Measuring Successful Innovation – It’s not about the Benjamins*

November 18, 2009 by Andrew (Drew) · Leave a Comment 

Now we’ve got around seven thousand people working, and that to me is fantastically satisfying.. more than dollars and cents, because I just believe that the greatest thing you can give someone is a job.
- Janet Holmes à Court (one of Australia’s richest business people)

I was having a conversation over lunch recently about ways to attract investment into small businesses and communities with David Kalow (Founding partner of Kalow & Springut, LLP and Founder of the Cleantech Corridor – CTC in NYC) and John Reaves (Founder of the Learning Worlds Institute and creator of the Storycapture.) The topics flowed freely from considering up-and-coming sectors for investment, to the types of people that need to be involved. We were discussing the differences between innovators and the people who invest in them and began to talk about the standard measures of success – ROI, EBITDA, and sundry other acronyms and initials. Then it struck me that while those measures are meaningful, wasn’t it keeping score primarily in that manner that created so much of the current economic turmoil. As one sharp-tongued friend noted, “At least we’ll remember these times as ‘great’ now that the general consensus has landed on an appropriate title for it – ‘The Great Recession.’”

BenjaminsSo, I propose that we keep score in the most tangible and ultimately meaningful manner possible – count the number of jobs created by investments. With an unemployment rate North of 10% at this stage and with no signs of it dipping below in the near term doesn’t it make more sense to apply the bragging rights to those investors who create the most jobs? After all, no one is going to catch up to the likes of Bill and Warren any time soon, are they? So, let’s reset and start counting things that are more universally meaningful.

I know that a large part of accounting for the expenditure in the ARRA (American Recovery and Reinvestment Act – aka. The Stimulus Package) is to account for jobs and that most local government economic development departments use that as a key measure. Certainly we have all seen state government leaders crowing about procuring hundreds of jobs when they attract a new manufacturing facility (usually by offering amazing tax breaks and poaching from other states). But in the world of business job creation is not a measure of any note. In fact, in order to maximize the value of investment “synergies”, job consolidation (read: elimination) is desired.

One recent positive note is that Goldman Sachs is pairing up with Warren Buffett (who, I believe sits on their Advisory Board) to foster small business investment for job creation. In this situation the bank is teaming with the legendary investor to boost financing and lending programs for under-served business owners. The $500M investment in the program called “10,000 Small Businesses” seems huge, but given that Goldman Sachs made $3.2B in the last quarter alone let’s just call it “a start,” shall we?

The key is that the investments being made go to the right area. I’m working on local effort to do exactly that in my community through the Princeton Job Creation Forum. We recognize that investing in million-dollar tax breaks to entice a large corporation to import a few hundred jobs into a state simply doesn’t cut it. Job creation is going to occur in the tens-of-thousands of small enterprises that can add employees in single digits, essentially creating 50% or 75% or even 100% job growth through judicious investments in their enterprises. If we can direct the investment dollars to the smallest innovators and accelerate their growth the economic ramifications are tremendous. Let’s count what matters. Not people counting Benjamins in their bank accounts. Instead let’s count (on) people creating value through their work.

*For those of you not familiar with the term, “Benjamins” – Benjamins are USD $100 dollar bills and the reason people call them Benjamins is because Benjamin Franklin’s face graces one side of the note. He was a publisher, a philosopher, a scientist, and the first major American inventor (read: innovator.)

I Am Just Like You – Bob Sutton on impediments to self-awareness

November 16, 2009 by Andrew (Drew) · Leave a Comment 

Bob Sutton dips into, “David Dunning’s book Self-Insight, which presents a compelling case that there are numerous impediments to self-awareness and that many of these roadblocks are mighty difficult to overcome. I am now on the last chapter, which contains some interesting ideas about how to increase our awareness of how skilled or unskilled we might be at things and our awareness of how others see us.” Bob’s full blog post is here.

