, or deliberately and completely disrupting existing businesses through adapting new insight, technology advancements or understanding, into new business models.
We only need to think of Apple and how it combined different technologies, revolutionary design and applied new materials into stunning, game changing products that changed our thinking of the actual jobs we thought about into totally different ones, which totally undermined existing business value or perceptions. Those become game changers.
Equally, a value proposition can emerge from those creative minds; again think Steve Jobs, where totally new business models become constructed upon a strong, clear vision or even different strands or inklings that something can be simply changed as the elements that were needed became available to make this happen. Yet they only happened from the dedicated hard work that came from purposeful design and detailed understanding of the possibilities.
No, value propositions come not just from known jobs-to-be-done but also from the unknown that can be identified through observation, research or ethnography how something is being completed. These come often from fertile, inquiring mind to see new combinations, different discoveries and then piece them together, in a business model that delivers new promise. So think beyond ‘just’ product and services, think always new business potential and then set about its design as the starting point, don’t constrain yourself initially.
Using a business model design approach that offers us a ‘fresh’ canvas structure where we can construct or even deconstruct the existing, might lead to completely revolutionary thinking when it comes to seeking out clear and exploring new value in any business propositions.

The second value point is in the Value Architecture.

For me, the architecture of the Business model is what and where something is going to deliver on the promise identified in the Value Proposition. Although much of the architecture of any business model is not seen, it is the ‘heart’ of what delivers the value. We can’t ignore or gloss over the value architecture, we must address it fully.
Fluidminds business model approach devotes much of its ‘canvas’ to this part. The initial questions of clarifying the offer, the value chain, the need for identifying core capabilities, for explaining the distribution and communication channels and who the (potential) partners are, all are initially raised specifically within the canvas to be addressed.
So many of these begin as open ended questions, not just when you are building from scratch a new business model but when you want to ‘challenge’ an existing one. Architecture will always ‘raise its head’ to be fully addressed. It is vital.
It might not be the sexist part of a business model but it is the ‘guts’, the performance engine, which can deliver the respective parts for ‘the promise’.
Addressing what makes up this part might leave some open questions to be resolved later but I’d recommend starting on the architectural design purposefully from the moment you begin, this makes for better and valued on-going conversations. You don’t need to get bogged down in the actual nitty-gritty of the exact design but you do need to sketch out the design and that is the role of the business architect, the orchestrator of design.
This is the place you seek and clarify understanding for that value. You operate often in three thinking minds here, to be fluid, agile and adaptable. You need to layer into your thinking a strategic view, a business design one and begin to work through the implementation actions and possible implications. You design and sketch. You need to begin to think layers of abstraction, a flow cycle approach.
The thinking around each part of the Value Architecture needs to grow within your thinking – the purpose, the performance you need, the possible processes that can support this, the level of preparation this will require and the level of commitment your people need to apply to this, so as to underpin and support the emerging business model or needed to change the existing one, all arise.
This is where the real value comes into play within the Value Architecture part. The deepening of thinking to achieve a shared thinking of what is possible, what needs further work to achieve the ‘value’ being looked for out of the business model.
So value architecture is the place for identifying the ‘value creation’ points, the rules and emerging governance that needs to be put into place. It is a large part of the fluidminds canvas as it requires multiple conversations to continually build the design to deliver on the ‘promise seen’.

The third value point is in teams and values

Anything new has controversy as it is pushing the known and accepted into the unknown. It raises fears, it whispers possible failure but for those that ‘unite’ and can see new possibilities a shared business canvas becomes the bonding point, the point where ideas come together and form within the team.
The canvas becomes the focal point where the energy flows. The value of bringing into any discussions on designing or redesigning a business models early enough those different opinions, is of huge value. This brings you around the canvas to agree where you are going to spend your energy, your days in the future, your commitment, your passion.
You begin to identify the strengths and weaknesses of the group; you begin to explore each other’s known and often surprisingly unknown competencies.
You also begin to spot gaps but you are working ‘collectively’ in resolving each other’s values and understandings of what ‘makes up’ the essence and worth that you perceive the new business design can bring, that ‘collective difference’ that allows you as a team to keep constantly questioning where the value lies by combing the efforts. You together as a team design-in value.

