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Brandwave-logo-6.png |Innovate or Die | apr '18
12.04.2018
The ingredient that brought 3M and Apple from the brink of failure to achieve such an amazing record of success

In its early years, Minnesota Mining and Manufacturing Company, now known as 3M, was a dismal failure. After years of mining losses and red ink, company founders and investors came to a crossroads. They could close the business, or change course. 3M executives did what most successful executives do when faced with failure. They used it as an opportunity to find a path to success. We're glad they did. Today, the company generates nearly $30 billion in revenue selling over 55,000 products and employing roughly 84,000 people.

When Steve Jobs returned to Apple after his twelve years of wandering, the company needed a controversial $150 million investment from "arch rival" Microsoft to stay afloat. Even worse, when asked what he would do if he were in Jobs's shoes, Michael Dell said, "I'd shut it (the company) down, and give the money back to shareholders." Rather than give up, Jobs was able to use these "indignities" to fuel an amazing comeback. In a very short period of time, Apple grew to the most valuable company ever.

What is the ingredient that brought 3M and Apple from the brink of failure to achieve such an amazing record of success? While there are several candidates, the one that both companies clearly had in common is innovation.

If innovation has this potential, how can you use it as a tool to power your company's success?

Create an Innovation Culture

To create an innovative culture, managers need to make sure that all employees know that innovation is a job requirement. It should be woven into the fabric of the business and given a prominent place in job descriptions, procedures, and performance evaluations. Innovation should be defined to include incremental as well as revolutionary improvements. In a Harvard Business Review interview, Katsuaki Watanabe of Toyota said, "There is no genius in our company. We just do whatever we believe is right, trying every day to improve every little bit and piece. But when 70 years of very small improvements accumulate, they become a revolution." Over a 35-year period, Toyota's innovation culture increased the number of annual suggestions per employee 480-fold from 0.1 to 48.

Create a New Product Development System that rewards Innovation

At 3M, employees are paid for spending 15% of their time creating whatever they want. Once employees believe they have a worthy invention, they can "run it up the flagpole" using 3M's "Champion" new product development system. The Post-It-Note was created by a couple of employees that used their 15% time to generate the idea and champion it through the 3M System. Google has adopted a similar system as part of their innovation framework since it pays employees for spending 20% of their time on whatever projects they want.

Embrace Failure

Innovative companies recognize that failure is an important step in the process of success. They understand that with each failure, the company moves one step closer to success. In this way, failure is given a positive value. For example, if a successful product brings in $1 billion in sales, and it takes 9 failures to achieve each success, each step in the process (including the 9 failures) can be viewed as bringing the company $100 million in additional business - a positive way to look at failure.

Look forward

Kodak invented the digital camera. It didn't commercialize this invention because it wanted to protect its film business. The Company had what I call the "FDH" syndrome. It was Fat, Dumb, and Happy with its success in film. It looked backward instead of forward. As Bill Gates is fond ofsaying, "Success is a lousy teacher. It seduces smart people into thinking they can't lose." To be innovative, you cannot be afraid to obsolete your own products. If you are, others will obsolete them for you. That is what happened to Kodak and many others.

Marketing Information System

The marketplace is constantly evolving and changing. To be successful, you need a system that continuously monitors the marketplace, collects feedback in real time, analyzes the feedback, reports the unvarnished truth to decision makers, and takes corrective action. What worked yesterday, may not work tomorrow, and the information about tomorrow is often available today. Companies need the right telescopes and microscopes to see what is going on and react swiftly once the information is properly analyzed and triangulated.

Passionate Pursuit of Improvement

The Lexus slogan the Passionate Pursuit of Perfection embodies the TQM (total quality management) mantra of continual improvement, or kaizen. This guiding philosophy has propelled Toyota to regaining its lead in global automotive sales in spite of self-destructive missteps and problems caused by the devastating Tsunami of 2011.

While Dell is not recognized as a product innovator, the company was very innovative in its factory processes, supply-chain management, and make-to-order e-commerce systems. Its efficiency strategies worked quite well for a number of years - giving Dell cost and quality advantages over its "IBM-PC compatible" rivals and Fortune 500 status. Dell got FDH, Michael Dell left for a while, and innovation went by the wayside. So did sales.

Necessity is not the only mother of invention

Companies such as 3M and Apple chose innovation at a point in their histories when they did not have much choice. For them, necessity was the mother of invention. 3M institutionalized their innovative ways. Time will tell if Apple will continue to innovate now that Steve Jobs has passed.

