So after working through the values of the Innovation Ecosystem over a series of three posts I asked Chat GPT to help me in making a pitch for the change from existing internal orientated innovation processes and structures.

I wanted to go way beyond just “open innovation” here, I wanted to provide a compelling set of reasons to make this move or accelerate this into reality.

Does this resonate with you? Are you moving along this journey of change seeing the reasons and lasting potential?

Unlocking the Full Potential of Innovation: Why an Innovation Ecosystem Outperforms Traditional Internal Innovation Structures and Systems

In today’s rapidly evolving market landscape, relying solely on internal innovation systems can limit your organization’s ability to stay ahead of the curve.

Firstly, a great podcast based on this post, its worth listening through.

I asked Google Notebook LM to discuss this pitch through their own AI research assistants to do a deep dive on this and they gave this their perspective, in a 17 minute podcast on this Innovation Ecosystem value.

The podcast gives a good perspective of why Innovation Ecosystems are important today and what you need to do. It further covers aspects discussed within the series of posts in drawing out benefits and challenges and the relevancy and why you should care. Finally going about applying Innovation Ecosystems, looking to possibly get external help and how and where to apply this thinking.

This is my pitch outline

“While internal structures have their strengths, they often operate in silos, restricted by limited perspectives, resources, and risk appetite. An innovation ecosystem, on the other hand, opens the door to a world of opportunities that can supercharge your innovation capabilities and deliver sustainable, long-term growth.

Here’s why you should consider transitioning from a closed internal system to a vibrant, interconnected innovation ecosystem:

1. Access to a Wealth of Diverse Expertise

Innovation ecosystems bring together a rich tapestry of talents and expertise from diverse sectors, industries, and disciplines. Unlike internal teams, which may be constrained by their specific knowledge and experience, ecosystems allow you to tap into cutting-edge research, emerging technologies, and fresh perspectives from a broad network of participants. This diversity fosters creativity, accelerates problem-solving, and leads to more groundbreaking and market-ready innovations.

2. Accelerated Innovation and Speed to Market

In an innovation ecosystem, shared resources, collaborative platforms, and agile development processes dramatically reduce the time it takes to move from idea to implementation. This accelerated pace means you can outmaneuver competitors, seize market opportunities more quickly, and capture first-mover advantages that are critical in today’s fast-paced environment. Your internal system may excel at refinement, but ecosystems excel at speed and agility.

3. Risk Mitigation and Shared Investment

Innovation is inherently risky, and bearing that risk entirely within your organization can stifle bold, transformative ideas. In an ecosystem, risks are shared among various stakeholders, enabling your organization to pursue more ambitious projects without the fear of jeopardizing your core business. Additionally, ecosystems attract diverse funding sources, from venture capital to public grants, further spreading risk and increasing the likelihood of success.

4. Enhanced Market Connectivity and Scalability

Traditional internal structures may struggle to quickly adapt innovations to new markets or scale them effectively. Ecosystems, however, provide direct access to vast networks of partners, customers, and distribution channels, enabling you to scale innovations rapidly and efficiently. Whether it’s entering a new geographic market or reaching a broader customer base, ecosystems provide the connectivity needed to expand your innovation’s impact.

5. Continuous Learning and Adaptive Innovation

An innovation ecosystem fosters a culture of continuous learning, where insights, feedback, and new knowledge flow freely among participants. This environment not only helps you stay at the forefront of emerging trends and technologies but also makes your organization more adaptable to change. In contrast, internal systems can become rigid over time, potentially missing out on disruptive innovations or shifts in the market.

6. Holistic Value Creation and Sustainability

Innovation ecosystems are designed to create value that goes beyond short-term financial gains. By aligning innovation efforts with broader societal goals—such as sustainability, social impact, and ethical responsibility—ecosystems ensure that your innovations are not only profitable but also contribute positively to the world. This holistic approach to value creation enhances your brand reputation, builds long-term customer loyalty, and positions your organization as a leader in responsible innovation.

7. Strategic Advantage in a Competitive Landscape

In a world where competitive advantage is increasingly defined by the ability to innovate, joining or creating an innovation ecosystem positions your organization at the heart of industry-wide advancements. It allows you to shape the future direction of your market, influence emerging standards, and stay ahead of disruptive forces. While internal innovation systems focus on incremental improvements, ecosystems empower you to lead transformative change.

