As we start to think about the next year, (is it here already?) it is a time of reflection and some forward thinking. We do need to make some real changes.

From my standpoint, I am simply amazed at how the world seems to be spinning faster and faster. I am convinced my working days are shorter or the clock is moving faster or worse still, I am being “deflected” even more by everything “digital”.

I never seem to finish what I had intended to complete by the end of a day or week. I then get caught up in the spillover effect. Something always gets in the way, something has to give. So we make a resolution to change something to improve on this constant catch up state we find ourselves in. We all seem to be spinning faster but equally slowing down. Often our innovation activities face the same dilemma.

Innovation needs time, it needs evolution and resolution but also speeding up

Here are some thoughts for our future. The need for innovation results has sped up considerably. The belief that lean management principles will get the innovation out of the door quicker, has been one of those management adoptions that often trick us into believing we are achieving more than we actually are. Reality is, we have only been tackling part of the innovation process and the end results often remain the same – a slow process of innovation follows as lean hits organization reality, it gets caught up in internal roadblocks, countless discussions, and debates.

Certainly, in the majority of cases we have found nothing wrong at all with applying lean management, as it tends to lead to improvements in a final outcome, but does it actually speed up the process? I’m not sure it does. Leans slows down and becomes increasingly burdened by fat being layered on, further down the innovation execution process.

For me, I think the real need is in speeding up of the whole innovation process, approaching the whole innovation in a systematic way, as the only path to tread in the years ahead. We need to broaden out the whole process of rapid innovation application beyond the two current favorites of lean and design thinking. That requires it to be fully connected up and that means making the innovation process one that is fully digital, on a platform and accessible by all, those that can bring value and meaning to the process to deliver greater innovation outcomes. We need a greater innovation rapid prototype approach to the whole innovation process- test, learn, adapt, adjust, iterate, refine at speed and rapid scaling.

Designing the complete rapid innovation application process.

Digital technologies are beginning to have a real impact on the methods, approaches, and rates of our innovation outputs. Social technologies are giving us real-time understanding. We can connect with customers real-time. We can have meaningful dialogues and exchanges that build relationships and constant sharing of knowledge and insights.

We continually learn real time, and recognize at our cost if we do not adapt, that intuition and ‘gut feel’ or research set up and gathered weeks or months ago, is becoming so out of date before we can learn from it, and sometimes highly dangerous to follow or believe in. We live in a rapidly evolving world and we have to be highly adaptive and responsive in what we offer in products and services. To get to this “responsive” state we need to fully connect up, freely exchange and build adaptive systems that accelerate our pathway of discovery into tangible meaning, through better products and services. We need to change our thinking and design in the digital insight part more specifically within and along the innovation process.

Digital technology and transformation are changing the innovation ‘game’.

We have, in the past, tended to take a safer route to market, by trying to achieve well-defined problems, place these into process maps and worked along the timelines, often impervious to the market conditions changing before our eyes. We continue to couch our bets and gravitate to solutions that are as close to what we currently offer, and that just keeps reinforcing the incremental route regretfully.

Yet digital threatens this entire incremental pathway. Markets continue to have even greater uncertainty and we need to respond in very different ways. Competition is changing, markets are blurring and customers are becoming far more vocal. To respond we need to reconceive innovation into a constant and rapid learning approach.

The need to be highly iterative, full of experimentation, testing and adjusting lends itself to the minimal viable product approach, where we continually test assumptions, checking what we are thinking against the concept of value gained from the customer or market feedback.

Digital is also pushing us to shake off complacency since customers are increasingly further connected and interacting in new ways, we need to find paths to ‘plug into’ and join the conversation, to help shape that conversation and through these exchanges recognize how the brand and reputations become increasingly important in all things innovating.

Digital tools are changing how customers discover, evaluate, explore, make their purchases and use products and then how they react, share, interact and make their connections with our brands. The whole process is highly dynamic and reliant on the ‘network effect’, and the job of the innovator is to translate this and respond in fast, nimble, agile ways, to fulfill the needs and capitalize in responsive ways. This demands a radical redesign of the innovation process.

The need always is to “test to learn” and constantly adapt

• Without a doubt, it is finding and using more techniques and tools that help you make far greater rapid prototyping, testing, piloting and learning from these understandings and how they can be quickly translated back into the innovation process to improve on what you have known, into one of what you have become aware of. “Testing to learn” will become the new innovation mantra and the accepted innovation process; a dynamic, fluid and rapid experimenting that makes it a constant learning one.
• We are today, partly down this route of early learning, with the help of software that can capture ideas, offering a sound vehicle for communicating these and a place to gather and define solutions that can be taken forward. Yet we have to push the path of constant evolution and that will continue to come at increasing speed from technology to keep providing new knowledge so as you can constantly improve on your eventual value proposition but that is going to require an ever-increasing agile organization and adaptive system.
• We will need to find different ways to redesign the manufacturing process (more outsourcing) to have more adaptive points where we can intervene and change product design. We will need to find different ways to ramp up or dampen down finished goods, that require a more rapid change, and that is going to push ‘agile’ even further. The ability to balance “scale, speed, and scope” will become paramount in this.
• We will need to learn to focus on the seizing of emerging opportunities in quicker ways but also take a much tougher approach to divestment, so as to release resources from declining positions of advantage. The whole lifecycle thinking needs challenging and thinking through differently.
• We will need to push for “agile systems” where we can design new applications, find better communication and collaborative social technologies, so as to reduce delays of getting better access to the right information, connecting to the right people, so as to advance the process. We need to actively reduce the duplication of work or the search for the information needed, to complete the job. We need to focus much more on reducing innovation process cycle time for faster deployment
• We will also need to invest in more data-driven front ends to build a more sophisticated process of discovery. The whole concept of divergent experiments and convergent testing and validations will become the way to think along the innovation process as a re-looping process. This will require a critical mindset change from a linear one on how you set about it, in the design of the process, Then also on the use and application of the digital tools you deploy, to move this through this constant, ongoing iterative process. Nothing can remain ‘static,’ we need to make it ‘highly’ dynamic.

Rapid innovation matters and it will become even more central as digital innovation takes hold.

Rapid-iteration needs to replace the fixed product release date mentality. We are in a world, driven by digital that requires us to constantly adapt to new learning that is coming from real-time market feedback. The way we learn from this and our rapid innovation application process will be all about this continually testing new assumptions to improve our (final) product and service propositions.

I have said this often, I believe we need to rethink the innovation process, as we will need to transform the existing methods and make them increasingly digital and social, in real-time. We need to focus on the rates of innovation output from our learning and improvement in the eventual offering, as our constant bearing or benchmark. It is how we design this in a more comprehensive manner will be a real challenge going forward

I predict that innovation has some very pivotal years ahead of it, as we absorb and use more rapid innovation application processes. We should start thinking about how we can fully design and adopt a more digital innovation discovery to the execution process,  at increasing speed for final innovating outcomes.

A design that pursues a constant path of innovation understanding and evolution, that fits far more with these digital transformational times we are going through. We are entering the digital innovation era.

** This post was first published on the Hype Innovation Blog site and modified here.

The post Adopting a Rapid Digital Innovation Process first appeared on Building Your Innovation & Ecosystem Intelligence.

I do have to admit I did head to the Web Summit a little biased. Everything “smacked” of commercialization on a big scale. I never really got past this judgment. I had been invited so should I be so cynical or ungrateful, perhaps not but it is hard not to get past this “sheer” commercialization and randomness. I’ll explain randomness later.

When you are told “Forbes has said we run “the best technology conference on the planet”;  or The Atlantic that Web Summit is “where the future goes to be born”;  The New York Times that we assemble “a grand conclave of the tech industry’s high priests.”

These overhyped claims roll on “Bloomberg calls it “Davos for geeks”, Politico “the Olympics of tech”, and the Guardian “Glastonbury for geeks”. My eyes are rolling on these. Overhype is an understatement.

The publicity blurb adds “At a time of great uncertainty for industry upon industry and the world itself, we gather the founders and CEOs of technology companies, fast-growing startups, policymakers and heads of state to ask a simple question: where to next?”

This year over 70,000 people were heading to Lisbon for this Web Summit.

The claim and I don’t doubt it, is that we’ll be joined by the CEOs and founders of the world’s biggest companies, the most promising new startups, influential investors and leading journalists. Can you find them might be another challenge as they are mostly tucked away in VIP or off-limits sections of the venue, pampered and feted? I doubt they lined up for their food from the food trucks provided. The lines were impressive and off-putting. I quickly gathered it was best to eat well before you came to this event and just keep “walking the halls”

It is claimed that the Web Summit is the world’s largest gathering of international journalists, attracting more than 2,500 global journalists from publications including Bloomberg, Financial Times, Forbes, CNN, CNBC, and the Wall Street Journal.

So let’s read all the reviews over on the Web Summit press site, where there are presently only THREE entries in SIX weeks as of today. Something is not connecting here. Where is the validation of worth provided by this largest gathering of journalists on the Web Summit site as the point of reference, of knowledge, insight or benefit? This focus on size and commercialized comes through again. Put some meat on your bone, Mr. Cosgrave.

The Commercial Icing on the Cake, the timing for me was suspect.

Then I receive this to add the extra “commercial” icing on the cake, announce just days before the event.

On the 3rd October 2018: Paddy Cosgrave, CEO of Web Summit, and António Costa, Prime Minister of Portugal revealed today that Lisbon will remain the host city of Web Summit for the next decade. This is under a new €110 million deal, including a large-scale venue expansion to facilitate the conference’s fast-growth.

After a robust and competitive tender process involving offers from over 20 cities across Europe, the company behind the world’s largest technology conference has come to a new agreement with the Portuguese government. As part of the deal, Web Summit will receive €11 million per year from the country.

Do your sums, this is a sizable revenue-generating event

Now assume 70,000 attendees at Euro 1,000 (average) and you have Euro 70m coming in for this one off event over as well as this Euro11m, not bad for any events, in today’s environment.