We should be most concerned about companies that are currently successful that do not have innovation ingrained in the fabric of their businesses. They are the ones that need to avoid the FDH (fat, dumb, and happy) syndrome, try new things and not rest on their laurels. They have to risk failure to continue to achieve great success. They should know that survival today requires more than treading water, and that many of the companies that were once great are now gone oron their way out largely because they stopped innovating. In fact, according to Forbes, the average lifespan of a successful S&P 500 Company was 67 years in the 1920's. Today it is 15 years. More companies need to innovate to improve these declining numbers.

The innovations do not have to be revolutionary or the exclusive domain of new or improved products. The improvements can be incremental as they are at Toyota, or they can be in business systems and processes as they were at Dell. Innovations can (and should) be in marketing as they have been at Procter & Gamble. Some may recall that the company invented the "soap opera" to sell its soap.

Wherever innovations come from, however they are done, and in whatever part of the business they occur, companies need to continuously innovate or risk dying.

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12.04.2018
Adapting your approach to innovation to the problem at hand in an attempt to optimize the process.

One of the best innovation stories I’ve ever heard came to me from a senior executive at a leading tech firm. Apparently, his company had won a million-dollar contract to design a sensor that could detect pollutants at very small concentrations underwater. It was an unusually complex problem, so the firm set up a team of crack microchip designers, and they started putting their heads together.

About 45 minutes into their first working session, the marine biologist assigned to their team walked in with a bag of clams and set them on the table. Seeing the confused looks of the chip designers, he explained that clams can detect pollutants at just a few parts per million, and when that happens, they open their shells.

As it turned out, they didn’t really need a fancy chip to detect pollutants — just a simple one that could alert the system to clams opening their shells. “They saved $999,000 and ate the clams for dinner,” the executive told me.

That, in essence, is the value of open innovation. When you have a really tough problem, it often helps to expand skill domains beyond specialists in a single field. Many believe it is just these kinds of unlikely combinations that are key to coming up with breakthroughs. In fact, a study analyzing 17.9 million scientific papers found that the most highly cited work tended to be mostly rooted within a traditional field, with just a smidgen of insight taken from some unconventional place.

But what if the task had been simply to make a chip that was 30% more efficient? In that case, a marine biologist dropping clams on the table would have been nothing more than a distraction. Or, what if the company needed to identify a new business model? Or what if — as is the case today — current chip technology is nearing its theoretical limits, and a completely new architecture needs to be dreamed up?

In researching my book, Mapping Innovation, I found that every innovation strategy fails eventually, because innovation is, at its core, about solving problems — and there are as many ways to innovate as there are types of problems to solve. There is no one “true” path to innovation.

Yet all too often, organizations act as if there is. They lock themselves into one type of strategy and say, “This is how we innovate.” It works for a while, but eventually it catches up with them. They find themselves locked into a set of solutions that don’t fit the problems they need to solve. Essentially, they become square-peg companies in a round-hole world and lose relevance.

We need to start treating innovation like other business disciplines — as a set of tools that are designed to accomplish specific objectives. Just as we wouldn’t rely on a single marketing tactic or a single source of financing for the entire life of an organization, we need to build up a portfolio of innovation strategies designed for specific tasks.

It was with this in mind that I created the Innovation Matrix to help leaders identify the right type of strategy to solve a problem, by asking two questions: How well can we define the problem? and How well can we define the skill domain(s) needed to solve it?

Sustaining innovation. Most innovation happens here, because most of the time we are seeking to get better at what we’re already doing. We want to improve existing capabilities in existing markets, and we have a pretty clear idea of what problems need to be solved and what skill domains are required to solve them.

For these types of problems, conventional strategies like strategic roadmapping, traditional R&D labs, and using acquisitions to bring new resources and skill sets into the organization are usually effective. Design thinking methods, such as those championed by David Kelley, founder of the design firm IDEOand Stanford’s d.school, can also be enormously helpful if both the problem and the skills needed to solve it are well understood.

Breakthrough innovation. Sometimes, as was the case with the example of detecting pollutants underwater, we run into a well-defined problem that’s just devilishly hard to solve. In cases like these, we need to explore unconventional skill domains, such as adding a marine biologist to a team of chip designers. Open innovation strategies can be highly effective in this regard, because they help to expose the problem to diverse skill domains.

