In contrast, dynamic capabilities are those higher level competencies that determine a firm’s ability to integrate, build, and reconfigure both the resources and competencies to possibly shape, have the power to transform and then be deployed to meet rapidly changing business environments to take advantage of these changing conditions.

Recognizing the importance of Dynamic Capabilities

Dynamic capabilities are about selecting the right things to do and getting them done, while ordinary capabilities are about doing things right. The former implicates dynamic efficiency, the latter static efficiency.

Dynamic capabilities require an organizational form that leverages the knowledge and capabilities of managers throughout the organization. In business firms with strong dynamic capabilities, the key tasks of managers, especially those in the top management team, are entrepreneurial. It’s not just a planning role; it’s also strategic. It involves planning along with engagement and enactment, it encourages agility.

Appreciating and leveraging those ordinary capabilities is equally essential

The stronger these ordinary capabilities can be ‘honed’ then organizations can go beyond performing basic business functions well and can excel in these. While most capabilities, including some dynamic capabilities, are underpinned by organizational routines, many of the activities of top managers are non-routine by nature.

The key entrepreneurial capabilities needed for asset orchestration and realignment of the enterprise often reside in the skills and knowledge of top managers, managing the routines and assets and respond dynamically when changes are happening to adapt and respond

Ordinary capabilities involve operations, administration, and managing the governance. They are rooted more firmly in routines that are dynamic capabilities. A routine is a repeated action sequence, which may have its roots in algorithms and heuristics about how the enterprise is to get things done. Organizational routines transcend the individuals involved.

Finding the right complementary blend of capabilities is a real challenge to achieve

The capabilities perspective views the enterprise as clusters of complementary assets that must be combined and coordinated to create value. The utilization of such assets, therefore, requires managerial action. Managers in the dynamic capabilities framework perform that role. They orchestrate and call into being, the assets that are vital to firm performance.

They determine the speed at which and the degree to which, the firm’s particular resources can be aligned and realigned to match the requirements and opportunities of the business environment in order to generate sustained positive returns.

The alignment of resources both inside and outside the firm includes assessing when and how the enterprise ought to form alliances and joint ventures with other organizations.

Understanding all your required capabilities needed is essential

Valuing and knowing both your ordinary repeatable capabilities, to enhance and improve existing performance and discovering those that are more dynamic in nature, to change performance more significantly are both critical to identify, build and support in both consistent and thoughtful ways. The key is knowing what is critical and then how to focus and invest in those that drive and sustain performance.

Investing in a mapping of your innovation fitness landscape can significantly contribute to this understanding and advance organizational performance in the critical areas that offer it present and future value.

Extracts have been drawn from the paper and built upon: “The Functions of Middle and Top Management in the Dynamic Capabilities Framework” by Sunyoung Lee and David J. Teece

The post Recognizing the different capabilities to develop and grow first appeared on Building Your Innovation & Ecosystem Intelligence.

Achieving innovation fitness is a journey- to get there we often have to manage the switchbacks as we build our capabilities and capacities to innovate.

1. Getting Started – Understanding the Needs & Imperatives of Innovation Fitness

• Why we must travel this critical path for Innovation.
• The meaning of dynamic capabilities and innovation fitness landscapes
• Merging  the theory with practical reality to produce new outcomes and positive results.
• Focusing on resources and performance – why is this important
• The problem is knowing what we have and what we really need

2. The Fuel of Innovation Performance – the dynamics of innovation

• A sharper, clearer focus on innovation resources to meet strategic need
• What is known about resources to sustain, enhance performance
• Knowing and aligning  your strategic criteria – for sound innovation approaches
• Getting innovation within the right context of your business
• Moving your resources in the right direction

3. Getting even more specific – quantification and qualification

• Recognizing the building of scale, change rates and dynamics that happen over time and why we need to constantly build our innovation capabilities.
• Developing the resources to meet the need – structured, focused, clarified by bringing out the necessary discussion.
• An illustrative scenario for a directional innovation fitness landscape map
• Recognizing resources can come beyond the firm and bringing these in successfully. Managing within a more open environment.
• Achieving  mutual dependencies to support; recognizing the hindering ones
• Being aware of  the impact of different scenarios in the management of innovation

4. Building the Innovation Fitness Machine – reinforcing feedback, identifying needs

• Recognizing the current status, spotting emerging patterns, seeing spaces and gaps and identifying solutions.
• Beginning the ‘adaptive walk’ to get to higher fitness points needed to compete.
• Clarifying the complementary resources, looking to embed new routines quickly and set up follow through approaches.
• Introducing natural tensions into the system to trigger ‘step change’
• Resource dependence climate, culture, diversity, intensity and uniqueness
• Reinforcing feedback – watching for dangers, managing the machine capacity, removing the brakes selectively
• Shifting your resources need not deplete or force other people to compete for them – working through the tensions within teams and silos.
• Matching resource dynamics with the innovation value chain & life cycle stages
• Simulation modelling the ‘what ifs’ and ‘why’

5. The Strategic Architecture – designing the system to perform as needed

• The step process for designing and executing the architecture design
• Diagnosing performance challenges and road blocks – resolving, moving on
• Lining up the solutions is not a linear process and needs careful management
• Addressing the effects of intangibles in the Strategic Architecture.

6. The Hard Face of Soft(er) factors – the hidden power of intangible resources

• Clarifying the impact of the intangibles and recognizing time, climate and conditions are significant contributors to innovation activities.
• The different rivalry types: internal and external, inter department, inter projects and working through resolutions to these.
• Reflecting feelings and expectations, addressing all the different needs
• Measuring the tougher parts of intellectual capital
• The real value of your intangible resources
• Recognizing the value of hidden innovation and spotting its occurrence

7. Entering into Competitive Battle – the Dynamics of Rivalry, the Uniqueness of You

• Recognizing, developing, capturing, transforming, avoiding and out – manoeuvring
• Your point of choosing what, where, how and when to compete.
• Building capabilities that are unique to you and hard to replicate
• Building sustainability into the innovation equation as ongoing
• Extending the turf, exploiting the situation, pushing beyond, seeking partners.

8. Building and Testing Capabilities to Perform

• Measuring capabilities through different fitness levels and scale.
• Learning to build capabilities as ‘ongoing’ and evolving for changing needs
• Re-Structuring the process for dealing with the dynamics of change
• Knowing the points of impact on performance to enable recognition and reality
• Managing innovation performance progressively across the spectrum of business need through testing and extending capability learning.
• Building from personal to team to organizational learning in measured steps
• Recognizing the role of leadership, achieving strategic alignment and working on broadening out innovation competence at different organizational levels.

9. Keeping the innovation fitness wheels turning, keeping your eyes on the road

• Resolution of conflicting goals, control and structure
• Dissecting conflicting positions, resolving impasse
• Knowing the limits of human engagement
• Goals, controls and measurements can dominate and strangle
• Keeping the measurements simple and clear
• Managing innovation as a critical strategic resource
• Merging the results into a greater alignment to Strategy and Approaches

The end result is looking to generate your fitness landscape

As you can see this is applying a very comprehensive approach, a fairly ‘intensive’ one.  This might alter individually after some clear piloting, learning and experimentation undertaken.  Building innovation capabilities takes time; they are complex, highly structured and multi-dimensional. Any structured approach to tackling innovation takes time and considerable commitment.

The post 9 Stages for building innovation fitness first appeared on Building Your Innovation & Ecosystem Intelligence.

