The post The art of "Back Casting" needs care first appeared on Building Your Innovation & Ecosystem Intelligence.

Backcasting is a planning method that starts with defining a desirable future and then works backwards to identify policies and programs that will connect that specified “future to the present”.

The fundamentals of the method were outlined by John. B. Robinson from the University of Waterloo in 1990. The fundamental question of backcasting asks: “if we want to attain a certain goal, what actions must be taken to get there?”

While forecasting involves predicting the future based on current trend analysis, backcasting approaches the challenge of discussing the future from the opposite direction; it is “a method in which the future desired conditions are envisioned, and steps are then defined to attain those conditions, rather than taking steps that are merely a continuation of present methods extrapolated into the future”

I have collected different views on “Backcasting”.

Those are from assorted references like Wikipedia, from past work on water and energy systems, Natural Step, from Innosight, discussed and promoted in Mark Johnson’s book “Lead for the Future” and a really recent one from Roxi Nicolussi and her Backcasting; Creating a Strategic Roadmap for the Future” or finally here, this one “All Roads Lead From The Future Back — A Vision and Spoke Model” by Aidan McCullen. I am looking to further explore the applications applied in water, energy and climate work.

So exploring backcasting as a method

Backcasting involves establishing the description of a very definite and particular future situation.

It then involves an imaginary moving backwards in time, step-by-step, in as many stages as are considered necessary, from the future to the present to reveal the mechanism through which that particular specified future could be attained from the present.

Backcasting is not concerned with predicting the future: The major distinguishing characteristic of backcasting analyses is the concern, not with likely energy futures, but with how desirable futures can be attained. Thus, it is explicitly normative, involving “working backwards” from a particular future end-point to the present to determine what policy measures would be required to reach that future.^[

The concept of “backcasting” is central to a strategic approach to sustainable development. It is a way of planning in which a successful outcome is imagined in the future, followed by the question: “what do we need to do today to reach that successful outcome?”

This is more effective than relying too much on forecasting, which tends to have the effect of presenting a more limited range of options, hence stifling creativity. More importantly, it projects the problems of today into the future.

In the context of sustainability, we can imagine an infinite number of scenarios for a sustainable society – and ‘backcasting from scenarios’ can be thought of as a jigsaw puzzle. We have a shared picture of where we want to go. We put the pieces together to get there.

However, getting large groups of people to agree on the desired future scenario is often all but impossible. Further, scenarios that are too specific may limit innovation and distract our minds from the innovative, creative solutions necessary for sustainable development.

Over the years, I have pursued the Three Horizons methodology. I am more comfortable with this and applied this approach to countless issues or future thinking as it feels more casting forward.

Backcasting offers a different approach nicely illustrated here.

Backcasting is further explained or applied.

So strategic sustainable development relies on ‘backcasting from sustainability principles’ – which are based on science and represent something we can all agree on: if these principles are violated, our global society is unsustainable.

To achieve a sustainable society, we know we have to not violate those principles – we don’t know exactly what that society will look like. Still, we can define success on a principle level.

In that way, backcasting from principles is more like chess – we don’t know exactly what success will look like, but we know the principles of checkmate – and we go about playing the game in a strategic way, always keeping that vision of future success in mind.

Natural systems are complex and non-linear, and while we understand more and more about how they behave on the principle level, we still cannot predict the weather. Social systems are far more complex. Still, we try to force these systems into models so we can ‘understand’ them and ‘predict’ how they will behave.

To do this, we are forced to make assumptions that often make the models reductionist, simplistic, and absurd. For example, in economic systems, the assumptions are that all people are ‘rational actors’ and that there is ‘perfect information’.

In large part, this is due to a tradition of compartmentalized disciplines in academia, where the social scientists have pushed a quantitative, value-neutral approach to study these systems in the misguided pursuit of establishing concrete laws similar to the laws of nature.

Even if we could predict the future, why would we want to? We have the power to create a better future.

If you backcast, future cast or apply the three horizons we do need to look out, into the future and try and bring it back to the present so we can move towards that desired state in a planned and methodical way.

More on backcasting in the future!!

The post The art of backcasting needs care in innovation activities first appeared on Building Your Innovation & Ecosystem Intelligence.

Today most executives seem to be time-starved. They are constantly reacting to daily events, to fix upon the focusing and fixing of short-term performance. This applies to the top executive down to the most junior. The sheer difficulty of having most, if not all of your colleagues working remotely is making it so much harder. Keeping the business simply going is hard, demanding work. What time is there left to think beyond the present?

How can you keep the engagement, how can you find an environment that is creative, stimulating and allows for innovation? Juggling so many crisis events in different ways is exhausting.