Mix Business With Design Thinking – from Fast Company

November 11, 2009 by Andrew (Drew) · Leave a Comment 

We’ve all heard the news that the traditional MBA framework is broken, but adding courses on business ethics and financial crises won’t solve the problem. And although Harvard, Wharton, Kellogg, and the rest are all considering bringing new ways of thinking into their hallowed halls, a relatively small school in Canada is actually transforming the meaning of an MBA right before our eyes. The Rotman School of Management, helmed by Roger Martin, proposes a radical idea: to develop business leaders who are well-grounded in multiple disciplines.
The complete Dev Patnaik article may be found here.

Innovation Trapped – Rethinking the flow of ideas to market

November 10, 2009 by Andrew (Drew) · Leave a Comment 

I think we do need to move very swiftly in creating value for consumers and reacting to the economics.
- Brian Becker

On BusinessWeek’s website recently (November 9, 2009), Vivek Wadhwa posted a ViewPoint column focused on the implication of globally outsourced innovation. While what he reviewed was not necessarily earth-shattering in its revelations it did highlight a series of long-held but little discussed ways for the USA (or any country) to position itself in the new exchange of research and development ideas.

OutsourcingWadhwa catalogued the inherent risks in the present shifting innovation landscape: over 50% of US companies have developed outsourced innovation initiatives; US inflexibility in partnering with offshore resources is negatively impacting domestic innovation performance; cost may have been the initial driver for embracing outsourced solutions, but tapping global talent is the new fundamental necessity; and, the support roles previously outsourced have been superseded by much more complex jobs involving complex thinking, research, and solution design. If the most complex jobs are moving off-shore, what remains of the innovation-driven US economy?

In response he offered four approaches to help the US retain its innovation edge:

    1. Increase the global awareness of American workers as they will be looking off-shore for ideas to apply at home in new and interesting ways, to drive the US economy domestically and globally,
    2. Mid-tier companies cannot afford to outsource so better policies need to be developed to make it easier for them to use technology and provide them tax breaks for research,
    3. Outsourcing is inherently disruptive so we must upgrade our investment in workforce training and development and make these items more of a corporate priority (as well as a national one akin to Singapore’s approach, perhaps?), and,
    4. As early-stage ventures create the highest percentage of value per capita during the lifespan of companies, we need to harness this innovation treasure by building mechanisms to break the innovation logjam at the source, inside the research institutions and organizations where good ideas too often die.

Of the four areas for action defined, it is perhaps the last one which can provide the most immediate positive impact to both the innovation standing of the USA and to the need to generate new jobs to replace those lost in the current economic turmoil – or “Great Recession” as I heard it so glowingly defined recently. It is not a question of, “does America need to try harder on the innovation front?” Far from it. What needs to occur is a fundamental rethinking of the way current innovations, often set aside due to missteps and poor advocacy, so that they can receive a full and frank assessment for market potential.

A case in point. I was recently attending a fundraiser for the 80th anniversary of the non-profit nursery school for which I serve on the Board of Trustees. In the middle of meeting-and-greeting I began a conversation with John, the Alumni Relations and Development Director for a local high school, about the nursery school which in turn led to a discussion of my role on the Board and my work away from the Board (in the “real” world). After explaining my consulting approach, which is focused on helping people bring their ideas to market as fast as possible, John said, “that’s interesting…”

(If ever there was an opening!)

John then recounted an innovation lost story of his own. It seems he was asked to provide support to a pair of university professors who had developed a serious piece of heads-up display technology. It was truly mobile and ground-breaking. The professors were evidently excited by their breakthrough and eager to present it to possible venture capitalists. John, in working with them closely recognized that the professors needed some additional preparation. They simply were not ready for “prime time.” He tried to address his greatest fear, that they would not present their concept in the best light, by spending extensive time with the professors in advance of the impending demonstration. The professors tolerated his involvement, but kept insisting that their ideas would speak for themselves.