Summing up the pitch

By embracing an innovation ecosystem, you’re not just enhancing your existing capabilities—you’re transforming your entire approach to innovation. This shift opens up new avenues for growth, mitigates risks, and ensures that your organization remains agile, competitive, and relevant in an ever-changing world.

In contrast to the limitations of internal structures, an innovation ecosystem offers a dynamic, interconnected, and resource-rich environment that’s essential for driving meaningful, sustainable innovation.

Making this transition could be the key to unlocking your organization’s full innovation potential and securing its future success.”

**End of pitch.

I have written three posts so far on building this argument of moving towards an Innovation Ecosystem in mindset, approach, value and reasons

The first was providing examples of the move from open innovation to innovation ecosystems in “Moving from Open Innovation to Innovation Ecosystems , the second was “Recognizing the distinguishing points of Innovation Ecosystems” and following on with “Innovation Ecosystems need you to engage and openly embrace?” I followed up with this pitch proposal outlined here: “Pitch me on why Innovation Ecosystems are better than my present innovation approach”

This is the final post in a four-part Innovation Ecosystem series moving beyond “just” open innovation into recognizing the value and potential in adopting this Innovation Ecosystem thinking and design, outlining the benefits.

*** I was supported by Chat GPT in helping in the structuring and validating of this thinking within the series build and also in the discussion generated from Googles AI research assistants and their podcast.

The post Pitch me on why Innovation Ecosystems are better than my present open innovation approach first appeared on Building Your Innovation & Ecosystem Intelligence.

Following on from my last two posts related to recognizing the importance of Innovation Ecosystems we need to ask what makes these dynamic, interconnected and engaging, from a diverse groups perspective?

An innovation ecosystem becomes impactful and particularly effective in driving growth and value creation because it aims to leverage the collective strengths of its diverse participants to drive continuous innovation economic growth and societal progress- today’s dual need.

By fostering collaborations, by pushing to accelerate innovation cycles providing resilience, scalable options that address complex challenges, you can create sustainable benefits for all stakeholders involved. This becomes that interconnected and dynamic environment that offers a more widespread, equitable and long-lasting potential

Lets break down this view of Innovation Ecosystems even further

I have written two posts so far on this argument of moving towards an Innovation Ecosystem in mindset, approach, value and reasons

The first was providing examples of the move from open innovation to innovation ecosystems in “Moving from Open Innovation to Innovation Ecosystems , the second was “Recognizing the distinguishing points of Innovation Ecosystems” and following on from this current post on “Openly embracing this Innovation Ecosystem approach”, I will follow up with this proposal: “Come on pitch me, why Innovation Ecosystems are better than my present innovation approach”

I asked Googles NotebookLM to provide a podcast of this series. It is a listening of 13 minutes but I like how it discusses this.

Ecosystem thinking and design for Business is becoming a real essential need to do. It can advance innovation solutions by connecting up diverse and different thinkers who bring insights and experiences to combine and tackle more complex problems, share in risk and development, deliver concepts and ideas that provide value and impact for growth and customer resolution to their needs in radically different ways.

A view on driving innovation and creating real impact and value the ecosystem should include the following key elements:

1. Diverse and Inclusive Participation

• Variety of Stakeholders: The ecosystem should involve a wide range of participants, including large corporations, startups, SMEs, academic and research institutions, government agencies, non-profits, and individual innovators. This diversity ensures a rich exchange of ideas and fosters creativity.
• Cross-Disciplinary Collaboration: Bringing together participants from different fields—such as technology, healthcare, finance, arts, and social sciences—encourages the cross-pollination of ideas and the development of innovative solutions to complex challenges.
• Inclusive Engagement: Ensure that the ecosystem is accessible to underrepresented groups, including women, minorities, and individuals from various socio-economic backgrounds. Inclusion drives broader perspectives and more equitable innovation outcomes.

2. Strong Network Connectivity

• Collaboration Platforms: Establish digital and physical platforms that facilitate communication, collaboration, and the sharing of resources among participants. These platforms should support formal partnerships and informal networking, making it easier for participants to connect and collaborate.
• Innovation Hubs and Clusters: Create or support innovation hubs, co-working spaces, and innovation districts that physically bring together diverse players. Proximity can lead to serendipitous interactions, faster knowledge transfer, and stronger collaboration.
• Events and Workshops: Regularly host events, workshops, hackathons, and conferences that bring together ecosystem participants. These gatherings help build relationships, exchange ideas, and stimulate new collaborations.

