In a new book on innovation (The Other Side of Innovation: Solving the Execution Challenge. Harvard Business Review Press, 2010), Vijay Govindarajan and Chris Trimble have laid out some well thought out rules for the corporate set. Most importantly they knowledgeably illustrate the difference between creativity, AKA generating ideas, and the hard work of executing innovation initiatives that can have a real impact on the world.
"Companies think far too little about the other side of innovation, and we are not the first to say so. In 2007, IBM ran an advertisement intended to convey that it could help its clients innovate. It featured a pudgy mock superhero sporting a capital "I" on hi outfit who introduced himself as "Innovation Man". A bemused colleague asked, "And your job is?" The superhero replied with gusto, "I for ideation! I for invigoration! I for incubation!" The onlooker replied, "What about I for implementation?" Innovation Man answered "I knew I forgot something." ..... It captured so humorously and yet so perfectly the off-balance approach to innovation that is commonplace in corporations around the world. There is too much emphasis on ideas, not nearly enough emphasis on execution. Thomas Edison made essentially the same observation more than a century ago: "Genius is 1 percent inspiration and 99 percent perspiration." Nobody listened."
While innovation in the form of software start-ups by 20-Something digital wizards is now the stuff of popular myth and legend, this book provides a detailed a recipe for the rest of the business world. In a treatise that seems directed primarily at the Fortune 500, Govindarajan and Trimble make three key points:
- Business organizations are not designed for innovation, they are designed for ongoing operations, with deep and fundamental conflicts between the two;
- Innovation requires a dedicated team with its own structure and processes; and
- innovation initiatives should be run like a disciplined experiment.
Govindarajan and Trimble contrast their approach to innovation, which is most relevant to major innovation initiatives, to innovation strategies that lead to incremental or process innovation. Interestingly, they define the different possible innovation models with four different "equations" (with the authors' characterisations of each):
- innovation = idea + leader + team + plan (their approach)
- innovation = ideas + motivation (people working in their spare time to generate many small initiatives, but unable to get much beyond the idea stage);
- innovation = ideas + process (small steps that may accumulate into a meaningful result);
- innovation = ideas + leaders (based on talented leaders to overcome the organizational barriers to execution - flawed in the authors' opinion).
I was surprised at how dismissive they were of the approaches other than their own.
Briefly, looking at the authors' three key points:
Referring to them as Performance Engines, they make the case that the ongoing operations of established businesses "instinctively swat down innovation initiatives - or any project, for that matter, that cannot make an immediate contribution". Hence their first rule of innovation: Innovation and ongoing operations are always and inevitably in conflict. This isn't a characteristic of a poorly run business - on the contrary, its a part of every succesful Performance Engine's approach to optimizing its business:
"The most powerful conflicts between innovation and ongoing operations ..... lie in the method of the Performance Engine. The method is the same, in every company and in every industry. To maximize results, the Performance Engine strives to make every task, every process, and every activity as repeatable and predictable as possible."
A Dedicated Team
The solution: building a fit for purpose team with its own, custom organizational model. In their view, an innovation team, to be successful, must leverage off of the skills and resources of the Performance Engine but must have the independence to strike its own path, unencumbered by the biases, habits and business models of the mothership. While the innovation team will be structured, managed and measured differently from the Performance Engine, successful innovation requires a partnership between the two. Three key steps are identified for building the innovation team:
- Divide the labour between the dedicated team and the shared (with the Performance Engine) staff;
- Assemble the dedicated team and assign roles and responsibilities; and
- Manage the partnership between the dedicated team and the shared staff.
A Disciplined Experiment
Govindarajan and Trimble advocate a learning based approach to innovation, arguing that the goal of an innovation team should be to learn from innovation experiments as quickly and cheaply as possible. Following a process that sounds a lot like the scientific method, they suggest three key steps:
- Formalize the experiment following a disciplined process that maximizes the opportunity for learning. The core of the process is a clear hypothesis of record against which progress can be measured;
- Break down the hypothesis
- Seek the truth
The approach is good (the disciplined experiment element is also directly based on the scientific method, a point the authors never acknowledge) and could be used to bring discipline to almost any organization's innovation initiatives.
What I liked about the book was the recognition that the real challenge for innovation was not generating new ideas. Contrary to popular understanding, eureka moments are just the beginning, with the greatest challenge being the hard work of execution or implementation - and the authors lay out a convincing approach for overcoming the execution challenge.
What I didn't like about it was the degree to which they dismissed approaches other than their own. Not all innovation takes place in the Fortune 500 and involves transformational change. I think I would have appreciated a greater recognition of this fact once they had established the focus on execution. Some suggestions on applying that focus to incremental and process innovation might have been nice too.
On balance, the book is well worth reading if you have an interest in how innovation occurs and how to drive it in an organization (stepping back to look at the prescriptions a bit more generally, it also has lessons for implementing change of other sorts).