Who is encouraging your pause button to go on as we lose more of those relaxing moments to top up our stimulations, as we all continue to isolate, with our lack of socializing, travelling, being in each others company continues to leaves us so devoid of real human interactions, apart from countless Zoom, Skype, or Team meetings? We need to replace this “void” with better thinking time to re-stimulate our curiosity and logic senses.

It just seems to me they simply don’t have this luxury to think.

Technology is rapidly taking over this thinking role, we increasingly rely on searches to at least begin our thinking. Humans are becoming the 2nd class citizen for thinking.

We are getting increasingly unobservant unless it is coming from the screen in front of us. More of our information is coming to us in predictable and narrow ways, we are being cut off from alternatives.

We are being deluged by social media that constantly become smarter on your clicks to give you the information to help you in your daily lives. We are numbing our own instincts and relying on others. We are losing the world of “personal physical experience”, our own journey of being curious and replacing this with a “junkies” fix of being reliant on others to entertain us.

Sitting back simply becoming increasingly remote observers is not helping us too really think, we often are simply not connecting the dots, we are chasing the moving dots or just moving from one dot to another and never thinking about connecting them up.

We should think more about the gaps, the issues, and most importantly for us, the implications. The more we react and don’t think things through and apply them to our situation, our context, our situation, the more we are more than likely going to foul up somewhere along the way. Equally, the more you fail to project something into a situation you have observed, the more you ignore the opportunity for change or at least challenging a situation.

This time-starved environment has real implications for innovation.

If we don’t sit down and think through issues and implications of our present performance around innovation, how can we close the gaps and improve it? We just simply don’t seem to have a more systematic, connected roadmap within our thinking that points the way to the improving longer-term as we keep doing this ‘reacting’ only.

We have such a limited amount of time to pause, evaluate, or redesign. We equally don’t feel capable to simply assign this over, even to outsiders to help. We are far too challenged and driven, often far to inbreed into thinking “our solutions can only be the only solutions to our problems”.

Often I am caught in finding better solutions to this trap. As an external consultant or advisor, I see a mistake, upon mistake happening. It is not from a lack of trying or a lack of working within the abilities or situation, it is often that lack of alternatives that might be considered. We simply cannot get a different message through, those “in charge” press on regardless.

Tell me, does it really need to be like this?

Often there is no time for thoughtful analysis, a depth of thinking, a platform of knowledge and connectors to bounce this off. Yet there is a growing need to discuss this, the risk of wrongly innovating, of dealing with increased failures all seems to call for solutions to help but where? Where do I quickly go to gain some innovation knowledge or insight, as I simply have no time to sift through it all.

We are losing sight of time, a time where we stop talking, wanting to search for latest events, follow the latest trends, watch something on tik tok or youtube. We need to stop, switch off the distractions and simply learn how to think. To piece different strands of thinking together in new ways and understanding the implications of that. Instead, we push this thinking aside to go back and listen or read about the latest “breaking news”.

If we continue this way, human innovation will be dead in years to come. We will just sit back, explore the artificial intelligence sources we have and never be able to filter out the possible and not possible without the aid of technology as we will have lost our own skills and ability to observe the world, as our experiences get increasingly shut down, to what we are “feed”.

We are often faced with the death of a thousand cuts.

Often that precious lack of dedicated time to investigate, to question, to deepen understanding, simply to relate too and interpret innovation is a key missing ingredient. This is where the external perspective can fill critical gaps; it can become the extra resource, that runs in parallel.

I believe it is the time where the value of external, dedicated innovation thinking has a place within the time-starved innovators thinking, it might help provide more comprehensive delivery of innovation understanding and plugging individual gaps by delivering thinking that bridges many of those current gaps I seem to find. This comes from building up our own experiences, learning from our own failures and getting knocked back and most of all our abilities to create, build and influence others with innovations that are different, creative and have a positive impact on what we have.

Is there space for an “innovation thinking guru?” I believe so, do you? If so…………hello, invest some of your time in (quality) thinking time?

The post No thinking time left- help first appeared on Building Your Innovation & Ecosystem Intelligence.

Last week, Siemens had a really valuable virtual event called their “Digital Enterprise SPS Dialog“. Those that missed it you can watch previous sessions on-demand at any time via “Recordings”. They provided an outstanding virtual showroom packed full of innovations, product presentations and use cases are exhibited in an exciting real 3D environment. The platform and all on-demand assets will be available until January 29th 2021.

The “Digital Enterprise SPS Dialog” had 56 3d-exhibits in 12 topic areas, more than 130 product presentations, 3 real factory showcases with 21 stage presentations involving over 38 speakers. By registering you can view “on-demand” selectively or watch the whole event, explore the showrooms and simply learn, evaluate and assess what these concepts would mean for you in your own Industry 4.0 journey, to a more highly automated and connected environment.