3. Open Innovation Culture

• Knowledge Sharing and Open Access: Foster a culture of openness where participants willingly share knowledge, data, and best practices. This can be facilitated through open-access repositories, public databases, and collaborative research projects.
• IP Management and Collaboration Frameworks: Develop frameworks that allow for the secure and equitable sharing of intellectual property (IP). This can include licensing agreements, joint ventures, or consortia that balance collaboration with the protection of participants’ interests.
• Crowdsourcing and Co-creation: Encourage the use of crowdsourcing and co-creation models where end-users, customers, and the broader community contribute to the innovation process. This can enhance the relevance and impact of the innovations developed.

4. Shared Resources and Infrastructure

• Shared R&D Facilities: Provide access to shared research and development facilities, such as laboratories, prototyping spaces, and testing environments. This reduces barriers to innovation, especially for smaller players who may lack the resources to invest in such infrastructure.
• Common Platforms and Standards: Develop and promote common platforms, standards, and protocols that facilitate interoperability and integration across different technologies and solutions. This is particularly important in tech-driven ecosystems.
• Funding and Investment Networks: Create a robust funding ecosystem that includes venture capital, angel investors, grants, and public funding. This should also involve mechanisms for de-risking innovation investments, such as public-private partnerships or innovation funds.

5. Effective Governance and Coordination

• Ecosystem Orchestration: Appoint or establish an entity or body responsible for orchestrating the ecosystem, ensuring alignment of goals, facilitating collaboration, and managing conflicts. This could be a consortium, an industry association, or a public-private partnership.
• Clear Roles and Responsibilities: Define clear roles, responsibilities, and expectations for all participants to avoid conflicts and ensure smooth collaboration. This includes setting up governance structures, decision-making processes, and dispute resolution mechanisms.
• Adaptive Policies and Regulations: Work with regulators and policymakers to create a supportive legal and regulatory environment that encourages innovation while protecting public interests. This includes flexible policies that can adapt to new technological developments.

6. Continuous Learning and Capability Building

• Training and Education Programs: Offer ongoing training and education programs to build the skills and capabilities of ecosystem participants. This includes upskilling in emerging technologies, innovation management, and entrepreneurship.
• Mentorship and Advisory Networks: Establish mentorship programs where experienced innovators, entrepreneurs, and industry leaders can guide and support newer or smaller participants. This helps to accelerate learning and growth within the ecosystem.
• Feedback Loops and Iterative Learning: Implement mechanisms for continuous feedback and learning, such as regular ecosystem assessments, innovation challenges, and pilot projects. These allow participants to learn from successes and failures, driving continuous improvement.

7. Alignment with Market and Societal Needs

• User-Centered Design: Ensure that innovation efforts are aligned with the needs and preferences of end-users and customers. Engage them early in the innovation process through user-centered design approaches and real-world testing.
• Focus on Impactful Innovation: Prioritize innovations that address significant societal challenges, such as climate change, public health, and social equity. This not only creates value but also strengthens the ecosystem’s relevance and sustainability.
• Measuring Impact: Establish metrics and evaluation frameworks to measure the impact of the ecosystem’s innovations. This includes both economic impact (such as job creation and revenue growth) and social impact (such as improvements in quality of life).

8. Resilience and Sustainability

• Adaptability to Change: Ensure the ecosystem is resilient to disruptions by fostering adaptability and agility among participants. This includes encouraging diversification, continuous learning, and flexibility in business models.
• Sustainable Practices: Promote sustainable practices within the ecosystem, such as reducing environmental impact, supporting circular economy models, and encouraging responsible innovation.
• Long-term Vision and Strategic Planning: Develop a long-term vision and strategic plan for the ecosystem that balances immediate innovation needs with future goals. This ensures that the ecosystem remains relevant and sustainable over time.

Conclusion

A dynamic and interconnected innovation ecosystem that engages a diverse group of participants requires thoughtful design, strategic coordination, and continuous evolution.