As Thomas Kuhn explained in the The Structure of Scientific Revolutions, we advance in specific fields by creating paradigms, which sometimes can make it very difficult to solve a problem within the domain in which it arose — but the problem may be resolved fairly easily within the paradigm of an adjacent domain.

 

Disruptive innovation. When HBS professor Clayton Christensen introduced the concept of disruptive innovation in his book The Innovator’s Dilemma, it was a revelation. In his study of why good firms fail, he found that what is normally considered best practice — listening to customers, investing in continuous improvement, and focusing on the bottom line — can be lethal in some situations.

In a nutshell, what he discovered is that when the basis of competition changes, because of technological shifts or other changes in the marketplace, companies can find themselves getting better and better at things people want less and less. When that happens, innovating your products won’t help — you have to innovate your business model.

More recently, Steve Blank has developed lean startup methods and Alex Osterwalder has created tools like the business model canvas and value proposition canvas. These are all essential assets for anyone who finds themselves in the situation Christensen described, and they are proving to be effective in a wide variety of contexts.

Basic research. Pathbreaking innovations never arrive fully formed. They always begin with the discovery of some new phenomenon. No one could guess how Einstein’s discoveries would shape the world, or that Alan Turing’s universal computer would someday become a real thing. As Neil deGrasse Tyson said when asked about the impact of a major discovery, “I don’t know, but we’ll probably tax it.” To his point, Einstein’s discoveries now play essential roles in technologies ranging from nuclear energy to computer technologies and GPS satellites.

Some large enterprises, like IBM and Procter & Gamble, have the resources to invest in labs to pursue basic research. Others, like Experian’s DataLabs, encourage researchers and engineers to go to conferences and hold internal seminars on what they learn. Google invites about 30 top researchers to spend a sabbatical year at the company and funds 250 academic projects annually.

Yet one of the best-kept secrets is how even small and medium-size enterprises can access world-class research. The federal government funds a variety of programs, such as the Hollings Manufacturing Extension Partnership, a series of manufacturing hubs to help develop advanced technologies, and Argonne Design Works. Local universities, which have a wealth of scientific talent, can also be a valuable resource.

Taking steps to participate in these types of programs can help small business compete in competitive markets. For example, Mike Wixom of Navitas, a four-year-old battery company that joined the Joint Center for Energy Storage Research (JCESR) as an affiliate, told me, “As a small company, we’re fighting for our survival on a daily basis. Becoming a JCESR affiliate gives us an early peek at technology, and you get to give feedback about what kinds manufacturing issues are likely to come up with any particular chemistry.”

So, clearly, being able to reach out to scientists on the cutting edge can help a business plan for the future, just as the other approaches, such as design thinking, open innovation, business model innovation, and others, can help propel a business forward if applied in the right context. But no one solution fits all problems.

If your innovation strategy is struggling or failing, consider whether it’s because you’ve locked yourself into a single approach. There are always new problems to solve; learn to apply the solution that best fits your current problem.

source hbr.org

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OUR NEWS
Innovate or Die Morning Talk
As part of Brandcell’s knowledge initiatives, RDCL members were invited to a Morning Talk on March 23rd, 2018 in Brandcell offices around the theme “Innovate or Die, innovation in business in the age of transformation”. 
Participants engaged in a debate around the main market challenge: 'is a performing economy mandatory for innovation or is innovation mandatory for a strong economy?' Followed by a presentation on 'How to innovate' and a review of the design thinking approach.

12.04.2018
With the speed of technology adoption and a fast-paced global economy, companies rise and fall faster than you can say Alibaba.

In 1955, Fortune Magazine listed the 500 largest companies in a list that’s become synonymous with success. 60 years later, only 71 of those companies still remain.

With the speed of technology adoption and a fast-paced global economy, companies rise and fall faster than you can say Alibaba.

(And ummm, maybe they should've considered using Vocoli to understand their employee voice)

The Secrets to Innovation

So what’s the secret sauce to success (or more accurately, survival)?

First, a strong corporate culture is key, as we’ve talked about [herehere and here]. But in addition to a defined “perfect employee blueprint,” creating an innovatation culture and the ability to market solutions before your competitors is a difference maker.