Achieving innovation fitness is a journey- to get there we often have to manage the switchbacks as we build our capabilities and capacities to innovate.

1. Getting Started – Understanding the Needs & Imperatives of Innovation Fitness

• Why we must travel this critical path for Innovation.
• The meaning of dynamic capabilities and innovation fitness landscapes
• Merging  the theory with practical reality to produce new outcomes and positive results.
• Focusing on resources and performance – why is this important
• The problem is knowing what we have and what we really need

2. The Fuel of Innovation Performance – the dynamics of innovation

• A sharper, clearer focus on innovation resources to meet strategic need
• What is known about resources to sustain, enhance performance
• Knowing and aligning  your strategic criteria – for sound innovation approaches
• Getting innovation within the right context of your business
• Moving your resources in the right direction

3. Getting even more specific – quantification and qualification

• Recognizing the building of scale, change rates and dynamics that happen over time and why we need to constantly build our innovation capabilities.
• Developing the resources to meet the need – structured, focused, clarified by bringing out the necessary discussion.
• An illustrative scenario for a directional innovation fitness landscape map
• Recognizing resources can come beyond the firm and bringing these in successfully. Managing within a more open environment.
• Achieving  mutual dependencies to support; recognizing the hindering ones
• Being aware of  the impact of different scenarios in the management of innovation

4. Building the Innovation Fitness Machine – reinforcing feedback, identifying needs

• Recognizing the current status, spotting emerging patterns, seeing spaces and gaps and identifying solutions.
• Beginning the ‘adaptive walk’ to get to higher fitness points needed to compete.
• Clarifying the complementary resources, looking to embed new routines quickly and set up follow through approaches.
• Introducing natural tensions into the system to trigger ‘step change’
• Resource dependence climate, culture, diversity, intensity and uniqueness
• Reinforcing feedback – watching for dangers, managing the machine capacity, removing the brakes selectively
• Shifting your resources need not deplete or force other people to compete for them – working through the tensions within teams and silos.
• Matching resource dynamics with the innovation value chain & life cycle stages
• Simulation modelling the ‘what ifs’ and ‘why’

5. The Strategic Architecture – designing the system to perform as needed

• The step process for designing and executing the architecture design
• Diagnosing performance challenges and road blocks – resolving, moving on
• Lining up the solutions is not a linear process and needs careful management
• Addressing the effects of intangibles in the Strategic Architecture.

6. The Hard Face of Soft(er) factors – the hidden power of intangible resources

• Clarifying the impact of the intangibles and recognizing time, climate and conditions are significant contributors to innovation activities.
• The different rivalry types: internal and external, inter department, inter projects and working through resolutions to these.
• Reflecting feelings and expectations, addressing all the different needs
• Measuring the tougher parts of intellectual capital
• The real value of your intangible resources
• Recognizing the value of hidden innovation and spotting its occurrence

7. Entering into Competitive Battle – the Dynamics of Rivalry, the Uniqueness of You

• Recognizing, developing, capturing, transforming, avoiding and out – manoeuvring
• Your point of choosing what, where, how and when to compete.
• Building capabilities that are unique to you and hard to replicate
• Building sustainability into the innovation equation as ongoing
• Extending the turf, exploiting the situation, pushing beyond, seeking partners.

8. Building and Testing Capabilities to Perform

• Measuring capabilities through different fitness levels and scale.
• Learning to build capabilities as ‘ongoing’ and evolving for changing needs
• Re-Structuring the process for dealing with the dynamics of change
• Knowing the points of impact on performance to enable recognition and reality
• Managing innovation performance progressively across the spectrum of business need through testing and extending capability learning.
• Building from personal to team to organizational learning in measured steps
• Recognizing the role of leadership, achieving strategic alignment and working on broadening out innovation competence at different organizational levels.

9. Keeping the innovation fitness wheels turning, keeping your eyes on the road

• Resolution of conflicting goals, control and structure
• Dissecting conflicting positions, resolving impasse
• Knowing the limits of human engagement
• Goals, controls and measurements can dominate and strangle
• Keeping the measurements simple and clear
• Managing innovation as a critical strategic resource
• Merging the results into a greater alignment to Strategy and Approaches

The end result is looking to generate your fitness landscape

As you can see this is applying a very comprehensive approach, a fairly ‘intensive’ one.  This might alter individually after some clear piloting, learning and experimentation undertaken.  Building innovation capabilities takes time; they are complex, highly structured and multi-dimensional. Any structured approach to tackling innovation takes time and considerable commitment.

The post 9 Stages for building innovation fitness first appeared on Building Your Innovation & Ecosystem Intelligence.

A truly integrated innovation solution that sits in our organization to allow innovation to be fully leveraged and exploited.

We need to recognize innovation has many touchpoints and a myriad of dimensions that need to be aligned and integrated. I genuinely believe we need a solution provider, who takes a more holistic view of innovation management that can make a significant advancement on where we are today, in our processes and systems.

These need a total integrated solution as the approach. this has its complexities in the challenges but we do have the potential through technology deliveries, platform constructs, and using the flexibility and adaptability found in the cloud.

If we combine these technology enablers with our innovation management understanding, then we can begin to construct this systematically and thoughtfully. It is very achievable and necessary for our organization’s abilities to absorb and translate knowledge into innovative growth, something missing for many.

Innovation is certainly one of those in need of a real concerted effort to bring our approach to the management of innovation up to date within our enterprises, to make it more inclusive and that can I believe come far quicker through delivering it across the organization and all their partners by operating within the cloud.

An Enterprise Innovation Process (EIP) that is highly visible, agile and core to the organization’s future, seen by all, used by all and truly valued by all, as integrated and highly valuable to engage with.

The formal management of innovation is not resolved today, it is a collection of pieces.

To quote these statistics from an Innovation Leadership Study in March 2012 for example:
• *Only 30% of respondents agree they have an effective organisational structure for innovation.
• *45% do not have a well‐defined governance structure for innovation.
• *40% lack clear roles and responsibilities for innovation.
• *39% state they do not have an effective decision‐making process for innovation.
• * 54% of those surveyed indicate they do not have a formal KPI system for promoting innovation.
• *49% are not having a well‐defined process to prioritize and allocate time and funding to innovation projects.

If innovation management can be integrated into the organizations systems, I would suggest many of the current problems and frustrations we face today, in our innovating efforts, in barriers and issues surrounding innovation, might begin to melt away or change the existing unsatisfactory result game of today.

We need to strive towards making a more radical attempt at integrating innovation into our systems and structures. It is needed, as we need to all engage through innovation far more, to tackle growing issues and problems that are complex challenges that really need integrative thinking and connected processes.

Making the business case

Innovation management today is often standing outside any integration structure.  Some people, I am sure, would argue that it should do, yet I do often see and certainly feel innovation is often missing the critical top management line of sight and suffers accordingly.

Often this is in numerous resource constraints that ate becoming a real performance drag against expectations. To resolve this and many other issues innovation needs to be more central in core process thinking and managing throughout the entire organization.

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

• Alongside this to allow for more radical innovation that taps into greater needs for mobility, usability, elasticity and yet still be aligned to leverage, exploit and maximise opportunities needs to run in parallel.

We need not just a new innovation management system; we need to build this on a modern engagement platform. As constant change happens we will need to accommodate new technologies and its realization of enterprise value will need an even greater evolution than ERP, the present backbone of organizations.

