Innovation is certainly one of those in need of concerted effort to bring up to date within organizations, to make it more inclusive and that can come through delivering it across the organization within the cloud. Highly visible, agile and core to the organizations future, seen by all and truly valued.

Let me outline my initial thoughts here, put the seat belt on for the ride please: making the business case.


The cloud solutions do seem to look promising for those adopting a strategy of increased use of the cloud as a future IT approach. They seems less emphasis on the cost savings but its potential to improve business flexibility and gain access to a wider array of technologies and solutions.

Also there is a growing view that the cloud supports critical aspects required today and in the future, that are more radical in organizational design.

Those that look to run IT processes in the cloud, such as development tools, test tools, development systems, test systems, service management and performance management as well as incorporating SaaS offerings (such as Salesforce) with their internal systems, and with this host of cloud hosted systems to make hybrid architectures that promise radical changes can be realized within our organizations.

If these changes can be delivered, then I think they will be welcome by all sides inside organizations, each grappling with all the changes swirling around the business today and forecasted to become even more volatile in the future.

Clearly organization design and its core processes and systems needs fresh, vastly different approaches, to tackling chronic organizational rigidity that is seen today. Business unit leaders are frustrated with a lack of new, more radical solutions to their needs of being responsive and agile.

Switching into the cloud can transform IT into a provider of on-demand service when the business needs it!

Switching to the cloud can also radically alter the position of IT as a real provider of the services you need to do the job, when it is needed, more on-demand. It can offer those in ITa future role of looking constantly towards being the ‘go to’ service provider, that is constantly adding the supporting structures for supporting new value and impact in flexible systems and processes that can constantly be adaptive to meet the business needs.

Critically the cloud can help significantly in the quest for speed, agility, scalability as well as being designed for the increasing need of having in place support structures for a more ambidextrous organization. These need different solutions than today’s systems and will become the big IT challenge to manager over the next few years.

There is a constant talk in IT circles of “everything is a service” and if this translates as the business expects this can have a real transforming ring to it. Business groups require faster execution, reduced time-to-value and higher levels of flexibility, and perhaps, IT might have a way to deliver these through the cloud. The promise is ‘hanging out’ there it seems.

Bringing innovation fully into the corporate fold

Thankfully, for many perhaps, innovation has been a little out, off on one side of enterprise resource planning. To some degree this has helped but also is rapidly becoming a real performance drag, innovation needs to be more central in core process thinking.

I believe the solution is to buy into ‘innovation in the cloud’ as the next practice idea. Today many innovation processes and systems have been fairly stand-alone, remote from the clutches of IT and not being ‘integrated’ into the Enterprise Resource platforms so far, would all have to go and that will have a few cries of “OMG no!”

On-premise IT solutions for innovation remain highly constrained.
I’m certainly against innovation continuing to stay in the on-premise platform at all. Of course, any migration plans will give the current systems sometime but the cloud just seems to be an alluring prospect that meets many of innovations needs.

Innovation can only really thrive and move considerably up a notch or two in performance and recognition, if it can obtain the integrated flexibility and achieve the more open access to all shades of business agility that can be found, if we have the opportunity.

Innovation runs counter to repeatable processes; it needs to leverage this ambidexterity of having access to all that makes it adaptable– nimble, agile, constant change, and experimentation, prototyping that is tailored to explore incremental innovation in faster, more flexible ways.

Alongside this to allow for more radical innovation that taps into greater needs for mobility, usability, elasticity and yet still be aligned to leverage, exploit and maximise opportunities needs to run in parallel.  It sounds a tall order doesn’t it, yet I’m not sure it actually is, when you stand back and think about this and try to begin to piece together all the pieces of the puzzle.

I think there are multiple ways forward exploit the cloud

There are many thoughts one could explore with a little bit of imagination, alongside a decent knowledge of what is possible today and what can be possible in the future, that is already in our ‘present line-of-sight by using something like the three horizon methodology.