I said it at the time, and I repeat it: “The event was, for me, the best virtual event of this very strange and weird year we have all been caught up in“. For Siemens, they also commented this was quite a milestone to be achieved in the field of virtual events. It delivered a lot. My initial post “Siemens SPS Dialog.” might be worth also picking up upon.

By being virtual, the insights provided has advanced my understanding of what is being offered in Siemens Digital solutions significantly and would give any clients a terrific understanding of Siemens combined physical and digital offerings.

An event showcasing critical aspects of the factory of the future

It opened my eyes to the changes within factories that are being currently undergone to get to the factory of the future. I have been learning what has happened in the past 12 months to change our perception of Manufacturing and the factories we need in the future.

Siemens has been focusing on building their ecosystems consistently for years, and this exceptional focus on the connection needs to successfully deliver Industry 4.0 has been central in their Digital Enterprise solutions, consistently offering the solutions for making all things (IIoT) both digital and in the physical, building out on additive manufacturing, motion controls, artificial intelligence, flexible autonomous as well as their more known aspects of Siemens digital offerings of industrial IT as a service with Siemens Mindsphere, the role the Digital Twins are playing in designing, exploring and extending the physical world.

What comes across in the event by Siemens was how significantly the future of production is undergoing an extreme transformation in its combined physical and digital offering. Let’s take four.

• When we reflect on the recent events of the last twelve months, this has been highly disruptive but those industrial companies that had already started their Industry 4.0 journey were in such a better shape to step up to the challenge, they kept production running but is highly adaptable ways. This is where Siemens comes in in the solutions to allow this highly automated, flexible, digitally connected environment to work at all times.
• When we reflect on the remote work, rapid response and agility have all been tested in recent months. The factory that had digitalization and autonomy at its core made astonishing adjustments to its ability to be flexible and even “ramp up” or speedily adjust its production to demands that were unpredictable and requiring immediate decision making. The learning from these last nine to twelve months has been astonishing.
• The shifts from the predictable to managing in (total) uncertainty required a factory of significant flexibility in design understanding, digitally prepared and physically able to be reconfigured.
• The pressures have grown, shorter cycle runs are becoming more normal and necessary. Not just because of the rapidly changing customer demand but as past established supply chains have been disrupted or dramatically altered to adjust to different global circumstances, the shift has become one of production is entirely customer-focused.

Factories are undergoing massive change.

Sequential production has given way to a more autonomous manufacturing approach that has agility at its core. The system is becoming more based on modular, autonomous machines that continuously optimize themselves and operate extremely flexibly and efficiently.

These autonomous, decoupled manufacturing units quickly form new assembly cells and can produce constantly varying products without repeated manual engineering. Each machine is assigned skills based on the product ordered.

The manufacturing steps are engineered by an Autonomous Factory- the factory design of of the future

An AI-based system that performs a producibility check that determines whether all the necessary skills for manufacturing
the product are available in the factory. The requisite production steps are then combined in an optimal sequence, fully automatically and without reprogramming.

Artificial intelligence as the foundation of production. Autonomy in production is made possible by digitalization. Based on a digital twin of the product to be manufactured, AI algorithms enable the system to detect product variants, check material availability, and plan the steps necessary for manufacturing the product. AI also enables sensors and actuators to perform human-like actions like identifying parts and positions for gripping an object.

Production as a whole also makes its own decisions and organizes itself. Many assembly steps can be performed in any order. A central, AI-based system ensures the highest possible output and monitors optimal utilization and compliance with delivery deadlines. The system always knows the status of production at every workstation down to the smallest detail.

The Siemens “Digital Enterprise SPS Dialog” gives massive insights into what is currently being undertaken to connect factories and offer leading-edge solutions. To deliver Industry 4.0 gets a good reality check at this event of why Siemens are regarded as leaders in this evolution across all industries.

The ultimate goal is end-to-end consistency as the foundation of digitalization and physical being combined.

To quote from Siemens literature here:

“A big part of the needs of today’s factory environment is “Totally Integrated Automation (TIA)”. The world’s leading automation concept provides absolute end-to-end consistency in three dimensions.TIA enables seamless interaction between all automation components, the software involved, and higher-level systems and services Integration”

This capability is ensured by consistent data management, worldwide standards, uniform interfaces, and openness – from the field level to the company management level.

Siemens role is to lead tomorrow’s technologies by integrating all the parts today, step-by-step, for a secure investment and end-to-end capability.

This SPS Dialog provided significant insight into what is possible. To be at the cutting edge of so much innovation in product and digital solutions must be an exciting time. I got a (massive) dose of that Siemens Energy from this event. Take a little time to find out yourself is my recommendation.