We need a new outward-focused orientated system that can be delivered through this suggested Enterprise Innovation Planning (EIP) system.

As outlined earlier here, to achieve this I think we must go cloud‐based, agile, and moving towards having a more ambidextrous organization design for innovation.

This will help innovation to break out of the existing constraints and linear approach we have given it as its present straight jacket.

Integrating the innovation process and system is needed more today than ever.

We are in a really evolutionary period, with the explosion of change taking place in the post‐digital world of cloud, big data, social and interconnected devices. External insights and Intelligence will not become Enterprise knowledge that flows without real, deep integration.

Receiving the knowledge alone will not turn these into ‘higher scales, richer, more innovation business outcomes’ that have real growth value, unless we realize the massive ‘mismatch’ between digital flowing in and the physical attempting to cope with this.

The discovery of insights from all this embedded intelligence, social activity and data analytics is leading us to potentially manage a significant wave of new innovation opportunities from this growing digital knowledge and activity.

Insights and ideas will form a real log jam attempting to enter the innovation pipeline

As it stands I can see a potentially damaging build‐up, or a log jam of promising concepts all desperately trying to work themselves through the innovation funnel.

Either decisions or the existing disciplines have to be radically altered, where we take on a much higher risk profile to enable these to move from idea to finished product or new service, or we accept the consequences of different failures, growing frustrations or variable revenue metrics against the cost invested.

The innovation pipeline today is very manual; it will always need human intervention, in decisions, in inputs, in what is communicated, and what is approved or dropped. Yet innovation often gets far too weighed down by the wrong type of human intervention.

What changes are needed, who will be willing to invest in this radical redesign of the innovation system?

It is through searching for and seeking engagement in the ‘wider’ world we will begin to make greater connections and receive potentially enormous amounts of (raw) data, about interactions, performance, possible issues and connecting that previously fragmented and dispersed information, through analytics so it can be turned this into emerging valuable knowledge.

Innovation needs a radical redesign and update to accommodate the changes occurring in the present digital evolution of mobility, social and big data.

• We will need to transform much within our systems but more importantly to orientate our skills to receive, translate and diffuse new knowledge, in significantly different ways.

• It is through this combination of people and ‘things’ connecting into our businesses that we will be able to extract new observations, to give us insights that can lead to completely different innovation opportunities.

• Market trends are changing faster and becoming shorter, so opportunity windows are narrowing. Risks of missing out are constantly increasing for those who are not focusing intently on that critical ‘time to market’ and not constantly streaming their innovation system, looking to automate it where ever they can.

Today we are still too reliant on manual systems for much of our innovation work.

What is needed is to push the thinking on how to automate the innovation process even more.

We need to think about our innovation system designs a whole lot deeper to allow these new digital technologies and the insights to be worked through the innovation process.

Speed is becoming ever more important, for new solutions to be turned out to the other end as new innovations.

We need to design a complete innovation system otherwise we will be investing in a front-loaded area alone, limiting digital impact and that will not deliver the power of actual growth expected or needed from our innovation activities so as to deliver new valuable outcomes.

Approaching the innovation process holistically would certainly help instead of bolting further onto our present ways as our innovation challenges become even more complex.

Offering an Enterprise integrated solution would really offer innovation and its management a real opportunity to become fully embedded within our organizations.

Innovation gains a real line of sight and across organizational engagement to move closer to its promise of delivering sustained growth, new business and impact.

So it would be a real achievement if we saw real hard physical evidence that innovation was moving towards this integrated system in 2015, so our Enterprises can leverage all the knowledge and insights that can be harnessed into new innovation growth.

The post My innovation wish for 2015 first appeared on Building Your Innovation & Ecosystem Intelligence.

In contrast, dynamic capabilities are those higher level competences that determine a firm’s ability to integrate, build, and reconfigure both the resources and competences to possibly shape, have the power to transform and  then be deployed to meet rapidly changing business environments to take advantage of these changing conditions.

Recognizing the importance of Dynamic Capabilities

Dynamic capabilities are about selecting the right things to do and getting them done, while ordinary capabilities are about doing things right. The former implicates dynamic efficiency, the latter static efficiency.

Dynamic capabilities require an organizational form that leverages the knowledge and capabilities of managers throughout the organization. In business firms with strong dynamic capabilities, the key tasks of managers, especially those in the top management team, are entrepreneurial. It’s not just a planning role; it’s also strategic. It involves planning along with engagement and enactment, it encourages agility.

Appreciating and leveraging those ordinary capabilities is equally essential

The stronger these ordinary capabilities can be ‘honed’ then organizations can go beyond performing basic business functions well and can excel in these. While most capabilities, including some dynamic capabilities, are underpinned by organizational routines, many of the activities of top managers are non-routine by nature.

The key entrepreneurial capabilities needed for asset orchestration and realignment of the enterprise often reside in the skills and knowledge of top managers, managing the routines and assets and respond dynamically when changes are happening to adapt and respond

Ordinary capabilities involve operations, administration, and managing the governance. They are rooted more firmly in routines than are dynamic capabilities. A routine is a repeated action sequence, which may have its roots in algorithms and heuristics about how the enterprise is to get things done. Organizational routines transcend the individuals involved.

Finding the right complementary blend of capabilities is a real challenge to achieve

The capabilities perspective views the enterprise as clusters of complementary assets that must be combined and coordinated to create value. The utilization of such assets therefore requires managerial action. Managers in the dynamic capabilities framework perform that role. They orchestrate, and call into being, the assets that are vital to firm performance.

They determine the speed at which, and degree to which, the firm’s particular resources can be aligned and realigned to match the requirements and opportunities of the business environment in order to generate sustained positive returns.

The alignment of resources both inside and outside the firm includes assessing when and how the enterprise ought to form alliances and joint ventures with other organizations.

Understanding all your required capabilities needed is essential

Valuing and knowing both your ordinary repeatable capabilities, to enhance and improve existing performance and discovering those that are more dynamic in nature, to change performance more significantly are both critical to identify, build and support in consistent and thoughtful ways. The key is knowing what is critical and then how to focus and invest in those that drive and sustain performance.

Investing in a mapping of your innovation fitness landscape can significantly contribute to this understanding and advance organizational performance in the critical areas that offer it present and future value.

Extracts drawn from the paper and built upon: “The Functions of Middle and Top Management in the Dynamic Capabilities Framework” by Sunyoung Lee and David J. Teece

The post Recognizing the different capabilities to develop and grow first appeared on Building Your Innovation & Ecosystem Intelligence.

For me innovation capabilities and competencies needs to be far more adaptive and aligned to the different emerging skills we should be bringing to bear, so we are able to find better innovating solutions for our collective futures.

The issue is this: if we do want to reshape much of what we are struggling with today – poor growth, diminishing futures, disconnected communities, stagnating economies or ones struggling to emerge from devastated and austerity measures inflicted upon them.

We do need to change our skill sets to reflect a more realistic and up to date need to navigate and transform knowledge to tackle these. Often our present skills are not equipped to manage in these more “disruptive” environments.

I wrote in a past post about “Learning to absorb new Knowledge for Innovation and the ability to understand Absorptive Capacity and how it works. Recently I followed that up with two recent posts about our pressing need that Jobs can be created but our skills do need very much adapting and refining, from where we are at present. One post was “Innovation Job Chasing- A Race Needed to Win” and the other was its precursor “The Present Innovation Jobless Era We Face.”