I’ve also written about the need for a “innovation mashup” previously, as well as I can see the clear advantages that all these emerging platforms are providing that are delivering radically new innovative business models. Large organizations need to climb on board to thinking innovation differently.

Large organizations are lagging in the ‘responsive league’ clearly, they need to think beyond holding everything in house and look towards a more radical innovation agenda for change. Growth does not come from incremental dripping techniques; it comes from spotting emerging opportunities and turning those into commercial value as quickly as possible.

The current legacy within any innovation systems is creating such a drag on organizations current innovation performance and why are our organizations not recognizing this?

Putting innovation in the cloud is itself disruptive.

It offers a real chance to innovate existing business practices, it can give increased visibility. Innovation can be ‘seen’ throughout the organization, not tucked away in dark corners, scrabbling to gain attention. If you take the example of what salesforce.com did in cloud computing to transform the customer end, then why can’t getting innovation on multiple platforms in the cloud really show its potential as well?

Then innovation connects and suddenly the customer becomes a co-creator of value and collaboration really comes to the fore also, as something necessary and needed.

The speed of any innovation implementation process is determined by demand and acceptance though.

Any new design is determined by its adoption, diffusion and usage, all the way through to exploitation and uptake. I’ve written about the need to adopt improved practices for capturing and distributing knowledge through applying absorptive capacity that give greater structure and receptiveness to change that is increasingly needed to cope with growing inflows of information, knowledge and increased big data insights.

We need to find ways to ‘push’ organizational readiness for innovation to change and that comes from the top really pushing harder to achieve real growth from new opportunities but supporting the infrastructural changes this requires, a real place for IT and HR to become more involved in preparing change.

We also need to reflect on what is needed to help assimilate innovation as it will continue to have a complex, non-linear need in processes and this often in the past has simply kept it out of the ERP space, for example.

Equally due to this exclusion, sometimes the constant need to focus on innovation falls out of the corporate line-of-sight daily, as it is not part of this core, organizational supported process, it operates on one side for many to feel not involved. It comes back into the spotlight only when something has not happened, not as promised and that then ‘expends’ lots of negative energy chasing down answers, seeking explanations.

Resolving existing thorny issues need to be brought bring into the innovation cloud equation.

We need to tackle some problems within the innovation that will simply not ‘go away’ but will remain thorny issues until we tackle them ‘full on’.

The greater emphasis on the softer aspects of innovation in skills, attributes and collaborative techniques calls for different thinking on talent development, learning new topics, working in different, far more project related ways that are responsive and agile to ‘seize the opportunity’ by actively seeking the solutions that are available but most probably beyond the walls of the organization and this can be through the cloud.

The art of letting go and opening up to collaboration and co-creation is a growing challenge for all organizations. The pressure is on finding the ‘ways and means’ to enable that to happen.

Another strong argument for promoting the cloud where you have a constant array of collaborative tools and applications to help draft, design, brainstorm, make mock-ups live, share to-do lists in real-time, manage projects, offer concept board development on the fly, provide facilities for all aspects of audio, mind mapping and creative enhancing techniques and on and on.

I’d argue that innovation needs the very best ways to tease out understanding, not locked in selected mindsets of product developers. We need to offer interactive, real-time collaboration tools to make the design and execution of innovation a whole lot better.

Lastly, without droning on more, we need to find ways to orchestrate, monitor, allow for broader performance monitoring, add tools as needed on-demand, to build and deploy capacity management and modelling outcomes against performance within innovation all are needed. We need to change the ways we report on our total innovation activity,  not in the days and weeks these requests can take, but at the speed, the cloud can potentially provide and the business requires, fast.

So I am making my call of innovation and its need to head towards the cloud fast!

We have come a long way in understanding innovation, yet it still stays locked in legacy systems and structures. We need to make future choices on what we want out of our innovation activity, much of the same as today or the ability to move it into a new domain of performance?

To do this we have to navigate through all the hype and mystic surrounding innovation, we have to be bolder in testing out capabilities to experiment and explore the options we have available today in new software, tools, thinking and applications.