A product brochure to support this event showcasing the innovations discussed and presented by Digital Enterprise at this event is available here. Here you can recap innovations, new products and exhibition highlights from #SPSDialog at a glance in this 56-page brochure about #simulation with #TIAPortal, #Mindsphere, #cloud connectivity of PLCs and much more.https://sie.ag/32RT3s8

For me, they got me hooked in so many of the sessions. Within my business, I attempt to combine Innovation, Ecosystems, IIoT and Energy as my core focus. An event like this one that compresses so much gave me such a lot of value into accelerating my own understanding of all that is ticking away under the Siemens Digital Enterprise bonnet.

The post Building our understanding of the factory of the future first appeared on Building Your Innovation & Ecosystem Intelligence.

Atos is a global leader in digital transformation. Atos employees 110,000 across 73 countries with annual revenue of Euro 12 billion.

Atos holds the number one position in European advisory companies in Cloud, Cybersecurity and high-performance computing that provides end-to-end solutions to Orchestrate a wide array of Digital Solutions.

Why do I single out Atos for a post? There are several good reasons:

Firstly, I like its stated purpose “to help design the future of the information space” and Atos looks to contribute to the development of scientific and technological excellence.

Secondly, I have worked with, often exchanged views and shared from the work that a wonderfully knowledgeable person so often provides on such a diversity of subjects. I do recommend you should certainly follow Antonio Vieria Santos (@AkwyZ) who works within Atos in a roving, supportive role building community knowledge. We presently meet and participate in the Siemens #SIEx community together, and each time I find the opportunity to talk with him, I learn from him. He is a great teacher to engage with and passionate about diversity in opinion and knowledge sharing.

Thirdly, Atos has recently been ranked number 1 in sustainability performance within the IT services sector for the second year running, and they continue to push social responsibility, and this brings me to why I am writing this post.

Atos has made a significant commitment to achieving net-zero carbon emission for themselves by 2035, as have many others. Still, it is the leveraging of this sustainability journey of their clients towards decarbonization, security and digital inclusion that attracts me in a core purpose and need, that for me, makes for further investigation.

This commitment drew me in to investigate further.

I spent some time taking a deeper look at Atos and its positioning in the decarbonized digital services through its sustainability consulting capabilities. Atos recently completed the acquisition of EcoAct, a climate strategy consulting firm with a team of 160 climate experts. This acquisition further shapes a global Decarbonization Excellent Center to offer comprehensive delivery capabilities for clients and their climate ambitions.

My fourth reason came from my investigations and shared focus.

Fourthly Atos is looking to develop digital solutions to support decarbonization. They rightly state it becomes an important aspect is to challenge the existing and find new innovative ways to solve decarbonization issues across many tough areas. Atos decided this year on an IT challenge seeking out to develop digital solutions that will support multiple decarbonization initiatives to help companies and society as a whole tackle climate change.

I relate strongly to this as the #EnergyTransition is a core focus area for me, and I devote a significant part of my time researching, exploring and explaining this transition. If you are interested, go over to my dedicated posting site of www.innovating4energy.com – a transition in all of our lives. Increasingly our “collective” focus will be on this overarching need to decarbonize the planet.

My own views on the themes for Decarbonizing has been set in my agenda setting post if you care to read it.

Atos offers its first international student competition dedicated to technological innovation.

I really hope this is well supported, the challenge is vitally important to continue to accelerate the energy transition we are all undergoing. This is their first international student competition dedicated to technological innovation. Let me outline this here: Technological innovation to achieve decarbonization is vital.

The challenge closed for entry on 29th November 2020, so registration please go here

Background and challenge

The Paris Agreement sets out a global framework to avoid dangerous climate change by limiting global warming to well below 2°C and pursuing efforts to limit it to 1.5°C. In order to achieve this, it is necessary to reduce atmospheric greenhouse gases, particularly Carbon Dioxide. This is especially true in the area of energy production and usage; by increasing the share of low-carbon energy sources, especially renewables, with a corresponding reduction in the use of fossil fuels.

They are asking students to develop a functioning application, mobile app, service or simulation to support industry, commerce or individuals in the drive for decarbonization. They are looking for interesting applications that could have immediate and impactful real-world applicability.