 The good news I have just found out is the Web Summit has launched a $50 million VC fund baptized Amaranthine, the Financial Times reported. According to the FT‘s sources, the new fund will use the data from the conference to support its investment decisions, such as which startups have attracted more attention at Web Summit and what trends are worth attention. The fund will supposedly take minority stakes in startups at all stages, however, judging by the fund’s size and the startups that usually exhibit at the conference, it’s more likely to be anywhere from pre-seed to early growth stage.

Amaranthine will reportedly be led by David Kelly, the co-founder of Web Summit, and Patrick Murphy, who used to work for Goldman Sach’s and Universal’s venture arm.

The other part of the pre-event announcement was that additionally, a part of the Web Summit deal to stay in Lisbon deal is to double the size of the Altice Arena and FIL (Feira Internacional de Lisboa) within the next three years, to fit Web Summit’s growth forecasts. Commencement of the first phase of the expansion project will start in the coming months and will be completed for Web Summit 2019. I think it is WAY TO BIG now

The catch for anyone interested in buying out Web Summit is that they have also agreed to a €3 billion buyout clause. The buyout clause is the minimum, the expected economic impact of Web Summit to Portugal over the duration of its contract, and provides security to Portugal that Web Summit will remain in its capital for the 10 year period. It was estimated by the Government of Portugal that Web Summit generated more than €300 million in economic impact for the country.

It is also claimed Web Summit has also helped elevate Portugal and Portuguese companies on the global stage. Portugal was described recently by The Wall Street Journal as “one of Europe’s hottest stars, with tech startups mushrooming and investment pouring in”.

Web Summit CEO Paddy Cosgrave said: “We’re incredibly excited to be staying in Portugal. Without a larger venue, this would not be possible. Even until a few months ago, we never believed it would be possible. The plans are incredible and we’re very thankful to all those who have worked on them.

 This deal gives certainty to our many attendees from over 170 countries around the world, and our thousands of partners and exhibitors. It also gives certainty to our host country, and to our team of more than 200. Together we’re looking forward to doing incredible things.

 Finally, I should add that we are grateful for the support and encouragement we received from other cities who also placed bids to host the event. We very much recognize their efforts and definitely appreciate all they have done.”

The Mayor of Lisbon, Fernando Medina said: “This 10-year agreement with Web Summit will decisively make Lisboa a key capital for innovation, entrepreneurship, and talent. I am confident the next few years will bring a sharp rise in IT investment and employment in Lisboa. We are thrilled to continue to write this story together with Web Summit”

So did it live up to this hype? Simply NO! Well not for me. Let me explain

The Guardian’s quote of “it defines the Ecosystem”. All I felt was,  if this is defining an Ecosystem, then watch out, it is a lop-sided, highly unbalanced event. As my title of this post suggests “I was overwhelmed in its sheer size and underwhelmed in what it actually delivered to me”.

To start with just take a look at the jaw-dropping schedule.

Check out the schedule here. You can search by title, description or speaker or use the topic filter. The Web Summit App feeds you like the hungry beast sifting through so much. For me, personally it was not that easy to visualize, schedule and that was my loss in not investing pre-event time on this. This needs serious organization and focus and I am not famous for that!

The event crowds 1,200 speakers into limited time slots over three days. So in 20 to 30 minutes, all these speakers deliver a message. Inspiring, shallow, motivating, boils down to “depends” Some were listening to speakers for much of the time. Not sure why unless you wanted to top up your “I listened to..” claims to fame.

There are over 2,000 startups set up in ALPHA, BETA & START tracks pitching away to 1,400 Tech Investors. Where do you go, what do you visit really needs organizing your day and that is very hard unless you have a very definite focus.

I was talking to a fellow Web Summiteer on the way home on a plane. He valued the experience, he found some value but spent significant time having to “weed out” all the messages, promotions, announcements he was getting on his “Web App” as he found the “keyword” suggestions too broad, so he lost time picking up on those points of value in any (decent) organized way.

I believe Digital has not really arrived at the show to help the attendee pack in the real return on investment. It is great at knowing where the night time events were happening or the next “star turn” on the main Stages if you can get to them on time. Somehow the Web Summit people need to think about investing in a greater digital event set of tools. I was not impressed.

Without a doubt, the Web Summit is a very different beast than I had experienced before.

I felt I was sometimes on a different plant. The halls were seething, thousands were constantly on the move, walking these halls, chatting, meeting and drawn together. Some of the vendors like Amazon were pitching to packed audiences. So it attracts without a doubt.  It has the chance to mingle, seek out tech founders, investors, prime ministers, magazine editors, heads of global banks and multiple startups all under one roof. This is certainly unique and draws in such a diversity. Yet it is a little scary. I am not a techie, geek or seeking to compete in the technology Olympics. I wanted to learn a little more from some of the bigger sponsors on where the future was heading (AI, Big Data etc). To be honest I am learning more ‘rooted’ to my desk than I did for much of the time at this event.

The one thing that certainly struck me was how CISCO, Google and Microsoft were working very hard on AI face image recognition. The one that caught me was Pedro over on the Cisco booth and his coffee brew to show how tired you were. Take a look, the coffee grinder worked overtime. While over on Google it was comparing your face to famous people or past ones or Microsoft comparing you to a dog breed. So they decided I was comparable to a bluetick coonhound. I am smart, devoted and tenacious- I’ll take that! Fun maybe, helpful for them to build out their data bank of faces but where was the serious stuff I had come to hear from very significant tech companies. Missed it and they are missing what they can deliver if they bother to think beyond “missing out” by not being there. They need to rethink what they can offer web summit attendees.

Most of the big players in technology were sponsors but lacked any real substance. They had the bigger booths (bigger pockets) but gave little of their size, contribution or what they offered. Perhaps there were so many startup or tech investors they have not figured out the appropriate messages they want to deliver into such an audience like this. They had a brand presence but not a great amount more, they should. You do notice the Chinese, Japanese and most of the Asian tech world is dramatically underrepresented at the event- I wonder why? Bring them in, it might raise the bar for the established ones.

One example of a decent delivery of content was Amazon,.  I managed to listen to the Amazon AWS presentation on Knowledge Graphs and found out it was repeating what I knew or had invested in research, so not much new came out of this, apart from the fact it is a very hot topic figuring out AI and where Knowledge Graphs fit within this. The event was overflowing though and many more just gave up and simply moved on, back in the mass migration from one hall to another.

Actually, Amazon did seem to have the most active presence in what they are offering, so they get my vote for being the most tuned in for what was needed and provide as good awareness material. The other biggies were honestly a waste of time for what they should have given me or countless others as a “captive” market. So underwhelming.

Now the real appeal for many is the networking.

I think there was so many who were attending were having this as a reward for their contribution to the work they were doing. I think there was some serious partying going on at the Night Events and recovering during the day. So maybe CISCO had tapped into our need to check how tired we all were with their coffee idea.

At all the events, night and day, you can start up some great conversations but getting to know this one person is that someone you should talk too, is still left to chance. I cannot figure out why the bracelet we are all told to wear throughout the event can’t work with the web app to “signal” and connect us more.

Networking is such a generic term, how can the Web Summit turn this into a real powerhouse of connecting investors, those that are pitching and actually looking to change job. I loved the bland “we are hiring” signs for many, so lacking in anything imaginative besides this. Another lost opportunity

I found it amusing, up to a point, when I was pitched non-stop for three minutes, with his partner or wife I think, holding one or two sales pointers. To stop him and point out he was wasting his time on a randomness that was bordering on the ridiculous.

Randomness is where I want to finish.

This event is far too random, far too diverse, far to big in what it tries to provide; a melting pot “a place where many different people and ideas exist together, often mixing and producing something new”. It is certainly a “potpourri” offering an unusual or interesting mixture of things but does it work?

There was one talk “We cannot rely on algorithms to determine quality” by Ev Williams, CEO, and Co-Founder of Medium and former CEO of Twitter, but in the case of this Web Summit. If Paddy and his team invested in AI and some well-focused algorithms for their event, we might get a greater connection going, even more than presently claimed, with a real validation of its value, a real take-home value over simply tiredness.

As I said this event was both overwhelming in size, and due mostly to this, it failed for me and underwhelming in value I got out of it. I can’t imagine heading back to Lisbon for this event unless Paddy Cosgrove and his team stop thinking size and really investing in understanding what really matters, besides the buzz of this, and that means a very different set of digital solutions, not ones focused on selling hype and tickets.

It is certainly not the “the best technology conference on the planet”. For me, I feel it is an event that needs to be experienced once, a bit like The Great Wildebeest Migration – the annual migration of giant herds of grazers across Northern Tanzania and Kenya is a truly spectacular event. Replace herds with nerds of digital devotees moving around an event, restless for new feeding grounds. Yes, that was the Web Summit for me, the problem is I failed to get across the divide.

The post Overwhelmed, underwhelmed at the Web Summit, Lisbon first appeared on Building Your Innovation & Ecosystem Intelligence.

There is this consistent need or pressure to grow, yet that specific needle stays stubbornly stuck in low growth numbers, even with all this innovation talk and desire. Why is that? We know you simply grow a business by choosing a mix of investing in innovation, merger, and acquisitions or releasing your resources into more profitable activities. Innovation as a dedicated activity still sits uncomfortably within many organizations.

To try and catalyze growth, companies undergo perennial reorganizations, often to revitalize themselves. According to a Deloitte report, 50 percent of companies are undergoing an organizational transformation, yet only 11 percent think they will succeed. What’s worse, 70 percent of transformation programs do fail. In these failures, we only seem to continue to layer on complexity as a further stop-gap measure.

It is no wonder we’re growing increasingly pessimistic about making a positive change to a different transforming model within organizations. Without innovation taking a more leading transforming role, most of our established companies will continue to struggle to break out of their existing approach to business. Far too many are mired in a past business mindset.