Having ‘value’ as central to your business model design is critical.

The design of the fluidminds business model canvas purposefully ‘looks’ for the value points. It provides a structure that asks for a value proposition, seeks out the value architecture and looks to the team to define their values and what values they need to pursue.
So why should your new business model exist? Because it seeks out new value, pure and simple, irrespective if you are an entrepreneur, someone just starting out for the first time or an existing business questioning its existing business approach. A new business model in its design, in its proposition, in its approach does need to seek out the value points constantly to get the best out of any new emerging business concept.
Are you exploring value constantly within your business model approach?

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In most organizations the Human Resource Management (HRM) function seems to have been far too often side-lined on shaping and influencing how innovation should be designed as a critical part of the future for the company. Many of the existing traditional HRM solutions might actually be in conflict and working against innovation actually.

If we look at the broad areas that HRM has to cover and master in organizational development today, it can, perhaps, leave little time for adding in innovation into this array of demands.

You can understand that HRM has little time to master a ‘decent’ understanding of what makes up innovation, when they are grappling with so much already but they should.

It might simplify or promote a rationalizing of some of the existing practices built up over considerable time as the expedient option but this is still creating a ‘lagging’ set of effects and not offering the ‘leading’ ones that innovation demands.
Today’s HRM role is demanding and complex, no question.

Let’s firstly remind ourselves what does make up a current HRM role in leading or participating in many crucial areas needing constant attention.

These include planning and designing and the executing of change management, seeking out potential leaders, participating in career development and recruitment, managing organization capability and effectiveness in all its different demands called for across a diverse demanding organization.

This goes along with seeking out different designs to team building, organization transformation, building knowledge and talent capacity, let alone the classic payroll, reviews and turnover questions brought on by volatile markets, change of directions or global expansion.

I could add more but organizational development is an extremely tough, challenging and pivotal role, often under-appreciated and struggling to gain their rightful seat at the top table.

Adding innovation as a simple add-on will not work

So adding onto this veritable list of tasks we are appealing for a different approach and more focus on innovation, maybe a little unfair because it is unlikely to work.  I believe HRM should have a new raison d’être making innovation the central, repeating theme running through of all the activities currently being undertaken and mentioned above.

Presently HRM is little involved in the current innovation process where innovation is focused on developing and designing new products, services and often even excluded from the design of new innovation business models to find the best ways to break these out from existing organization design so they thrive and not just survive due to patronage alone.

The management of human resource needs to be replaced with the management of human creativity and ingenuity, as this is the triggering point to innovation success. The critical role of innovation is without question needed for the future growth, wealth creation and organizations potential survival.

Who is to drive the human change required here?  I believe HRM should have a lasting design impact and central engagement role in this.

HRM has a crucial role to play in the needs to facilitate and underpin top-line growth through innovation design and bottom-line impact through risk balance and control as people are the essence of innovation. Individuals gain (new) insights, they offer idea generation and the capabilities to implement these through the designed innovation process as new introductions into the world that improve on the existing.

HRM needs to make sure this is well supports and happens by ensuring the people factor is well designed into the organization, in every activity for making innovation the ‘way of life’ and well understood as corporately vital to be well support and consistently enhance in capabilities and capacities.

Reversing the current organization design

Over the past few decades, even the past century it has been the organization ‘knows best’ and decides and passes down, the teams are then resourced and empowered and the structure is put in place for the individual to deliver. Today that is not working well.

Going forward this top down approach will simply not work. In the case of innovation the reverse actually applies. The germ of an idea or insight starts with the individual connecting different strands of knowledge and combining these in new and often novel ways.

Then they must go and convince others of its value, so they will support this and turn it into a project. This then needs to move up the organization for others to come on board to offer the necessary means, resources and support to achieve the eventual outcome.

Failure to move potentially exciting but ‘raw’ ideas into projects, then into reality by attracting required resource is becoming crucial to be managed. Recognizing this essential shift of bottom up is crucial in organizational design for skill development and approaches throughout the organization.