Our real need is to put in place those stronger adaptive skills  as our foundations so we can be better equipped to compete in the growing innovation race we all facing at personal, community and national levels. We need to equipped differently to meet the tougher global conditions that will be with us for our lifetimes, irrespective of our present age.

Competition won’t go away; it will only increase in its intensity.  To meet this we need to be far better equipped to be ‘innovation-ready’ in our skills. What forms a better ‘innovation ready’ skill set?

So what are those future skills we should be working towards to group around?

There was a report published in 2011 by the Institute for the Future (IFTF) and sponsored by the University Of Phoenix Research Institute to understand the skills workers will need over the next decade in our changing world, based far more on technology and its continued advance.

The report “Future Work Skills 2020” looks initially at what it feels are the six drivers that are shaping our landscape and then the ten skills they see as emerging that need to be where we place our future focus upon. These are:

• Sense-making: the ability to determine the deeper meaning or significance of what is being expressed
• Social intelligence: ability to connect to others in a deep and direct way, to sense and stimulate reactions and desired interactions
• Novel & adaptive thinking: proficiency at thinking and coming up with solutions and responses beyond that which is rote or rule-based
• Cross -cultural competency: ability to operate in different cultural settings
• Computational thinking: ability to translate vast amounts of data into abstract concepts and to understand data-based reasoning
• New-media literacy: ability to critically assess and develop content that uses new media forms, and to leverage these media for persuasive communication
• Transdisciplinarity : literacy in and ability to understand concepts across multiple disciplines
• Design mindset:  the ability to represent and develop tasks and work processes for desired outcomes.
• Cognitive load management: ability to discriminate and filter information for importance, and to understand how to maximize cognitive functioning using a variety of tools and techniques
• Virtual collaboration: ability to work productively, drive engagement, and demonstrate presence as a member of a virtual team.

A call to action

As the report authors of Anna Davies, Devin Fidler, and Marina Gorbis suggest, the results have clear implications for individuals needing to learn these skills. They will be asking from where will these come? From the educational institutions that need to grapple with changes that are occurring fast. Also it is the actions both  in business and at government level on how they will encourage and develop the strategies and policies fast enough, so as to offer the incentives to drive the changes needed. It is how quickly we move towards any organized ‘grouped’ learning of new skills can we begin to build within these new groupings.

All institutions certainly do need to provide the leadership to embrace the shifts needed in a constantly changing set of lifelong learning. It is recognized increasingly that skill renewal is constant to meet tomorrow’s ever changing global challenges.  A place where skills are far more heavily reliant on technology and we are able to manage these constant changes effectively. So as the knowledge that is emerging gets translated into new values offering new opportunity, learning and growth. We discover, absorb and translate.

Teaching both hard and soft skills that reflect tomorrows needs

The underlying need is to teach skills that promote quickly in response to changing conditions that will include a higher emphasis on critical thinking, depth of insight and the analysis capabilities to ‘translate’ the information or data emerging from multiple sources.

Equally the soft skills, so often ignored as crucial become increasingly relevant. The ability to collaborate and network, to read social cues, not ignore them as not important to me and respond with this much higher level of adaptability. I wrote about “Recognition of better soft skill taxonomy for Innovation some time back that has a useful way of grouping soft skills.

My summary

Predictions can always be difficult but the impression I gained from looking at the suggested ten future skills suggested by IFTF is that they do seem to make for a solid basis for us to gather around.

What of course we need to do is to develop what ‘lies underneath these ten skills ‘to allow us all to become more ‘innovation ready’ in our skills needed to survive. These might give us that better chance to thrive in the future and find fresh innovating opportunities because we are better equipped in relevant skills.

The burning issue is that our window of time to change and incorporate these into our organized learning is shrinking at ever faster rates. We need to move from recognition of these skills into the setting about of building them far more systematically.

We need to build our future innovation capacities on more relevant skills that are based more on what we need to have within our ‘natural’ skill base based on today at least, and not ones still based on 20th century practices.

The post Navigating the future landscape by developing adaptive innovation skills first appeared on Building Your Innovation & Ecosystem Intelligence.

I wrote about “The present jobless innovation era we face” raising up the theory that Professor Christensen points towards, that we are working on the wrong types of innovation to create jobs.

We are measuring our businesses in financial metrics that were more designed for periods of scarce money supply and not what most of our companies have today, cash in abundance, sitting on their books and a world ‘awash’ of cheap money. Professor Christensen calls this theory of his “the Capitalists Dilemma.”

Risk-aversion is dominating our Western thinking
The present situation is that we are in a period of risk-aversion where the innovation ‘bets’ are more incremental, more short-term pushing for greater utilization of existing assets that are designated by Professor Christensen as “sustaining or efficiency” innovations. He believes we need more “empowering innovation” – those that create jobs and invest capital across longer-term horizons than today.
In Professor Christensen’s original article he had published in the New York Times in November 2012 he believe the solutions are complicated and he has looked to “seed the discussion”.

Firstly he rightly points out that the “challenge is not framed properly” as he suggests “even if there is robust growth there won’t be (necessary) job creation”.

He argues Governments can’t dictate. I believe there is continued risk of even more exit of the migratory capital to lower cost countries and projects where the conditions seem more attractive unless the ‘dynamics’ surrounding the need for innovation plus jobs can change significantly.

We certainly need “innovation + jobs” and not exported!

In my view and to a large view until we focus on all the factors that need to promote innovation plus jobs, our economies in the West will never recover that sustaining ability.

A place where capital is deeply invested again, so  it provides growth ‘within our borders’  that can, over time, allow us to return to prosperity.

We need these “sustaining and efficiency innovations” as they liberate capital but it is in providing the right conditions for this capital,plus all the idle cash today that is simply sitting on businesses’ books, to be moved towards this “empowering innovation” we need for job creation.

Professor Christensen ‘floats’ three places to start in making changes within our economic  systems to allow innovation activity to break free and become job creators.

Firstly, To change the types of metrics we use, to move these into more people orientated ones.

Secondly, to change the capital regimes that shift the thinking on investment incentives, where longer term productive investments held can make that horizon shift due to these tax incentives put into place for investing in longer term, bigger budget innovation.

Thirdly is changing the politics where consumption has dominated into different “empowering” decisions. I’ll come back to this another time. My feeling is, as these stand they are little too “apple pie” for me – sweet, initially satisfying but not enough.

Getting your jacket off

Let’s firstly go where the jackets have already come off with a far more substantial set of proposals to “win” this innovation race. Rob Atkinson of the Information Technology and Innovation Foundation (ITIF), a Washington DC-based technology policy think tank along with Stephen Ezell have explored this innovation dilemma in their book “Innovation Economics- the race for global advantage” (released in September 2012) and offer a web site on this whole area www.globalinnovationrace.com

Within the book, the web site and ITIF they outline the arguments for significant innovation change and provide many sensible solutions to win the innovation race.

They have put these under the eight “Is” needed and cover each one in a chapter. These are under the following (organizing) headings:

1. Inspiration. Setting Ambitious Goals
2. Intention: Make innovation-based competitiveness a National Priority
3. Insight: Improving understanding of innovation performance
4. Incentives: Encouraging innovation, production and jobs IN the United States
5. Investment: More public funding for Innovation and Productivity
6. Institutional Innovation: Doing new things in new ways
7. Information Technology Transformation: broaden the IT transformation base
8. International Framework for Innovation: Everyone plays by the same rules.