One basic argument is that no matter what we do to undertake change, we seem stuck in the Industrial Age of the last century. We claim we are in the innovation age, one where a digital transformation will finally transform us, yet it remains elusive. I recently came across the below illustration of the struggles we seem to be having, in changing our companies from the industrial age to the innovation age. It depicts much of the constraints around how people are still working.

Source: www.swarmvision.com

What is holding this innovation age back?

To start, we face strong countervailing forces that restrict our abilities to break out of our past to move towards a new way of working. Pursuing old business paradigms of how a company should be run is not helping us.

Is it because of this traditional way of working, designed into the company, that we are all becoming disengaged and disenchanted with what we do? We’re often left feeling powerless to influence the type of change that we want to see, to release our creative juices and not simply to make those quarterly reporting numbers or get caught up in constant cutbacks when they don’t meet market expectations.

We are increasingly facing very different competitive pressures. This is a very “VUCA world” – the volatility, uncertainty, complexity, and ambiguity of general conditions and situations we operate within. Pressures are not just external. We often bring them upon ourselves, as we were not anticipating, investing, and looking to build a different type of business. We fail to invest in foresight and insight, continually not adapting and adjusting our organizational skill set around a more agile, adaptive, highly responsive innovating and creative organization.

Every time we begin to call on innovation, we face negative forces. These are the ways we still wish to judge business – on its short-term results and its ability to limit risks. To give returns to shareholders that safeguard their investments. To achieve this, we look for maximizing efficiency and focus on the continued extraction of value from our core. We talk about investing in the future, in making adjacency moves, and in encouraging risk – but is that really the case?

For many, risk management has never been seen beyond the protection of the status quo. This attitude toward a risk-containment approach restricts innovation. It is actually limiting or even sacrificing the future by not investing in all the aspects of growth, especially bold explorations of new growth avenues. They fail to invest in a clear, distinctive capability of innovation capacities, that is fully integrated within their organization. Innovation stays outside the current core.

I am not proposing we abandon the need to protect our investments and to provide a reasonable return for investors. Instead, I’m suggesting more of a conscious shift where we focus on building more effectiveness, extracting more synergies, and exploring greater growth options.

Can you imagine having the same number of people involved in innovation growth as we have that manage the finances of a business? In most companies, we have small, dedicated innovation teams of five to 10 people trying to take on this Herculean task of growing a business through innovation. They are reliant on engaging others, focusing on their specialized areas to hand over their time to innovation. This is often above and beyond their daily job responsibilities.

Approaching innovation in this highly constrained way is simply not a recipe for success even though in recent years we have been trying to make the subject of innovation more attractive by tempting people to join in and participate in multiple ways.

Extracting innovation has become very complex

Let’s all agree that we live in a complicated world. We are continually witnessing growing threats all around us. Competitors are disrupting – even ones who were not around 12 to 24 months before. We see mergers, closures, or once great beacons of industry shrink before our eyes due to new alternatives. I have in mind here GE and the dramatic restructuring pain it is currently going through. We feel increasingly unsafe unless we happen to be one of those sitting in a technology-related business where growth has been extraordinary in recent years (e.g., Apple, Alibaba, Amazon).

But first, when you think of innovation, what comes to mind?

Source: European Commission

In “Opportunity Now: Europe’s Mission to Innovate,” a 2016 European Commission report (a mere 360 pages long), the author makes this point:

“Innovation is also more complex than ever. Complexity, chaos, and non-linearity have been seen since the 1970s as the defining features of our age. But still, our advanced societies find it hard to make robust policy for a complex innovation system.”

We should always start by recognizing innovation as a complex system. As the report defines, a complex system is a place where:

• no one can have a complete map of the actors and forces at play,
• the system’s behavior is not simply the sum of the behavior of those parts,
• feedback loops surprise us and change the behavior of the system,
• the system is “autopoietic”: behaving in a self-driven way and not just in ways we have yet to understand.

The report also questions, quite rightly, that having a pipeline theory as too simple. The author suggests innovation is not like a Roman aqueduct, designed to allow water to flow; instead, it’s a “muddy pond,” rich but obscure.

That is not a comfortable view for business leaders determined to limit risk, maximize resources and be consistent to extract efficiency and be fully effective. Innovation flies in the direct opposite to this need of corporate design. So, we have become highly creative for innovation to be allowed to operate under the same roof as these efficiency and extraction rules and regimes.

We have come up with multiple ways to exploit innovation. It can contribute to the business model, explore the margins, undertake core renovation work, experiment, and prototype, and be completely new to the world. But it always seems to be divided up in different parts of the business. I often feel innovation activities within companies are a continuing set of experiments, needed but not systemized, fragmented in its potential energy by this underlying need to keep it under control and to minimize risk and feel exposure.

Are we dissipating innovation resources or recognizing that one-size does not fit all?

We are fragmenting much within innovation. Is this good or bad for the longer-term? “The Ten Types of Corporate Innovation Programs,” an article was written by Jeremiah Owyang, founder of Catalyst Companies, provides a terrific list of possible types of innovative programs to consider. But by adopting too many, you fragment and possibly dissipate your innovation resources. Owyang offers a good description and examples that make this a highly useful reference point. Which do you undertake or are actively considering?

Many others are emerging beyond these ten types, where “open” sets the tone for building creative spaces, in lab designs or investment by different avenues of VC funding, internally and externally.

To begin with, these ten types of corporate innovation programs form a good starting point to consider what works for you. Which strategies can push innovation further down or out of the company and help move the growth needle for your innovation program? Check out Owyang’s description below.

The Ten Types of Strategy for Corporate Innovation Programs

 1. Dedicated Innovation Team

Corporations often start with staffing an innovation team within the company of full-time employees dedicated to developing the strategy, managing, and activating innovation programs. These leaders are experts at internal communications and are change agents.
Example: MasterCard, Hallmark, and BMW all have innovation teams dedicated to new business ideas, as does Nokia. Learn how Nokia’s innovation team works here.

2. Innovation Center of Excellence

Innovation can’t happen in a single group; without broader institutional digestion, new ideas will falter and fall. Some corporations are setting up cross-functional, multi-disciplinary groups to share knowledge throughout the company.
Example: Various retailers and consumer packaged goods companies enable this. Read: Creating the Physical Space for Innovation

3. Intrapreneur Program

Rather than rely solely on external programs, internal employees – dubbed “intrapreneurs” – are given a platform and resources to innovate. These programs invest in employees’ ideas and passions to unlock everything from customer experience improvements to product enhancements and full-blown internal startups that are then launched from within the company.
Example: Adobe’s Kickbox program is widely recognized as the leading program. Read: Exploring the Intrapreneurial Way in Large Organizations

4. Open Innovation: Hosted Accelerator or Corporate Incubator

Hosted inside a corporate office, large corporations invite startups to embed at their physical locations and provide them with funding, corporate support, and other perks. This brings innovative startups inside a large company for everything from overnight hackathons to long-term programs. Other variations include online open-innovation programs that request – and often reward –ideas from the crowd.
Example: Allianz Digital Labs in Munich hosts startups, and GE Garages enables startups to partner.

5. Innovation Tours

Frequently inspiration comes from outside, not within. Corporate leaders tour innovative organizations, companies, and regions to discover trends in various industries, learn from speakers, meet partners, and be inspired as they immerse themselves in innovation culture.
Example: European-based WDHB and Nexxworks tour executives in Silicon Valley and beyond. See an example of an innovation lab tour from the University of California San Diego here.

6. Innovation Outpost

A dedicated physical office, such as in Silicon Valley or wherever innovation happens in their market, staffed with corporate innovation professionals whose job is to sense what’s occurring in a market, connect with local startups, and integrate programs back into the corporate HQ. Some of them host partners, events, and startups, thereby spreading the function to Internal Accelerator programs. An Innovation Outpost is typically managed by employees – unlike an External Accelerator, which is run by a third party.
Example: Swisscom, Vodafone, and Nestle have opened Silicon Valley outposts. Read Evangelos Simoudis’ blog for insights.

7. External Accelerator

Corporations partner with third-party accelerators to provide sponsorship and/or funding in exchange for relationships with startups and integration opportunities. Corporate innovation professionals often embed themselves in Accelerator offices, fostering relationships with local startups. These External Accelerators are run by third parties – unlike Innovation Outposts, which are managed by employees.
Example: Plug and Play, Singularity University, Rocketspace, Runway, 500 Startups, Betaworks, and more.

8. Technology Education, University Partnership

Corporations can tap into new graduates, early-stage projects and companies, and the network of an established educational institution. In addition to traditional universities, there are new private versions opening up that are dedicated solely to technology training, like Galvanize and General Assembly.
Example: General Assembly, Galvanize, and most tech- or business-focused universities.

9. Investment

Many corporations place bets among the startup ecosystem, with both small amounts for early-stage startups and larger amounts of corporate funding that yields market data, creates opportunities for follow-on investments, and blocks competitors.
Example: Intel Capital is a leader in direct corporate investments.

10. Acquisition

Rather than build innovation from the inside, many corporations acquire successful startups and then integrate. While often expensive, the startup is often already successful, and the acquisition can help the startup scale further.
Example: As one example, Dollar Shave Club was purchased by Unilever for a reported $1B.

Source: Jeremiah Owyang. Some additional links also applied where relevant.

Are we fragmenting our innovation activities or applying a solution to a specific problem?

We do have to guard against “simply” adopting one type of innovation over another. It needs a deeper understanding of what we want to achieve, and then we seek out the tools, methodologies, and solutions. Diving in and experimenting has some value, but some clarity in what you want to build in innovation capacity makes sense first.

If we apply one approach, we are in danger of “shoehorning” innovation to fit a program. Maybe we are then not allowing the idea or innovation we had in mind to evolve in its own way – in its natural path. Perhaps we are only responding to a top-down pressure of fitting initiatives into that same pattern of seeking efficiencies that fit within an organizational design that will eventually choke innovation.

We need a new call for change based on a focused innovation mindset

For the majority today, we are at this countervailing point where innovation is in need of breaking the impasse. We need a different, more holistic set of solutions to manage innovation.