We have to take clearer positions on the best applications to do the job and not settle for today’s poor compromises of having one stage-gate system for example, we need to feel comfortable leveraging and extend our resources and capacities to innovate and learn on a continuous basis how to exploit the opportunities in agile, flexible and real-time ways.

Making the business case

For me, to achieve this we must go cloud-based, agile, and moving towards having a more ambidextrous organization design for innovation. This will help innovation to break out of the existing constraints and linear approach we have given it as its straight jacket.

It will not come overnight, a cloud-based innovation capability but I see no reason why it can’t be delivered in less than five years.

I’m sure there are some out there wanting to bring this hugely disruptive potential into realization quicker than that, it has a real business case potential in my opinion. Does it for you?

The post The growing need is to move innovation into the cloud. first appeared on Building Your Innovation & Ecosystem Intelligence.

Presently in many of our economies, particularly in the West, we are struggling to find real growth; we are limited in our wealth-creating possibilities.

Why is that? Our structures seem to be weak, not strong.

We are certainly relying far too much on ‘selected’ pockets of economic activity to keep us going. Technology is clearly one of these.

Yet our longer-term forces for sustaining growth remain ‘fragile’, our structures remain wickedly out of kilter and we need to find stronger connecting frameworks that reinforce each other, so we can build further upon these to manage our business activities in new ways.

In most of our economic activities technology is playing a significant part in altering our habits, routines and thinking but it alone is not enough.

For technology to really give benefit it needs to be driven by our ability to generate wealth-creating activity and that comes from integrating knowledge, gaining experience and being able to articulate this in better ways.

To achieve this, the business structures that we have in the past relied upon are in need of changing. They need different pillars to build upon.

Welcome to my four pillar room……..with a view

One such room I see has four pillars; firstly a value creation one, then one that prompts a change in our thinking around the value and creation of constantly evolving business models, a third one based on understanding our intellectual capital base, where our knowledge resides and can be harnessed, and then the final pillar of the innovation capital that can be generated from this to create wealth-generating opportunities.

Why are these four pillars important as our structure within our ‘wealth-creating’ room?

Pillar one – For me we lack the ability to articulate the value creation narrative.

We need always the wealth-generating perspective to get behind. We want to feel this is ‘dynamic’ and can offer all those involved that feeling of identification, so we can find individual ways to apply them, where there are the combining and transforming possibilities for us to, investigate, explore and exploit. We are searching to manifest fresh, new outcomes to create new wealth-creating potential.

To have the ability to articulate the value, what potentials can make up the possibilities to develop and deliver the future promise? Developing a good value creation narrative is essential, it requires critical components and for us all to identify through a common language.

Value creation and its potential can be created through the Business Model. It is identifying the inputs from the different capitals and the ways we can transform these through business activities and interactions. Our ability to articulate where the value creation potential lies requires our ‘narrative’ to be broken down, often called the value proposition.

Pillar two – The Business model is becoming even more critical today

The whole movement towards creating the business model through a canvas approach allows us to articulate our ‘potential’ value generating story. As we learn to work with all the components that make up a business model we are responding, capturing, creating and delivering a constant flow of new value generating opportunities.

The more we can express ourselves through narratives and the emerging business model canvas we are offering disclosures, we are setting in train discussions so others can contribute and add to these emerging business model concepts.

To sketch out our business model canvas, we do need to constantly work the BM canvas for the integrated design. What we must try to develop within our narrative and canvas is the underlying dynamics that capture the process of change and why this combination provides the value creation.

Underlying any Business Model is knowledge, experiences and insight. These come from combing all our capitals and the ones often described under our ‘intellectual capital assets’ become essential.

Pillar three – Re-framing the debate around our intellectual capital assets
It seems today our business environment is highly diverse, far more dynamic and subject to rapid change. We need to constantly survey the landscape to adapt and adjust, acquiring what is needed. The increasing value is to know all the potentials within the ‘interactions’ of the parts and how to renew and recombine them on a constant basis.