Key digital platform technologies are places for real job creation also

They (ITIF) also suggest there are at least six key digital platform technologies today that need significant longer-term capital investment.

These are broadband- the critical enabler, next-generation wireless communications that speeds it all up, health IT for easier access to a comprehensive view of patients, intelligent transportation systems for real-time intelligence, a smart electric grid to ‘sense’ location of power, contactless mobile payments to use their cell (or mobile) to pay across society.

They quite rightly suggest without Government help to catalyse the deployment of these platforms progress will be slow.

Then we have “Innovation Economics” as a growing doctrine
The book and Wikipedia I would think have the same source but the Wikipedia source does provide a terrific outline of this growing doctrine that is suggested should reformulate conventional economics theory so that knowledge, technology, entrepreneurship and innovation become positioned at the centre of a model, and not independent forces trying to influence it.

This Wikipedia source goes through historical origins, offers the innovation doctrine as a more advanced theory, provides evidence and the geography associated with many successful innovation efforts, that are deliberate concerted efforts by combining markets, institution and policy-makers and use the geographical space. This then finishes up with worldwide examples and countless references.

Competitiveness and Innovative Capacity

In January 2012 a report came out from the U.S Department of Commerce in association with the National Economic Council entitled “U.S. Competitiveness and Innovative Capacity. This report may be a long read of 160 pages but lays out many ways of “Moving Forward” across a well laid out set of the parts that make up the innovation context

These steps suggested include 1) rising to the challenge, 2) the keys to innovation, competitiveness and jobs, 3) Federal support for research and development, 4)Educating our work force, 5) Infrastructure for the 21^st Century, 6) Revitalizing Manufacturing, 7) The Private Sector as the Engine of Innovation to offer a fairy comprehensive evaluation of the issues, challenges and investment opportunities to bring about a more “empowering innovation”.

Again within this report in their “Moving Forward” suggestion lies ten recommendations or factors that are suggested as ways for the United States (or even Europe) to regain a pre-eminent capacity within innovation.

It is a race each country engaged in innovation activity will want to win as this building of innovation capacity is the bedrock of economic growth and future prosperity. Otherwise, if we fail to grab this fully, we will face continued decline, short-term disruption and long-term stagnation.

Jobs can be created; our skills need adapting and refining

Of course everyone will continue to need a basic education or knowledge but they will need sharpening the skills and their motivation more. When we lack motivation, we lack that curiosity that becomes so important to innovation. The intrinsic parts of being curious, persistent and willing to take risks needs to be instilled far more into our education and thinking.

The call for education reform is gathering but we need to be careful in the rush to ‘reform’ we don’t “throw the baby out with the bath water” in our haste.

I was reading and storing away for future reference an article “What 100 experts think about the future of learning” that again places learning into its multiple parts: of using technology, sharing education openly and differently, where creativity and innovation fit to foster a new spirit, the internet and new media and its potential impact on teaching and learning, leadership, educational technology , the brain and psychology, technology education, different teaching methods and our institutions.

The list does provide a fairly comprehensive view for the impact of learning in the new ways we need to move towards.

Need a job? Invent It.

Thomas L Friedman offered a view in a New York article piece “Need a job? Invent it” suggesting these are dangerous times where high-wage, middle-skilled jobs – those sustaining our past economies – are in the past. These have become only high-wage, high-skilled to recalibrate this middle-class and their dependency.

The article further explores the view of Tony Wagner, a Harvard education specialist, that we need to send out every child as “innovation ready”, ready to add value to whatever they do. Wagner argues “the capacity to innovate – the ability to solve problems creatively, or bring new possibilities to life – needs these skills of critical thinking, communication and collaboration and are far more important to meet today’s challenges than academic knowledge”.

So who is doing this right out there in the world? “Finland is one of the most innovative economies in the world,” Wagner said, “and it is the only country where students leave high school ‘innovation-ready.’  They learn concepts and creativity more than facts, and have a choice of many electives.

Who is putting in place those stronger foundations within this innovation race?

I finish here on the competition and it is everywhere. Not just in a region of one country, or on one continent but across the world. The race is truly on, on who organises the relevant conditions to allow innovation to thrive, to offer the place where “empowering innovation” and where jobs are part of the equation.

There are examples in Europe- not just in Finland, Norway, Sweden but in Switzerland, parts of Germany, regions of Italy, Spain, France, Ireland and the UK. They benefit but equally suffer from centrally driven policies ‘handed down from Brussels at the EU level or constrained in “restrictive” thinking at National level.

Many of these “selected” places are simply “pockets of innovation” and lack this cohesiveness and coordination to really accelerate innovation into far more “empowering”to benefit society as a whole.

The BRICS of Brazil, Russia, India, China and South Africa are the emerging group are all developing or newly industrialised countries, distinguished by their large, fast-growing economies. These are the emerging new superpowers where they are experimenting but laying in the necessary building blocks to support and accelerate innovation.

They are sucking in the capital and provide the horsepower in people, both those that have gained from a focus in high skilled areas and those with basic education.

These combine in that drive to move up the social scale. Ambition is a highly motivating force and those within the BRICS have it. They are searching for advancing their global innovation advantage and know what it means to them personally and collectively.

Coming back to Professor Christensen he suggests the Chinese and Taiwanese in one interview. “Because they measured return on invested capital, every semiconductor company in the U.S. except Intel decided to outsource their microchip production.

All that production went to Taiwan. Morris Chang [who pioneered the $28 billion semiconductor foundry industry] now owns half the chip production in the world”. When Professor Christensen asked him why he wanted chips on his balance sheet, he said, “Because I measure profitability in cash, not ratios.” I don’t see why American companies can’t think that way.”

Technology Convergence – What’s your plan?

Lastly in our lightening round-up of emerging innovation power spots, one that we all really need to take seriously, South Korea. This came from Rohit Talwar, CEO of Fast Future under Technology Convergence – What’s your Plan?

I leave it in its entirety, as it states so clearly the organizing power of a country that is determined to win a larger part of the innovation race and is intent to achieve it:

“I have just returned from South Korea where I was delivering a keynote speech to a cross-industry forum on how to prepare for and benefit from the opportunities arising from industry convergence.

South Korea has made a major strategic commitment starting with government and running through the economy to be a leader in exploiting the potential opportunities arising from the convergence of industries made possible by advances in a range of disciplines.

These include information and communications technology, biological and genetic sciences, energy and environmental sciences, cognitive science, materials science and nanotechnology.  From environmental monitoring, smart cars, and intelligent grids through to adaptive bio-engineered materials and clothing-embedded wearable sensor device that monitor our health on a continuous basis – the potential is vast.

What struck me about the situation in Korea was how the opportunity is being viewed as a central component of the long-term future of Korea’s economy and how this is manifested in practice.

Alongside a national plan, a government sponsored association has been established to drive and facilitate cross-industry collaboration to achieve convergence. In addition to various government-led support initiatives, a range of conferences are being created to help every major sector of the economy understand, explore, act on and realise the potential arising out of convergence.

I am fortunate to have had the opportunity to visit 20-25 countries a year across all six continents and get to study and see a lot of what is happening to create tomorrow’s economy. Whilst my perspective is by no means complete, I am not aware of any country where such a systematic and rigorous approach is being taken to driving industry convergence.