What I want to look at in a series of articles in the coming months is how we can manage risk from innovation differently. How can we build and accelerate different corporate innovation programs? How can we begin to re-equip our talent to build their capabilities and capacities and to recognize that we can design innovation differently to engage in innovation in more transparent, more structured, and more open ways? How can we design our programs more purposefully?

There is a call for finding more methods and approaches that are open and scale well. We need to reset the baseline of innovation through knowledge, collaborations, and building capabilities. We need to build networks and systems designed for this explicit innovation purpose. Let us finally separate “extraction” from “exploration” in the design of companies. We need to strip away complexity within the way we practice innovation today and connect “it” all up in a new innovative design.

***This post was originally provided for Hype and has been republished here

The post Why Are We Making Innovation So Complex? first appeared on Building Your Innovation & Ecosystem Intelligence.

Today, I think we certainly have a beginning point but all of us lack a clarity of the end point of where digital transformation will take us. Why, well I think this nicely puts it, we have to move or be moved. Nicely put Mirko

Yes, we can measure success in our progress but these are in both multiple and equally personal ways.

Each organization is unique. Never has this become crystal clear that when you face your own transformation journey. You can learn from others, you can adapt but you need to clearly understand where you are in your own evolution and capacity to undertake change as it is simply your journey. This has not been as well recognized as it is today when we attempt to make any transition, from the old ways of doing business to the new one; that is highly connected, collaborative and based on our growing reliance on technology and ‘everything’ digital. It can become life-changing.

Each business makes a judgment, on speed, scale, and scope of transformation.

How they evolve, in new growth, in their changing business model, in their innovation, in their capabilities to manage the “spread” of activities required to transform. How do they upgrade or re-orientate their people, their customer-facing activity for example?

The world is moving at different speeds, technology is being implemented in unique ways. We are all making and leaving our digital footprint, each very differently depending on our own situations. Judgment becomes personal, relative to your own situation. We need to measure in those “measured steps” what you need to determine as a transformation journey. Of course, once we have our ideas, we can begin to find ways to measure. It is not a bad thing that we must calibrate this against others, in seeing the outcomes feeding back from our customers and markets but it is a journey that you can undertake as you and only you, have the best grasp of what is needed or required. It is your journey.

Can we look out and give it a ‘hard’ quantification in five or say ten years? Does digital transformation have any easy answers? We can take some broader measures as business is still driven by growth, growth in revenue, in product mix, in-country development, in market share. Or equally how the perception of the company is beginning to change and how the market ‘sees you’ as different and adapting to volatile conditions. You hear the word “exponential” often and that seems a high validation point today.

Seeing the digital transformation story in different ways

I am involved in a community that supports Siemens and attempts to contribute as well as extract better understanding of their transformation journey.

This involvement is being part of their external influencer community. We influence in different ways but more increasingly shape perceptions and undertake exchanges. For me, and I think certainly Siemens Influencers, this is taking on a radically different meaning from that social media aspect alone. It is where there are engagements in deeper meaning and relationship growing, that can only emerge from sharing other’s perspectives.

We have two perspectives for this community to thrive in, the insiders working within a business like Siemens, and those outside, looking in, mutually engaging. This can sometimes be a very uncomfortable, often challenging ‘relationship’ when someone outside challenges the management of an organization. You can face “push back” or simply a rejection, or moments where you can openly exchange and gain from conversations.  Or, you simply add a new dimension to a particular challenge or problem, that is if the other party is prepared to listen or learn.

Many companies talk of diversity, in who they attract within their company but this diversity of opinion, of different perceptions, is as increasingly important. I think Siemens is recognizing this and exploring what this means in value and contribution. It is a privilege to be part of this.

The initiative for this building of a Siemens Influencer Community is driven within Siemens Communications Group, where Clarissa Haller (@clarissahaller), the head of Corporate Communication within Siemens, outlined her vision of this in an article, providing some of the opening values in forming an influencer engagement group in B2B.  She talks the three “R’s” of “relevance, reach and resonance” and that forms a good “mantra” for influencers, in general, to work towards and specifically for influencers working with Siemens, in my opinion. How this group is forming and storming in new ways lies with Patrick Naumann, (@naumannpatrick) the Siemens Influence Engagement Manager. He has the hard task of “herding cats”- An idiom denoting a futile attempt to control or organize a class of entities which are inherently uncontrollable – as in the difficulty of attempting to command a large number of cats into a group (herd). This he does in a number of amazing ways. It certainly is not “futile,” it is very progressive and highly imaginative but it can be a little disorderly and challenging to steer, transitioning change that is radically different from past practices within an organization like Siemens. The diversity within the group influencing needs exploiting in many ways to extract the greater value.

Patrick recently commented in “The 2018 State of Influence 2.0” written by Brian Sollis that shows the progress of influencers and he commented on the impact within Siemens. Being on the inside of the Siemens program this report is lagging behind the evolution. Siemens has been turning aspirations of getting this community to form and influence in unique ways. What Patrick states here, these are getting greater each time we meet. As part of this exposure to Siemens, we are having some significant engagements with their senior people.

Three months ago, while in Munich for one of these community sessions, we met up with Dr. Roland Busch, (@BuschRo), currently the CTO of Siemens and soon to assume the role of COO, in a new structure emerging early next year.

At the time I had mixed feelings on the session but in the past few months, I have been reflecting a little more on this.  Recently revisiting the recordings of the event (part of my misgivings of the session being recorded) I extracted a lot from the dialogues. So the recordings gave me a longer-term value of putting much in a different context.

It reminded me that the perspective of giving events considered time for reflection may deliver many “sound bites” from parts of a session but there is this need for us to piece together a ‘greater’ whole. At the time we react and magnify one aspect and not frame it in something that is greater, more cohesive and lasting. Giving time and reflection can do that. This Q&A gave me the opportunity to consider how a digital transformation journey is made up of so many aspects to consider. There are no easy answers.

The session, a Q&A, spoke around many of the aspects of managing a digital transformation. This was within Siemens and in general.

Dr. Busch presented a very sharp operating canvas that Siemens is working through, their emerging narrative to handle digital transformation and equip themselves to be at the forefront of leading this.

You might have value in watching some of the sessions, short vignettes that tackle specific aspects of any digital transformation journey. These offer the Siemens perspective and are worth listening too.

So each of these questioners is part of this influencer community. I have picked out five that reflect part of the connection issues that make up our digital transformation journey

The first was a question from Lucian Fogoros, (@fogoros), co-founder of IIoT-World, was asking about the present stage we are in, relating to the digital transformation journey, relating Industry 4.0 and asking specifically about adoption rates. Dr. Busch’s reply broke this question down into the ability to deploy, how digital transformation needs to be gradual or can be undertaken in more “bigger step changes” depending on the type of industry each organization operates within. He saw digital adoption coming from “how they show up in each environment” to give us a level success rate. I liked that perspective as it signified it is relative to your own position, industry, and ability to drive change. Huge infrastructure facilities are totally different from re-equipping a whole plant for a new car. Each takes the digital journey in unique ways.

A question from Antonio Grasso (@antgrosso) a well respected and leading digital transformation advisor, zoomed in on Cybersecurity and the worries of trust, of possible roadblocks on the road to digital transformation. Dr. Busch touched on Siemens own focus through their “Charter of Trust” as they can see sustained attacks that might run down (degrade) critical infrastructure as critical to be prepared for. He touches on a concept of simulation of these possible attacks through having a digital twin and working through their Mindsphere platform where you can prepare for these attacks or get levels of adaptive security. to be increasingly secure, wherever possible. Yet it is still a cat and mouse game that needs constant vigilance to stay ahead.

Then a further question from Wilko Wolters (@WSWMUC) a digital specialist in the Automotive world and Lecturer. He raised a question about much of the current roadblock to digital transformation lies in the attitude of the people, in their awareness, current skill set and the ability to adjust and change. He emphasized the need for a “working culture” that reflects a digital transformation. Dr. Busch spoke at some length on finding a new way to unlock the potential in the people, the blending of different engineers into a team environment where software redesign gets increasingly factored in. Then the inevitable “agile development needs” and co-locating closer to market and customer needs and finally, that need for as rich a “diversity” in backgrounds, skill sets, and experiences. It is as much an adaptive challenge in changing the culture as it is ‘simply’ applying digital solutions

One from Antonio Santos (@akwyz), Atos Social Media Business Evangelist and Community Manager, asked one of those great open questions around a digital narrative of “are we talking all about the same thing?” “Are we blurring differences?” Now that has different perspectives (again) be those regional in maturity, in market and company outlooks. According to Dr.Busch we are in very different stages of evolution, there are emerging common understandings of recognizing where platforms, the cloud, data, and analytics are growing in importance to making these digital transformation changes, yet they are very different across industry type, regions of the world and even individual markets on their abilities to actually bring about change within “certain” architecture constraints. Yet Dr. Busch felt there is a growing convergence as: “we continue to mature solutions we bring this convergence”

Lastly, the one question I got the greatest value out of, was one posed by Dean Gratton (@grattonboy), a technology futurist and global influencer. Dean was asking did Dr. Busch see an end result. how would Dr. Busch and Siemens look back in “X” years time and judge success in any digital transformation? Now, this is a tricky question to answer. The reply from Dr. Busch I liked “there is no end point”, he spoke about us all being in the middle of a (digital) chess game, you can see opportunities opening up but the permutations, in this case, are constantly increasing, not closing down. “We are seemingly sitting in the middle of the chessboard”. An interesting perspective.

I got the understanding from this that we are in that wonderful world of perpetual beta. I like the work of Harold Jarche he calls this “the future of work is a perpetual beta”  You pick up the message within the Dr.Busch Q&A here that “we are connecting devices quicker than people” and how do you measure this? The need is to shape it, to leverage on the strengths we know and can see as valuable.