By integrating these elements—diverse participation, strong connectivity, open innovation culture, shared resources, effective governance, continuous learning, alignment with societal needs, and resilience—the ecosystem can drive impactful and sustainable innovation that creates real value for all stakeholders involved.

*** supported by Chat GPT in constructing this.

The post Innovation Ecosystems need you to engage and openly embrace? first appeared on Building Your Innovation & Ecosystem Intelligence.

Within a short series about Innovation Ecosystems this post asks what really are the distinct differences within innovation ecosystem thinking and design, to provide a set of common distinguishing points to move from “just” open innovation.

What distinguishes an innovation ecosystem and makes it a must-have, is its ability to create a highly interconnected, dynamic, and supportive environment where innovation can flourish.

Is it access to knowledge, markets, opinions or is it spreading risk and resource sharing or enabling the flows in knowledge, ideas, capital- what else really distinguishes it and makes it a must to have. What sets an innovation ecosystem apart?

What truly distinguishes an innovation ecosystem and makes it essential are several interrelated factors that together create a unique environment where innovation can thrive.

Here’s a deeper dive into what sets an innovation ecosystem apart:

1. Access to Diverse Knowledge and Expertise

• Collective Intelligence: Innovation ecosystems bring together diverse participants with different expertise, experiences, and perspectives. This collective intelligence fuels creativity and problem-solving by enabling the cross-pollination of ideas across disciplines and industries.
• Knowledge Flows: Ecosystems facilitate the free flow of knowledge and ideas among participants, which accelerates learning and the development of new concepts. The ability to access cutting-edge research, market insights, and technical know-how from a wide network is a key driver of innovation.

2. Resource Sharing and Efficiency

• Shared Infrastructure: Participants in an ecosystem can access shared resources such as research facilities, incubators, digital platforms, and intellectual property. This resource sharing reduces costs, minimizes duplication of efforts, and allows even smaller players to participate in high-stakes innovation.
• Efficient Use of Capital: Ecosystems attract investment by reducing risks associated with innovation. Investors are more willing to fund projects within a thriving ecosystem because they see the support network and collaborative potential as reducing the likelihood of failure.

3. Risk Mitigation Through Collaboration

• Spreading Risk: In an ecosystem, risks associated with innovation are distributed across multiple participants. This shared risk allows for bolder experimentation and innovation, as the potential downsides are not borne by a single entity.
• De-risking Innovation: By involving diverse stakeholders, including regulators and end-users, early in the innovation process, ecosystems help identify and mitigate potential risks before they become critical issues. This makes the path to market smoother and more predictable.

4. Dynamic Interactions and Adaptive Capacity

• Network Effects: The interconnectedness of an ecosystem means that as more participants join, the value of the ecosystem increases. This dynamic interaction fosters a virtuous cycle where innovation begets more innovation, creating a continuously evolving and expanding ecosystem.
• Agility and Adaptability: Ecosystems are naturally adaptive due to their diversity and interconnectedness. They can quickly respond to changes in technology, market conditions, or societal needs, making them more resilient and better equipped to sustain long-term innovation.

5. Market Access and Scalability

• Market Connectivity: Ecosystems provide participants with easier access to markets through established networks and platforms. This connectivity allows innovations to scale more quickly, as ecosystem participants can leverage each other’s distribution channels, customer bases, and partnerships.
• Global Reach: Well-developed ecosystems can extend beyond regional or national borders, enabling innovations to reach global markets. This global connectivity is crucial for scaling innovations and maximizing their impact.

6. Innovation Speed and Efficiency

• Accelerated Development Cycles: The shared resources, knowledge flows, and collaborative environment of an ecosystem significantly speed up the innovation process. Rapid prototyping, testing, and iteration are possible because of the concentrated support and expertise within the ecosystem.
• First-Mover Advantage: Ecosystems often enable faster market entry, allowing participants to capitalize on first-mover advantages in emerging markets or technologies. This speed can be a critical differentiator in competitive industries.

7. Cultural and Behavioral Shifts

• Innovation Culture: Ecosystems foster a culture of innovation where experimentation, collaboration, and continuous learning are valued and encouraged. This culture permeates all participants, leading to more innovative mindsets and behaviors across the board.
• Collaborative Competition (Coopetition): Ecosystems encourage a balance between competition and collaboration. While participants may compete in certain areas, they also collaborate in others, leading to mutual benefits and collective progress that would not be possible in a purely competitive environment.