Those who study Korea know that this approach is nothing new for them – long term research and strategic planning are acknowledged to have played a major role in the evolution of its knowledge economy and rise of Korea and its technology brands on the global stage. Coming from the UK, where it seems that long-term thinking and national policy are now long-lost relatives, I wonder why it is that so few countries are willing to consider – or capable of taking – such a strategic approach.”

To sum up our need for Innovation Job Chasing

Until we see a change that indicate a longer-term view of profitability and start measuring innovation differently we are stuck far more in the present jobless innovation era I outlined in my last article

Yes, we do have a “Capitalist Dilemma” but it runs deep in its fault lines and its many weaknesses nicely highlighted by Professor Christensen but for me, any current dilemma needs deeper evaluation today, not in 12 or 18 months’ time.  We need to look far more boldly at the Innovation Solutions and the economics and knowledge creation within this.

In all real honesty, it  is urgent and vital for each countries race for global advantage and future prosperity we become organized and see that “empowering innovation” and job-creation become more central in our thoughts and future decisions.

Can we really overcome the barriers to innovation we have, as each of our developed countries are so mired in old-style legacies? We need ones that can still take making profit into the equation but in different ways to ‘release’ capital funding that does bring jobs fair and square back into the innovation solution we actually need, to solve growing societal challenges? Ones that seek collaboration across all sectors of society, who recognize much needs real change.

These need long-term investments and all  the relevant parties working on solutions. At present far too many are playing the waiting game and that has to change.

It does seem many are also simply “re-arranging the deck chairs on the Titanic” who will be overtaken by events and not providing real solutions of a current problem.

The post Innovation Job Chasing – A Race Needed To Win first appeared on Building Your Innovation & Ecosystem Intelligence.

This idea ‘hit the world’ when he wrote a piece in the New York Times last November, 2012. I gather this has been one of his best, if not his best read article ever.

As I’m sure you are aware Professor Christensen must be regarded as if not the top, then one of the top experts, on innovation. For me he sits at the top, so when he explores a theory, you stop to think about what he is trying to explain. It takes some of us mere mortal awhile to grasp and relate to these ideas and theories.

Theories into solutions sometimes is a long wait for wrong reasons

Firstly an aside, I need to get this off my chest. Although I suspect a book will eventually emerge, perhaps only next year 2014, far too often this is a little later than preferred or when really needed. The ‘currency’ or present day relevance often suffers from this parallel world of academics, moving on a much slower level.

They are still working within the publishing strictures and structures where a book has to be firstly written, reworked, proofed by editors, printed, bounded and distributed.

As you might guess here, I just wish some of these breaking theories that emerge from the academics could be sped up, they are seemingly just caught up in the dogma of rigour, validation and peer review. Weighed down in this legacy they often fail to provide the valuable insights that can alter the present day where the theory or dilemma has arisen.

That valuable thinking to address the very problem we need a solution too is today not having even further debate after a book comes out, sometime in the future. We need to begin to travel the road, not just survey it!
Actually it is rather ironic in one of Professor Christensen’s own theories, the disruption theory, that this is one of the real challenges within the publishing industry,  of being “disrupted,” as they fail to deliver in this faster world in the new alternative mediums many are looking for,  that he of all people chooses the old slower avenue of a printed book. Still he chooses to use this medium, such a shame when he expands on the very theories that explain much of what is presently going on today.

The world has sped up and I would urge Professor Christensen to get out of one of the very traps he has previously identified, and explains so well to others, for himself.  I would suggest his insights and suggested solutions are applicable to today’s problems and need exploring now. Can we afford to wait?

So what makes “the Capitalists Dilemma” so relevant today?
The basic concern today in most developed economies is the lack of real growth and the worrying concerns that each capital stimulus round seemingly does not offer that number of new jobs you would expect.  Old ones are being constantly being stripped away at a much faster rate. We are seemingly caught in a broad jobless economic recovery.

At the heart of this dilemma seems to lay the issues of the type of innovation being employed, the way we measure profitability, where this capital is being invested to offer increased returns and the lack of political and leadership will, or understanding, to change this.

Again when you read the article Professor Christensen talks of a doctrine of New Finance, taught over recent years by him and countless others in Academia, of failing to catch up with the new realities and teaching theories we need to operate in a changing world.

One of those is the need is to ‘account’ more in creating new jobs and people (gainfully) employed do not seem to be as much within any capital equation. Our new norm is certainly bringing increasing financial returns but without this job creation.

We seem to be faced with focusing on jobless innovation outcomes that are measured by magnifying each dollar invested by the classic ratios of RONA (return on net assets), ROCE (return on capital employed) and I.R.R (internal rate of return), used more when capital was scarce and costly so you husband resources.

Today capital is abundant and cheap – no, really!

Today capital is abundant and cheap, new skills are becoming scarcer, education is lagging the new knowledge economy need and we are applying these old rules of measuring outcomes in the wrong way in our changed world.

Professor Christensen argues that successful companies are making the right economic decisions within the wrong situation or economic needed times. Capital is not scarce, it is abundant, yet it seems we are investing in the wrong types of innovation. We still are measuring capital as though it was scarce when it is not.

Companies continue to drive assets off their books, they choose innovations that provide fast returns, they continue to outsource and they consistently keep the time horizons deliberately short for improving the rates of return and constantly higher dividends in focusing on the quick wins.

The politicians have not grasped the need to change the thinking to invest in longer term innovation that makes for more breakthrough and radical innovation activity.

Those that employ more people, kick starts new economic activity with fresh investment, new equipping to supply these new activities, and finally also attempt to reposition dividends in their longer-term value for the recipients.

Awash with money

In the Economist there was a recent article “A world of cheap money”  stating: “The message from the rich world’s central banks is clear: the era of ultra-loose monetary policy is here to stay.”

The Economist goes on to state: “Unfortunately, the effect on output has been more muted. America’s GDP is showing signs of accelerating. But Europe’s economies are flat or shrinking. Overall, rich-world growth is likely to be barely over 1% in 2013, little better than in 2012″

“Given the gap between financial froth and feeble growth, are central bankers doing the right thing? Supporters argue that cheap money is essential for economic recovery, particularly when (as in Europe and America) austerity-minded governments are tightening fiscal policy. Critics counter that low rates simply pump up asset bubbles, distort financial markets and risk inflation”

Clearly “monetary policy should not just operate in a vacuum” and it is Professor Christensen’s insight on where innovation is playing it part, or not in most cases, that can hold one of the real keys for rethinking how we measure success. Let me explain if you have not read his thoughts on this.

There are three types of innovation in his view where jobs occur or are lost.

These are summarized by Professor Christensen as:

Empowering innovations: these create jobs, because they require more and more people who can build, distribute, sell and service these products. Empowering investments also use capital — to expand capacity and to finance receivables and inventory. Empowering innovations are essential for growth because they create new consumption.

The second type is “sustaining” innovations: these replace old products with new models. They replace yesterday’s products with today’s products and create few jobs. They keep our economy vibrant — and, in dollars, they account for the most innovation. But they have a neutral effect on economic activity and on capital.

The third type is “efficiency” innovations: these reduce the cost of making and distributing existing products and services. Taken together in an industry, such innovations almost always offset the net number of new jobs, because they streamline processes.

But they also preserve many of the remaining jobs — because without those, entire companies and industries would disappear in competition against companies abroad that have innovated more efficiently.

