In today’s rapidly evolving business landscape, innovation is paramount for organizations to thrive and achieve sustainable success.

Traditional approaches to innovation, often isolated and siloed within a single organization, may not be sufficient in addressing the complex challenges and opportunities presented by the modern business environment.

Organizations must embrace innovation ecosystems to harness the power of innovation and drive transformative change effectively.

What are Innovation Ecosystems?

Innovation ecosystems are dynamic and interconnected communities of individuals, organizations, and institutions collaborating to accelerate the development and commercialization of new ideas, products, and services.

They foster open innovation, where participants share knowledge and resources freely, leading to exponential growth in the generation and implementation of innovative solutions.

Why Embrace Innovation Ecosystems?

There are numerous compelling reasons why organizations should embrace innovation ecosystems:

1. Accelerated Innovation: Innovation ecosystems foster a collaborative environment where ideas are exchanged, cross-pollinated, and refined, leading to a rapid pace of innovation.
2. Broader Perspectives: Innovation ecosystems promote a more comprehensive range of perspectives and approaches by bringing together diverse stakeholders from various sectors, enhancing problem-solving capabilities and the likelihood of breakthrough innovations.
3. Access to Talent and Resources: Innovation ecosystems provide access to a pool of talented individuals, experts, and resources that may not be readily available within an individual organization. This can greatly accelerate the development and commercialization of new ideas.
4. Shared Risk and Cost: Innovation ecosystems allow organizations to share the risks and costs associated with innovation, making it more feasible to pursue ambitious projects that may not be viable for a single organization.
5. Reduced Market Entry Barriers: Innovation ecosystems can facilitate access to new markets, customers, and partners, expanding the potential for growth and revenue generation.

Key Benefits for Organizations

By participating in innovation ecosystems, organizations can reap a multitude of benefits, including:

1. Enhanced Innovation Output: Organizations can achieve a higher rate of successful innovation by tapping into the collective intelligence and expertise within the ecosystem.
2. Accelerated Time-to-Market: Shorter development cycles can be achieved through shared resources, expertise, and streamlined processes.
3. Expanded Market Reach: Access to new markets and partners can drive growth and diversification of revenue streams.
4. Improved Competitive Positioning: Innovation ecosystems can help organizations gain a competitive edge by fostering a culture of innovation and adaptability.
5. Enhanced Brand Reputation: Participation in innovation ecosystems can strengthen an organization’s brand image as a forward-thinking and innovative leader.

A Roadmap for Embracing Innovation Ecosystems

To effectively integrate into innovation ecosystems, organizations should consider the following steps:

1. Identify Relevant Ecosystems: Assess the organization’s strategic priorities and identify innovation ecosystems aligned with those goals.
2. Build Relationships: Actively engage with ecosystem stakeholders, establish partnerships, and participate in events and initiatives.
3. Contribute Value: Offer the organization’s unique expertise, resources, and insights to the ecosystem, forging mutually beneficial collaborations.
4. Foster Open Communication: Maintain open and transparent communication channels with ecosystem partners to ensure alignment and collaboration.
5. Continuously Adapt: Adapt strategies and approaches as the ecosystem evolves and new opportunities emerge.

Moving Forward

Innovation ecosystems offer organizations a powerful platform to accelerate innovation, expand market reach, and gain a competitive edge. By embracing the principles of open innovation, collaboration, and knowledge sharing, organizations can harness the collective power of the ecosystem to drive transformative change and achieve sustainable success.

Move away from thinking of your innovation solutions only; think about how a collaborative, co-creative, open ecosystem of a rich diversity of knowledge, insights, and different market perspectives can combine into a dynamic innovation ecosystem.

Please find out more by contacting me through Agility Innovation or here, on how we can help you accelerate your transformation to Innovation Ecosystems.

The post Are You Embracing Innovation Ecosystems for Enhanced Competitiveness first appeared on Building Your Innovation & Ecosystem Intelligence.

Now I am a terrific admirer of Steve and his thinking but he does, I feel, rush to an assumption to fit one specific problem area, most coming from the start-up world. I apply the three horizons from the more mature organizations perspective and in a much wider lens framing approach than clear he does.

Steve Blank, no less, wrote about the problems with applying the three horizons as his view recently. You can read it here. He changed the title from “the fatal flaw of the three horizon model” to “fast time in three horizon high” mainly due to the push back he received from one of the original creators of this framework. It got even further dampened down into a more observational under “McKinsey’s Three horizons Model defined Innovation for years. Here is Why It No Longer Applies” in a Harvard Business Review posting that digs him further into his specific business focus corner that little bit deeper, as his title assumes.

Steve, I have news for you, the three horizons frame is healthy and fit for use, maybe not in your specific application (although I know it can be) but in multiple applications. I am not sure he decided why he became so dismissive on the 3H. “Fatal flaw, fit for use” can confuse a wider audience, many living off his pronouncements, when the value of this 3H frame is even more compelling today than when it was first proposed. It has moved on, not regressed.

Actually, he is wrong again on that initial innovation positioning for the 3H. It was proposed by McKinsey for a growth strategy framework and then others then took its framing principles and applied them differently. The 3H can lend itself to innovation application in multiple ways really well. Not sure the changes in titles conveys his message better than his provocative one of “fatal flaw”, which has been challenged already, with due “diffidence”. The “fatal flaw” might be in his rigid application and not in the many ways you can apply the Three Horizons potential across a broad range of framing techniques.

Steve is absolutely right, speed has made such a difference for every organization to quicken their pace. Each of the horizons has for some come closer together, or as I recommend, need all working in parallel, not one following the other

Actually, I value the three horizons in analyzing a business, its position today and its stated position tomorrow and look for gaps or opportunities to work on the different horizons needs of supporting the present, building capabilities in the near term and exploring the future in imaginative ways. One of the outcomes is more than likely, in most cases, mean adding new competencies, capabilities, and capacity.

Also, the three horizons is a good dialoguing frame to allow each of the voices within an organization to have their opinion “aired” and then the combined voices determine the path forward. I’ve written on that here in a post “Drawing out the different voices within the three horizon methodology for Innovation” and here. “Are you engaging with all the different voices around you?

I also offered up a different perspective on using the Three Horizons as a Wire Frame” Applying the Three Horizon Thinking to a Fresh Perspective of Innovation Design”

Then I looked at how to manage our assets “The New Game Or Is It? Asset Orchestration” talking about modes of commitment to innovation as first suggested by Javier Busquets.

I can go on and on about the potential versatility of the three horizons, just put into search on this posting site “three horizons” you can view the different articles I’ve published on this, or equally you can download these within different summary series, within my “insights and thinking” page, under the three horizons. They do offer a detailed build on this framework to bring it all together.

Then to finish here in my push back to Steve and his (restricted) view of the three horizons, in one of my posts “The Compelling Value of the 3H for Innovation Management“

He can perhaps open up his thinking a little more on the 3H and its value?

I still think he fails to see this beyond his “relative delivery time” applied to each horizon. He is absolutely right that horizon three deliverables have sped up but I still believe he thinks outside big organizations (thankfully to get alternative thinking) and inside these, the three horizon framework is a great (initial) organizer, to break down the complexity of thinking, if you apply it with some different imaginative thinking.

It gives a portfolio thinking for setting different priories, revealing needs, and expertise to give the renewed intensity of purpose towards each horizon. It breaks down complexity and gives the actually greater intensity of purpose.

The three horizons can be in need updating from its original purpose but if you apply one definition you can miss the real power of its value, I see multiple applications.

I think Steve does a good job of challenging some of the shifts we are undergoing in thinking differently.

Sometimes he does like to sensationalize this but that is partly why he stands out in challenging much. He makes us sit up and listen. His lens, coming from the startup environment challenges many existing ones of the incumbent.  I am always really pleased to see it through his highly “entrepreneurial eyes”.

Today if you apply the three horizons as originally intended it certainly does not solve his basic argument of a speed of deployment and asymmetry but it gets the conversation framed in larger organizations in many imaginative ways if you are prepared to step outside the three horizons original constructs thinking.

Applying the three horizons to breaking down complexity in how we organize and manage and why it needs to be seen in different frames does not go away. It does a great initial job of recognition and allocation, to tackle different challenges of managing change in different ways.

Perhaps Steve is applying his own thinking too rigidly to the three horizons, he might want to open it up in its rich potential of the application. Sometimes leaders might miss the memo as he suggests but also those writing the memo miss important points to restrict and not open us up to alternatives.