When asked a little further of Dr. Busch on a “harder” measurement, when looking back, it comes back to where Siemens digital business is today and where it can possibly go. Today of the digital business of Euro 5.2 billion, only Euro 1.2 billion is digital services and Euro 4 billion in digital software. It is the ability to grow this in a company that has Euro 80 billion, digital shows its (external) revenue as only 6.5% of total company revenue. This is where ‘exponential’ needs to happen.

The absolute need for Siemens is to grow this part of the business as an increasing share of total business and that requires finding better answers to deploying digital solutions to customers, designing solutions that can be replicated and not reinvented each time and continuing the search for breakthroughs in products, that provide improvements in productivity, efficiencies, in improved and efficient ways. This is, in my opinion, the way to validate and make the digital transformation through the increased ability to build new business model designs, ones that capitalize on this connecting up and the acceleration for innovation in future design, to ‘account’ for the promise of digital.

What is better in understanding digital transformation than having open dialogues?

I think having dialogues, debates, and conversations between those on the inside of our organizations engaging in open conversation with a savvy, smart and digitally aware group of outsiders have real value. Many of the questions and answers are on many a senior executives mind when it comes to digitalization.

This community forming around Siemens is a brave step initiated with Siemens Communications Group to give this richer diversity of opinion, advice, engagement. It takes “influencing” way, way beyond just today’s influencer meaning, of social media influencing. It can become an interesting model in design for companies wanting “dialogues of trust” in community exchanges.

Digital transformation is central to Siemens in its future. It offers a good “window” to observe, learn and gain from.

The post How do we measure success in our digital transformation? A journey of discovery first appeared on Building Your Innovation & Ecosystem Intelligence.

We have to evolve it, as we go. With anything that is evolving in front of our eyes, we will need to recognize some of the decisions we will make will turn out to be wrong but made as a good judgment at the time, on ’emerging’ evidence, not proven. Achieving a digital transformation is becoming really essential for innovation, helping to enable your ability to deliver sustained growth through making all the ‘connections’ come together in different ways than ever before; in evaluations, analysis, in collaborations and in the process from discovery to eventual commercialization.

Digital transformation executed well is a really big undertaking. It goes way beyond making a series of incremental improvements to become cloud-ready as are supposed to build in and reflect social, mobile and digital technologies in the solution set. We need to fundamentally transform our processes by opening up and engaging with customers in dramatically different ways, in real-time, in constant exchanges and connected ways. Everything needs to be tracked and traced.

Customers will want to participate, influence and aid your design and final product. On top, we have to deal with a broad range of communities, across platforms and in different ecosystems at speed, scale, and scope to master different levels of complexity and draw in the expertise we lack within our organization. However, we must do all this in this world of the uncertainty of if it does all connect and work, to reposition all our businesses towards the digital world.

Digital transformation is, without doubt, an event of historic impact, challenging what we know

Technology is becoming an integral part of our lives, for us personally, as consumers or employees, but equally for businesses, the government and our educational institutions. It is pervading everything.

Look at digital transformation as an investment, our future ability to function, compete and communicate will depend on it. Investments always take time to show results, and digital will demand a lot. It is shaping the ways we will work in the future, on how we are going to connect, communicate, and learn. Often, we have been caught up in a specific device we use. This time, it is different though. It is how that set of devices allows us to become connected, how they interact and form a system to tackle a need or task. We are all struggling to re-equip ourselves, in skills, in simply managing, in managing the digital world and its demands. This is another work-in-progress

Digital transformation will keep pushing us to become more efficient and effective yet also to become more adroit and innovative. It erodes and eats into our time that in the past was taken up by so many other things. We will need a new reset in our values and beliefs, we will have to carve out a different set of routines and habits, otherwise digital will simply take over our lives to the detriment of everything else.

The good thing is that Business entities are being forced to open up

Digital transformation happens on a scale and scope that makes many reluctant to take it on; it seems overwhelming in its complexity and risk. The business returns seem hard to quantify in traditional metrics yet the need for transformation compels us to ignore the known metrics and believe in all the unknowns that we are told are achievable.

Often it is hard to convince deciders to support this need for such a significant transformation, whether they are just skeptical or lacking technology adroitness. They want to slowly attack it, sometimes in the hope, it might “sort of” go away. Yet for others, who recognize the future lies in technology and the power of networks and community engagement, it is the opportunity to radically alter their way of doing business; the opportunity to forge new competitive positions that have an engagement at their heart.

We don’t know what the “end game” will look like

We don’t know how the digital transformation will turn out in the end and we have to accept that. Much will come towards us as we adapt, learn and experiment, with many emerging technologies, all in different stages of their evolution.

You sometimes get a sense of crisis pervading the boardrooms, a sense of growing concern, when they recognize the threats and the magnitude of change this transformation will demand of them. They are often the least equipped to understand it. They have to become highly reliant on others to teach them, inform them and encourage them to keep ‘at it’

They will be required to find multiple resources for this journey, and be it just to stay competitive in this new digital world where the demarcation is blurring and industries are agonizing in continuous disruption. It is the blending of all the different experiences, understanding, and comprehension that is rapidly flattening the hierarchy to accommodate all these different voices contributing to building a new digital business landscape.The “survival of the fittest” will be determined by how successfully and how fast deciders

The “survival of the fittest” will be determined by how successfully and how fast deciders maneuver through this shift. Transforming established businesses has become an imperative today.

We are told there are three strategic goals to justify the transformational journey:

1. Providing a better, systematic customer experience, leading to greater loyalty and fostering a community of advocates
2. Internally, digital transformation can improve the operational efficiency
3. New business models, which were not feasible before the time of the connected world, offer new markets and growth opportunities

The worry becomes with customer engagement there is this risk that senior executives will let transformation fail

Of those strategic goals, achieving customer engagement, in the sense of a sustainable partnership, is the most valuable one. Digital transformation enables you to engage your customers along their journey across various products, services and communication channels. Digital has become truly pervasive in people’s lives now and this forces businesses to think about how they can become a consumer technology company, irrespective of what they offer.

The challenges are massive. Companies are struggling to see clear business benefits in traditional ways of managing return on investment. Senior executives have been trained in a curriculum that didn’t prepare them for this world of digital technology and a collaborative world where they have to listen, learn and accept others are often more often right.

The senior executive lacks the understanding of new tools of engagement, which are table stakes already in the world beyond their own corporate offices, in startups, social media companies etc. They consider technology as something for others to worry over. Increasingly, they also lack the relevant exposure and experience to handle the new game successfully.

Driving an effective digital transformation through technologies, which are constantly adapting and evolving, is not the prediction-model based experience they are used to and that got them to the top. A new mindset is required, with solid risk judgment based as much on experience as in listening to others, replacing hard facts often with soft instincts, and incomplete data that is in a constant validation of structured experimentation.

What’s the goal to keep in mind? Looking at the needs of return

• Simply put, you need a picture of how you will (eventually) make money when you start your journey of digital transformation. Create a clearly outlined set of value propositions, and define how you will engage and interact with your customers, partners, and suppliers in products, services, and business models.
• Your business will revolve around what customers really want, a seamless experience where speed, time, performance and response become dominating values – far beyond a specific job-to-be-done. The return in innovation, in new products and services that will rise in ongoing customer satisfaction, becomes as relevant as pricing a product. The customer is willing to pay for a product he or she believes good value, great service and solves their needs
• The toughest part of any transformation is actually recognizing you have to challenge your own past assumptions and be prepared to strip them down and rebuild them on a constant always experimenting basis, adapting to what you ‘hear’ and can ‘see’ in breaking opportunity from all the increased data coming into you to analysis.
• In general, business is moving towards a culture of experience. Whether in communications, development, or delivery, with the customer, in the product itself:
• Everyone’s time within the organization is pivoted towards the outside world, learning to collaborate, exchange and forge different alliances.
• There is a great advantage in seeking increasing speed and scale. It delivers ‘time to impact’ to as wide an audience as you can achieve. Having a global ambition or partnerships that can enable speed to market makes increasing sense but there is a higher likelihood you will have to narrow your offering focus to reduce internal complexity but still deliver within a network of providers, products, and services that deliver to customer needs.
• And the most important change in perspective is about being different, about carving out our own uniqueness but recognizing this is forming more around platforms and ecosystems where all participants look to collaborate and build a more superior offering than one they could achieve on their own

So the actual starting point will be to come up with a detailed plan of coordinated actions that challenge the way you have been running today’s business and totally rethinking it from top to bottom to make any transformation, digitally dependent.

Innovation is becoming highly dependent on digital technology, it feeds understanding, validates it and delivers much of the final value proposition. Undertaking a digital transformation becomes essential to the health of innovation, let alone the company for the future.

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The post Moving to a Digital World totally across your Business is highly challenging first appeared on Building Your Innovation & Ecosystem Intelligence.

We continually learn nthat intuition and ‘gut feel’ on research set up and gathered weeks or more often months ago, has a hidden cost as it rapidly goes out of date. This ‘knowledge’ is becoming out of date before we can gain from it and sometimes highly dangerous to follow, or believe in in the more volitile market conditions of today’s, those that are rapidly changing. We need to get closer to ‘real-time.’

This reliance on rapidly out-of-date understanding cannot be the basis for any justifications for high-stake bets when it comes to innovation. We need to change our thinking and design in the digital insight part more specifically within and along the innovation process. Technology in all its forms is altering the innovation game but are we adapting to this radical change potential? We need to embrace it.

We have, in the past, partly because of levels of uncertainty. We have been overly reliant on ‘poor’ limited data and tended to take a safer route to market from this limited comprehension of the dynamics within the market. We are trying to achieve well-defined problems based on limited validation and simply place “solutions” into the pipeline for innovation. We attempt to work methodically along the timelines irrespective of changes constantly occuring, often impervious to the market conditions change, often going on before our eyes, with the end result, a disappointment and a lot of wasted energy and resource.

We continue to couch our bets and gravitate to solutions that are as close to what we currently offer, and that just keeps reinforcing the incremental route regretfully.