If we take just one example, the failure to take ideas forward as one area that needs to be treated differently than the current traditional judgement or measurement metric of valuing only ideas just going through the pipeline. If we value experimentation, prototyping and piloting of innovation ideas that did not fully work out or got combined or re-scoped, we can begin to see experiences gained, challenges resolved, obstacles overcome as learning points.

This gives a different measuring approach that can reverse current design and reward and show the increasing value of exposure, practice and understanding as accomplishments that build deepening capabilities and highly valued in experiences.

We should be looking for the knowledge and insights gained as part of the robustness of the pipeline. This is one area where HRM can design innovation differently and intervene so as establish the impact of learning as one of the factors to enhance innovation capability. There are many of these intervention points that have a catalytic effect.

Those that attempt innovation gain valuable experience

If HR took innovation into the core of organizational design, the mandate for each person is to get involved in innovation activity to gain valuable experience that enhances the desired capabilities for the future.

If innovation is seen as core, you begin to break down the present barriers and mindsets that restrict innovation today by current behaviours, blocking innovating activity or placing constraints in allocating the required resources to ‘allow’ innovation to flourish.

HRM plays the critical role in breaking down the existing barriers (cultural, environmental, structural) and determines the need for information and knowledge sharing to actively lower one of innovations greatest barriers today, the not invented here, that existing within organizations both in themselves and in opening up to external new sources of stimulus. HRM can find clear ways to foster innovation in more open ways.

Moving beyond today’s traditional competencies

In many organisations HRM are adapt at, or certainly working hard at the assembling, managing and deploying of resources to support the work-to-be-done. They pride themselves on managing labour costs, evaluating workforce performance, enhancing productivity and focusing on retaining valued talent.

These are well within themselves but are simply not enough in such changing market conditions. They are reinforcing effectiveness and efficiency and these alone are simply not enough for securing the future, it is through innovation and creativity that is urgently needed to be added.
Future leaders need to emerge not from managing existing assets well but in managing in increased uncertainties, being more adaptive, agile and responsive to changing needs.

CEO’s are demanding creativity, flexibility and speed to size up, quickly seize and grab breaking opportunity. These newer demanded skills come from knowing how and where to go, to be well-connected across platforms of knowledge, having close client connectivity and being able to extract all the essentials, resources and commitments to enable execution.

Adaptability to constant change has a very different mindset to be developed in our future leaders.

The changing role of organization design

There is a consistent need to sustain and secure a steady top-line and bottom-line growth, CEO’s tenure is mostly based on this. What is increasingly needed is to go beyond this expected ‘state’ and deliver the ‘wow’ factor, which comes mostly through innovation. Here top managers have to seek out speed, flexibility and adaptability as outlined earlier in this article but they also need to go beyond this.

Managers need to find the right ways to stimulate innovation in creative and systematic ways and encourage entrepreneurship, more reciprocating in the transfer of knowledge, ideas and practices for pushing across boundaries for value creation opportunities.

We come back to the ability to extract new value is in the individuals identifying, assimilating and exploiting knowledge and it is in recognizing this reverse flow, is where the HRM role needs to focus on a different organizational design.

For me building absorptive capacity is crucial and HRM needs to focus far more on understanding the value of this. I loved one suggested description on the absorptive capacity model.  Absorptive capacity is like the alternating current, whereas development capacity is the direct current.

Combining this into a AC/DC innovation model then Innovation becomes the ‘power provider’ to growth requiring both currents, with one, a direct current flowing one constant way, whereas alternative current flows one way, then the other, continually reversing direction for knowledge generation that acquires, assimilates, transforms through exploitative learning. HRM needs to leverage ‘exploitation learning’ as a real need for building the power into innovation capability.

HRM needs to be on the cutting edge of innovation

HRM does need to step up and define a new mandate for innovation. If innovation is ever going to achieve a core place within organizations it has to be deliberately designed in for skill definitions, leadership development and knowledge and experiences gained. HRM needs to cultivate, mobilize and capitalize innovation.