Yet as we see business as ones framed in threats, disruption concerns, ways to deploy resources, allow a focus on where to place “thin” resources, apply different techniques for prototyping, minimum viable products, tackling legacy etc there is an amazing richness within this three horizon framework. They are under appreciated.

One day I want to find the opportunity to dig around the greater value than looking through his prism of the “start-up is eating the established business world”. He is totally right that incumbents are facing more challenges from new competitors that make the incumbents business model quicker to becoming obsolete.

If you apply time to the three horizons model you do get what he states but if you take the assigned horizon work and apply the principles of simultaneous working them, you get a level of clarity that most new entrants can never comprehend, as they often do not have the level of insights that the incumbent does.

We need to apply the concept of the three horizons in greater ways for the incumbent, not just as he suggests, through one lens that he seems constrained in this limited application.

The post How do you apply the three horizon framework in your thinking? Steve Blank you are limiting your thinking. first appeared on Building Your Innovation & Ecosystem Intelligence.

An innovation value proposition (IVP) is not the easiest place to go. It must build meaning and purpose and provide that unique identity that enables innovation to flow. Building your innovation value proposition is critical to your innovation success.Value propositions are essential always in my opinion, innovation is no different.

Thinking about my own identification with the IVP took me back to when I started out on my innovation journey 18 years ago. That now seems like ages ago, and a lot has changed in how we manage innovation since then. But, strangely enough, a lot has also stayed the same – especially the fact that delivering good innovation is hard work.

Yet, the one thing I firmly believe reduces the “pain” comes back to how you design and relate to your value proposition – your meaning of what innovation needs to do.

Understanding the innovation value proposition

Back in 2003, I came across a two-page document written by a U.S.-based consulting firm, called Macroinnovation Associates. Though the company seems no longer around today, back when I was beginning to switch my focus to advising, consulting, and learning about innovation, their innovation value proposition struck me as excellent. I kept it, shaped it to my own emerging thinking, and it still has as much value today as it did 15 years ago. Some of its parts may have fallen away or need rephrasing, but its basic frame holds good. I will expand on those later.

The other important part of my learning about value propositions comes back to its critical focal point in the Business Model Canvas, conceived by Alexander Osterwalder and Yves Pigneur (and the basis of HYPE’s Collaborative Innovation Canvas). I found the idea of a one-page business canvas brilliant.

This sought out of our thinking “to describe the bundle of products and services that create value for a specific customer segment.” Osterwalder and Pigneur argue that the value proposition is the reason why customers turn to one company over another. They suggest that the value proposition “is an aggregation or bundle of benefits that a company offers customers.” It creates value “through a distinct mix of elements catering to that segment’s needs.” That value can be quantitative (e.g., price, speed of service) or qualitative (e.g., design, customer experience).

Osterwalder and Pigneur further teamed up with other writers to generate the book “Value Proposition Design: How to Create Products and Services Customers Want,” which explores the value proposition in a highly structured way and explains how to write a business model. The book opens with three messages that will resonate with anyone who has given thought to a value proposition. These are:

1. Understand the patterns of value creation
2. Leverage the experience and skills of your team
3. Avoid wasting time with ideas that won’t work

These three points ring equally true for innovation.

Four parts to consider when building your value proposition

There is a lot of advice out there that deals with value propositions, but there’s not as much that focus on innovation value propositions.

The starting point in designing an IVP is “what will bring it to life?” Does it reflect the mission? Does it “paint” the innovation initiative? Does it indicate where value creation lies? Well, all three and then some.

The IVP needs to state the most important point of “how it serves others.” That comes back to solving a problem, its relevance, its benefits, and its differentiation. If you can capture those four main aspects, you are shaping your IVP in a unique way.

An IVP also is a “statement of intent.” It is beginning to provide why your innovation needs to be compelling, to make it valuable to those that have a clear and vested interest.

This “vested interest” part is why the initial value proposition I came across in 2003 hit home. It sought to break down the IVP into four constituents that needed consideration, which include:

1. The Value Proposition to the Management and Staff
2. The Value Proposition to Shareholders
3. The Value Proposition to Customers
4. The Value Proposition to Other Stakeholders

So, tell me how often do we consider all four in their distinctive ways? Or do we tend to merge and blur these into one?

Let’s look at these four critical entities separately as your triggering points to build out in your specific meaning and validation.

There are four distinct groups to consider when you build an IVP, and each wants to see and hear differently. Take your time to separate out your IVP for each of these stakeholders. In separating these out, you are confirming each of these stakeholder groups is mutually reinforcing and being rewarded.

1. The Value Proposition to Management and Staff

• Improves the rate and quality of innovation: to detect problems and opportunities and to address them effectively
• Enables earlier and more thorough detection of problems and opportunities: so early responses reflect the continually changing environment to capture ground-breaking valuable additions
• Expands the range of business solutions available to management: through diversity, seeking out worldview perspectives and how to translate these
• Enhances the quality of inventive thinking: share entitlements to innovations with employees
• Raises employee satisfaction and morale: all employees need to be actively engaged in organizational learning
• Leads to richer “communities of communities”: communities are essential to learning and innovation in a firm
• Amplifies knowledge sharing and integration: by focusing on the policies and programs for knowledge sharing
• Results in “sustainable innovation”: supports, strengthens, and reinforces the self-organizing tendencies of organizations to innovate in their own endemic ways

2. The Value Proposition to Shareholders

• Enhances the quality of information about a company’s operations: the “open enterprise” approach
• Lowers risk in investments: decisions are more open to scrutiny from stakeholders
• Improves financial performance: enhanced capacity to detect and solve problems and opportunities
• Increases the value of intellectual capital: the social capacity to learn and innovate is the most valuable form, building a company’s intangible “assets”

3. The Value Proposition to Customers

• Advances the quality of fit between a supplier and its customer: responding to individual expressions of customer demand, thereby increasing the value and fit of their offerings – and themselves – to their customers
• Lowers risk to the customer: the risk of disruption can be mitigated by choosing to do business with suppliers whose operating environments are “open” and innovative

4. The Value Proposition to Other Stakeholders

• Enhances the quality of relationships with trading partners: for all of the same reasons as customers
• Reduces risk of irresponsible social behaviors by companies: in broader social responsibility efforts and in the conduct of business affairs

Now, imagine this was written in 2002 or thereabouts. Taking my thinking into these does it not hold true for today? Or maybe even more so? It establishes dialogue and openness.

If we can build out our IVP on these value-adding parts, we are making a compelling statement of innovation’s contribution. Can you see why I liked this and often refer to its ideals? I think the customer value-adding can be built out in stronger, value-adding ways for example, same as we can build our intent into each of these.

Also, as you reflect, you can perhaps make it more personal and more compelling to project out your innovation ambition.

Over time, I took the concept of innovation value propositions into my consulting work. I was looking to turn the need to convert IVPs into new business results by promoting the meaning (to the client) on the following positioning:

Innovation services consulting – additional value proposition statements that drive a value proposition to arrive at a bundle of benefits.

I used the below as my triggering points for opening discussions.

Building a more effective innovation transformation system, which:

• Leads to higher conversion rates
• Increases business volume throughput
• Improves business quality and evaluation techniques
• Uncovers the unmet needs of customers (clients become marketing resources)
• Enhances perception of professionalism in the marketplace and by other stakeholders

Achieving a higher integrated development program for innovation, which:

• Allows individuals to develop at their own pace but in structured ways
• Increases workforce effectiveness and engagement
• Links competency with rewards/recognition
• Provides empowered career paths due to higher motivation and identification
• Integrates strategy, vision, and governance within embedded practices
• Offers greater value from your business process, systems, and their design

Searching for and building a robust management evaluation toolset, which:

• Generates on focused customer needs (data mining/management)
• Explores priority analysis (individual/grouped/clustering)
• Promotes developmental analysis (benchmarking and best practices)
• Improves strategic forecasting/planning and alignment capability
• Advances resource management capabilities
• Enhances internal mechanisms (resources/business transactions)

Establishing the levers for a motivated workforce focused on innovation, which:

• Seeks out and resolves concerns with clear adoption techniques
• Emphasizes organizational and team focus
• Stimulates individuals’ desire to participate and share
• Evaluates candidate capabilities (attitude, reasoning, and learning capacity)
• Reduces organizational “risk” with improving profiles and learning experiences

Then, I wanted to force the IVP thinking even more to explore the “differentiation” points of seeking competitive advantage.