8. Holistic Value Creation and Impact

• Economic, Social, and Environmental Impact: Ecosystems are uniquely positioned to create value that is not just economic but also social and environmental. By addressing complex global challenges, such as sustainability or healthcare, ecosystems generate innovations that have broad, long-lasting impacts.
• Alignment with Societal Goals: Ecosystems often align innovation efforts with broader societal goals, such as sustainability, equity, or public health. This alignment ensures that the innovations emerging from the ecosystem are not only profitable but also socially responsible and impactful.

9. Institutional Support and Policy Alignment

• Policy and Regulatory Support: Innovation ecosystems often benefit from favorable policies and regulatory environments that encourage experimentation and reduce bureaucratic hurdles. Governments and institutions may provide incentives, grants, and frameworks that further support ecosystem growth.
• Public-Private Partnerships: These partnerships are often a hallmark of innovation ecosystems, where public entities collaborate with private companies to drive innovation in areas that serve the public interest, such as infrastructure, education, or healthcare.

10. Long-Term Sustainability and Resilience

• Sustainable Innovation: By focusing on long-term goals and fostering innovation that addresses pressing global challenges, ecosystems contribute to sustainable development. This focus ensures that the innovations generated are not just viable in the short term but are also sustainable and resilient in the long run.
• Resilience to Disruption: Ecosystems are better equipped to handle disruptions—whether technological, economic, or environmental—because of their adaptability, diversity, and interconnected nature. This resilience is increasingly important in a rapidly changing world.

Conclusion What distinguishes an innovation ecosystem and makes it a must-have is its ability to create a highly interconnected, dynamic, and supportive environment where innovation can flourish.

It is finding the unique combinations that work for you. That unique combination of diverse knowledge, resource sharing, risk mitigation, market access, and a collaborative culture enables ecosystems to drive innovation more effectively than isolated efforts.

Building out your depth of Ecosystem understanding

A depth in understanding ecosystem thinking and design enables the Innovation Ecosystem environment not only to flourish but also accelerates the pace of innovation. You build out its dynamics and interactions needed

It is principled on ensuring that the innovations created are impactful, sustainable, and aligned with broader societal needs. In a world where the complexity of challenges and the pace of change are ever-increasing, innovation ecosystems are essential for driving

This is a second post on Innovation Ecosystems within a short series of four. The first one here “Moving from Open Innovation to Innovation Ecosystems highlight a number of organizations making the move towards their Ecosystem structures.

The next follow-on post to this is “Innovation Ecosystems need you to engage and fully embrace” with a final post of “Come on pitch me, why Innovation Ecosystems are better than my present innovation approaches”

The post Recognizing the distinguishing points of Innovation Ecosystems first appeared on Building Your Innovation & Ecosystem Intelligence.

How do we differentiate (traditional) approaches of Innovation to (evolving) Innovation Ecosystems?

Is your innovation process closed only to you? Or have you gone to being more open in innovation with outside selected partners? Well we do need to move beyond both of these and start thinking and designing with Innovation Ecosystems.

I would argue we need to adapt to thinking and designing in Innovation Ecosystems. True differentiation comes from solving unique challenges in ways others will find difficult and expensive to attempt to replicate as it is the combined value, experience, diversity and knowledge within a network of partners that can be unique.

For me, innovation ecosystems in their ability to provide added value are important to recognize.

In recent years we have been moving away from open innovation but not at the accelerated rate I would have expected, taking this into Innovation Ecosystem design and thinking.

We do need to recognize we are in an evolution stage moving from open innovation into this innovation ecosystem thinking and design. Business ecosystems are the present and future need to build, and build correctly.

To get to this point though does needs significant business ecosystem understanding, exploring, investigating, investment and cultural shifts.

So a brief point of separation between Open Innovation vs. Innovation Ecosystems

• Open Innovation: This approach involves sourcing ideas, technologies, or solutions from outside the organization and integrating them with internal R&D efforts. The focus is on collaboration with external entities to bring in new perspectives, reduce development costs, and speed up innovation.
• Innovation Ecosystems: This goes beyond open innovation by creating a network or system of interconnected players, including businesses, governments, universities, startups, and more. The goal is to create a self-sustaining environment where innovation is continuously nurtured through collaborative efforts, shared resources, and aligned objectives across the ecosystem. An innovation ecosystem is more holistic, focusing on the relationships and interactions within the network rather than just external input.

