This report was produced by Dr. Michael Kolk, a partner, Digital  Innovation Lead in Arthur D Little and Heike Woerner, a principal, technology and innovation management.

Now that is music to my ears, a report that provides extra “jest” to my own arguments that digital innovation is going to take over in very significant ways the innovation management process from discovery to delivery.

So many of the current suppliers of software are asleep at the wheel still working the old tired model of how to set about innovation. That will change, it will change and I predict we will see significant movement into having digital solutions specifically for innovation management in 2019. As I know the continuing deepening of insights will eventually compel companies to change their innovation management thinking.

I just want to highlight four visuals from the Arthur D Little (ADL) report that makes the connection of digital and innovation stand out as a place we all must go, as soon as possible. Arthur D Little have copyright to all the visuals shown here.

ADL suggest the most important technologies can be grouped into three families, depending on what they bring to innovators
1. those that boost intelligence, for instance about customer needs;
2. technologies that bring better and faster foresight, e.g. concerning product performance;
3. digital solutions that improve and accelerate collaboration, communication, and learning.

As ADL rightly point out we have had consistent improvement in innovation performance but it still has not been at, in my view, at most organization’s satisfactory levels. They raise some critical “if only” questions and ask “might digital provide an answer”? The answer is not so much what digital can offer, it is what organizations want to (finally) become. Will they become more focused and organized to commit far more deeply to building innovation into their core. I think they will have too, in this digital age or they will be even more disadvantaged, disrupted and struggling to find sustaining growth. Its the call of top management to commit to innovation in more resolute ways.

The fourth one I want to provide from this ADL report gives a really excellent visual of the nine building blocks they (ADL) believe have the potential to transform the way innovation gets down.

ADL clearly have their views on how they will approach this digital innovation transformation. Much of the report breaks down different “persona” or archetypes and offers suggested ways to set about approaching each of their challenges to gain benefit from the transition to digital innovation, “if companies can overcome a wide range of barriers”

ADL offers some helpful opening guidelines to help solve this challenge to move to digital innovation. I think it is going to be very hard, firstly to instal any innovation engine across an entire company and in bridging this lack of capabilities, competencies and capacity without radical overhaul of what is in place today, the legacy systems of innovation, and this deep commitment to making innovation as core as digital will be.

Again, where ADL have gone in identifying how digital technologies will transform the ways that innovation will be managed, signals a positioning that they, as a practice, can continue to build from this research that went into this report. I assume they will further build a practice into advising on the translation, impact, and meaning. To help us all translate this radical redesign of the innovation management system, that we are all struggling to get our heads around. This report contributes in very helpful ways.

ADL in contacting them promised, “there is more to come“. I, for one, will be looking forward to this. The comment was: “We have already deepened and broadened our insights in recent months and will continue publishing on this important and intriguing topic!”

If you go to “search” in this posting site of mine, you will see I have been researching and offering thoughts on this new digital innovation era. If you put into the search one of these (links supplied);  “new innovation age” or “the future of innovation” or “designing the future of innovation” or “collaborating across industries” or finally “digital discovery” you will see how I have been looking at this across multiple strands of thought. All I can offer is some thoughts here: “start reading, start thinking and start transforming”

There is a new innovation era and it is digitally enabled. 2019 promises this to become critical in it’s building and gathering momentum.

The post Innovating in the digital age- a terrific report first appeared on Building Your Innovation & Ecosystem Intelligence.

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

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

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

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

Source: www.swarmvision.com

What is holding this innovation age back?

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

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

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

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

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

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

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

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

Extracting innovation has become very complex

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

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

Source: European Commission

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

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

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

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

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

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

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

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

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

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

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

The Ten Types of Strategy for Corporate Innovation Programs

 1. Dedicated Innovation Team

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

2. Innovation Center of Excellence

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

3. Intrapreneur Program

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

4. Open Innovation: Hosted Accelerator or Corporate Incubator

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

5. Innovation Tours

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

6. Innovation Outpost

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

7. External Accelerator

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

8. Technology Education, University Partnership

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

9. Investment

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

10. Acquisition

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Seeing the digital transformation story in different ways

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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.

Much of the innovation discovery journey is a disappointing one. A hunch or insight becomes a dead end. A promising idea did not foresee a roadblock that cannot be resolved. Resources constantly “churn” and get depleted, waiting for others to be brought up to speed. Those not involved directly within the innovation project constantly remain skeptical or require more proof. The status quo of the existing places an increasing drag on the forces of change.