Amplifying the value proposition (and rethinking it every 12 months)

Delivering a set of innovative solutions in these changing market environments needs to focus on your resources to provide you with clear freshness on a constantly-updated basis. Markets don’t stand still, nor do competitors. We are constantly “disrupted,” so any future innovation results need to lead to significant competitive advantage within your offerings. You and your firm should also evaluate your IVP every 12 months by asking the questions below.

How can we…

Increase operational effectiveness (channeling your resource management)?

• Build more effective and systematic management frameworks to grow a more adaptable, flexible business
• Improve the rate and quality of our innovation
• Gain an early warning system of detection to stop or accelerate opportunities
• Create a robust innovation process that moves concepts to market faster

Achieve greater people retention and productivity returns (focused more on outcomes and needs)?

• Grow the use of networks and knowledge necessary for value creation
• Encourage a more engaged and motivated workforce wanting to innovate
• Foster confidence across self-forming, motivated teams
• Improve the quality of inventive thinking and knowledge exchanges

Drive innovation across the organization (through different tools and techniques)?

• Use the innovation integrated framework
• Define and align on the innovation choice cascading model
• Create a clear innovation process across all its stages
• Know the right evaluations to measure value and success

Provide a return on innovation (ROI)?

• Reduce costs through a better idea or project development structure
• Increase revenue by spotting new business opportunities, realizing new products/service in faster delivery, extending existing lifecycles
• Align goals and business objectives to intangible benefits that generate our make up of much of our innovation capital
• Build your intangible assets as the core capabilities to generate market advantage

I provided these points above to strengthen the innovation value proposition

Conclusion

Every day our innovation is being eroded. We must continually seek out new positioning, differences, and points of value – those new value pools that build and sustain our business.

By crafting a well-thought-through IVP for all its constituent parts, we are giving innovation a robust and dynamic framework to build out and point back as validation.

Building your innovation value proposition is critical. It forms a bedrock of your actions and your big picture of your innovation intent. We often must restate the value of innovation. If you work through some of the above suggestions, then those that “might doubt” will see the compelling value that makes innovation central to your company’s future. Innovation creates value, but it is by stating these value propositions in clear and highly visible ways that you are held to the “innovation flame.”

Get this right and innovation burns bright.

*** This post was first published through Hype. and is republished here.

The post I would recommend applying the Innovation Value Proposition first appeared on Building Your Innovation & Ecosystem Intelligence.

Throughout the past couple of years, I have been constantly arguing about the need to put innovation management on a digital platform.

These have come in different thoughts on digital platforms, ready for cross-industry and having in place, a rapid digital innovation process that scales and evolves on new technology and insights.

We need a radical design, universal in design and approach.

What if you could manage your innovation in the ways shown in this diagram?

This is the way PLM innovation platforms are progressing and currently being assessed by CIMdata in a PLM Innovation Assessment Scorecard shown further below. Link to the position paper

The argument about what any innovation management system provides goes on and on and still, we seem not to be at the universal acceptance point that an innovation management process is critical and needs a better system of management.

What we should finally accept, a platform connects all users, both internally and externally in their ability to share their knowledge and information in exchanges, in one environment to cultivate collaborations and continuous collaborative creativity. The more we design and need to deliver smart, connected and innovative products the more we have this innovation platform need.

The majority of the present software providers fail to grasp this.

Those that do, grasping the incredible value of offering a digital innovation platform, will be, it seems, coming more from the Product Lifecycle Management perspective (PLM) where product design has always been complex. Those that don’t come from the old traditional thinking about innovation idea management or managing a single product portfolio. Both of these older solutions to managing innovation are approaches urgently requiring a radical change. Solutions should not come out of a box, loaded on your machine but readily accessible in a cloud environment built on a digital innovation platform design.

It is in recent years that the whole need to emphasize collaboration and constant ongoing exchanges become essential to speed up the response to customer needs and competitive advantage. This constant demand for improvement and digitally connected products is a constant “dynamic”, demanding ever-changing needs, additional tools, software updates, adoption of new technologies, and expects the constant change in how you manage your innovation environment differently. Innovation management, at present, stays in the last century.

The requirement has been growing around the understanding to make innovation work, we need to make sure our tools, people, information and departments of expertise all work in sync, increasing throughout the whole lifecycle, not just in ideation, or execution of a launch. Innovation today requires, no it actually demands, more connectivity to stand a chance of building (really) innovative solutions

The whole need is for functional domains (silo’s of knowledge) can work outside of their specific domain so others can link the information and knowledge up and apply the orchestration to bring this together in “better” products. We move from specific owners like marketing into organization engagement and enterprise ownership contribution.

Platforms perform really good jobs of making this enterprise engagement happens.

The platform becomes the conduit for connectivity, you begin to build a certain gravity in finding, securing and exploring data. You achieve a greater flow, you see traceability and configuration, you begin to evaluate iterations of design, you encourage openness. You make these platforms available, accessible and above all, provide a stable environment for all to appreciate end-to-end innovation lifecycle evolution.

So why don’t many software providers within innovation provide us this connectivity, so as to make sharing and accomplishing tasks easy? Most provide the tools to do this but they are often labored, manual, controlled for those that need them, not for all to see and participate.

We simply liberate connections on a platform.

Software providers want to sell licenses, that is the source of their gravity, of their measure of success. But gravity, in my view, comes from building compelling interfaces, designed to build positive experiences and collaborative efforts. Of course, designing software out of a box (many of today’s models) attempts this but “gravity” comes from making connections and offering great platforms in tools, connections, apps etc gives innovation management a whole new dimension, that software limited out of a box can’t. It keeps evolving and being dynamic.

Then we have this magic word of “flow”– the activity where innovation is fostered, encouraged and building momentum. It is understood today as the need to have interoperability, seamlessness, and traceability as the core of our solution needs. We know that the flow is essential to innovation. To make this gravity and flow to happen we need openness, in collaborations, in support, in continuingly improving our design systems to galvanize and connect innovation work.

Two platform authors Mark Bonchek and Sangeet Paul Choudary often talk of the building blocks of platforms and any platform success is built on this connection, gravity and flow thinking.

The other keys of a platform are its ability to scale. It can offer sustainability in being adaptive in interfaces and workflows, far more dynamic and evolving that solutions out of a box. They can be extended via constantly updated configuration than awaiting modification or updates on the next release or software upgrade you are forced to pay for. Then you have maintainability as it seeks to stay current, relevant and response as technology and application are evaluated and changed.

For me, I have become increasingly impressed with where the PLM providers are going.

One stands out for me in giving that significant focus on innovation management, not just product is Aras.

Now Aras I have written about before (herein “Can We have one of These- A product Innovation platform?“) as they are laying out their PLM product innovation platform so it is open, flexible, scalable and upgradeable powered by digital solutions.

Specifically, and interestingly, Aras has no upfront software licensing fee’s, enabling the ability to seek out as low as the possible total cost of ownership, company-wide, not restricted to a few. This challenges most of the conventional business models of upfront license models currently offered by Innovation software providers.

Aras provides a range of services that sit on the platform allows for dynamic workflows, plenty of visual collaborations, reporting all in different variants to fit your (entire) business, not one specific part, choosing separate solutions.

This is the present assessment of Aras and its platform score for its product innovation platform assessment

I keep hoping Aras recognize innovation is not just emerging from those older CAD days, or limited to certain industries that needed heavier industrial engineering solutions, but able to grasp the greater potential; to offer an innovation platform to everyone that needs one.  Innovation comes from everywhere and through the adoption of the Aras design, I believe can offer a total innovation management solution across the entire enterprise, irrespective of industry or service focus.

This visual shows the existing Aras PLM platform. It can be adapted to all of the innovation we undertake today, quickly and fairly well, if the value is seen and the parts needed to be added are made, especially relating to innovation deriving from marketing initiatives.

The significant advantage of having tools integration, integrated workflows for all to participate (R&D, Engineering, Marketing, Designers etc), to be able to track and trace the evolution of the product concept throughout its entire lifecycle. Also in having selective parts being able to be reused for a product family or variant design has significant time, and cost savings. You can minimize rework or build out from past work.

Can the present application overview of Aras be extended to incorporate all types of innovation that require collaboration, exchange and constant on-going evaluation?

In Summary

Can you imagine a fully integrated product design development for innovation management, one that enables global, cross-industry, an open collaborative approach built into the platform design? One that is still built on your rules and structure suitable to your task and vision, of what a product needs to achieve? One that is giving you the potential for not just the digital thread but higher levels of digital twin design to prototype, share and engage customers with, throughout a product and its service design. One that manages the entire end-to-end design to eventual market, how it evolved, was validated and update. Then why are we not screaming for this solution?