Today we can radically alter this innovation discovery by getting as close to ‘real-time’ if we care to invest in it. We need to invest in the enablers of technology to deliver constantly updated data, to allow greater analysis of choices and potential, closer to ‘go/no-go’ decision points.

Digital threatens (thankfully) this entire incremental pathway.

Markets continue to have even greater uncertainty and we need to respond in very different, faster, well-informed ways. Competition is changing, markets are blurring and customers are becoming far more vocal. To respond we need to reconceive innovation into a constant and rapid learning approach, listening and observing from these sources.

The need is to become far more iterative in feeding back what we hear; full of experimentation, testing, and adjusting, we must lend ourselves to adopting a far more minimal viable product approach, where we continually test assumptions, checking what is valued about the concept, gained constantly from the customer or market feedback.

Digital is also pushing us to shake off complacency since customers are increasingly further connected and interacting in new ways, making the constant choice, adapting to best experiences, imaginative offers and certainly not being as brand loyal for most of our products as previously. We need to find different and adaptive paths to ‘plug into’ and join the conversation, to help shape that conversation and through these exchanges, recognize how the brand and reputations become increasingly important in all things innovating.

Digital tools are changing how customers discover, evaluate, explore, make their purchases and use products and then how they react, share, interact and make their connections to our brands. The whole process is highly dynamic and reliant on the ‘network and social media effect’, and the job of the innovator is to translate this and respond in fast, nimble, agile ways, to fulfill the needs and capitalize in responsive ways. This demands a radical redesign of the innovation process and the whole customer engagement process. Most of our organizations today, really lag on this engagement, let alone on building a more adaptive and agile innovation process being ‘fed’ by the technology solutions we have available to us today.

The need is to “test to learn” and then adjust and adapt, some thoughts include:

• Without a doubt, it is finding and using more techniques and tools that help you make far greater rapid prototyping, testing, piloting and learning from these understandings and how they can be quickly translated back into the innovation process to improve on what you have known, into one of what you have become aware of. “Testing to learn” will become the new innovation mantra and the accepted innovation process; a dynamic, fluid and rapid experimenting that makes it a constant learning one.
• We are today, partly down this route of early learning, with the help of software that can capture ideas, offering a sound vehicle for communicating these and a place to gather and define solutions that can be taken forward. Yet we have to push the path of constant evolution and that will continue to come at increasing speed from technology to keep providing new knowledge so as you can constantly improve on your eventual value proposition but that is going to require an ever-increasing agile organization and adaptive system.
• We will need to find different ways to redesign the manufacturing process (more outsourcing) to have more adaptive points where we can intervene and change product design further upstream. We will need to find different ways to ramp up or dampen down finished goods and that is going to push ‘agile’ even further. The ability to balance “scale, speed, and scope” will become paramount in this.
• We will need to learn to focus on the seizing of emerging opportunities in quicker ways but also take a much tougher approach to divestment, so as to release resources from declining positions of advantage. The whole life-cycle thinking needs challenging and thinking through.
• We will need to push for “agile systems” where we can design new applications, find better communication and collaborative social technologies to reduce delays in getting the right information to the right people to advance the process and reduce the duplication of work or the search for the information needed to complete the job. We need to focus much more on reducing innovation process cycle time for faster deployment.We must be constantly adaptive not blindly following an outdated innovation process, that is full of rigidity.
• We will also need to invest in more data-driven front ends to build a more sophisticated process of discovery. The whole concept of divergent experiments and convergent testing leading to validations will become the way to think of the innovation process as a re-looping process. This will require a critical mindset change from a linear one on how you set it, in the design of the process and the use and application of the digital tools you deploy to move this through this constant, ongoing iterative process. Nothing can remain ‘static,’ we need to make it ‘highly’ dynamic, iterative and fluid, a constant learn and adapt.

Rapid innovation matters and it will become even more central in 2017 as digital takes hold.

Rapid-iteration needs to replace the fixed product release date mentality we see in much of our innovative software. We are in a world, driven by digital that requires us to constantly adapt to new learning that is coming from real-time market feedback. The way we learn from this and our rapid innovation application process will be all about this continually testing new assumptions to improve our (final) product and service propositions. This is where the cloud provides the ability to constantly update and release, so we the innovators benefit.

This, I believe, requires a rethinking of the innovation process, as we will need to transform the existing methods and make them increasingly digital and social, in real time, feeding (as close to) real-time data and insights. We need to focus on the rates of innovation output from our learning and improvement in the eventual offering, not on the ‘classic’ input and output metrics from the past, as our constant bearing. It is outcome learning as the driver for metrics It is how we design this in a more comprehensive manner will be a real challenge in 2017.

Are we in a pivotal year of the rapid innovation application process? Will we finally move towards a greater fluid and looping innovation process? One that is fully designed and adopt as our new innovation discovery to the execution process based on the transformational effect of technology. One that is a constant path of innovation understanding and evolution that fits far more with these digital transformational times we are going through. They certainly do need to form a closer partnership for us to gain the transforming value.

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**adapted and revised from an original post supporting a digital transformational study exploring leading practices completed for Hype. Register and then download, it is complimentary

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The post Digital technology is changing the innovation game first appeared on Building Your Innovation & Ecosystem Intelligence.

The customer has become absolutely central to this transformation and the push towards the 4th Industrial revolution is driving this transformation wholesale, across all industries and services engaged in business.

Let me outline some of the challenges in my opinion that might help us all form a clear view of the digital transformation journey, recently researched.

Firstly I’m sure we can all agree transformation is very hard at the best of times

Digital transformation is doubly difficult, it forces us to work with mostly emerging, constantly evolving technologies, and then apply these in an integrated way into an existing business. This stretches our abilities significantly.

Beyond making a series of incremental improvements to become cloud-ready, we are supposed to reflect social, mobile and digital technologies. We need to fundamentally transform our processes by opening up and engaging with customers. On top, we have to deal with a broad range of communities, across platforms and in different ecosystems at speed, scale, and scope. However, we must do all this to reposition all our businesses towards the digital world.

I provided a recent digital transformation report that might help you in planning this digital journey.

I wrote a meta report on the recent developments in the digital transformation in late 2016 that was published by Hype. The report offered a selection of key visuals and overviews from 14 reports, which in turn were shortlisted from an original data set of 140 reports on the topic, ones published over the course of the last few years, that from my research, I found the most valuable. To obtain a copy, it’s free, click this link to register and download.

The intention of this report was to provide data for orientation for people dealing with this difficult topic, it was an attempted to extract a selection of the best emerging practices or thinking of the what, how and why digital transformation needs to be top of every business person’s mind. The report was designed to help you to trigger your thinking, and make you aware of multiple challenges and opportunities you may encounter on this journey.

I provided an opening backdrop to the report here as triggering points to reflect upon and recognize.

Business entities are being forced to open up

Digital transformation is happening at a scale and scope that makes many reluctant to take it on; it seems overwhelming in its complexity and risk. The business returns seem hard to quantify in traditional metrics. Thus it is hard to convince those undecided to support this, whether they are just skeptical or lacking technology adroitness. Yet for others, who recognize the future lies in technology and the power of networks and community engagement, it is the opportunity to radically alter their way of doing business; the opportunity to forge new competitive positions that have the collaborative engagement at its heart.

We have to embrace new technology – or leave the stage

The buy-in to this means undertaking a disruption to the existing organization, to the way you go about business. When considering this, you begin to understand the magnitude of the speed of change demanded. It implies a competitive need for opening up, for responding to and connecting with all external parties who are ready to collaborate.

We all need to think mobile, digital, cloud, and social far more than we did to date. We need to become comfortable in the analytics of big data. If we are not willing to accept that, we should step aside and allow those willing and digital savvy to take the reins and set the pace for the transformation journey.

At present individuals are far ahead of businesses in embracing the digital world

Transformation is coming at us in rapid waves. Its scale and complexity is either seen as amazing or simply accepted, with a shrug of the shoulders. Many are expecting it to be a seamless experience, powerful and adaptable, allowing the individual to make it highly personal.

However, business is lagging in exploiting the opportunity, whereas we as individuals seem to have embraced the social digital world already. Companies want technology to transform their business, but they struggle to find ways towards opportunities that offer true growth.

We don’t know what the “end game” will look like

We don’t know how the digital transformation will turn out in the end and we have to accept that. Much will come towards us as we adapt, learn and experiment, with many emerging technologies, all in different stages of their evolution.

You get a sense of survival pervading the boardrooms, a sense of growing concern when they recognize the threats and the magnitude of change this transformation will demand of them. They will be required to find resources for this journey, and be it just to stay competitive in this new digital world where the demarcation is blurring and industries are agonizing in continuous disruption.

The “survival of the fittest” will be determined by how successfully and how fast deciders maneuver through this shift. Transforming established businesses has become an imperative today.

However, there are three strategic goals to justify the transformational journey:

1. Providing a better, systematic customer experience, leading to greater loyalty and fostering a community of advocates
2. Internally, digital transformation can improve the operational efficiency
3. New business models, which were not feasible before the time of the connected world, offer new markets and growth opportunities

Customer engagement becomes the primary focal point of justification to transform

Of those strategic goals, achieving customer engagement, in the sense of a sustainable partnership, is the most valuable one. Digital transformation enables you to engage your customers along their journey across various products, services and communication channels. Digital has become truly pervasive in people’s lives now and this simply forces businesses to think about how they can become a consumer technology company, irrespective of what they offer.

The challenges are massive. Companies are struggling to see clear business benefits in traditional ways of managing return on investment. They need to experiment and be ready to be agile and adapt as they go, as their customers will radically alter their perceptions and past positions. The journey will often be uncomfortable but necessary.

Senior executives have been trained in a curriculum that didn’t prepare them for this world of digital technology.

They lack the new tools of engagement, which are table stakes already in the world beyond their own corporate offices. They consider technology as something for others to worry over. Increasingly, they also lack the relevant exposure and experience to handle the new game successfully. Driving an effective digital transformation through technologies, which are constantly adapting and evolving, is not the prediction model based experience they are used to and that got them to the top. A new mindset is required, with solid risk judgment, replacing hard facts with soft instincts, and incomplete data with structured experimentation.