Often intellectual capital is grouped into three or sometimes more categories. The capitals commonly used to describe ICA are human, structural and relationship capitals. In summary:

a) human capital have at its core the competences we build, our intellectual agility and attitudes to form potential synergies for new value creation. Our outcomes are governed by our motivations to want to produce fresh knowledge creation or simply absorb what is ‘out’ there.

b) The structural capital provides ‘the skeleton and glue’ of the organization in its philosophies, processes, routines, infrastructures, culture etc., for permitting and building knowledge. It builds the mechanisms and architecture.

c) Our relationship capital, is our third ICA, which represents our abilities to make connections, to network so as to absorb, exploit and explore new knowledge, it is this new understanding that feeds and influences organizations life, to renew, to rejuvenate, and to offer longevity.

We need to move beyond often just that academic debate around intellectual capital and their asset value, moving well beyond simply infer the value of our intellectual capital, we need to really understand its make-up.

It is the interactions of these intellectual capitals that is becoming essential to understand, they make up our innovation capital. Knowledge alone has limited value, it is the knowing how to apply it through innovation that will offer us the potential for wealth generation.

Pillar four – Innovation capital is the essential strategic asset to strive for.

Innovation is made up of a collection of ‘stock’ and our abilities to allow this stock to ‘flow’. We mostly acknowledge and recognize innovation is essential for business growth and our future wealth generation potential.

Innovation is for me a real wealth generating capital, it is future orientated; it needs consistent learning, experimentation, exploration and reconfiguring. The innovation capital is the ‘core sum’ of the abilities we can combine from our intellectual capitals.

I believe we need a new innovation capital valuation model. It needs to capture the dynamic interactions of our capitals contributing and ‘render’ these into different productive outcomes. This model needs to find and then separate the ‘dynamic’ from the ‘static’ innovation capabilities, the ones that offer new potential not ones simply repeating the process.

To achieve this we need to unbundle resources, assets, renewables, competencies and capabilities and describe these outcomes in , in my view, a fitness landscape that provides a visual of what you have, what you might need and highlight where the critical gaps lie.

We are needing to understand how our organizations can integrate, reconfigure, renew and recreate its resources and capabilities to build different value creation propositions and business models.

Recognizing the combining effect of the four pillars

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

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

These four pillars offer perhaps a new core, a new transforming power, they make our activities connected and dynamic.

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

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

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

The post Building upon four key wealth creating pillars first appeared on Building Your Innovation & Ecosystem Intelligence.

Now if you know Alex, he is either jetting off to somewhere in the world to keep spreading his Business Model gospel, or about to get immersed in his next idea associated with it, so these conversations are grabbing him through twitter or short email exchanges.

Short and sweet
”Excellent! One thing I’ve seen: once the Canvas is in an org it spreads organically, virally without my intervention… interesting research topic!”

Those of you in the business world that have either been hiding under a rock recently or obviously as it seems, in a number of larger organizations, the Business model canvas comes from the pioneering work Alex did for his PhD.

This was published not just in his thesis but in a bestselling book, as lead author, called ‘Business Model Generation” http://amzn.to/uY9U4b. Also take a look at his site : http://bit.ly/m4DNC1

The books claim of “You’re holding a handbook for visionaries, game changers and challengers striving to defy outmoded business models, and design tomorrow’s enterprise” on the cover, it sets itself up for the imaginative person striving to alter the status quo within their business.
Without doubt this book weaves design throughout, to give you a visual feast through its canvas approach. It leads by example in wanting to replace or alter the more established business book with its style.

It is a beautifully designed book to enhance the pleasure of reading it and it is not a typical business book, it conveys the essentials that you need to know quickly, simply and in a highly visual format.

So what is holding the large organization back?