Tell me why we continue with a pen, paper, excel spreadsheets, silo’s of knowledge, dependency on opinion and not fact. Why do we keep restricting our innovation to move across our organizations due to limitations on software-out-of-a box or licenses as the go-to-market business model? Why are we not talking to the PLM providers, especially it seems to me, Atas, and getting some level of movement out of their traditional PLM box, into the innovation world? A world for all, to finally have the potential to connect up innovation across the whole enterprise and beyond?

The post Building the Single Innovation Digital Platform Environment first appeared on Building Your Innovation & Ecosystem Intelligence.

I have often been returning to scaling, struggling with finding the best answers. Many organizations struggle with scaling. This can be scaling their organization, their capabilities or more often, taking an idea into a fully scaled delivery.

Maybe I have been looking at it all wrong?

The complexities of scaling can’t be lightly dismissed. You need very often, size to scale. This could be in a new plant, in where production should be situated, so it can be allowed to scale at a later date, in resources able to achieve scale or more importantly you scale according to the type of goods or demand so they can be readily available, closer to the market they are needed.

When you work in a global organization, scale takes on even greater set of dimensions, one that needs coordinating and managing.

So I was thinking through some points on scaling a little differently. They are partly ‘open questions’ or some thinking out loud. You can say they are “half-baked”, perhaps in more than one way!

Can we make scaling up more systematic? I know that a good colleague and friend of mine, Ralph-Christian Ohr spends significant time on this to crack. He is a joint facilitator to “Scaling-up: From Corporate Startup to Business Impact” along with Frank Mattes. You can follow their work over on innovation-3,  where they help companies to set the Scaling-Up of a fully validated innovation concept up for success.

I am thinking scale differently here, So let me explore this, it is only emerging for me. I have found much on scaling-up as specific to a certain point of need, such as a startup to a new business outcome. Can we think of scaling-up differently?

So a series of questions first.

Are we placing the emphasis of “scaling-up” too far down the delivery chain? Should “scaling” be broken down and modernized? Can we scale-up firstly in the digital world and then take this into the physical world. I am questioning scaling-up and much of this might be simply mumble jumble or is it? So some of my opening thoughts and I will also want to come back to this at a later time.

When we decide to scale

As we scale and become more outward in chasing global trade, issues move from being simply complicated to be far more complex. Past experience can be enough to assist complicated but complex becomes more problematical as it is ambiguous, uncertain and presents a uniqueness in its challenges. Scaling-up does have the potential of opening up new places to play, or the dark holes many of us often fall down into. Getting scaling right is hard and having it available at the right time even harder. How can we reverse engineer scaling up to reduce complexity?

This growing uncertainty we face in the world that has become (overly) reliant on the continuance of open borders, will add to our scaling up dilemmas. We are seeing risk management become increasingly important in any assessment on where, how and why we need to scale-up and more importantly when. This growing complexity to manage is increasingly moving organizations towards the very traits innovation also requires. Those of dealing with greater ambiguity, of building in the needs of agility, higher levels of flexibility, curiosity and the willingness to explore and experiment, and take increasing risk.

Dealing in agility

For many, it is a very uncomfortable place to go, when they have invested millions in their supply chain. They naturally want to channel everything into their supply chain to optimize and utilize it. They have obtained high levels of visibility but in this pursuit of optimization traded off many levels of flexibility. Supply chains have become reliant on high levels of predictability. This reliability has been working well for the established organization, set up to extract maximum efficiency and effectiveness out of the investments they have made in predictable markets. Careers have been made previously on stability, exploitation, and extraction, not risk and exploration. Yet, what if this changes? Scale will be dealt with differently if unpredictable conditions come towards us.

Yet, as markets become increasingly uncertain, new competitors entering the markets with very different ways that they see the supply chain and delivering their solutions, will be better positioned to leverage on a more volatile set of market conditions. Emphasizing delivering on customer needs will be placing uncertainty back into the previously honed supply chain model or production model of many companies stuck in the old model of generating demand for their solutions, not those of the marketplace. The risk of being highly scaled is fast becoming a point of disruption for others. Scaling up needs a different lens than in the past perhaps.

The shedding of legacy can equally liberate innovation

Legacy, leadership, cultures, and processes, are inherited from the past industrial economy of standalone businesses, where the scale was achieved through mass production, tailored to the producer’s needs, of providing products that worked but not necessarily in alignment to the customer’s needs. That was fine when you had a limited choice available. There is a shift going on today.  Supply is exceeding demand and demand has simply become that, demanding. That is reversing part of the thinking towards scaling up, the consumer expects and demands a solution to their own specific problems, and organizations have to adjust accordingly.  This is where innovation comes into play. Supply has become more tailored and focused. It needs to be more agile and flexible. It is being forced back in the production process to meet rapidly changing demand. The scale has to respond accordingly.

To get supply closer to demand, you need to be closer to your ultimate consumer, in the market and through a more personalized, focused dialogue to shorten “the response to change,” to keep in pace with customer requirements. In many ways we need to scale-up understanding, the front end of innovation, drawing in the knowledge and insights quickly enough and then process these at speed to keep pace. Today scaling-up has a different point of resource emphasis, it is not so defined as the end point but more as “adaptive” scaling, at the appropriate point of need. We are shifting from applying standardization and searching for increasing flexibility. Scaling needs a more modular set of solutions.

So standardization is giving way to customization. Large-scale product runs are being adapted to meet more specific opportunities; response rates and customer engagement are being hugely advanced by technology and constant exploring the full customer journey with data and analytics helping the understanding. Hierarchy and delegation are flattening out and seeking engagement. The whole doing and thinking, is based far more on this dependency on growing real-time feedback and ongoing knowledge flows. Digital application throughout the organization to speed up understanding and provide visibility, where ever it is needed to shorten ‘response’ time.

The changes we are undergoing play towards innovation outcomes seen differently

Strategy today, is far more on grasping the essence of a constantly changing situation and equally on anticipating the future. It is forward looking not backward filled. A primary goal of growth requires innovation to be the catalyst to create the future. For this to happen we do need to recognize that innovation must become a greater instrument of strategy, far more central or core, in organization application and understanding. It is the best means of gaining a strategic advantage and often the basis of survival in how innovation creates, leading to new growth and profits.

So by us recognizing innovation as the means of gaining an advantage, we need to think more creatively on where and how we scale.

Unfortunately, innovation is primarily made up on “Knowns and Unknowns in Innovation: Let’s Manage Them Differently and much of the innovator’s job is to make these “known” as soon as possible. Any plan of future actions needs to be designed in different ways. We need more modular thinking and this is where scaling can be achieved differently. We are seeking emergence; this is the key.

Today we are struggling due to these legacies. We are attempting to scale out, often on a current path of decline, or organizational design; one that is too rigid, and static, and we chose to ignore many warning signals as the understanding is not well connected up. The route to new scaling needs to be built on a fluid design, dynamic and based on constant discovery so we can be in this ’emergent mode’ as quickly as we can, to translate this.

The value of the digital twin may offer some resolution to scaling up (of everything)?

The smaller the component to build, the quicker you can scale it and optimize it. In the age of the digital twin, we can build the virtual product by specifying and validating it, we can prototype it for increase verification and greater digital/physical engagement and interaction. Then we can go into a virtual production to simulate, to map product concepts out, to validate and begin to commission and structure the physical as you can provide better understanding, structure, and behavior your innovation concept will have increasingly “down the innovation concept/validation” process.

We are moving the front-end of design into a virtual one, more and more, to enable products and then eventual production to simulate, test and optimize concepts in a virtual world before it enters the real world. As we work in this digital twin world we continually gain new insights from concept designs, from customer feedback and then when it does enter the real physical world there is a well-established continuous loop of improvement.

We can design production, facilities and a host of other things through digital twins. I wrote “have you got your digital twin strategy sorted out yet? This thinking more holistically about how and where digital twins can be applied does make a significant contribution to thinking “scaling-up” accordingly in very digitally connected ways.

Scaling up comes from focusing on real points of value, these being optimizing, enhancing, digitalizing and streamlining, on a continuous basis and digital process design, might do this well. It is for me, the combinations we can achieve from engineering the innovation value chain through connectivity, through increasing intelligence and feedback, and by constantly validating this, by automating this innovation process of design in this digital (virtual) world, as well as in its physical one.

We need to build more into our front end to model different scenario’s so we can “scale” and ask “what if?” accordingly. We are surely building designs that by going through this digital /physical process that gives us flexible, are scalable and upgradable as the designs evolve. We then adapt our scale as we validate.