• In power generation and demand, how can we support a shift to nuclear, hydro, biofuels, geothermal, solar, wind and tidal forms of generation?
• In the area of power use and efficiency, perhaps local power generation, distribution, storage and community schemes can be investigated?
• In the production of steel and cement, which produces large emissions, are there ways that digital solutions can reduce or optimize the use of these materials?
• In agriculture and farming, we need to solve the large volumes of methane release. The use of inorganic fertilizers releases methane into the atmosphere. Additionally, livestock farming (particularly cattle) produces large volumes of methane. Can we reduce these emissions, or use digital technologies to make better use of waste methane?
• How can digital technology help to prevent the destruction of rainforests or aid in the recovery of deforested areas?
• In transport, how can digital technology support a shift from fossil fuels to electricity or hydrogen, maximise the use of public transport, car-sharing and rental schemes? Can this be extended to shipping or air travel?
• Can digital solutions aid the distribution and delivery networks supporting increased online product and grocery shopping, especially now that we’re living in a world so impacted by coronavirus?

The 2021 winning team will receive €10,000 to help them bring their app to the market and the two finalists respectively €5,000 and €3,000. Also The IT Challenge organizing committee will offer to all the members of the winning team and the two finalist teams the possibility of applying for an IT Challenge-fast track internship to work within Atos on subject areas relating to their projects.

You can follow the competition on Twitter at @atositchallenge

Finally a useful link to more on the competition: on More information about Atos decarbonization ambition

I can only wish Atos and those that take up this challenge good luck. The areas chosen are so vital to have all levels of innovative solutions. Finding imaginative digital solutions to decarbonization is so much part of our needs today in making this energy transition

The post Setting the right innovation challenge first appeared on Building Your Innovation & Ecosystem Intelligence.

 Reflecting on a rapidly changing business world.

The issue we must tackle today, is how we go about adapting to the changing world? One that will be able to take all the advantages of the changes all businesses are undergoing, how societies will be adjusting and responding. We are facing a time of unprecedented economic and social crisis but this is a time equally for seizing and sizing different opportunities.

We clearly need to find ways to navigate ourselves back into some (new) order; to stabilize the chaos we are in. What we first need to do is make sense of what is going on around us, we need to determine what actions to take and the level of action, resource and support each part needs. We are in a period of (great) change. How are we thinking about how to adjust, not just to the immediate challenges but the greater ones that are certainly heading our way.

Within business, the present crisis is offering a chance to make significant changes to how we operate in the future. I am not sure many of you feel the same, it seems disruption is in everything, in what we need to undertake, in what is coming towards us in change. We are challenged but we have ample signals to amplify and explore. 

Disruption actually has a common purpose, often far less sinister than promoted or we suspect, it requires us to re-equip and open up, as we learn to deal in this changing world where connections can emerge from anywhere at any time, offering a new ‘line of sight’ onto an existing problem to begin to break down the barriers and find new fresh ways forward.

These will be through different approaches to designing and extracting the potential value gained and these, in my opinion, will form around ecosystems and their management, through technology solutions provided by platform providers.

We need to respond quickly and in very different, highly collaborative ways. Digital offers unique, new ways to address many of our challenges everywhere. Our need is to explore and exploit, and we have to harness ourseleces, our organizations, through these new technologies and collaborative concepts to take advantage and leverage all that is possible.

 We need to engage in different ecosystems and participate in new platform learning to take advantage of the changes taking place all around us. To quote Chuck Robbins, the Cisco CEO and Chairman “We believe that no one company can deliver the full breadth of technology solutions that customers need at the pace the market requires”. It is through the increasing intensity of using data and a deep analysis where this growing need for broader collaborations becomes so essential.

Technology, innovation and digitalization are the combination effect that will move us forward in our changing business world. We can’t operate in isolation, we need to be far more highly collaborative.

Partnerships abound, not just within a specific industry but in cross-industry collaborations. Ecosystems need to form to take advantage of many rapidly emerging market opportunities. It is not just welcome to a world of ecosystems, it is learning to change from being exclusive owners into open collaborators, that build ‘greater value’ from the common need of working together, and many of these are increasingly cross-industry ecosystems.

Just recognize the changes we are undertaking in cross-industry collaborations are significant

If we recognize what it takes to build new transportation business models, it needs an ecosystem of public authorities, automakers, component suppliers, software providers and infrastructure builders to come together to make this happen

 The travel industry will emerge far differently in the months ahead, in its post-recovery from the ravages of Corvid-19. Within airports, train stations we are seeing a conscious integrating of all that makes up this travel hub, including connecting traffic updates, weather conditions, arrival and departures, airport shops, restaurants, hotels, parking terminals and flight or train understanding and on-line bookings. This will be rapidly advanced, integrated and providing a very different business model proposition. 

 Many of the changes that will emerge in the next twelve to twenty-four months will become more cross-industry and service ecosystems. The search is for synergies. It requires a host (platform provider), different apps, weblinks and consistent ways to integrate these so those using the airport or train station can navigate their way around their personal needs. It needs an ecosystem and platform management to bring this together.