In our experience, there are several reasons for stifled innovation:

  • Fixating on one successful offering without accepting something better can (and will) come along
  • Only focusing on the customer of today without anticipating their needs for the future
  • Failure to update technology and change with the times

We’ve highlighted 10 companies that had success but ultimately missed opportunities due to one or more oversights:

Blockbuster

It’s a shame that future generations won’t be able to understand the soul-crushing experience of a sold-out Blockbuster movie. Aside from the endless parade of late fees, Blockbuster was a weekend night tradition for most families.

Then Netflix happened.

Netflix sent videos you would’ve rented through Blockbuster straight to your home without due dates or late fees. Blockbuster was unconcerned and even had the opportunity to buy Netflix for $50 million in 2000. They decided to meander along and not change a thing for the next four years while Netflix became more and more popular, and eventually went from a mail-order service to a streaming one.

In 2004 Netflix finally offered an online option, but it was too late.

On September 23, 2010 Blockbuster filed for bankruptcy. But I still have a VHS tape that has their “Please be kind, rewind” slogan, just as a precious memento.

Xerox

In 1959, Xerox launched the Xerox 914 photocopier revolutionized the document-copying industry.

According to Wikipedia: “One of the most successful Xerox products ever, a 914 model could make 100,000 copies per month (one copy every 26.4 seconds, or ~136 copies/hour.)”

But most everyone knows the story of PARC (or the Palo Alto Research Center). PARC’s inventions include the mouse, the laser printer, and a windows/icon-based user interface (sound familiar?).And they gave it away. For years , Xerox management did absolutely nothing with their cutting-edge inventions and continued to profit off of the 914 photocopier.

Meanwhile, Apple, Microsoft and Hewlett-Packard ”borrowed” their technology and made billions off of it.

Borders Books

When Borders Books launched its first store in Ann Arbor, Michigan in 1971, the world was a different place. A kindle was a pile of sticks used to start a fire, and a nook was that tiny part of the kitchen in the corner where you eat breakfast.

40 years later, you can read books on your phone, on a tablet or via the web. And Borders’ competitors (Amazon and Barnes and Noble, to a lesser extent), saw this trend. They launched tablet devices to strengthen their relationship with readers.

On the other hand, Borders didn’t adopt any of new technologies (and according to this Time article, focused on music sales). In doing so, they wrote their obituary.

Blackberry

Do you remember your first “CrackBerry?” There was a time when the primary mode of business communication was BBM and everyone wanted to know your PIN. It was the phone to have in the mid- to late-2000’s (in 2007 it had more than half of the marketshare of phones in the US.)

But on June 29, 2007 the iPhone was released.

At first, Blackberry ignored touch screen based technology insisting their phones would remain the de-facto standard for enterprises especially since the iPhone struggled early with solid enterprise email security. But by dominating in the consumer market and slowly promoting Bring Your Own Device (BYOD) standards within companies, Apple redefines the market and left Blackberry stumbling and blinded by their own success.

Their initial inaction snowballed into a succession of failed attempts to innovate. Blackberry currently has 0.8% of the Smartphone market share according to IDC.

Rumor has it that they are now working on a Siri-Like feature called Blackberry Assistant. They might be a little bit behind the curve on that one.

Yahoo

In 2005, Yahoo owned 21% of the online advertising market, #1 among all players. Yet today, they’re struggling maintain their #4 position behind Google, Facebook and Microsoft.

In fact, Yahoo could’ve done just about anything differently and they could still be #1. First, their desire to be an online portal instead of a dominant search player led them to outsource their search engine to Microsoft Bing.

They were supposed to be what Google ended up being but got distracted along the way. They didn’t see the importance of search and instead focused on becoming a media giant.

Just a few of their missed innovations:

  • Google. In 2002 there was reportedly a deal struck for Yahoo to buy Google for $5 billion dollars. Then CEO Terry Semel refused to shell out the cash and the deal was squashed.
  • DoubleClick. DoubleClick was the dominant player in display ads throughout the late ‘90s and early 2000’s. Buying DoubleClick would’ve helped Yahoo strengthen their display ads as Google was gaining on them. Unfortunately they didn’t move quick enough and Google pounced on this opportunity.
  • Facebook. In 2006, Yahoo had a deal to buy the company for $1 billion. They then lowered their offer and Mark Zuckerburg backed out. Facebook is now valued x150 times their original asking price. Whoops.

Being a technology giant requires strategic mergers and acquisitions (and the innovative ideas they bring). Had a few of these situations gone differently, we might be “yahooing” instead of “googling.”