As put forward by some of the suppliers of PLM software, we do need to think far more about Product Innovation Platforms that offer enterprise-wide foundations to build and design the concept, to scaled out the solution. To achieve this we do need to creatively think where a digital twin can play their part, recognizing the digital thread that is occurring in all our future innovation activity. Going fully Digital offers us an evolutionary path if we choose to take it. It connects much more than we have connected today.

We must recognize “just” physical assets are actually less important, they are becoming increasingly dependant on digital being part of their offering, an increasingly valuable part, as more of our solution components are software related. It is in the software we have the potential to scale out in different ways, less in the physical assets that house them. The value of software giving outcomes and insights is increasing the value of the assets. The physical assets are the delivery mechanism, the host, and it is the value “extracted” from data that is rapidly giving the “return on investments”. So what should we be thinking about to “scale-up?”

Many “stand-alone” manufacturers would gain by considering platforms and joining forces in ecosystems that can design and share more complex solutions. This allows for a shared scaling up design. This fresh thinking of ecosystem design gives different scope, architecture, and capabilities. Having smart, connected products offers the ability to scale differently.

Innovations and Strategy need to be tested constantly in a different time and space.

Re-thinking design, applying digital solutions can provide the connecting mechanism to explore, relate and test assumptions, to relate your context to the higher level ones. You have brought back “scaling up” to the front end.

By designing your innovation through greater visualization and digital “twinning”  you can cascade your innovation views quicker. By building innovation concepts digitally, you can to make better assumptions, predictions, solutions, and decisions; it is drawing in all involved, specifically customers into the strategic process. It allows for conscious awareness, it becomes the method to examine, test, validate and improve on the assumptions. Then you can scale-up with increased levels of confidence.

The post The problem of scaling can confuse those innovating. first appeared on Building Your Innovation & Ecosystem Intelligence.

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.

The Whitepaper called “Product Complexity, Digital Transformation, and the Innovation Imperative- The race to reinvent how complex products are developed is here“.

This made me a little jealous and a little wishing that ‘we’, across the whole of innovation management, could not have one of these platforms available today. Some claim that they do this already but seriously they do not.

I have argued we do need to change the way we undertake innovation and its development. I am really frustrated by the legacy we have in our processes, systems and the ways we approach innovation, and its development lifecycle. We still break it up into separate parts, dealing with the pre-ideas stage, collecting insights, the idea management, then into a pipeline or portfolio system, that all has so such manual and siloed approaches built into this. These are tue legacy systems.We do need to bring innovation management into the 21st century where everything is transformed through a platform that allows total integration.

So as I read about the solution that Aras provides to the designers within Manufacturing to manage PLM complex systems and products, you have to wonder why this cannot be extended into all innovation’s management. Of course what “sits” on the platform will be different but it has much that can adapted and aligned in the principles of any design.

What is clear anyone that does develop a fully integrated platform designed for innovation will certainly disrupt the current way products are managed. We can actually get into true lifecycle management across not just one business but within collaborations across functions, companies, and entire ecosystems, to contribute.

This whole idea of a unified environment for innovation simply solves so much of our current constraints within this area. It allows all involved, those within the management of innovation and those who are actively supporting or needing to be well-informed, to all operate within the same environment. We can for the first time build a system of record, we can through “open” technology provide an approach that is flexible, scalable, upgradeable, and fully visual to all. A truly open innovation platform. The whole momentum of collaboration becomes accelerated.

The idea of platforms today is they can be overlayed over your existing systems (well most) if they have some level of digital interface. This allows for some levels of migration from older systems as they migrate to this innovation platform.

The ability to connect across functions, across different domains, different environments and entities really make this a highly valuable proposition. We really do need an innovation management platform and does the way that Aras has set about this, give us a working concept design?

Just take a look at the visual from the Whitepaper from Aras

Now think of the whole innovation management need. Can you visualize all our separate systems feed up and onto the platform to form the much-needed end-to-end lifecycle management across all the innovation management design, or need

I like the way Aras are designing their PLM platform system in broad functional designs.

This gives food for thought in designing functionality into a broader innovation management platform.

Function one is connect teams to contextual information, much like idea management software today undertakes. It is designed for pulling together the fragmented architecture and present information in immediately usable ways. We often need to collect ideas from multiple sources and channels and then attempt to translate these into value concepts to be explored across different functional groups. The design is working across system and functional boundaries.

Function two is focused on managing configurations across disciplines and functions complexity, often what is (poorly) attempted by portfolio management software. Here they are opening up for all to access, they can build this system of record in hand-offs. contributions, build functionality for design reviews and establish traceability. All involved can view progress, design and view all the necessary linkages

Function three is designed to enable collaborations across teams, functions, and disciplines. The platform provides open access at different levels and supports both formal and informal collaborations and exchanges. Established processes and rules can be built in, you can create an audit trail that records decisions etc. Now I know this sounds like some of the current idea management software providers attempt to provide but is this on a platform? Is this in a cloud? Is this potentially open to others outside one organization? Is this easily scalable without significant rework or cost? is this going from idea all the way through to commercialization?. The answer for all operating in our present space is an emphatic no!

Function four supports all phases of the product lifecycle. We lack functionality within today’s product development process to go beyond certain stages of the process. The effect is silos of trapped information that become buried, forgotten or simply not passed on. We cannot design one system for managing across the full product lifecycle design. To have the capability for modeling, designing, simulation all are requiring separate systems. Why? Let’s get out of the 20th century and get into this digital century in how we manage innovation, please

The design outcomes we need to determine

The whole ability is to see beyond just producing a physical product as the end result, we can move concepts into the exciting realm of having digital twins. Digital twins offer the new exciting way of seeing products in a virtual environment. One where you can draw in the final consumer, into contributing to these designs far more earlier, having a consistent reiteration environment. This gives us a far more extended prototype capacity for all to see and improve upon without expensive mockups or reworks, smetimes only offering crude ones that do not represent the finish product in so many ways. Because we can’t provide better prototypes or designs we can miss vital feedback. Having digital twins within the innovation development process can change that. We can design the concept digitally for people to see and get a digital “feel” about what it can mean in the final form

The other good things if we move over to a dedicated innovation platform we can consistently upgrade tools, methods, commuinicating mediums, repositories for access and recording. Just like the present software offerings this can still be managed and deployed supporting on-premise, hybrid or in cloud installations as your system of choice that can then be simply changed if and when needed or you become comfortable in opening up to others, to collaborate and build in a secure platform space.

Finally, we might finally get to adopting an open standards approach to innovation management to achieve integrations across other enterprises and we finally begin to establish a common language of innovation understanding. We really do break down barriers and build our trust in an innovation system built on data and a system of record and that, for all involved, puts a higher level of trust into the innovation management system. Even board members can become more engaged- oh careful, that is for many a dream or a nightmare!

In conclusion.

Am I dreaming or is this a reality? If it is a reality then how long? Innovation Management needs to come of age, a digital age where platforms form the connected future. Who is willing to take up this challenge and radically alter the innovation landscape forever? Be the disrupter that innovation actually needs to inject a sea-change of how we manage innovation and view it, as an integrated design system, all can see and work within. A true corporate system closer to the heart of the Enterprise to belief in, draw confidence and support for the value it can provide.

The post Can We Have One of These? A Product Innovation Platform first appeared on Building Your Innovation & Ecosystem Intelligence.

Innovation is often too intangible, full of unknowns as the very nature of anything new and different. Innovation risk leaves many executives very uncomfortable.

Organizations get uncomfortable when the words “radical” “intangible”, “unknowns” and other words like these when they form part of the conversation. It often starts to induce that “risk twitch” where that careful management for short-term performance might become threatened, or the manager feels any decision is ‘going out on a limb’ and possibly career threatening.

That growing uncomfortable feeling that innovation places their bonus at “risk” so they like to ring-fence innovation as much as possible. Now some of that ring-fencing is fine, you contain a risk to keep it manageable but most innovation does not constitute organization risk, yet it gets caught up in that risky fear that innovation seems to induce. Actually, if we were managing innovation at the core, our risk management for it would be very heightened and managed differently, but how many of our companies’ have innovation as their core?

So I always welcome discussion on risk and innovation. The more we talk about it the better for what is coming towards us.

As we talk about managing risk and innovation we can become more comfortable, yet when you often hear those leading the discussions on this innovation risk, where they keep overemphasizing “Risk-appetite, risk-attitude, risk-adversity, broader risk, even risk-contagion,” now if this does begin to get you nervous. Reality simply is, when most of the innovation is exploring the unknown to change the known for something better, then organizations seem to go into a certain “lock-down” when it manages the innovation-risk equation. Innovation remains uncomfortable for many senior executives.