I’ve previously commented Business model innovation meets one of today’s business needs. Many of the tools we have relied upon for decades just simply do not ‘articulate’ the job on hand. Models enshrined in business folk law like Porters 5 forces, Boston matrix and a host of others gave insight, were very analytical, but gave declining comfort on foresight and this is what is needed today.

the times they are a-changin– bob dylan

We have seen the significant shift from internalizing to externalizing through open innovation. In seeking differentiation, businesses have had to loosen up and give up some of their ‘control’.

The world seems more dynamic and complex, it is a place where you have to find a unique position in the market, and one built on competitive advantage seen through the eyes of your customer not from within your four walls.

The business model captures ‘breaking’ opportunities and clarifying existing value propositions, so why this lack of uptake?

Often a potential problem is to do with its positioning- for the BM is it:

• Alex spends an incredible amount of his engagement time with entrepreneurs, small business owners and to a far more limited degree, I sense, within the larger organizations. Is this one reason? There is only a certain amount of time and I’m sure Alex has to be selective with what and where he wants to deliver this message across the world. He might though, need to draw in a fellow BM disciple, who could focus and spread the message to the larger organization as his ‘patch’.
• Is his message skewed towards the entrepreneur more? Even the subtitle on the front of the book might be a little challenging to the incumbent. “You’re holding a handbook for visionaries, game changers and challengers striving to defy outmoded business models and design tomorrow’s enterprise”. Maybe those (the majority in large organizations) find this more of a “oh, I wish” but are simply not sitting in that sort of position to change the world?
• Maybe the book needs a mini-repositioning? Or a further one where a new book brings all the ‘collective’ knowledge that has been learnt since the first one, all together as a companion, or as a field guide?
• Is it also because it might be hard to imagine that you can capture a complex picture within a one page canvas? Within large organizations you deal in pages (I mean pages) of business plans, marketing plans, briefing papers and countless justifications. Could a business model be captured so easily? Well actually yes, if anyone is wondering.
• Is it partly because the Business model does not have enough of a blueprint of proven techniques or follows a more (comfortable) descriptive process, yet to be fully established? I’d argue that this has dramatically been changing in what I saw in a recent workshop given by Alex- it is going more along that route but perhaps not there yet, for wider adoption or ‘comfort’ for some.
• Perhaps it now requires a more radical ‘layered’ supporting structure that underpins the canvas? Or you simply shout “get on the train, it is about to leave without you”
• Or more than likely, it is far more to do with that classic ‘lead and lag’. Larger organizations are slower in adoption; it is just a matter of course. Be this in new technology, new processes, social media or a host of new things they tread more cautiously, they are slower to adapt.
• Those that get ‘it’ internally spend often frustrating months, sometimes years, trying to convince others to make a change, to change a process, a planning structure, even a widget within an established product that often holds it back.
• Then the CEO reads it in a magazine, hears it from a friend and away we go. Why not buy him/ her the book and save yourself the time and trouble!

Irrespective of the answer to any of the above, my question here is: “can they afford to keep on ignoring a brilliant tool? One that will help them ‘galvanize’ the understanding of their business model and provide an amazing tool to explore other potential ones?

I would argue to the large organization that “simplicity can sometimes be deceptive” and just find the time and really focus upon the potential that lies within the Business model canvas. It is a powerful tool in the right hands. Let me suggest a number of reasons here:

So the BM Canvas and its value to large organizations.

BMI provides an increasing value, my opening set of arguments.

1. It can help discover new perspectives on challenges, also new perspectives on solutions.
2. These perspectives can be new insights, new customers, new resources and new channels.
3. Framing BMI in the canvas approach can underpin the Business Case through the nine building block analysis and provide a great one page justification.
4. It can define needs- needs in the market, needs required from solutions and their impact. It can compliment ‘jobs-to-be-done especially.
5. It can investigate value propositions (ranking, impact, capability, competition).
6. It can help investigate higher impact propositions (value- based, enhanced economic, applications etc) to stimulate internal thinking and greater generation of potential BMI’s.
7. It can form the basis of any model for showing where the money lies in potential profit, the possible costs and the resources needed.
8. It can help in evaluating competition or watching for new entrants if ‘it’ or you understand the needs of the customer and where opportunities might lie.
9. It can explore and explain consumer thinking (pre and post discovery and execution) in easy visual ways.
10. It can be used as a neutral observer, uncovering opportunities or validating them in other industries that today may not be relevant but need to have a ‘watch’ placed upon them.