United States Postal Service

UPS, FedEx and not mention email—and the USPS has sat by and done just about nothing. If you Google “USPS” you will find approximately 10,000+ articles on why it can’t be saved. The market shifted and unfortunately due to government regulations the USPS was stuck.

And thus USPS is overshadowed by UPS and FedEx, left only to deliver some bills that aren’t paperless and wedding invitations.

Polaroid

In the last 10 years who has actually taken a serious Polaroid? Yeah they’re cool to have around at birthday parties as something out of the ordinary, but convenience is the name of the game for everyday use.

They started out as an innovative brand that brought instant photography into the playing field. However, Polaroid didn’t realize that digital cameras were going to be the way of the future and once they did it was way too late. Film photography is now a niche field at best and Polaroid filed for bankruptcy in 2001.

MySpace

MySpace was born and died all very quickly. It goes to show you how important the evolution of user experience is, seeing as how Facebook swooped in where Myspace had already made decent ground.

Here is one graph showing Google Trends of Myspace over the years:

Myspace Interest Overtime.PNG

Now here is that same time period with Facebook included:

Myspace and Facebook.PNG

Looks pretty comical in comparison.

Facebook saw what Myspace didn’t: people need to connect on more than one level—through shared interests and groups (not just random bands trying to get signed.) And so, everyone migrated over to Facebook and never looked back.

However, they do have over a million likes on Facebook but that’s mostly people shell shocked that they’re still around.

Hostess

Why change the perfection that is the Twinkie? It was something that you could find in every child’s lunchbox in the 1970’s. Unfortunately, times change and so do eating habits—“eat clean, train mean.” Hostess continued to churn out highly processed foods that aren’t bought as often in this healthy eating craze.

Hostess made two major errors in the last 20 years: failure to innovate new and healthier foods and marketing that didn’t even attempt to make their brand relevant. Hostess closed its doors in 2012 after two bankruptcies (and the eBay mad-dash started for Twinkies) and then re-opened as a new company Hostess Brands, LLC. Hopefully the third time’s the charm. Whole wheat Ding Dongs anyone?

The Entire Publishing Industry

We’ve been watching for awhile as publishers desperately cling to the prospects of print sales. It’s very clear that it’s not going to happen and electronic print is the way of the future (duh.) Instead of embracing the digital generation, publishers have been dragging their heels trying to slow it—wasting both time and money in the process.

While they’re over there fighting a losing battle, the market has shifted. People no longer look in the classifieds for jobs. Instead, they log in to LinkedIn or browse Craigslist for listings. If the public wants to catch up on the news they can get their updates from the web or their mobile phone. The New York Times crossword puzzle is a thing of the past (there’s an app for that!)

Revenue in the industry is expected to decline at an average rate of 4.2 percent per year for the next five years according to IBISWorld. The newspaper and publishing industry can combat these losses using paywalls through application stores across various platforms.

These companies used to be considered some of the brightest in their industry but their failure to innovate led to their ultimate (or eventual) demise. Tunnel vision (or Big Company Syndrome) is common today. When companies are successful quickly, they assume that they should just keep doing what they’re doing and it will be fine. Which isn’t completely untrue, you should definitely champion your best products. But what separates good companies from the best companies is innovation and always trying to find ways to improve.

source: vocoli.com

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FEATURED CASE STUDY: BBAC Bank
OVERVIEW
BBAC Bank has asked Brandcell to assess and enhance the in-branch customer experience ahead of the rebranding launch.

 
HOW DID WE HELP?
We identified key insights through both the employee experience and the current customers' pain points in their daily transactions. We then held a 2-day workshop centered around finding innovative ways to upgrade the customer and employee experience. This led to the redefining of the role of the branch in the digital era.
FEATURED BOOK
Making Innovation work
by by Marc J Epstein, Robert Shelton, Tony Davila
Profitable innovation doesn’t just happen. It must be managed, measured, and properly executed, and few companies know how to accomplish this effectively. Making Innovation Work presents a formal innovation process proven to work at HP, Microsoft and Toyota, to help ordinary managers drive top and bottom line growth from innovation.
 

TIPS-copy-copy.jpg
1- Start by building a bigger box (Rather than thinking outside it)

2- De-risk your idea

3- Learn collaboration (Versus teamwork)

4- Get out of the office

5- Involve an outside provocateur

6-Have a Start-up entrepreneur mindset



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