Recently I re-read a recent PwC report “Managing risks and enabling growth in the age of innovation” as they continued to periodically give risk an innovation focus. We need more reports on innovation and risk. I can recall two or three reports they produced around this ‘risk and innovation’ theme over the years, happily sitting in my taxonomy of innovation, always useful to refer too. This latest one had an opening theme about innovation being described in more revolutionary terms such as part of the fourth industrial revolution, the second machine age, the cognitive age and this is adding more pressure to innovate or search for “greater innovation within companies.

Of course, the more you invest in innovation, the likely the risks will increase. So the report polled 1,500 executives, focusing on managing innovation risk and how effective they are in managing this risk-reward balance needed for innovation. As I have just finished writing about innovation and the 4^th Industrial Revolution in my last post, it was good to try to find some new ways to look at the changes going on in innovation.

I cannot agree more with PwC and the fact that the innovation and changing risk landscape is making us all think differently. I have called this the “new innovation era” where technology is underpinning so much of innovation’s activity and outcomes.

I have written about risk at different times, such as a post “Treating innovation risk differently, dealing with uncertainty” and a few times since. Enter “risk” into the search box to check these out if you are interested. A very extensive review of risk I wrote in suggesting “Developing a new framework for risk and innovation”

Yet this post is not about the risks but the emerging possibilities

As we enter this different era of innovation, as we begin to connect “everything up” through implementing the 4^th Industrial Revolution we do have so much new possibility for innovation than ever. Two of the visuals (figures) within the PwC report excite me in the optimism of taking innovation out.

If you look at the “within 3 years” add-on (see below), it does paint a really good picture of innovation opportunity, and by implication, the increased risk, in my opinion. This will simply not be the “as is” to simply extend our existing innovation activity,” it will be radical in innovative change. It simply has to be, coming from technology connecting up our networks supporting and forming new collaborative relationships providing us a growing set of new technology options, we have to integrate within our business thinking. These are all emerging frontiers for innovation to explore

Combining technology and innovation gives me real optimism for innovation, does it for you?

Yet just question if you are focusing on these types of innovation? I bet you many of you are not giving this much focus, your company is still debating and figuring out how to integrate the systems and processes required for such a magnitude of change. Well, innovators need to start pondering all the possibilities. Ask yourself what new innovation growth they could bring to your innovation activities?

There are new sources of revenue, of building out our growth options will certainly come from technology- it will enable projects, form new alliances through the greater ecosystem and network forming platforms. We have the potential for this connecting ability to achieve scale and global presence through the ability to connect across global networks and form new partnerships. New business models can emerge, enabling a moving beyond traditional borders, adding in new supply chain resources. All grow in innovative opportunities when you build out a digitally connected enterprise.

Then I wanted to put another spin on a second  PwC visual shown below.

This one outlines'” a programs ability to effectively manage AI, IoT, and robotic risks”. Confidence is growing as we learn to embrace and value new technology enablers. Now my spin is simply  around “where is the new innovation possibilities in the exploitation of these emerging new technologies?” They really excite me, a little frightening for me as well, yet this adoption of new technology innovation must have so much new innovating potential, waiting to be extracted from implementing and leveraging these new technologies.

When you consider the incredible list of technology enhancements we are thinking through and adopting across a business, as we  learn their value to our business, we can clearly see a number of real innovative growth opportunities as we embed and extract value out of these:

• We can streamline operations and maintenance
• We can optimize assets and increase their ‘connecting’ value
• We can get closer to greater workflow automation
• We will focus on data as it forms a greater part of our strategic input as well as build out the security of this
• The ability to engage with customers directly and in highly personal ways from the connected 3economy
• We can achieve a higher dynamic of scale, speed, size and customer intimacy thanks to technology.
• We can achieve rapid adaption and continuous improvements through greater data monitoring and management.
• We can own assets, share and build out our service provider activities from leveraging technology
• New Business models become increasingly possible by mixing and matching resources and opportunity spotting.
• We gain new learning and awareness, sharing and exchanges on experiences

All of these bodes well for a new innovation era they give me optimism. Just reflect on this excellent visual supplied by PwC on each of the enablers to achieve this new range of innovative options.

Yet the innovation impact is troubling me though. Can we achieve all the promise emerging from these different technologies?

The huge elephant in the room is this: do we have a new innovation system in place to adapt to all this significant change occurring in the next few years?. Our present innovation processes and structures live in a different age, the old industrial age, not in the new one, the one where we connect up everything, as the 4th Industrial Revolution indicates can be realized. I wrote about this from the innovation perspective in my last post “Innovation cannot expand without the 4th Industrial Revolution“.

Have you explored these yet? I think we are still grappling with their meaning, their new positioning inside and outside our organization on their effect. Yet if we ask “what are those new possibilities” by exploring them from the innovation perspective, it perhaps offers some really new, exciting innovation potential we can only begin to consider.

Innovation is moving from taking an idea, validating it and then run it through a pipeline to build out and commercialize. Innovation is going to get increasingly complex as it brings in all the different technology enablers into play. What they provide is data, in new insights on how to manage, respond and connect all part of the business, to extend this into customers to engage. Without a doubt we need to design a far better process to innovation, we need to rethink how we manage innovation.

I am scratching my head on this, yes I am getting splinters in doing this, but we are changing the very way we are needing to manage innovation. It involves different people, different thinking, different processes and this adds up to a very sizable new level of risk that we have to manage and orchestrate. As PwC suggests there is a new risk appetite in how we are investing in technology and yes, we are learning to share risks far more through managing innovation, this being far more through platforms and ecosystem design. We need to manage our assets differently, we need to invest and equally divest and outsource and give a real fresh emphasis to our innovation capital differently, and that also means discussing innovation risk differently.

I don’t have the answers, only some emerging thoughts on where this seems to be heading- the new innovation era –  but we do need to lift innovation out of its place today and give it a much higher sense of urgency in how we manage it. Risk’s are taking on greater risks in Security, in Transaction, in Customer dialogue that innovation needs re-setting.

It is all about building new capabilities and the capacity for innovation

As we move towards a new age where technoölogy connects us up we are forced to address the need for a radical review of our existing capabilities. Do we have the capacity and skill-sets for extracting out new innovation opportiûnities? We will need a much higher level of “rapid and effective” sense-making, portfolio management, and execution, of those new innovation opportunities.

We will certainly need a very different approach to risk management. The greater the innovation opportunity, the higher the risk management becomes. We need reset points all round We are going to be dealing in a world of “all things” being visible and a greater relationship with all potential things being invisible. We are dealing in a world of the immediate, to read and react too and the dual world of scoping and exploring, based on a greater informed gut-feel, growing in relying on data validation and a healthy theoretical belief and vision of how this all connects up all those ‘famous’ dots.

Today we are facing increased frequency to react, a greater pace and speed to move from decision to execution. We need to redefine new tolerances of performance, to firstly seize and then grow these “breaking” opportunities. These new opportunities are coming from multiple points of value, not just one product or a service perspective, they are all different and we need to bring a different thinking to innovation to manage them accordingly.

We need to accommodate data analysis through ‘richer’ visualization tools, we need better dashboards of discovery and awareness, we need a new approach to different capturing tools on the needed innovation inputs, drawing our attention of where innovation is emerging and signaling opportunity. It is the ability to utilize and extract from all this technology connecting-up, through our learning of the innovation outputs and outcomes from applying the 4^th Industrial Revolution, through working in platforms and ecosystem designs for innovation, we really need this transformation of innovation thinking

Interestingly I feel one old evaluation model of innovation risk actually seems to have a new twist or lease of life if we add one new evaluation dimension. We have mapped innovation ând its associated risk according to three dimensions in the past: the degree of uncertainty, the degree of controllability and the relative importance in benefit. Well perhaps we add another, the degree of technology connection (our network relationships) we have embedded and put to use in our innovation activity.

In Summary

We are recognizing there is a growing pressure to change, the technical advantage is offering new revenue and innovative sources of growth. We can see a dramatically changing landscape of the business boundaries becoming more permeable, and a increased pressure on resource management in a changing world. Innovation needs to shape up to deal with this.

I want to thank PwC for their continued focus on innovation and risk. This recent report gives me optimism. It raises the level of risk but it is offering different strands of thought (for me) to begin to frame my “new era of innovation” in further ways.