Efficiency innovations also emancipates capital. Without them, much of an economy’s capital is held captive on balance sheets, with no way to redeploy it as fuel for new, empowering innovations until it is released.

His view here is: “as long as empowering innovations create more jobs than efficiency innovations eliminate, and as long as the capital that efficiency innovations liberate is invested back into empowering innovations, we keep recessions at bay” and suggests we are today not doing that.

The innovation machine is out of balance today

Today, our innovation activities are out of balance. I can strongly relate to this on where organizations are spending their innovation dollars: in short-term fixes, incremental thinking and efficiency relating projects, not on deepening innovation capacity.

We are presently encouraging our managers to measure profitability based on a return on net assets, or return on capital employed. That encourages companies to liberate their capital, so they invest in efficiency innovations, which means they can make even more money with fewer resources, so why would they invest in those more-longer term capital-intensive innovation projects under “empowering innovation?”

Professor Christensen offers this thought “what the economy ultimately needs are empowering innovations—like the Model T, the transistor radio. Empowering innovations require long-term investments, which tie up capital for years and years.

So companies are using capital to create more capital, and the world is awash in the result, more capital but the innovations we need to advance aren’t there”- this accumulating capital is remaining idle.

Today’s growth sustaining challenges are not framed properly

The need is to “unlock” the right type of innovation that creates a renewed, sustaining wealth for economic and industry revitalisation. There needs to be a shift from investing in efficiency innovation that tend to cut out jobs, where the focus is constantly on focusing on less capital in use and fewer people so that the extra release of capital is re-invested in more efficiency, not in disruptive or empowering innovation. The present day realities within business are how success is measures and if that is on RONA, ROCE and I.R.R then that is where the focus will remain.

Changing the existing paradigms takes time and convergence.

Empowering innovation takes time – anything from six to twenty years depending on many of the necessary long-term wealth creation factors required based on research and vision.

Two factors are well in place. We have capital, almost at zero borrowing rates, that the future net present value of any future stream of growth is identical to one that yields a return in weeks. We have a growing and compelling set of social needs to resolve many grand societal challenges that come more from empowering innovation.

Offsetting this we have a powerful set of factors to change if we see job creation as part of any economic recovery. We first have this current risk-aversion prevailing and we spend public capital on propping up ailing industries but do not pursue the alternatives with a grander vision and plan.

We are holding renovation back in some of these politically motivated decisions yet the young in most countries cannot find any jobs. We prop up banks with their bad loans yet the defaults by small and medium-sized enterprises will continue to rise.

In Spain, Italy, Portugal, Greece, Ireland, and many parts of the UK, along with others all have growing at alarming rates, bad debts. So many smaller businesses are close to the ‘tipping point’ of going bust here in Europe.

A bolder innovative framing is necessary

We need bolder re-framing of our challenges, a clear recalibration of our measuring success and a set of cohesive strategies, policies and political judgements.

What will eventually bring this to the boil is the unrest, unemployed, stagnating economies, risks of growing debt and loss of property and capital achieved from the past unless those in policy decision don’t ‘face up’ and make bolder, imaginative steps.

Our markets need stimulating and this will either be from importing the type of goods that meet our declining economic needs as those are produced more efficiently elsewhere. Not a good prospect to face.

Lastly the very company that needs financing does not get the financing it needs. Capital is presently hoarded in the billions on pristine balance sheets of the biggest corporations; billions are inert and uninvested in private equity funds and sitting in countless private bank accounts offshore.

According to one report $1.8 trillion just sits in American listed firms alone.
The missing link is between cheap money and finding ways to achieve new corporate investments in the developed  economies that need this, otherwise there continues to be growing issues of dealing in the latest crisis or further kicking the can down the road in future pay off from continuous mounting debts and a lack of addressing bad loans and all the structural problems we are not facing today except in applying ‘selective’ austerity..

So why has this caught my attention?

Simply incremental innovation (sustaining, efficiency innovation) is getting us no-where fast. You see so many people within many of our organizations, big and small, working longer hours, feeling reduced identification with what they are doing and lacking that sustaining satisfaction.

There are millions out of work that could offer positive economic activity contribution.

We could have innovation that is exciting, that is empowering and this does come from working on challenging that are game changing concepts that we often suggest today as distinctive, disruptive, breakthrough, radical and certainly are empowering.

We are failing to translate today’s set of challenges because the metrics applied are inappropriate to our needs today and in the future. We are applying solutions often in their vacuum, they boost sufficiently in small ways but lack boldness, changing the dynamics and policies, the way we should be measuring and valuing success.

We reflect where we are in the West – far too timid, applying often just a real hard dose of harsh austerity, minimal structural reform that have a constraint on growth as we don’t people in their rightful place within the equation, they are being progressively written out of the capital model we seem to be locked into.

We apply “selective” innovation solutions to meet mostly short-term gains.

There are different solutions that need discussion

There are different innovative solutions, those I will attempt to outline in my next article, more to stimulate and trigger awareness of alternatives for today’s more jobless innovation outcomes.

In the meantime watch Professor Clayton Christensen’s talk at the World economic forum under “an insight, an idea with Clayton Christensen”.

Worth watching, believe me, and then you might be reflecting on why we do need to change that does bring that real, fresh growth from innovation that has people and jobs as part of the lasting equation, that fits more in today’s world, needing innovation to begin a stronger recovery than we have seen in a number of years.

The post The Present Jobless Innovation Era We Face first appeared on Building Your Innovation & Ecosystem Intelligence.

These dynamics are made up of the capabilities and competencies that reveal and clarify what is required as the relevant traversing points needed to achieve improving innovation success, to move you more effectively towards your strategic innovation goals and build a fitter, more responsive and dynamic organization around its needed innovation capacities.

The lead explorer to walk you across this innovation terrain is Paul Hobcraft

By exploring and modelling the mutual dependencies you get to see how the existing and alternative future innovation system  will behave as you begin to map out and recognize the different emphasis points that make up your innovation system. You can begin to identify what are the more important dynamic ones that require a more dedicated focus and placing more of your resources behind, while others can evolve at their own pace or simply improve as they are far more dependent on the dynamic ones than you realized initially. These can get simply get ‘pulled along’ and rise equally in their performance.

There is a complementary set of forces; improving one often triggers improvement in another. What you have to guard against is possibly ignoring one might equally impact negatively on others. Recognizing dependencies is critical and their triggering effect makes innovation evolution even more dynamic.

We are looking for the ‘combination’ effect of a dynamic set of capabilities and competencies that generates improved performance. The issue is to know what and which ones?

The combination effect to gain a greater innovation fitness effect comes from managing this over four stages shown in the above visual of the journey of innovation fitness dynamics.

The four stages will be described in more detail in future blogs but briefly are:

1. The goal within these stage is to identify the key dependencies relevant for improved innovation within your organization to discover
2. what are the mutual dependencies that will have a more dynamic impact on your innovation system so you understand
3. what consequences come from this and how the changing environment will behave so as to consider the effect, that then leads to
4. what recognition and implications this has so as to put in place an ongoing, evolving set of innovation dynamics that keep you fit to perform innovation on a sustaining higher performance basis.

Again I want to emphasis here, this is an evolving journey but the critical recognition here is, for innovation to continue to be the driver of future growth and wealth, it clearly does need to have a greater understanding and recognition of its management potential within organizations.