My other powerful argument lies in the yet to be fully explored multiple uses:

I call these my “large organizations eight powerful reasons to adopt the Business model canvas” and place all the options in front of you, to be explored, to be tested, to be given a decent trial.
These are:

• To simply explore new business models as the book originally sets out in the how, what and where of doing this through the canvas approach.
• To ‘map’ changes to existing business models as they evolve or need to pivot differently. There is a growing body of work on the pivot by Steve Blank and Eris Ries. This is not exclusive to the entrepreneur, where they have tended to focus but much of their thinking can be applied to the larger organization to learn, understand and gain from (http://bit.ly/bYhHwQ and http://bit.ly/1fpIpK ).
• Just spend some real time on these two sites, it is time well worth spending to learn and challenge your current thinking on many approaches to your market and knowing the different value generation points in any engagement with your customers.
• To sketch out competitors positions to explore possible opportunity gaps should be one of those consistent ‘habits’ that so many large organizations often have a real blind spot to undertake and then get caught out and surprised when they see their share slipping away. The BM Canvas can spot and track competitors.
• Use it as a dashboard for innovations that have an impact on existing business models. Whenever you have any major BM change you capture it on your BM Canvas so all above and below can see the change. Again Steve Blank has been pioneering this concept for using the BM Canvas to ‘signal’ significant changes that he as a VC investor really only needs to get involved in. This can apply also as a ‘trigger’ point for communicating significant changes happening, up and down the organization.
• Use it to compare business model components across countries where different models are being applied to build businesses. This enables all involved to quickly focus on the differences on these operating models and market formations to get quickly at strategic discussions.
• This gives the visitor clarity and draws out critical ‘talking points.’ for allowing the visiting fireman to actually say more than “how can we help” but “let me show you ways to be safe.” It brings everyone onto the same value proposition and to rapidly explore the different options far more quickly than through those countless power point slides we have all endured, explaining each of the factors within the market. It gives business reviews a (fantastic) template. Try it!
• When you are pitching for funds it provides the top picture that others can quickly see and appreciate the why and how- they ‘see’ the value and the $$ potential, Again this has been grasped by some of the more enlightened venture capital investors, just wanting to know where the money is coming from, and then when the changes occur, as they always do, why the ones running the business made the changes from the original BM proposition.
• This offers ‘intelligent enquiry’ not getting involved in the running of the business but supporting owners or business managers with appropriate experience to compliment theirs.
• To have ready alternative scenario’s for volatile business conditions as ‘early ready’ that have mapped out potential changing conditions and where and how the business model might be adjusted or radically changed. The earlier ‘warning system’ pays in volatile times and we are all facing those at present.
• Rapid concept brainstorming to move into prototyping evaluation and market testing. Testing many different variations in small bite sized bets is rapid prototyping, do this through the effective use of the business model canvas. Testing fast in the actual market place new business models and then learning from them to improve the approach is absolutely critical. Get the customer involved.

Just consider all of them. Learn the basics then experiment and you will not look back. I will be doing some more research and validation in the coming months on these, hopefully with large organizations willing to open up to this exploration and thinking.

Find a common language is simply needed

I do think the Business Model Canvas is about to go through a (further) tipping point, that crossing the chasm into mainstream adoption. Finding a common language is one of the critical tenets that Alex has been arguing with his Business Model approach. To find this common language and recognizing the value of this tool in many different situations can be valuable.

Gaining this common voice to the business model, so all those around can understand it easily and quickly, is a major advance on what we presently use in having to explain our business models.

For me there is something intuitive about the BMC approach.

But to then empower everyone, to go out and seek increased value from new ones seen, that can then be communicated on one page, well that’s the real power of the Business Model Canvas, for any organization, large or small.

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