The post Optimism in Innovation, Thinking About Risk Differently first appeared on Building Your Innovation & Ecosystem Intelligence.

In a recent report, jointly from the World Economic Forum and McKinsey called the “The Fourth Industrial Revolution and the factories of the future” they made a number of observations

“After a decade of flat productivity, the arrival of the Fourth Industrial Revolution (4IR) is expected to create up to $3.7 trillion in value to global manufacturing. A few years back, experts noted that the changes associated with the 4IR would come at an unprecedented rate yielding incredible results for those who truly embraced them.

Still, the hockey stick of benefits has not kicked in yet – while all companies are making efforts to adopt technology, most of the production industry (~70%) remains in pilot purgatory (where technology pilots last for extended periods of time, and companies do not take the final step of scaling up viable technologies). Less than 30% of manufacturing companies are actively rolling out Fourth Industrial Revolution technologies at scale”

No wonder we presently have trouble attracting many businesses onto platforms when they are still very much behind in deciding or deploying a strategically thought-through IIoT digital design, that is connecting everything up.

It is equally holding a new form of innovation back, one that is highly collaborative where partners come together to work on more complex problems. Collaborators can achieve solutions only by being “fully” connected up, comfortable with their data, understanding and contribution, both within their knowledge and insights.

The power of multiple-connected ecosystems gives innovation a completely different momentum but it needs this 4th industrial revolution to be fully operative, for a digitally connected world in manufacturing and beyond.

According to a recent Deloitte report: Most manufacturing lines still look a lot the same way they did 10, 20 or even 30 years ago. Operators clock in, have a brief conversation with their crew and shift supervisor and then operate a machine or tool for 8-12 hours before heading home. Depending on the day, the machine may break and need maintenance or an adjustment, the line settings may need to be modified for a specific product or run, or the operator may need to step away to resupply the line or be trained on a new procedure. In 4IR transformed manufacturing sites this is no longer the case. So why are we adopting digital in our manufacturing plants slowly and very cautiously?

The biggest reason is dealing with the fear of the unknown – a lesson in 4IR change management.

This fear of the unknown, that constant blocker of “not been tested in our environment” has greatly inhibited adoption. Equally the nature of much of production has been designed “on the fly” and the equally tough job of connecting the whole process up in a new integrated, fully connected system meets huge resistance. Legacy systems plague the ability to break out of our present traps of silo’s and we are still struggling to solve these issues, machine by machine, a process by process, incompatible software and hardware, piece by piece.

Arguably Industry is trapped by complexity. The system complexity, understanding and investment delays are often huge and difficult to unwind. Many organizations are constantly meeting resistance to change, building some very mixed views of transformation and its lasting benefits. Thirdly the redesign to save space, and to determine more up-stream flexibility needs embracing digital solutions and reliance on partners and levels of collaboration not truly established to date. Any revolution is difficult, costly and requires time to work through a change in “order” to adapt to the new.

The Underpinning drive to connect-up is getting closer to that “crossing over” point

Increasingly, there is this recognition that the competitors seem to be moving faster towards becoming more digital, so it then becomes a race to catch up, as this “digital advantage” is increasingly eroding competitive advantage for the digital laggard, even if he is today the market leader. There also continues today that industry disruption is increasing, by those spotting both opportunity and weakness in present market players. Those that are digital laggards can’t achieve the same flexibility, the speed of manufacturing change, productivity and response as the new investor, building more on “greenfield” principles. The established player has processes that are fixed far more on past trading conditions, where longer production runs produced (past) economies of scale that became over time, more rigid and not adaptive.

Supply chains have often remained reliant still on manual instructions with limited visibility to the whole supply change to manage, adjust and respond. Today, production is changing its philosophy where flexibility is “baked in”, for adapting further upstream and downstream so as to cater to a greater individual client and customer need. High levels of automation are generating the “digital factory” that comes as an offspring of this 4th industrial revolution.

The internal change is slow. There is a strategic resistance, there is a lack of organizational agility and still not the level of commitment this is required, driven from the top. Hence why we are stuck in so many “pilot purgatories”

Yet the threat of not changing is building pressures. this reluctance to embrace a new digitally connected world is feeding the “seeds of destruction”. Customers expect rapid response, reduced delays, tailored designs and greater engagement.  What is going to shift the needle on this dramatically to recognize we are in a real revolutionary period and caution is not your friend but your enemy?

There are increasing use cases being built and shown. The WEF wants to create a neutral, learning platform, which provides the best technical and organizational insights with respect to 4IR technologies in manufacturing to accelerate the delivery of the benefits, to give a sort of safe harbor. Such a learning platform will also facilitate collaborative action and the new partnership between companies and governments. Confidence grows through these learning exchanges This will partly help yet this will not be the real catalyst, that lies in addressing the old legacy problems, in bold, imaginative ways.

Innovation is one powerful catalyst ripe for leveraging in this 4th Industrial Revolution.

I wrote a post over on the Hype site “The Innovation World is Changing Due to the 4th Industrial Revolution“: We first need to recognize that there are twin forces at work, feeding off each other. We are facing greater disruption and an increasing innovation pace. These are constantly combining, relentlessly adding the new shape to our future. We are actually caught up in a very revolutionary period. The prospect of new innovation potential will eventually work through into the world of Industry 4.0 as a major game changer“. It is all ready for those accelerating and being fully committed to their 4IR journey.

We have to recognize the days of simple product innovation are dwindling. where technology, digital solutions, greater customer insights, where a new breed of designers, engineerings, scientists and software talent are combining built through a platform and new innovation ecosystems thinking, are all emerging. This new innovative approach is building greater complexity into our final innovation offerings, yet it is providing increased customer value or societal needs, on problems that require this combined thinking.

We need to recognize that we are increasingly becoming reliant on collaborative platforms, to realize the result: one of more radical innovations, that are capable of winning the hearts and minds of many consumers as they are more adaptable, adjustable to personalization, rapid shifts in trends or solving their complex problems with imaginative solutions, unseen at the time, in ways not possible without embracing and connecting up in the digital world.

Reality dawns, when the penny finally drops as I said in the Hype post “The customer is increasingly at the epicenter of the economy. The products and services are enhanced through the digital capabilities that boost their value and worth. New materials are making our assets more durable and resilient, and data and analytics provide the valuable feedback needed to build even better services and performance in the future. All this connecting and reacting is requiring new forms of collaboration, and we are seeing new types of organizations emerging. They are far more dependent on platforms and ecosystems. Innovation is the unlocking mechanism”

There is a real value in recognizing and delivering on the fourth industrial revolution, we can start to think outside our classic product innovation boxes. We can shift our often-linear thinking as the Industry 4.0 is the revolution that connects all the parts. We can loop, explore, connect, build scenarios, test assumptions, build digital twins to just the product and manufacturing impact.  Recognizing the transforming potential of having fully connected up digital factories will revolutionize how we manage innovation going forward. It shifts our thinking and the management of innovation dramatically.

The ability to have a more “rapid response, flexible manufacturing” can align more to market shifts earlier. We can begin to design products that are more “digitally connected” that can be updated in the consumer’s premise or hand. We can enhance “their” innovation by shortening the time-to-execution and extending the product life cycle, we can build new potential through greater innovation design, based on increasing insight and collaboration.

Growing the business in new ways, we are building revenue based on Industry 4.0.

Deloitte put out one report “Industry 4.0 and manufacturing ecosystems. Exploring the world of connected enterprises“ where it focuses on a few themes that point towards the benefits of IR4. One is growing the business through I4.0 and also integrating the digital and the physical to achieve business objectives

Growing the business comes through the transforming of engineering, research, design and achieving increased levels of customer engagement and interaction and achieving a greater co-design of the products themselves. The key is again through innovation to make already existing products smarter, offer more data relevancy from smart technology, the change to add completely new products and services in format or build alternatives in business model thinking.

We have the ability to apply a greater “intelligence” to marketing products, using analytics and predictive customer tools to draw closer to actual need. The opportunity to improve the aftermarket experiences, extend the life of the product and work towards maximizing uptime all have value. The use of sensors dramatically helps connect the product throughout its lifecycle to be constantly monitored, updated and managed in collaborative ways between the buyer and seller.

Application-based technology, based on connecting in new digital ways, can reduce the idea to market, be able to digitally link design to product intelligence and improve the overall effectiveness of having connected engineering. We can test, provide feedback on early design concepts, adjust them and redevelop their designs within our network of suppliers, customers, and the manufacturing.

Integrating the digital and the physical to achieve business objectives, the arrival of the digital twin.