On the day of the presentation, John reinforced the fact that the demonstration needed to go off without a hitch. The display equipment, all very beta, was a little unwieldy. The professors, eager to show off their creative genius, asked the venture capitalist to try it on as it was very impressive when you were immersed in the data display. For the wearer the experience was like a 20 foot video screen was floating before you. Or, at least that was what was meant to happen. No sooner was the headgear clamped to the head of the venture capitalist than the arm holding the small display snapped at its base and the arm swung down driving the display into his shocked and open mouth, chipping a tooth.

In an instant he went from interested party to injured party.

Needless to say, no money was to be offered that day, or any day as word got around about what had transpired. The professors couldn’t understand why no one was willing to take a chance. John, in frustration, walked away from the deal. His parting comment to me, “if we can’t help our best and brightest bring their sharpest ideas to market we’ll all suffer in the long-term.”

So, here’s the challenge, how can we help unlock those innovations, many already fully formed, so that they can flow to the market? No matter where they are, in the heads of our scientists and researchers, or in the work of our offshore partners, how can we capitalize on them as swiftly as possible. I’ll look for your ideas in the comments and will offer my own in future posts.

Pink Slip Blog – Maureen Rogers on Ethics Consulting

November 3, 2009 by Andrew (Drew) · Leave a Comment 

With so many people saying so much about so little, it’s great to see one person nail an issue that is fast becoming a stone in my shoe. Consulting about and teaching ethics. Do not get me started on how we ended up with Ethics classes alongside Macroeconomics and Supply Chain Management courses. Maureen Rogers lets rip in her Pink Slip blog post on ethics consulting:

“Forget ethics consulting. How about companies just keeping someone around who they can run their piss-poor ideas by before they put them into action? I think these used to be called executive secretaries. Do they just not exist anymore?”

Space & Place – Using the physical to influence the psychological

November 2, 2009 by Andrew (Drew) · Leave a Comment 

One of the great challenges in galvanizing a team to achieve new levels of creativity and innovation lies in the intersection between the tangible and the intangible. Missing from the thinking in the realm of innovation and product development is the way in which space not only influences, but directly informs, the quality and productivity of innovation and product development teams. So often the space in which people reside is an afterthought or, if it is considered at all, it reflects organizational hierarchies or norms of behavior defined by functional expertise. In many cases it fosters a silo-based mentality that destroys collaborative solution-seeking activities. Space and place directly prime us to be innovative, or not…

The smell of mystery…and successful innovation
Geyer_HeroOne of the classic uses of space as a way to buoy innovation occurred at the aerospace and defense contractor Lockheed (now Lockheed Martin) with the formation of their Skunk Works®. It was the height of World War II and Lockheed had been asked to work on a new jet fighter. Given the project to develop Clarence L. “ Kelly” Johnson hand-picked engineers and manufacturing people and housed them in a windowless office with hand-me-down furniture in Burbank, California. Each new team member was cautioned that design and production of the new jet fighter was to be carried out in strict secrecy. No one was to discuss the project with anyone outside the four walls of the facility. The physical space essentially became a clubhouse of sorts (not the first time an innovation team would find that moniker applied.)

The Greeks get bent out of shape
Yet, the manipulation of space in order to evoke a mood, feeling or even inspire is nothing new. For as long as humans have altered the landscape with structures we have used that alteration to influence and change behavior. Sometimes this is conducted overtly. Sometimes and perhaps more commonly this is executed covertly. Take the Parthenon for instance. This Ancient Greek structure sitting above the city of Athens was the crowning architectural element of Grecian society at one point (perhaps even today). It inspired awe with its massive perfection. The only problem is that it wasn’t perfect – at least not in any straight-lined geometrical sense. The Parthenon’s architects and builders understood that if they did not employ entasis, a process for curving straight lines into convex in order to give them the appearance they are straight (yes, really), their crowning achievement would appear to be collapsing in on itself. Not such a stellar way to inspire the masses, right? They understood that if their audience was to see perfection the building must not be “perfect”.