We are increasingly expecting as consumers, uninterrupted connectivity, and virtual integration and that need for continued connectivitity will spur new value propositions for trechnology and AI to take over and manage more of your daily, repeative tasks . It is this constantly connecting-up that is constantly layering mini-ecosystems onto each other so experiences improve as these ecosystems connect and work out what is needed to be delivered.

If we look around we are seeing increasingly the cross-industry ecosystem exploding.  

We have new ecosystems that are building new value in offering mobile commerce, building digital into all that we undertake increasingly in retail, banking, and entertainment. We are seeing new energy solutions emerge in Agriculture, Energy, Utilities. We are seeing a ‘connected difference’ in the Automotive, Driving, linking to Postal services, electronic transfers, blockchain transactions, purchasing across most of our goods, both personal and in business and exploring concepts in Health solutions that require cross-industry collaborations.

We see electronic capital trading getting faster and faster by the application of data flows, analytics and software that automates the trading decision. We are connecting into Public Services to gain insight and seek new value. Manufacturing is connecting up through its Industry 4.0 drive. We have Artificial Intelligence increasingly working, either in the background or foreground for decision-making. We are building platforms and connecting up the individual ecosystems of (internal) knowledge into these new creators of value, based on collaboration, mutually shared interest and vision and in the co-operation that emerges around the extensive use of platforms and technology application.

The smartphone is to date, our greatest ecosystem, and platform, as individuals as it is all wrapped up into one personalized connected ecosystem and the phone is the platform. It is rapidly becoming the source of information, value generator and our personalized “dual world” as it learns what we need and is increasingly responding to mirror our world.

Just image the ecosystem of connectors we require within our daily lives, living in “smart” cities.

The opportunity to connect the providers of ‘hard’ services (energy, equipment, construction, utilities, etc) with our ‘soft’ needs (where to go, what we can do, order, where to park, what to do and see) requires huge collaborative efforts but the reward has significant benefits. Smart cities attract ‘smart’ people that attract ‘smart’ institutions and eventually ‘smarter’ business entities.

The connecting brainpower allows everything to manage their own personal speed of things, a flow that can potentially reduce redundancy and enhance engagement. The connections begin to reshape everything through the data; communications, public services, responses to crisis and opportunity, being aware. The smarter in the use gets increasingly channelled, as this increasing flow of data to analyze, target and coordinate life in the city, can allow for a better way for all to connect to that city and personally identify. It changes urban life as it involves citizens increasingly in shaping the future.A connected city.

This is a very different potential in the new business models for all involved. The period ahead is going to be hugh “reset” within ourselves, within the way we go about and organize work. A world built on increasing collaboration, cross-industry cooperations that has technology, digitalization and innovation at its core.

The post Adjusting to a changing world first appeared on Building Your Innovation & Ecosystem Intelligence.

We are in the ‘cusp’ of a fundamental change that technology, platforms and connected ecosystems will bring into the mix for connecting and collaborating in dramatically different ways than in the past.

One of the implications will be our need in measuring the metrics within companies. The measurement of inputs, throughout and outputs need to become far more focused on delivering speed and scale potential as the critical points. We are far more needing to focus on the outcomes as our primary point of measurement.

This is a further post on discussing outcomes as the focal point of our innovation measurements, following my recent one of “Shifting to Ultimate Outcomes”

Recognizing the emergence of the outcome economy

The outcome economy which is emerging has many implications within it and how we measure and value these will become increasingly important. Companies will need better data to calculate costs, evaluate its potential value and will be modelling far more the risks and tracking the factors required to deliver within any outcome-based value promised.

To quote from a recent World Economic Forum report:

“In the outcome economy phase, companies will shift from competing through selling products and services, to competing on delivering measurable results important to the customer. This is a much more challenging prospect. Among other things, providers will require a deeper understanding of customer needs and contexts in which products and services will be used. Value based on output also entails quantifying results in real-time. Both of these requirements have been nearly insurmountable obstacles to scale – until now. It is the digital age that makes the outcome economy possible”.

There are a number of implications as we move from a ‘push’ into a ‘pull’ environment where results are measured by the customer as valuable to them. For example, pricing practices of a solutions end result will clearly change, based on sold performance, as will the emergence of more predictability modelling of delivering certain outcomes and their potential value.

We are becoming part of the connected world, comprising new market ecosystems and technology platforms that ‘look in’ and foresee, expect, and even predict new outcome results. This will require a far more dynamic environment, one that is responsive, agile, fluid and highly adaptive to meeting customer needs, in real-time.