Then we have that often-delusional aspect; where the organization has this total belief they are well ahead of their competitors and simply point to their financial performance as the justification that their innovation is superior when it is so many other factors that have determined that. Superior is often so transitory.

When they are constantly scanning reports on the “state of innovation” it can often lull them, to give some that warm glow, others quickly being dismissive, disregarding many of the key messages as “not applicable to me”.

Then disruption suddenly hits. The cries of “Where did that come from” and a doubling down occurs firstly on costs as that is easy to stop things, fire a bunch of people or plunge into a reorganization that “actually been in the works for months” A quick ramping up of innovation to counter the attacks, to regain the initiative is simply not possible, as the resources are not there, the systems not in place, the more radical innovation unobtainable. Simply there has been a lack of sustained investment in the exploration and exploitation of the “pursuit of innovative ideas,” that are pushing new concepts, that often lie at the edge of the organization.

I mean anyway, come on: “we really don’t believe in innovation, it all is full of risk, uncertainty and all those unknowns and that is the last place to go when you are fighting in a different set of market conditions, isn’t it?” Cut costs are the recognized solution not thinking your way out within innovation. Thinking about innovation implies the longer-term and that is not so welcome at board level in today’s volatile world.

So where does innovation sit within your organization?

Two reports recently came out. Both are, I feel, “painting” a realistic picture of where innovation does sit within organizations. Am I happy with either of these, no of course not but in my view “nothing can change until something does change” What do I mean by that? When innovation becomes paramount to the future at board level then a change can occur. I don’t mean lip service to innovation, I mean deep, defining and structured thinking on innovation

The two reports, one from CB Insights, who I believe do a consistently brilliant job at “tear downs” and evaluations of industries, markets or topics. The other reflection on innovation comes from a most dependable source, researchers moving towards their doctorates at the Harvard Business School and the necessary research support to get them there.

Lets briefly look at both.

I’ll start with the one from Yo-Jud Cheng supported by his professor Boris Groysberg and a co-author, Michael Slind from HBR. The article was “Innovation Should Be a Top Priority for Boards. So Why Isn’t It?” The survey was conducted asking over 5,000 board members from around the world asking “do they do enough to support innovation?”

The outcomes cover more than innovation but provide a good overview of board thinking and priorities for areas such as strategic challenges companies face, governance activities and processes that boards are good at, expertise sitting on the board, and the hard aspects of being a board director. Innovation gets caught up in so many, sometimes conflicting issues but in many respects does not get the attention it deserves, especially as it is the most important catalyst for growth.

Innovation is well behind many other issues being focused upon by directors. The survey exposes the myth that innovation is not one of the three top challenges, innovation ranks fifth as it follows the more conventional concerns of managing talent as the top (and that did surprise me) and regulatory and competitive threats. Technology trends lay in the seventh position in this “biggest strategic challenges.”Reading through the responses, the lack of faith in their processes was disturbing. Risk management is rated far more than innovation as a better process.

To quote “When we asked directors about the effectiveness of their board’s processes for supporting innovation, 42% rated their processes as above average or excellent. In contrast, 70% of respondents think their boards have effective processes for staying current on the company”

Both, for me a little damming for preparing for a disrupting world or positioning innovation as the future catalyst for growth.

The other valuable point for me was another insight from the survey

“We also found that a focus on innovation tends to go hand in hand with longer-term time horizons. Companies that are organized around creating and enhancing value over the long term were more likely to have boards that prioritize innovation, as compared with companies that are primarily focused on achieving short-term results. Laying the foundation for innovation requires a forward-looking mindset throughout the firm and the board”

The two major takeaways for me

The report can be viewed here but finishes up with a good quote (correct insight in my opinion or validation of many):

“As one director noted, “We spend a lot of time on operational strategy — growth, acquisitions, etc. — [and] not much on risk, people, innovation.”

Now that is very disappointing but what do we expect from innovation?

In one final quote from this article: “when boards seem to have a “widespread lack of board-level engagement in innovation processes (that) could be a major blind spot and a potential liability”

My second report is the one from CB Insights

CB Insights recently released a report on the “State of Innovation” where they surveyed 677 corporate strategy executives. It does fit or correspond to the HBR researchers thinking, it gives a closer fit of what is going on with innovation in today’s organization. You do need to provide your email for access and to download of this report.