You will find numerous posts on my interconnected approach to building Business Ecosystems on this site paul4innovating.com and also on my ecosystems4innovating.com site.

Five rich examples of companies moving to Innovation Ecosystems

In practice many successful innovation strategies involve a combination (even a progression) of both open innovation and ecosystem thinking and they do complement each other effectively. A lot of it is what stage of maturity or adoption are organizations in. For example:

Siemens is moving towards a fully integrated ecosystem engaging a network of partners to create synergies beyond simple collaboration. Its digital twin, metaverse approaches and industry 4.0 emphasis is facilitating more real-time collaboration and innovation. Siemens has actively presented itself as the Ecosystem Orchestrator through its sharing of its platform Xcelerator, data exchanges and co-innovation spaces. It strongly is leveraging AI-driven insights to share, forecast and anticipate changing needs and drive more targeted innovation solutions.

Proctor & Gamble established a classic open innovation model P&G Connect + Develop more focused on bringing in external ideas. This is moving to greater sharing and collaborations in real-time on product development, testing and marketing for a more continuous, interactive process. It is placing more emphasis on building out its customer-centric ecosystem on consumer date and insights and also in its sustainability-driven ecosystem to drive circular economy activities to counter rising consumer demand for responsible brands.

Apple has built the App Store Ecosystem and is looking at its next steps of cross-platform ecosystem, assessing more decentralized platforms that can lead to new forms of digital transactions and contracts within the Apps Store for greater partner control/ involvement, and looking to expand this App Store through augmented reality (AR) and virtual reality (VR) to create a different level of marketplaces.

General Electric with its split of businesses has gone beyond its initial Ecomagination Challenge and within GE Vernova it has allowed the potential to build out scaling and specializing in clean energy ecosystems focusing on Global Clean Energy to address the entire energy value chain. Also to offer specialized and niche ecosystems like hydrogen, renewable energy financing or climate start- ups to accelerate these but benefit from their broader ecosystem expansion. They equally are establishing circular economy integration by focusing on resource efficiency, tracing, recycling emphasis and building more sustainable product designs.

Toyota with their approach to developing hydrogen fuel cell cars is rooted in ecosystem thinking. Building a broad network of government, energy companies and other automakers to create infrastructure and market conditions and although this is more open there next steps there is Mobility-as-a-service for ride-sharing, public transit and autonomous vehicles to become a growing service provider besides the manufacturer of the vehicles. They are also looking to integrate into Smart City concepts moving towards a seamless, connected urban transportation ecosystem and finally, move towards a carbon-neutral ecosystem collaborating with new and different partners to create zero-emission ecosystems.

They are all moving from open innovation into their innovation ecosystem domains

Each has taken a distinctive, individual path forward. They are deepening their ecosystem strategies by leveraging advanced technologies, broadening collaborations and aligning more closely with market and global trends. They are making distinctive choices by combining the rich human knowledge available through their approaches with technology application.

This pathway for each is evolving, offering opportunities to drive greater and more distinctive innovation and value creation but more importantly be positioned to transform entire industries through a growing pioneering leadership to create new market from emerging opportunities and technology / human interface advantage.

We are all aware of how Open Innovation has contributed over the years but perhaps Innovation Ecosystems are presently underappreciated and will form the next innovation wave of growth, impact and value.

Finding the distinguishing points of Innovation Ecosystems

My next post asks what really distinguishes the innovation ecosystem thinking and design, are they common distinguishing points.

The post Moving from Open Innovation to Innovation Ecosystems first appeared on Building Your Innovation & Ecosystem Intelligence.

I’m undertaking a rather exciting approach to describing innovation, within a collaboration venture, that gets more exhilarating and inspiring as we explore, clarify and document. Regretfully I can’t share this here at present but I certainly will when it gets to that point of ‘release’.

Some of the different areas or themes I’ve been investigating have flowed from one set of enquiries that have taken me into another and then yet another.