Internally this is going to challenge organizations in significant ways. As we break down the present silo view of ‘our’ assets, bring into more into play a system of assets that we will evolve into a system of systems, this could fundamentally redefine businesses, the way they work, collaborate and utilize what is available to them and what needs to be ‘drawn in’ to get the job done.

We are facing an evolution from “solutions” to “outcomes”.

Our measurement system has been established on “value-added” principles or should have been at the very minimum. These have been based on “pushing out” the end result to customers, products and services offered in particular bundles of broad appeal.

Today we need to target and develop offerings that meet specific customers’ true needs. The customer has been evolving into a far more knowledgeable and increasingly sophisticated one, as they are closer to the end market, hold the relevant data and can determine and decipher changing patterns far quicker than those further back in the supply chain.

They have better visibility today. Often they feel they really don’t need the help of the salesperson, they have most of the means increasingly available to them, in a globally connected world, if they chose to exploit this.

The shift within suppliers of products and services is taking place, engaging even deeper with customers’ needs.

This focus to accelerate and determine their value to the customer needs to have a clearer understanding of their unique needs and then set about designing and delivering true solutions that meet these needs and are seen as highly valuable. Strategic relationships are increasingly important for maintaining ‘line of sight and value’ to the customer.

As we move far more to the art of selling outcomes, it will bring together sophisticated capabilities, based around technology. There will be an increased recognition of ecosystems that are seen as needing to combine for addressing customer strategic issues where higher value can be extracted.

These outcome-based approaches will be strategic, long-lasting partnerships where shared risk and reward become central to all parties. It changes the dynamics of relationships and offers radically different competitive advantages to shoot for.

The traits of outcome-based solutions

These will be very much custom based-solutions, they will be increasingly based on configurable solution- architecture. They will have clarity in “understanding the challenges and commitments to deliver specific outcomes on critical business needs”. They will be based on platforms that can design, deliver and operate the solutions.

This becomes more a customer partnering model, formed on a partner ecosystem strategy and clear solution architecture to allow it to flow. It will be designed for cross-organizational enablement, seeking – in real-time – customer intelligence to provide a better outcome.

The value for all involved is the opportunity to share in a greater value-creating solution that is based for on delivering the outcomes desired and needed.

How GE are switching their approach.

One outstanding example of how this outcome-based proposition is evolving, is by evaluating and reading about the GE Predix solution offering the software platform for the Industrial Internet through predictivity technologies covering health, extreme machines, lighting, aviation, oil & gas, transportation and energy.

They are building a platform for igniting the next industrial revolution and their white paper outlines this. This is not an easy sell, it has a significant time lag as many of the existing products already in the market are products that have less technology built-in them and have significant life spans to constrain this concept, but “predictive technology” has the potential in providing a real value-adding story into the GE selling story, where it may provide some changing competitor advantage if structured well.

This new industrial platform is here, we need to focus on outcomes.

With it has come the opportunity to make a broad-based change across the industrial world. The time to start is now and that requires a radical shift away from the past 20th-century measuring and metrics model into recognizing the significant shit to redirecting your business to outcome solutions.

Each person within your organization should be measured on outcome-based solutions, I’d junk all those income, throughput and output ones, these are holding you back if you want to release innovation. We are all in need of just focusing on outcome-based solutions, these are what customers want providing they deliver what they need to improve their business returns.

You certainly do “get what you measure” and that has a real challenge in today’s connected world where we need to collaborate, connect and share far more to achieve greater value-adding outcome-based solutions as the way forward to earn the trust of the customer by providing solutions they need but are also building better, lasting value into your product offerings.

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From this writer’s point of view, their innovation activity gets caught up in plenty of unintended consequences, to put it mildly, in wasted debate, discussion & bad decisions through wrong measurement criteria.

Firstly, we are still locked in the old paradigm of thinking this is an industrial economy where we set about measuring inputs to innovation (R&D expenditure, capital investment) and then focused on the intermediate step of throughput and then outputs (publications, production units, patent filing, end products).

We also perceive innovation far too much still as an activity within just one company – viewed as linear, with considerations for services more of an afterthought (like ‘bolt-ons’). Production systems remain far too often the driving force of performance judgement.
Today, the world of innovation is completely different. We need a far more open set of resources (many outside our own company) to enable innovation.

The process has clearly been recognized as non-linear. The chase for more ‘real-time metrics reflects the shift to a knowledge-based network economy to accommodate growing uncertainties, the multiple choices and varying outcomes that innovation offers.

We need to move our measuring to ultimate successful outcomes

Recognizing the need to change our measurement culture

This shift means we have to push a whole lot more on challenging established measurements and metrics – question if they are still valuable or just ‘simply’ established and have never been questioned in a way to overhaul the whole process. Everywhere we look within innovation systems, there are significant legacies in place.