We must overcome the barriers for digital transformation

As outlined above, we face plenty of barriers for digital transformation: a lack of vision, not understanding the urgency, holding on to traditional measures for growth, and a host of organizational constraints that restrict decisions.

How do we best start off?

The toughest part of any transformation is actually recognizing you have to challenge your own past assumptions and be prepared to strip them down and rebuild them. Once you have accepted that, the answer to the questions is as simple to say as it is difficult to carry out. You have to understand and potentially fix your customer relationship, adjust internal operations and create a data collection workflow for business insights you can base your decisions on. And you have to do all this in a concerted way, as much as possible. So the actual starting point will be to come up with a detailed plan of coordinated actions and this is where this report might have great value.

What’s the goal to keep in mind?

Simply put, you need a picture of how you will (eventually) make money when you start your journey of digital transformation. Create a clearly outlined set of value propositions, and define how you will engage and interact with your customers, partners, and suppliers.

Your business will revolve around what customers really want, a seamless experience where speed, time, performance and response become dominating values – far beyond a specific job-to-be-done.

In general, business is moving towards a culture of experience. Whether in communications, development, or delivery: everyone’s time within the organization is pivoted towards the outside world. And the most important change in perspective is about being different, about carving out our own uniqueness.

A digital transformation is an event of historic impact, challenging what we believe to know

Technology is becoming an integral part of our lives, for us personally, as consumers or employees, but equally for businesses, the government and our educational institutions. It is pervading everything.

Look at digital transformation as an investment. Investments always take a time to show results, and digital will demand a lot. It is shaping the ways we will work in the future, on how we are going to connect, communicate, and learn. Often, we have been caught up in a specific device we use. This time, it is different though. It is how that set of devices allows us to become connected, how they interact and form a system to tackle a need or task and we need to learn how to respond to what they are telling us, and listening to others has never been the corporate’s best attribute.

In Summary

Digital transformation will keep pushing us to become more efficient and effective but also to become more adroit and innovative. We will need to take a ‘dual’ mindset to constantly balance these often conflicting tensions so as to harness all the different power sources of digital and structure the business and organization accordingly.

Digital is presently determined to be all-dominant, it simply erodes much of what we know and eats into our time that in the past was taken up by so many other things. We will need a new reset in our values and beliefs, a new re-equipping, to deal with everything digital.

Welcome to the digital era where we all are learning to transform ourselves! You might find the visuals shown in the report as very valuable, so as to piece together your understanding of the needs of any digital transformational journey. I enjoyed researching and extracting the best leading practices and frames to help.

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Although she is addressing within this paper the bigger more complex social and economic challenges we are facing in healthcare, alternative energy, water scarcity, climate management, poverty and economic revitalization, she is attempting to reframe these into problem resolutions from breaking down discovery into four distinct channels. I liked this thinking.

The new innovating world we face in the 21st Century

Her opening insight is in the twenty-first century we are all requiring more reliance on social technologies that are designed to allow the different technologies to emerge and be allowed to integrate, due to the diversity and diffusion of knowledge. This is different from past practices found within organizations. Dr Dougherty points out much of what takes place today is still based on nineteenth-century practices where organizations were designed to stabilize, scale up and optimize, mostly internally, the scientific and technological knowledge into large working configurations.

Today, in the 21st century, we need to reply on social technologies that allow for emergence, anchor it far more into the region, or specific problems or challenge, and not so much scale up into large working configurations that might be limited and to integrate more than optimizing. She discusses as examples drug therapy, cancer cures, or developing a technology platform to integrate the creation, storage, and distribution of wind power.  Innovation needs to be more external in its outreach in creating, combining and recombining knowledge, so it can accomplish particular uses and can materialize all this gained knowledge into something new that actually works in the real world but can be dealing with different configurations in different situations. As she points out knowledge is fragmented, partial and widely dispersed, where we are constantly seeking out all the unknown, unknowns. This is why I value the absorptive capacity framework for knowledge.

The complexity today is being faced with any innovation challenge that spans the globe.

The success of extracting knowledge is in the connecting, capturing those unique insights and interdependencies in new contexts that capture the ‘nuggets’ of local knowledge applied in local situations or applied to solve and overcome situations and bring these together to accumulate all these diverse nodes of knowledge.

Today with technology, with platforms and the recognition of ecosystems we can really tap into these point of diverse knowledge and harness them in new innovative ways and deliver them far more specifically to closer customer needs by understanding these. The whole network and relationship building opens us up to discovery and the communication platforms and social types allow for a greater exchange, so new knowledge emerges.

The framework of discovery suggested

What I liked about her thinking was suggesting to “disentangle the ecology of complex innovation into distinct problems of discovery“. These were broken out into four: 1. the Project discovery Problem, 2. The knowledge integration discovery problem, 3. the strategic discovery problem and 4. the governance discovery problem.

This is suggesting these four discovery pathways can help develop a more robust 21st century for understanding and then managing innovation in a more social related way within organizations.

Let me describe the four discovery pathways as direct quotes from her paper as it does a good job of the why:

“The project discovery problem is at the heart of innovation. It concerns building and materializing the product, program, or service so that it works to actually resolve problems. Project innovators ferret out specific elements that might constitute the emerging product and how they go together to generate desired functionality. Project work is very hands-on, concrete, embodied, iterative, and multi-functional, but occurs in large networks because emergent knowledge is noisy, fragmented, and far-flung”.

We need less work on general network structures among scientists based on patents (patents are inventions or inputs to innovation, but not innovation), and more work on how particular relationships enable the ongoing confluence of knowing and doing for innovation across many potential participants in concrete settings. We need less work on small teams and more work on how to collectively integrate noisy information, on the nature of experiments for particular kinds of problems, and on the reasoning processes, people use when deductive confirmation cannot work.

The knowledge integration discovery problem redefines R&D as an ecology-wide challenge of integrating diverse knowledge in ways that support project problem setting and solving. Knowledge integration brings together different technologies to solve problems, selects alternative paths as projects move forward, supports general questions that span projects, or sets up experiments and testing regimes.

We need less work on investing in science and technology in general and more on how these investments lead to actual innovation. Studies might examine the types of organizing that enable knowledge co-evolution among disparate knowledge communities for different grand challenges, how governments, universities, and publishing regimes may perpetuate the myth of the linear flow of knowledge from basic research into application, and how to make basic knowledge actually usable without thwarting the basic research goal of fundamental insight.

The strategic discovery problem involves creating the strategic direction to channel resources, focus efforts, and incorporate the new with the old. In complex innovation systems, the question becomes how to strategize across the ecology, and how to map forward into the long-term future so that innovators can persist with projects that take decades to develop, or with problems such as education or health care that will never be fixed once and for all, because these problems keep emerging.

We need less work on short-term collaborations or open innovation, and more work on ecology-wide strategizing over the long-term. For example, how can strategic managers use knowledge from projects and knowledge integration efforts to develop a variety of potential value creating opportunities? How can they use these potential opportunities to map the future, and how far into the future can they see? How can managers of individual organizations use this mapping for their own needs, and how can they work together with others and still compete? What alternate temporal structures and metrics enable managers to work toward very long-term goals, and how can these be organized?

The governance discovery problem involves creating mechanisms of interaction among organizations and agencies that sort out who gets what is accountable for what, and for how long. Complex innovation requires orchestrating collaboration among many organizations, institutions, regulators, and other agents. We already have many examples of non-market systems of interactions such as regional agglomerations, industry platforms, social movements, strategic alliances, or self-designing standards-setting bodies.

Research can consider how such existing mechanisms might evolve to enable people to come together for complex innovation. In addition, societies invest enormous resources into supporting commercial development, education, basic research, and so on. Research can consider the kinds of governance mechanisms that effectively leverage society’s knowledge resources for particular problems.”

In summary

We need to rethink our discovery pathways for innovation in our new socially connected world. We do need to integrate emerging knowledge in new ways

Deborah Dougherty is suggesting disentangling the ecology of complex innovation into distinct problems of discovery: generating new products and programs; developing and integrating knowledge across the ecology; strategically framing
innovation for long-term development across the ecology, and enabling new governance mechanisms in the ecology.

Each discovery problem is an essential part of complex innovation that involves many players. Each must be set and solved in its own right, yet each is entangled with the others. All four discovery problems encompass the entire process of problem setting and solving and in a more “connected” world, we do need to manage these to emerge and fragmented knowledge in new ways.

I think this outline of four discovery approaches helps us to think about this a little more. I am thinking about how to take this forward in my own thoughts

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To cite this article: Deborah Dougherty (2016): Organizing for innovation in complex innovation systems, Innovation, DOI: 10.1080/14479338.2016.1245109

To link to this paper: http://dx.doi.org/10.1080/14479338.2016.1245109

This paper was published in late 2016 by Innovation: Management, Policy & Practice and © 2016 Informa UK Limited, trading as Taylor & Francis Group.

Deborah Dougherty has written a more extensive book on this ” Taking Advantage of Emergence: Productively Innovating in Complex Innovation Systems”, published 25 Feb 2016, Publisher: Oxford University Press, ISBN: 978-0-19-872529-9

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Firstly please forget best practice, this is a mistake for you in a rapidly changing world

The trouble with best practice is you are looking at someone else’s practices and these are highly individual, made up of different groups of methodologies, processes, rules, theories, values and concepts. These together have provided that specific company a level of success that others – mostly competitors – begin to notice and just attempt to copy.

No, there is no such thing as best practices, only your own distinct practices, specific to your own environment, history and needs, you can’t simply pick up and plug and play, as one organization’s initiative is never the same set of conditions or positioning that others can simply copy.