These simply get my innovation juices flowing and really are allowing me to make so many new connections. Here is just a few of these in this last week that have emerged from some of my research that provide a host of thoughts:

Leaders & Laggards
In this group of investigations, I started in trying to gain a better perspective of the discussion of leaders and laggards and what differentiates them. Timely to these investigations has been some recent studies by Capgemini Consulting and IESE Business School with a recent leadership study “Managing Innovation: An Insider’s Perspective”
I’d suggest the slideshare presentation is well worth taking some time out to view and understand as it covers views from those leading and managing innovation in their organizations and how they think about the innovation function http://tinyurl.com/c9o7cuw

Then I have been reminded of the continued great work of Chris Zook and James Allen, both partners at the consulting firm, Bain & Company, in their article “The Great Repeatable Business Model” http://tinyurl.com/d483eqq
The message of differentiation and the level of focus on clear specific areas of innovation and its management makes a real difference for separating leaders and laggards.

Those that endure and adapt

In the article by Chris Zook and James Allen they speak of differentiation that tends to wear with age and often the real problem is internal. It is complexity and in this a complex organization forgets what it is good at, it proliferates, it losses key people, it moves away from its core business, it losses focus and it begins to have that ‘great disconnect’ between upper management and the front-line employees. It seems to me the organization just simply begins to break down and lags even more in performance and returns.

They go on and suggest a lack of consistency begins to kill the economies of scale and equally retards the organizations ability to learn that adds up to them struggling with increasing complexity and fading differentiation.

I was looking for some of the enduring points of what needs to be put into place. This was offered “When a company internalizes a set of principles, the message no longer gets garbled. A shared point of view, core beliefs, and a common vocabulary improve everyone’s ability to communicate and foster self-organization.”

They go on and suggest “this increases the speed of business, you capture more growth opportunities ahead of competitors and accomplish more per unit of time.”

I also liked one comment they made that “up and down the organization, information slows and grows distorted.” I would suggest without a clear knowledge capturing and dispersing structure for information this is not the only thing that gets distorted, often it is the real values of the innovation activities themselves.

Those products or concepts that emerge eventually as completely out of shape from what was intended initially, due to this complexity within the decision and approval process, become totally different before something eventually gets ‘out of the door’ in finished design. So much gets lost or ‘distorted’ along the way and the end result becomes far too compromised on the customer need it was intended to resolve.

Innovation effort may not be worth it

Equally I always enjoy the thinking of Vijay Govindarajan and in a recent article along with Manish Tangri entitled “Why that innovation effort may not be worth it” http://tinyurl.com/847ah4c they discuss two key factors of motivation and competence and how you can put your organization and its leaders to the test.

They ask two great questions “How hungry are you for innovation?” and “Is the initiative set up for success”. I did like the point made of “a leader provides direction under ambiguity” and how many of our leaders would be truly comfortable in doing this?

Looping back we need to ask  how far are you from your core?

We come back to increasing complexity, straying from our core, communicating mixed messages, showing a clear lack of decisiveness.  If your innovation message is not sharp and convincing up and down your organization, or even understood by your customers you eventually lose out, you become even more of a laggard and allow others to slip away into clear leaders.

Part of our need in organizations is to stop breaking down the parts, layering on that increased complexity. We should be designing the innovation framework and system to clarify and inspire more. We need to reinforce more on where the key differentiation points are. We need to be sharper in our understanding of true differentiation and stick to this.

The key here is the real need to simplify and focus down within organizations.  Also we need to seek consistency wherever we can, in communications, in our strategic intent and in our dialogues to clarify. We tend to do the opposite, we make it too complex and this is killing innovation, killing growth, killing organizations.

Above all we need to work up and down the organization with some clear, compelling messages that give clarity, allows for the necessary linkages and make sure the parts reinforce one another.

The last part of my walkabout in my research was “Creative Destruction”.

I recently wrote a blog “The Innovating Era: Creative Destruction or Destructive Creation?” http://tinyurl.com/dyy964s and in particular the destructive creation part and how this was destroying more than what was coming in its place.

I finished with this comment: “All I hope is it will let us make sure we put the emphasis back far more on the “creative” innovation part and not the ‘destructive’ nature we have moved towards recently”.

Chris Zook has just written on this “When Creative Destruction Destroys More than it Creates” in the last week in an HBR blog http://tinyurl.com/7pe8qvf and makes an important point (in my mind) that “the extinction of once-great innovators is less often caused by technological or market evolution, and more often by self-inflicted wounds and slow cycles of decision and adaptation.”