We need to do a better job at measuring knowledge flows – it is the increasing emphasis and use of technology that allows us to challenge the old measurement paradigms. We still love to count machinery use, transactions, production of widgets with an engrained efficiency mindset.

Sadly it is not as effective, nor relevant, to the world today. Actually, most of these are just statistics that don’t drive us forward; they constantly make us look back. It is not ‘forward accounting’ for the knowledge built to underlie new creation and valuing the way this is developed and diffused in the future.

This also brings to the surface the need to understand our intellectual capital. If you understand that, you have a better chance to be more innovative, inventive and creative as you move far more towards a learning environment focusing on the value of all the intangibles that generate knowledge or leverage through relationships, human engagement or dynamic structures that shape and respond.

Valuing our network relationships more.

The value of networks is still not accounted for as well as it should be within our measurements. We collect the number of connections, yet we fail to capture the knowledge generated by these interactions; they stay resident often just with the receiver, not captured within the organization’s brain to understand and put to better, more effective use, applying the multiplier effect.

Technology is rapidly changing this, and this collective knowledge and networking are being leveraged more, but is it really being measured as a vital metric that provides value?

The conditions to generate really insightful innovation often remains ‘hidden in plain sight:

• Are we matching context, aligning innovation activities closely to strategic company needs?
• Are we actively seeking to match expectations and capabilities to deliver on the innovation that will lead to new forms of company value?
• Are we searching for ‘intelligent’ indicators where those initiatives shift the ground and advance on previously intractable issues?
• Do we know the true dynamics within innovation, what is either static or just simply repetitive and needs more constant monitoring, more likely through technology than human involvement?

Today we are working through the impacts of the Industrial Internet (IoT)

This promises to be transformative; it will change the basis of competition and, through this, the basis of how we measure ourselves. Not only will the industries have their boundaries withdrawn, but there will also be a new wave of disruptive companies challenging the incumbent since they don’t suffer the legacies of the past.

Technology is driving the change:

• The world will improve its operational efficiency in dramatically different ways (time, asset-utilization) through more predictive maintenance and increasingly remote management.
• We will become far more comfortable with connected ecosystems, forming around software platforms that will break down and blur traditional industry and working boundaries.
• We will see increased collaboration between humans and machines, and even machines to machines, which will shift productivity into a new realm – which we need to understand to capitalise on the potential this offers.
• Lastly, we are rapidly moving to the outcomes economy, fuelled by software-driven services, innovation built into the hardware, and the increased visibility into products, processes, location, customers and partners.

It is in this last shift of outcomes that we need to build our measurements and metrics around.

We constantly move towards the era of outcome-based services.

Businesses will be forced to shift from measuring the inputs and outputs of products to outcome-based results, where a business competes on its ability to deliver measurable results to customers.

This delivery on outcomes will radically shift how we measure and reward our progress. It will call for significant levels of increased collaborations across a growing, ever-changing ecosystem of business partners, bringing together those involved to combine products and services with meeting customers’ needs.

Platforms and ecosystems will become far more commonplace to facilitate and capture the data, translate the pockets of knowledge, so these are shared, aggregated and exchanged across these growing ecosystems, where we are all increasing working to create and capture value for ourselves and contribute to others within the platform ecosystem.

Our participation in platforms is helping us to facilitate transactions, interactions and mobilization and increasing extending out to learning platforms, each of us looking to achieve a successful and ultimate new outcome that improves on the existing.

These shifts in the ways we form collaborations give us broader connected knowledge that creates different insights and eventually new business models. To achieve this, we are becoming increasingly reliant on the partnership network or relationship we form within different (chosen) ecosystems to learn, distribute and monetize these in new products and services that fit our needs, all occurring at unprecedented scale and speed to capitalize on opportunities and create a new competitive lock-in or contribution to our needs.

These are providing increasingly new products and services that meet customer needs based on the learning outcomes and exchanges.

Moving from outdated measuring criteria

How we embrace the daily changes means we must challenge much of the way we presently measure and manage innovation. Innovation can’t stay hidden behind closed doors, safe within a selected group or siloed off. We can’t keep working with outdated measuring systems that focus on inputs, throughput and outputs.

We need to shift to the greatest judgement criteria. Our measures and metrics all need to become outcome-based solutions as the only really measuring point. In successful outcomes, we come closer to solving the real needs, tackle the problems and opportunities you find in innovation as others measure success seen and judged on the outcome.

The ultimate outcome from innovation that understands the real customers need and then understood, constantly iterated, translating what we learn and building with increasing speed and scale towards the lasting solution – and we all get paid or rewarded far more on the value of the result from successful ultimate outcomes judged by focusing only on the result.

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