The creatives run amok
Even when we attempt to directly address space as a fundamental support to innovation practices we can misstep. Chiat\Day (now TBWA\Chiat\Day) was at the vanguard of the advertising business in the 1990’s – they were the creators of such classic campaigns as, Apple’s “1984” and “Think Different” and the $30 million Reebok campaign, which centered on the rivalry between decathletes Dan O’Brien and Dave Johnson. The founder, Jay Chiat, wanted to unleash creativity in his Venice Beach office (strangely enough, also in California – apparently a hotbed of physical space-related innovation). Key to doing that was Project Chrysalis, a think tank designed to propel the agency away from its current restraints of time and space.

Chrysalis developed the blueprint for the industry’s first “virtual” office, a fully portable, organic workplace that broke with traditional concepts of office use and featured state-of-the-art communications technology. His vision for a virtual office was realized in 1994 as a “clubhouse” (see – back again!) designed by leading architect Frank Gehry to unleash creativity – agency staff were given only portable equipment, cellphones (aka. “bricks”), laptops and the edict to work wherever they wanted as the mood struck them. The intent being to “free” them from the confines of the physical space. Instead of reveling in their new-found un-tethered freedom the staff took to arriving early, commandeering space, and fighting pitched battles over the limited space available. With no personal space to anchor them, everything became a clamor to claim the personal and for some, way too hard. Needless to say the experiment was scrapped.

Today the TBWA\Chiat\Day facility takes a different approach. It is a miniature town with a mix of both “public” and “private spaces” with places to gather and bump-into each other. It even has a Central Park. The opportunity for the “water-cooler” conversation on a wider scale is writ-large across the organization. It is much more conducive to collaboration and creativity, because it is both unlike any office space you might experience, but so familiar in that it draws on very real archetypes. Main Street and the village square are both represented.

The cutting edge of physical systems
One of the most interesting developments in use of physical space to foster and promote specific behaviors and feelings is a marriage of the work of Maturana and Varela, two Chilean biologists, who coined the term “autopoeisis” in 1972, and the work of noted architect Christopher Alexander in the development of what he termed, a “pattern language” in a book he co-wrote with Sara Ishikawa and Murray Silverstein of the Center for Environmental Structure of Berkeley, California, with writing credits also to Max Jacobson, Ingrid Fiksdahl-King and Shlomo Angel for describing physical space requirements to meet specific needs. The marriage of these concepts is coming to fruition in the work of a graduate student at MIT by the name of Neri Oxman. She has created a body of work around the concept of materialecology:

“…an interdisciplinary research initiative that undertakes design research in the intersection between architecture, engineering, computation, and ecology. As such, this initiative is concerned with material organization and performance across all scales of design thought and practice. As such, it seeks to promote and define a design research agenda which is ecological in nature, in ideology and in material practice; it aims at embracing the evolving elements of change in both (and indeed related) social constructs and environmental descriptions of the ever changing built environment. materialecology undertakes research in advanced digital applications for architectural practice and pursuits – their contribution to a design paradigm promoting generative design processes.”

In this one area of practice, the implications of an holistic approach to the design and creation of space through a multi-disciplinary approach offers not only a framework for supporting innovation, but a frame of reference for what innovation could and should be in vibrant innovation cultures: open, immersive, divergent, exploratory, collaborative, generative, envelope-pushing, and synergistic.

Key questions anyone seeking to foster an innovation culture through the manipulation of physical space should ask themselves are:

  • What is my intent?
  • Who else needs to participate?
  • What is their intention?
  • How many paths are there to achieve a combined intent?
  • What paths intersect with those who we are attempting to influence?
  • What changes can we make swiftly? Why?
  • What changes must be made over time? Why?
  • When we implement these changes, what could go wrong?
  • What can we do to prevent that?
  • What can we do if something does go wrong?
  • How might we capitalize on what goes well?
  • Only after consideration of these questions then, and only then, should we step into the breach and begin our work.