He brings us back to the point “it is internal complexity that turns companies into lumbering dinosaurs.” The suggestion is, if we can’t keep ourselves clear on simplicity and focus and really tackle complexity as this is the “silent killer of profitable growth,” and “the greatest inhibitor of adaptability”.

Leading the way does falls to leaders.

My last extraction was from another lead and laggard viewpoint:  “A leader doesn’t tell people what to do. A leader helps people understand what needs to be done and brings the people and resources together to make it happen”

We need to focus on our greatest strengths but to do this we do need to understand them. It seems to me, so many leaders surprisingly don’t have a clue on how and where innovation can contribute in lasting differentiation, where the growth should be coming from or how to galvanise the organization to be simply on the same page to make sure it can happen.

We need some consistency in how we set about innovation.  Sometimes what simply scares me is that this basic task is often missed off the leader’s agenda to actually make sure it is happening, often because they have not been fully involved or understood their role in this.

The post Making those increasing connections first appeared on Building Your Innovation & Ecosystem Intelligence.

For me, one ‘type’ of innovation that seems always to be often passed over is distinctive innovation in discussions. Why is that?

Most people work away in the trenches of incremental improvements and these outputs make up the vast substance of innovation activity.  Many working in these trenches of innovation on a daily basis would love to be part of a breakthrough but tend to find this is always ring-fenced for a few others to work upon. All they can often do is gaze over the fence or quietly accept this divide simply goes on.

I believe many who work within innovation simply do not share in this delineation of innovation activity, as it divides talent into separate teams, often pitting scarce innovation resources against each other, often in many unseen ways.  This divide of activities is often a real pity but perhaps another story for another day we can explore.

Disruptive innovation is seen, partly by the way it has its effect on us and our lives. Many of us are always happy to discuss disruptive as long as it does not have an impact on ourselves, on the receiving end.

As long as we are the ones doing the disrupting, or just wanting to show off the status as being early adopters or within the early majority of the innovation adoption curve, then we love disruption. Otherwise, it is a very uncomfortable space many are not prepared to travel to.
I would suggest most people understand incremental as the first type or basic stage of innovation, especially in larger business organizations. For me, large organizations give this incremental area far too much of a focus in their resources and efforts, to the detriment of other options which is partly due to their risk-averse cultures.

I really do think though, they miss a trick, by failing often to ramp up to breakthrough or disruptive innovation, by not focusing on building a real capacity to strive for ‘distinctive innovation’ on a more consistent, even sustaining basis.

We should move out of the incremental trap far more and not continue to reinforce it as many do. Let us name and shame the incrementalists and get them thinking more about distinctive innovation.

The missing value of distinctive

I think we miss something and it is a great big pity. Distinctive innovation is actually not just the middle ground, the passing through point towards breakthrough or disruptive but it is the inspirational point for all of us to rally around far more than we do.

Inspirational is really important, it is a great motivating point if we can all achieve far more in our identity with something distinctive than just incremental.

Whatever we work upon in innovation we should seek something distinctive as an outcome. I don’t regard the latest flavoured yoghurt, improvements to the speed of our computer processor power or a few more pixels on our I-phone as anything more than incremental. This is to keep pushing up the awareness curve to extract longer value from the brand or product. I’m looking at something that makes it stand out, to be distinctive.

A transforming point for all to all gather around

I think there is far more value in talking about this transforming type of innovation that I call distinctive. It is not a complete breakthrough, it is not something that really disrupts an industry but it enables a certain leadership status, a chance to build a reputation for your brand or service.

Distinctive innovation gives you the ability to build and lead in either design, solution resolution, improving function etc., etc. We forget to talk about this type of innovation as we move from incremental to breakthrough.

I believe there is a clear consensus-building point for all working on innovation would want to achieve, that is knowing they are delivering something distinctive. It is the new innovation neighbourhood we should all move toward and plan out. Let’s find ways to get out of the overcrowded incremental slums.

Most people can’t jump or not even be able or allowed to think about breakthrough, as that is far too often  “left to others” What they can really identify with is working on being more distinctive and less trapped in the basic, incremental mindset.

What do you think?  Would you want to be associated with something distinctive, I would.

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