The report is a visually very easy read but gives a clarity to the big issues constraining innovation. I do like this style of reporting, offering up one page per insight. It brings them specifically into “stark relief”. This approach is really good to bring out the impact of that particular point. A good lesson in presentation, certainly for me!

I picked out these as my specific takeaways:

1. 41% of executives said their companies are extremely at risk or very at risk of disruption
2. Corporate strategists talk the talk but don’t walk the walk
3. Companies focus on incremental innovation with 78% of innovation portfolios allocated to continuous innovation instead of disruptive risks
4. Customers and employees are driving innovation. My thought is what do you expect if boards are not as engaged as per the HBR report above stating?
5. 57% of respondents said their companies do not follow formal innovation processes and executing remains mostly ad hoc and unstructured. Even the majority don’t have processes for ideation and development phases. Now that is shocking!
6. Companies lack confidence in their ability to innovate and it progressively gets “less effective” in each of the phases of innovation. Idea Generation, Development/Design, Commercialization/ Launch, Optimization/ Management and Product Retirement
7. Companies take an insular view of how they will attack innovation
8. Finally: Because they prefer to build (themselves), corporate innovation is slow.

When I look at this list I really do go “oh dear”. There are some clear positive takeaways also in this report such as “high performing companies build cultures of innovation across functions” and achieve a 5X increased performance due to this and “high performing companies invest in disruptive projects”.

The issue for most is “how do they become high performing? Until we treat innovation as a core process, disciplined, structured set of activities that are managed in different ways than the existing business, we will struggle. Embracing the aspects of a high performing business within innovation offers significantly increased performance. The ability to grasp all that this entails and establishing a set of innovation management disciplines, most will simply “bounce” along on a very unsatisfactory innovation projection of mediocre growth and return.

So to download the CB Insights report go here “State of Innovation“. It is well worth reading and is in such an easy, digestible format

In Summary

I would suggest you go and take a look at both of these reports. They reaffirm that innovation is not the priority it should be at board level, both offer a devastating reality of poor innovation processes and structures and a lack of corporate design for salvaging innovation out of its current mire of incremental, ad hoc and risk constraints due to this lack of top focus.

Innovation is full of rhetoric and hot air. Those in the trenches are believers but they are battling forces that make it doubly hard to make a success of innovation. The internal forces are as much against them as the external unknowns.

As I opened with as my title “What do we expect from Innovation? Mostly disappointment.” We can only dream that we are still moving towards my view of that “New Innovation Era”. It still lies ahead if we want to recognize the valuable contribution innovation does make to the future growth and, more importantly, to their ongoing sustainability.

These two reports reflect the potential of where innovation can go but do offer a snapshot of the present reality of why it cannot until multiple aspects of innovation management are addressed and accepted. These changes are essential to underpin innovation with a clear focus, dedicated resources, recognized as a functional discipline, well thought-through processes and a top to bottom recognition and focus on its importance. Will something change? I seriously wonder although I’ll keep banging the innovation drum, hoping some will (eventually) listen.

The post What do we expect from Innovation? Mostly disappointment first appeared on Building Your Innovation & Ecosystem Intelligence.

How do we set about engaging with all these different voices surrounding innovation?

Have you ever worked with the three horizon framework?
It is really useful for managing your innovation activities, drawing out the often conflicting voices within the organization on how to take innovation forward. The approach can unlock you from just being caught in the present, to one of envisaging a future that then allows you to begin to build different capabilities, competencies and capacities.

Find out more here and here and here on the three horizons or within this blog site put “three horizon approach ” into the search box. You will find  I have provided a considerable overview in different posts’ thoughts on the 3H thinking and why I place such value in it for innovation’s evolution.

The 3H framework offers a perspective that accepts the need to both address the multiple challenges that occur in the first horizon, foster the seeds of the third and, allocate appropriate focus and resources to manage the transitions from one to another.

What makes the model valuable to innovators is that it ‘accepts’ that competition is restless, markets are evolving, and that change is a constant. The three horizons approach offers the methodology for constructing plausible and coherent innovation activities projected out into the future. It looks for emerging winners.

The 3H not a planning tool; it is providing a valuable evolutionary perspective that dialogues can be formed around, so decisions on where to focus and what resources to apply can be based on a more plausible and coherent set of activities projected into the future, searching for emerging winners, those that can potentially change and challenge your existing business but evolve it in clear ways.

The 3H is a dialogue mechanism to help frame the evolving journey and allow you to move towards it in a better-structured way.