We desire the “one-size fits all” as a comfort blanket. Many consultants love this request, as they do not need to apply the real skills of discernment, subject matter expertise and the difficult challenge of peeling away a client’s practice to understand how they can rebuild them to become unique, into a leading practice that cannot be copied. Here lie a true competitive component and so many organizations seek to apply someone else’s practice, so they can end up as “same” practice.

Moving from “Best Practice” to “Next Practice”

The digital transformation that is underway is becoming a very uncomfortable place. We are all presently learning a new practice. The past best practices are now a very poor playbook for the future digital connected world. We need to ditch much of the endeavors that make up a legacy of past practice, and think forward, to which the term next practice becomes the learning spot.

Finding your best practice is extremely tough, it is often a “blind” adoption as you never fully appreciate how one company arrived at this point, whatever is claimed. It is far better that you quickly benchmark assorted practices across yours and also different industries and then stop and reflect. You need to invest a lot in researching, seeking out understanding, and then experimenting with your own needs to develop your emerging practices for digital transformation, believe me.

Just take a look at the recent report I compiled on digital transformation.

This is a meta report I have written and was released this last week, on the recent developments in digital transformation. It offers a selection of key visuals and overviews from 14 reports, which in turn were shortlisted from an original data set of 140 reports on the topic, published over the course of the last years. The intention of this report is to provide data for orientation for people dealing with this difficult topic.

The report should give you an opportunity to find connecting points in the understanding of digital transformation. The link provided below takes you to an access sign up page. Do please note the statement “Just good stuff, no spam, unsubscribe anytime” to give you assurance the intention is to inform and offer useful content, they want to track the level of interest in the report. 

http://i.hypeinnovation.com/exploring-digital-transformation

I do encourage you to take the time and download the report, it should offer a good oversight and value into your own understanding of digital transformation but let’s get back to your next practice.

Forget the past, much of our roots need digging up and discarding.

No one can maintain the past, much of our systems are rooted in the 20^th century, in markets that were predictable and where supply and demand were simply managed to seek out the status quo.

We are facing such an unprecedented change and technology is re-writing the rule book in everything we are going to do. Many have argued it is a foundational shift and today we are struggling to articulate or codify the shifts. We seem to be moving from the world of complicated into the complex. It is hitting us in multiple ways, in scale, in speed, and in scope, across the whole organization. Technology and digital are changing the business dimensions significantly.

We are moving from “pre-connectivity” to “post-connectivity

In this report I have been compiling writing on the topic of Digital Transformation, I have been attempting to find these emerging and next practices. It has been a very, very deep dive into this subject and it is full of different views, approaches, suggestions and recommendations. In the report due out in the next few weeks I have attempted to ‘pick out’ those practices that take you towards a new thinking for digital transformation.

What I have not included in the report are these two wonderful paradigm shifts we need to take to grasp digital transformation. I believe these should stand apart as they form the new ‘common language’ we need to apply to move into a digital transformation.

It is the critical shift from best (past) practice into next (new) practice

The first contribution is from a short article I came across in my research written for information-age by Carl Bate, managing partner, digital strategy and transformation, Atos

http://www.information-age.com/digital-transformation-are-you-living-and-breathing-next-practice-or-best-practice-123458572/

This emerging shift in leadership techniques, from best to next practice, from pre-connectivity to post-connectivity, are shown here:

The practices of ‘best’ on the left-hand side are the very practices that have fostered industrialization and led to global connectivity.

The irony is that these practices do not naturally foster external and connected views, which are essential to working in the connected world that the best practices have helped create.

The second contribution into thinking next practice comes from a really promising book by David L Rogers called “the Digital Transformation Playbook”, recently published in April 2016, and he is offering a superb list of changes to consider as we move from the Analog to the Digital Era.

The Author offers a view on how digital forces are reshaping five key domains of strategy—customers, competition, data, innovation, and value. These five domains describe the landscape of digital transformation for business today.

Many of the fundamental assumptions are outdated and he is suggesting we move from the Analog to Digital era, with his chapters in the book to work through these. This I think is such “next practice” thinking to get us in the digital era mind-set.

David Rogers sums up the change we are all facing from digital transformation

“We live in what is commonly referred to as a digital age. An overlapping ecosystem of digital technologies —each one building on those before, and catalyzing those to come—is transforming not only our personal and communal lives but the dynamics of business for organizations of every size and in every industry.

Digital technologies are transforming not just one aspect of business management, but virtually every aspect. They are rewriting the rules of customers, competition, data, innovation, and value. Responding to this change requires not just a piecemeal approach, but a total integrated effort—a process of holistic digital transformation within the firm.”

The key is to look forward and recognize past best practices are just not relevant today. We need to look forward and seek out those “next practices” that are emerging and explore them for what they mean for us, not for others. They are, or will become the (golden) keys to unlock the future common language of digital transformation, something we all are needing to learn.

Publishing note:  This blog post was originally written on behalf of Hype and with their agreement, I have added this to my own site.

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The lack of having a well mapped out customer journey means missing out on opportunities caused by not knowing this complete set of connections being made into you. By not knowing all these connecting points and drawing them together in a cohesive plan, there is a significant chance you are simply restricting the developing of innovation solutions that map back to all the decision-making that is going on in the customers’ minds.

This failure to optimize and seize upon all the possible options to connect with your customers is restricting your ability to broaden out your innovation solutions, making the journey more value creating, it certainly can be really holding your business back.

As you explore the digital transformation path this can become your best opportunity to connect along the total customer experience and see a greater return on this understanding and investment.

With the increasing need to adapt to a digital world, the essential need for understanding customer behaviors of those wanting to engage with your business or brand becomes even more of a challenge if you have not mapped this out. Also, how comfortable are you as new customers start connecting – can you have any certainty of the reasons why they did, what decided this and what might hold them for the future of a repeating business?

The vital map of the customer journey

A recent Altimeter report “the 2016 State of Digital Transformation” discusses these problems, along with many others. The mapping of the customer experience (CX) has become a top driver of digital transformation, yet only half of the companies studied have mapped or are mapping their customer’s journey. So that you are aware, the data and insights in this report are based on the input of more than 500 digital transformation strategists and executives who are leading change within their organizations.

In a good visual, they illustrate the severity of the digital transformation challenges: finding that 71% struggle to understand behaviours or impact of a new customer; 69% cited the lack of data or ROI to justify the value of data transformations; and 67% on the risk management, compliance and /or legal implications. Lacking the essential insights many companies are failing to grasp the potential, with many (alternative) innovation opportunities wasted and perhaps suffering a growing customers churn rate. Knowing the why of your customers is something that keeps many marketing and C-level executives up at night.

The good news is that although half of those surveyed are now mapping the customer experience journey most of these are only just doing this. Back in 2014 at the time of the last survey by Altimeter, only 25% of companies undergoing some form of digital transformation had mapped the customer journey, as now 88% cited CX as the driver of change and why technology was the necessary solution. There is some real catching up taking place to justify any transformation.

I still sense that it still seems IT & Marketing are not working on this together, there are separate initiatives and operating in their own silo’s, often in pursuit of different investment decisions that might be better served by combining forces.

As each organization changes in its modernization with new systems, models, processes and architectures it is this lack of customer-centricity that is a growing problem. The lack of a vital set of insights means the continued investment taking place in front-and-back-office solutions has this lack of the customers’ expectations, preferences and values clearly understood.

There is even more of a warning within the report

Traditional touchpoints, such as websites, contact centers, representatives, affiliates, etc., seem to not meet heightened expectations. In fact, they deter from what’s becoming an on-demand customer experience. Equally Mobile has given way to what Google refers to as “micro-moments,” and they are completely upending traditional customer journeys.

These mobile-first moments play out in common scenarios when someone is intent to do, buy, or learn something. As consumers increasingly use their phones to complete everyday activities, they’re fracturing the consumer journey into hundreds of new “micro” touchpoints where they seek real-time, mobile-optimized content, reviews, shared experiences, and direction online.

Despite all of this, just 20% of digital transformation leaders are studying the mobile customer journey and/or designing for real-time micro-moments in addition to customer journey work. There is a need to understand these ‘micro-moments’ as they increasingly impact on the customer decision-making, behaviors, and values.

The report warns even further: Mobile is just the beginning of disruption in the customer journey. With the runway for disruptive technologies still ahead (e.g., wearables, Internet of Things (IoT), artificial intelligence, virtual and augmented reality), companies will need a resilient infrastructure that adapts to not only mobile’s “micro-moments,” but also the impact of all these trends and new devices over time.

There is also a change taking place on the primary catalyst

While CX was initially the primary catalyst for digital transformation, innovation, agility, and the pursuit of digital relevance are the new factors driving companies along the maturity model. For executives and senior leadership, the need to accelerate innovation (81%) was at the top of the digital transformation agenda.

Right behind this was the need to modernize the IT infrastructure with increased agility, flexibility, management, and security (80%), and the third priority for enterprise transformation is improving operational agility to more rapidly adapt to change (79%).

Altimeter argues it is through these priorities, businesses are developing a roadmap that helps them compete for the present while building a next-generation business model to compete for the future.

For this report, Altimeter, a Prophet Company worked with Phronesis Partners to conduct a survey of 528 qualified digital transformation strategists and executives leading change within their companies. Respondents were from companies in varied industries, with more than 250 employees, in the United States, Canada, United Kingdom, France, and Germany.

In summary

As Altimeter state in their opener in this report and I repeat here in my closing:

“Digital Darwinism continues to impact businesses as technology and societies evolve. As a result, organizations are moving away from “business as usual” as they pursue digital transformation to compete”

We are all aware (or should be) that customers are increasingly choosing products and services based increasingly on the quality of the experiences they have with them. The pressing need is to address a competitive risk if you are not mapping and understanding the channels, touchpoints and shifts taking place in technology solutions that capture, evaluate and determine customer experience.

Are you meeting your customer needs, do you fully understand their motivations, associated behaviors to design a better range of innovation solutions?

Link to the Altimeter Report “The 2016 State of Digital Transformation”

Publishing note:  This blog post was originally written on behalf of Hype and with their agreement, I have added this to my own site.

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