This site www.innovationfitnessdynamics.com is determined to push beyond today’s accepted, often ‘lagging’ performance from innovation activity, and raise the innovation performance engine up within organizations. I feel we do have this critical need to have in place a growing clarity of the factors needed to consistently deliver a more ‘leading’ position of knowing what does actually have real dynamic impact, both on an organizations innovation performance and the individual contributions that contribute towards the required strategic goals and objectives.

This I feel states our journey and how we are planning this out to traverse across the terrain towards better innovation solutions, that make up the dynamics of innovation and provide a ‘fitness’ solution that is unique to your needs. Care to share and join the journey?

Paul Hobcraft

Mail to : paul*AT*agilityinnovation.com

www.paul4innovating.com

www.agilityinnovation.com

The post Moving along the path to innovation fitness first appeared on Building Your Innovation & Ecosystem Intelligence.

There is a continuing need is to build the management of innovation into a clear organizational capability, where innovation becomes a continuous effective innovation process.

To this end I have produced a conceptual model of what constitutes the ‘make up’ for providing an ongoing innovation performance engine- the innovation fitness landscape and the dynamics– that determine the appropriate capabilities and capacities available & required. I felt it needs a dedicated website to be the ‘go to’ source of reference. It is a work-in-progress so please recognize this when you visit it here: http://bit.ly/wX5q8R.

This is an evolving journey, any terrain that we travel over does offers very different challenges to build innovation capability into the very fabric of organizations, it needs building and structuring thoughtfully. You will see there are so far already thirteen categories making up this quest to map out and build out this innovation fitness. Each category is part of the total workout we need to go through. I’d suggest be selective in reading these, take your time and as you explore these progressively you will begin to see the overarching ‘fit’ these have with each other but each person, each organization will have different needs to get innovation fit. The more you explore, the more dynamic they become in possibility but it does takes time, for you and for me to build this fitness regime. We do always need a clear starting point and also a journey’s end in mind. See http://bit.ly/A0en7f for the ‘about’ story we all need to reflect upon.

The recognition that innovation for us all, to make it sustaining, does needs dedicated  investment in the understanding of the makeup of the capabilities to build a required ‘innovation performance engine.’ This is to provide more of the rich potential for wealth and value creation required in most organizations. It is an area of serious under-development at present, when you compare this with the focus on physical assets and general make up of offering support with limited direct knowledge application, within the majority of organizations.

The makeup of innovation

Innovation is made up of both tangible and intangible assets. It is the marriage of these two that makes innovation a unique capability to manage in well structured ways. It is the people engaged in innovation activity that make it work.  Everything else, the process, structures, technologies and management systems are just the contributing enablers.

The struggle to date is that innovation remains hard to manage well; we strive to systemize it and then attempt to replicate any success we achieve. Often this does not work as the variables that make up innovation can be different for each innovation event or activity.

The important point though is successful innovation contains core elements and processes regardless of industry, form, or type of innovation, we are pursuing.  Much of the difference though is in its varying degree’s based on these core elements. Our search was to find those core elements so as to leverage and strengthen them even further to strengthen an organizations capability to innovation continuously in a sustaining manner.

We as organizations strive to achieve distinct competitive advantage, and innovation is one of those real contribution points this can achieve this. The need is to make the innovation capabilities and capacities a distinctive, not easy to copy, unique set. These are shaped by the context and content of innovation, the organizations position and its choice of evolutionary paths it has decided to take or needs to take.

The emphasis points needed for dynamic innovation capabilities

Dynamic capabilities emphasize management capabilities and the inimitable (unique) combinations of resources that are constantly at work across all functions to make them distinctive and valuable.

Distinguishing innovation capabilities that are relevant are based on the type of knowledge they contain. Functional capabilities allow development of technical, practical knowledge. Integrative capabilities allow firms to absorb knowledge from external sources and this is where the absorptive capacity develop comes in. Innovation requires more of a higher-order integrated capability approach to constantly learn, develop, mould and manage multiple capabilities. This required the integration of critical capabilities to successfully stimulate innovation for effective and improving performance.

Many of the identified resources in capabilities have some level of complementary, improving one triggers improvement in another. Equally ignoring one can impact negatively on others. So individual components on their own have limited effect, it is the combination effect that generates the improving performance. Equally, the needs do change over time and you have to constantly ‘refresh, challenge and stimulate’ these otherwise you can have core rigidly set in.

Shifting away from the accepted norm

Innovation understanding and building strength in competencies and capabilities takes an organization beyond the accepted norm of managing efficiency, quality, being responsive and reacting with speed- all challenging within themselves. Innovation represents today’s competitive advantage statement that should be supported by these others. We must avoid dysfunctional consequences and why the existing systems and structures do have to ‘fold into’ new innovation based ones.

Organizations need to shift from the one often still found today, of a higher focus on stability, efficiency and effectiveness for profitability though that current preoccupation with performing routines and formalised structures. The challenge in today’s world is to be adaptable, agile, adjusting to offer consistent instability in the right ways to keep adjusting to the consistent market challenges. Innovation in itself is a force of instability. The shift needed to be made is to balance the dual ‘tensions of stability through efficiency, with change driven by innovation. It is the dynamic forces within the world we operate within that require us to respond and mirror, with equally the capacity for managing dynamic innovation capabilities.

Integrating back or making anew

The challenge is to integrate all of the organizations capabilities into the innovation process, not as many do today, try to integrate innovation into the existing structures- it does not work. The linkage and mechanisms need to be focused on creating new knowledge and competitive advantage, not searching to maintain obtained knowledge offering known results, today we are searching for resolving the unknowns, yet to be articulated needs to grow our markets in ways that customers strongly relate too and reward us for in multiple ways.

So the combination of efficiency of the existing structures needs folding into the more knowledge intensive ‘creative’ new one for achieving competitive advantage.

Innovation capability is defined as the ability to continuously transform incoming knowledge and news concepts and ideas into new products, services, processes, systems and new business models, for the benefit of the organization and the stakeholders. Innovation is about synthesising as well as operating in the two paradigms of efficiency of the existing and innovating new to the world.

The need is to recognize an organization-wide innovation capability that pervades all aspects of the organizations existence, forming the core value system to the measures and behaviours that are exhibited and on show on a daily basis for all to appreciate, assess and value.

Being nimble, flexible for managing across the different domains.

The need is to build a nimble, flexibly effective innovation performance engine that is quick to adapt to those constant changing market conditions. High performance deliberately and systematically enable and motivate the chaotic and complex domains (reference the Cynefin model on this) of novel and emergent practice that ‘present’ divergent behaviours and where the dynamics of innovation lie. Equally knowing the reinforcing practices and processes that make up of existing good and best practice are needed to make these more efficient and effective and reliable in their management.

Each part of the innovation fitness dynamics though is designed to reinforce and extract the innovation performance required of them. It is identifying the elements (both dynamic and more static repeating aspects) that make up the fitness landscape for managing innovation’s performance. I can only encourage you to begin to explore the categories that make up our terrain map to begin to consider your own innovation fitness journey of building capability and capacity that makes you a more dynamic organization to respond to different challenges in todays more fluid and adaptive world.

Ó      PAH 22.02.2012.W-I-P

Paul Hobcraft

Mail to : paul*AT*agilityinnovation.com

www.paul4innovating.com

www.agilityinnovation.com

The post Innovation fitness dynamics – to engage with and recognize the need to change. first appeared on Building Your Innovation & Ecosystem Intelligence.