To do this it needs to redesign its existing practices and approaches so at least four critical aspects become established as the starting point and way forward while a deeper understanding of innovation is gained:

1. Recruiting always people for the potential to innovate and knowing what this means in inputs, outputs and expected organizational outcomes.
2. Nurturing individuals and teams constantly in innovation capabilities and skills and setting about designing a comprehensive programme for this to take hold and stick.
3. Recognizing and discussing in formal ‘learning ways’ the critical factors needed for success and equally acknowledging and recognizing the learning value of the failures. Valuing both in experiences and organization outcomes.
4. Build on going diversity into teams, resourced across the organization, augmented with external resources as and when needed, so the teams are varied, distinctive and constantly changing and exchanging experience and are delivering innovation that makes a real difference to the future of the organization.

If this means employing external mentors, coaches and innovation expertise to bring HRM up to speed, then it is well worth it. Having a dedicated external resource to work with you in HRM has the same ‘outsourced value’  as many other activities deemed to be handled by specialists, receiving the support and inputs to your needs that makes sound economical and knowledge intensive sense.

Care of course, is in finding those that have the depth and breadth of required experience to work alongside you, to build up and transfer the appropriate understanding of those innovation needs, until it has been ‘embedded’ within HRM so it becomes fully absorbed and part of the daily fabric of the organization as a new core, well supported and constructed to deliver sustaining innovation.

HRM has a stark choice

HRM needs to take on a more pivotal role for innovation. They can become central for a lasting place to plan and significantly contribute to building innovation capability and capacity or stay more passive and operate always in the outer periphery of today’s and the future corporate relevance that innovation needs to play.

I believe HRM needs a new raison d’être, one that comes from grabbing hold of innovation and making this core to the organizations future design.

Building capabilities and capacities for innovation are essential to our organizations future well-being and HRM needs to step up and become far more engaged.

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It is about the power of design and interaction to make something new happen fast.

Tackling messy problems

“A pressing question for more established economies… is how to foster more entrepreneurship and innovation despite greater stability and predictability.

One method that companies and individuals are adopting is design thinking—the approach of scaling or “group-sizing” the way that solo designers have always worked to enable to cross-functional teams tackle messy problems that don’t fit neatly into any one person’s job description or academic discipline.

Design thinking is one way to simulate some of the extremely dynamic conditions of an emerging economy and foster entrepreneurship in the US.

Forcing direct contact with users

The idea is to put teams in situations where they are forced to synthesize meaningful opportunities out of a lot of highly subjective data about the world and the needs of end users.

At the Stanford d.school, for example, classes are all project-based, and require students to have direct contact with users to gain empathy and test ideas, including the use of ethnographic research to quickly gain insight into unfamiliar environments, communities, and systems.

Imposed constrained timelines

The projects also force students to operate under highly constrained timelines. This can effectively replicate the whirlwind conditions that entrepreneurs in emerging markets experience – consumer needs and the whole ecosystem are changing so rapidly that they have to adopt an iterative approach to nearly everything.

Cultivating skills in quickly assessing complex situations with fresh eyes – and swiftly getting prototypes out into the world to test ideas concretely are what allow design thinkers to conquer uncertainty and create concrete opportunities from open-ended project mandates.

A wonderful example of  taking a ‘raw’ idea into a fast prototype

Two graduate students taking a d.school course this past spring used design thinking to go from idea to revenue-generating product in just 6 weeks. That product is Pulse, which quickly shot up the iPad app charts to become the number one selling app. Pulse is a newsreader that allows users to rapidly toggle between multiple sources and articles.

Once they had the original seed of the idea from conducting user research, the Pulse founders sat in a café and tested a low-resolution version of their product with potential users. They quickly iterated in response to feedback, coding new aspects of the software in the time it took to drink a latte.

Unconcerned with whether the next version was 100% ready or “right,” their bias was to learn from low-res prototypes as quickly as they could.
By using design thinking to collaborate and innovate, these two students were able to upend what seemed like an established market for digital newsreaders and compete with major incumbent players like the New York Times.

Skills in design thinking are a foundation for finding hidden patterns and making something real and actionable emerge from an uncertain environment.”

My comment: this is such a great illustration of the power of design interacting with potential users, so as to discover if the idea firstly ‘gels, meets a need and can be worked on really fast in prototypes to deliver on that.

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