Deloitte nicely put this as “It is the leap from digital back to physical—from connected, digital technologies to the creation of a physical object—that constitutes the essence of the Industry 4.0 concept”

We are at a point of combining information technology (IT) and operations technology (OT) to enable the creation and use of a digital twin for example and fuse our operating environment into one.

Deloitte points out “The value of a digital twin can allow companies to have a complete digital footprint of their products from design and development through the end of the product lifecycle. This, in turn, may enable them to understand not only the product as designed but also the system that built the product and how the product is used in the field. With the creation of the digital twin, companies may realize significant value in the areas of speed to market with a new product, improved operations, reduced defects, and emerging new business models to drive revenue.

The digital twin may enable companies to solve physical issues faster by detecting them sooner, predict outcomes to a much higher degree of accuracy, design and build better products, and, ultimately, better serve their customers. With this type of smart architecture design, companies may realize value and benefits iteratively and faster than ever before.

A digital twin can be defined, fundamentally, as an evolving digital profile of the historical and current behavior of a physical object or process that helps optimize business performance. The digital twin is based on massive, cumulative, real-time, real-world data measurements across an array of dimensions. These measurements can create an evolving profile of the object or process in the digital world that may provide important insights on system performance, leading to actions in the physical world such as a change in product design or manufacturing process”

“Indeed, the real power of a digital twin—and why it could matter so much—is that it can provide a near-real-time comprehensive linkage between the physical and digital worlds. It is likely because of this interactivity between the real and digital worlds of product or process that digital twins may promise richer models that yield more realistic and holistic measurements of unpredictability. And thanks to cheaper and more powerful computing capabilities, these interactive measurements can be analyzed with modern-day massive processing architectures and advanced algorithms for real-time predictive feedback and offline analysis. These can enable fundamental design and process changes that would almost certainly be unattainable through current methods”

The Deloitte report Industry 4.0 and the digital twin is a highly useful reference to read.

The present organizational inertia is stopping innovation to realize radically different benefits from Industry 4.0

There are so opportunities for innovation well beyond products and services. We require new approaches, new skills, different talent and design capability to realize and leverage the power of connecting coming from industry 4.0. It can offer us, for the first continuous learning, we can tap new a network of talent through ecosystems and platforms designed for greater collaboration and exchange. We can reach far more into underserved markets through greater customer connections and engagement, we can co-design with them.

We can, by embracing 4IR, have available far more predictive and evaluation tools to help improve processes, to reduce or test risk, to prototype and experiment, partly engaged with customers in learning and adjusting design and value. We can build and connect different supply chains that read and react, we can create new ecosystems where we share a common goal and value, we can enable more agile systems that can adapt and respond to changes in real time to reconfigure the ‘connected factory’.

Innovation emerges out of the Industrial 4.0 initiative in radically different ways to explore and exploit.

We are waiting for the fully connected up factory and process so we can apply a very different digital set of innovation tools. Until then we have innovation being managed the current linear, disconnected way.

We fail to have a seamless set of connections into our industrial process world, into our designers, engineers, research scientists and more importantly our customers. Until we all get the same “line of sight” innovation stumbles along its familiar “guessing game” derived of insight and underlying knowledge.

The quickly we connect up and build the fourth industrial revolution we can explore, build and redesign our whole innovation process. We can .look towards managing more radical innovation design in ecosystems and networks, that push existing boundaries, explore new technologies and materials, that all can combine into the Innovation Revolution that follows the Industrial Revolution.

The post Innovation cannot expand without the 4th Industrial Revolution first appeared on Building Your Innovation & Ecosystem Intelligence.

If you are not aware, it is worth reading about the Gordian Knot.

“For people the world over, the Gordian Knot represents the difficult, the intractable and often the insolvable problem.

Today’s systemic business problems are the modern-day equivalent of this seemingly impossible challenge, our Gordian Knots to untie or cut through.

According to Greek mythology, the huge, ball-like Turkish knot with no ends exposed was impossible to untie. An oracle had predicted that the first person to do so would become the ruler of all Asia. Thousands of people had tried, without success, to unlock its complex riddles. Alexander of Macedonia, son of King Philip II of Macedon, solved this puzzle simply and very creatively – by cutting it in half with his sword, exposing its ends and making it possible to untie. Alexander the Great went on to conquer all of Asia, just as the oracle predicted”.

So are Organizations Cutting their Gordian Knots?
So how can we cut the intractable knot inside organizations and thrive from it?
We all face increasing uncertainties and are having our trust battered. We live increasingly in a world of complexity. We are seemingly not rising to the challenges that seem to be growing in this complexity in the global, organizational and personal context.

For me it is attempting something new and different, can often undo these knots we find ourselves. We grab digital transformation as one of those solutions. Often that simply makes it even more complex unless we cut through the current impossible knots we have today.

Innovation has a vital role to play but it must be ‘treated’ differently.
Where do we start? Firstly we need to revisit any work we are thinking about changing more on an “adaptive enterprises and systems” way of thinking.
We need to find ways to deal with unpredictable, discontinuous change and make this more predictable for us to manage.

We need to be agile, fluid and adaptive in allowing design, systems, and processes to continually adjust, to reflect the constant challenge of change going on continuously.

We lack often a real coherence of purpose; we lurch from one opportunity to another, from one-quarter of financial results into another, reacting to that moment, often defensively, with often no longer-term consistency in our activities. Performance has been taken over by opportunistic behaviors. Innovation often takes the real brunt of this. It gets cut like it is the very knot that needs cutting!

Our intended strategy, moves suddenly, into more of a deliberate strategy, and then somehow this gets abandoned or unrealized. We keep responding and slowly we replace this with an emergent strategy that is rapidly become our realized strategy that we present to the world, as a response to ‘factors outside our control’ for our often indifferent performance. We are passing through different strategy responses without any coherence of purpose.

Who really talks about the EXACT results achieved from a specific innovation for instance? We might get financial numbers, we will get lots ot “hype” but we never get the recognition, that transforming validation of this success, maybe in rare cases. Why is that?All we hear is just a general reference to it, to cloak innovation often in the ineffectiveness that lies within. We bundle up our innovation activity, we cloak it in mystery, we fail to draw it out and give it the credit it is often due to our growth strategy. We rarely encourage it and give it the real recognition it deserves but we constantly “simply” talk about our innovation success.

I think innovation should be central to any events involving results and predicted future. Knowing the innovation capability is knowing the changes to a better future and shareholders are denied that. Do we have any clarity on innovation processes, are they sustaining or one-off, do we know the investment being made in building individuals innovation value. Do we break out innovation investments in capability, capacity or competence management. We should, as innovation grows a company, it is a major indicator of future success. It needs more “cutting open” and revealing, as “our” innovation management process.

For innovation and many things going on within organizations they often lack a real coherence, they ‘signal’ inconsistent behaviors, especially within the organization. These bad signals simply build up all the tensions and dysfunctional aspects that middle order management and the organization, in general, has to mop up and cope with.

How can innovation thrive in this sort of chaotic mess? No wonder it never takes hold, it just has nothing ‘permanent’ to attach too and grow. Management needs a radical overhaul so innovation can be the vehicle for what is articulated but often poorly delivered on a consistent basis.

Context & Coordination needs designing in purposefully.
Again, where do we start? We start with ‘disconnect’ that organizations often have. As we “cut through” the problems we need to take the different strands and piece them together. To make fresh knots to make a different strength. The understanding of the underlying purpose of the organization going beyond just making money and keeping the shareholders happy is that it does need a deeper primary function, it needs re-articulating, it needs constructing a new entity. Some organizations do a reasonable job of this but many simply don’t.

We need to restate our primary function and purpose far more in its societal contribution. We need to express the bounds as a governing set of principles that are known, reinforced and measured against. We then need to set about building in a consistent way, the capabilities that are able to produce the outcomes. Those new outcomes need innovative thinking to be central to them.

We need to build in the accountability into the roles that reflect that need to combine innovation, effectiveness, and efficiency, that is needed so they can be managed equally side by side. We need to teach the ability to be adaptable and recognize the differences so as to actively manage the ‘creative’ conflicts and tensions.

Innovation can help in cutting through existing “knotty” problems by searching for new strands that give fresh opportunity to be tied together and build strength beyond the existing. We need to cut through old knots but, yes, make new ones that form around some of the old and plenty of the new, “weaved” into them, to give them a greater strength of purpose and ability to take on new “knotty” problems, in different innovative ways.

The post The legend of the Gordian Knot and today’s organizations knotty problems first appeared on Building Your Innovation & Ecosystem Intelligence.