The need is to discuss the challenges in horizon one and nurture the seeds of the third. It is not an either/or, good/bad discussion. You need those robust discussions to form fresh perspectives. The key is in listening out and becoming adept at managing these conversations between the ‘voices’ of the three horizons.

The three voices that need to be in the same room

• You have the voice of today, the voice of the manager(s) responsible for delivering todays result that are more concerned with managing the existing, maximizing returns and keeping the organization going efficiently and effectively.

• Then you have the second voice, the voice of the entrepreneur, the one eager to experiment, try out new things, explore and extend, accepting some aspects will not work

• Last we have the third voice, the voice of the aspirant, who is looking to build a different vision, believing in different, more pioneering ways and visualize things in their ‘mind’s eye’, far more aspirational they often seem on the first take to look to be totally incompatible to the reality of today.

The different voices involved can be highly engaged, all wanting to add their perspective, you need to listen to them. You need to search for common ground, growing recognition and sometimes realization, that these are not so much separate voices, but actually ones that can all be combined, to provide a far greater outcome when they can ‘see the same future’ but through their own specific voice.

It is the combination of these different three voices that need to come together and help frame the innovation journey. It is by applying and using the three horizons framework and its methodology you can draw out and advance better outcomes for your future innovation activity.

There is this powerful need to look toward the future

Based on what we know today and what we can set about building and exploring, does hold the exciting promise of the future. Look out of ourselves offers a more rewarding prospect. Valuing the often conflicting voices around us or even seeking them out provides for richer promise.

We need to keep reflecting upon what is dominant, prevalent and seems to be pattern-changing, as these positions are constantly shifting. Scanning the horizons and what is simply all around ‘us’ offers those ‘pockets of the future’ to invest in, explore and experiment, to be open to change, to shape and prepare for, to become far more “future ready”.

Initially these pockets of the future may seem a long way off, often just really weak signals, but are indicating different, perhaps far more radical and perhaps disruptive changes for our organizations to re-equip for. The earlier yon can spot and organize for changes ahead the greater the chances of building the different capabilities and competencies these are more likely to need.

Technology clearly comes to mind with wave upon wave of change is crashing against the established rocks, beginning to weaken the existing structures and form new ones. Innovation gains from this constant flow, if you are ready to receive it.

Change does come from different experiments and explorations

It is partly through the treatment of innovation, feeding into the system a rising wave of future innovations that alter positions. Staying stuck in ‘just’ incremental to serve the existing conditions in the market seriously constrains you for the future, you stop growing, exploring, being curious and experimental.

You need to encourage experimentation, testing, prototyping, accelerating the learning and then being ready to scale what holds promise and abandon what seems not to.

For this, you need all the voices within your organization seeing the future, so they can consciously work towards it, even when it might seem vague and not fully clear. The 3H framework draws out discussions, it helps project into the future.

Just always remember, the present is already in decline.

Look out, do not stay locked in.

Entrenchment limits your options to break out, as much as you might feel it needs defending, as it’s providing your present-day core yet it is ‘holding you hostage’ not able to break free and embrace the future in the planned ways you can achieve.

The post Are you engaging with all the different voices around you? first appeared on Building Your Innovation & Ecosystem Intelligence.

You still have marketing, research, financial, strategic development all offering their unique views of what and where innovation can contribute. This often ‘fragmented’ approach reduces the promising breakthrough effect of innovations potential contribution.

By not having this comprehensive and cohesive viewpoint articulated at board level by a fully accountable person, the Chief Innovation Officer, innovation often stays locked up in one position or another.

No one is stepping in and unlocking its full potential from a holistic viewpoint, totally responsible for innovation by structuring it, for adding real scale, giving it momentum and growing sustainability but more importantly driving it throughout the organization from the top board room perspective.

What this ‘combined’ voice can really bring too many present and future growth orientated discussions is real strategic alignment  significance; it can transform discussions and significantly influence directions the organization can take and where to allocate its resources.

Yet innovation still struggles to be fully accepted as a fully functioning discipline and expertise needed in the boardroom to focus innovation on providing real sustaining growth, fully integrated and aligned across the whole organization for its value potential.

The exploring going on around innovation

Many organizations still are exploring how to approach innovation and you can see plenty of experimentations and I’d say interim ‘bridging’ solutions.

We are making some progress within innovation for its function, location, financing and ownership, as these have shifted more towards the top of organizations, yet they still lack that final unifying catalyst, of appointing a chief innovation officer for many, and innovation as a strategic activity being pulled together in a unifying strategic innovation framework.

Some that have made this appointment are still working through the make-up of the function and how the ‘arm-wrestling’ works out between the existing groups making up their part of innovation and this new realignment can be hard work.

Often, as the CEO lacks real innovation expertise to effectively arbitrate such an appointment, to design in the real accountability and appropriate weighting for managing such a critical component needed for growth, it does not have the executive strength built into the position to make it the pivotal role it should be.

The role remains poorly understood in its focused value and contributions, and can be reduced to this in-fighting and trading, to make slower headway than it should.

Driving outcomes often required separate innovation functions.
Added to the lack of recognition of what ‘makes up a clear innovation function’ many organizations are still rather stuck in a silo thinking that innovation is only about developing products and services based on traditional functional lines.

Innovation has evolved way beyond this product and service view only, or certainly should have done.

We need to explore making major shifts by thinking through different business models, working on a variety of collaborative platforms and ventures, having increased agility to explore, experiment and step far more out of the ‘classic’ core, into new adjacencies, or even investigate whole new ‘white spaces’ for business opportunities.

Many are leaving this to others as they stay ‘locked into’ traditional viewpoints of what innovation contributes.

These significant changes on ‘how to innovate’ are creating organizational tensions that do need resolution as they are increasingly colliding against each other, like tectonic plates.

These tensions are disrupting organizations and having a lot of internal friction that reduces performance, at this critical time when a unified approach to tackling external challenges would be better served by aligning the innovation view.

In some ways organizations are experimenting in different innovation designs but these still tend to be ring fenced, islands of experimentation that stay locked in their space and unable to be seen, strategically, for their (rapid) scaling opportunity due to this lack of a comprehensive, innovation view, from the top.

There are different designs being explored, often within the same organization. All serve a ‘given’ purpose but perhaps stay constrained by this lack of an overarching strategic understanding of innovation and its contribution to strategy and driving growth. We might be in real danger of dispersing innovation energy when we should be unifying it.

Diversity is made up of innovation experimentation.
We see today innovation centres, new-business development functions, separate emerging-business opportunities groups and selected incubators along with emerging-technologies business groups and even advanced-technologies or institutional collaborations.

Each has a focused and valuable role to play but the cross-over values, the ability to drive cross collaboration and learning often lack that overarching coordination that only a dedicated top person can bring in bringing this together to serve the strategic purpose of the organization.

Usually we also have the older established research and development centres, the marketing pilot plants and other more established and traditional avenues that product and service tend to work through.

I think we definitely duplicate resources, loose knowledge, constrain expertise and don’t get the potential innovation ‘horsepower’ out of the combining effect as and when needed. Can this change?  It certainly should to extract and unlock all of innovations true potential.

How we align innovation will decide many of our futures.

Alignment between the goals and objectives at the top of our organizations is still at serious ‘odds’ with what is being worked upon. We need a real strategic innovation framework. I’ve offered some thought on this in the past if you care to pick up on this as one starting point, in this article “The Overarching Proposition for the Executive Innovation Work Mat.

We are daily being faced by significant challenges in meeting our strategic objectives and where often innovation fails to bridge. Examples of this can be seen in the ongoing competition with short-term priorities from across the parts of the business as well as the difficulties of integrating different function’s objectives with those of the core needs.

Then there is still the poor business case or value propositions made often to corporate leaders, or that consistent dilemma of withdrawing funding from an idea that has not lived up to its promise and become one that drags and diverts away critical resources. All work against innovation delivering on its much-needed potential.

We are managing more cross-functional issues than in the past.

The more we engage with open innovation partners or begin to develop promising new business models then more we conflict with many established positions. This slows the real contributing value of innovation.

These new challenges need a different type of boardroom representation, it needs a clear mandate for a Chief Innovation Officer, to bring the ‘disparate parts’ together and explore the broader potential that wider innovation can bring in all its potential forms.

A call for a new concerted effort for providing an overarching innovation design

Designing a new strategic innovation framework at the top of organizations helps close the many gaps we see today. We need to move from ‘disconnect’ to ‘reconnect’ and make innovation more centrally designed to meet today’s challenges, those that are cross-cutting, to allow innovation that greater freedom and scope to contribute into the growth organizations leaders are demanding.

To align innovation to the organizations strategic goals, we need to challenge many of the established practices and functions to allow innovation to fulfil its promise of being the true catalyst to growth.

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