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August 2009

Welcome to the summer edition of the Practical Innovator Newsletter!

Veteran readers will notice that the content of the Practical Innovator newsletter continues to expand. In addition to articles about personal creativity and the application of the eight creative talents to leadership, there are now articles addressing the challenges of leading an innovative organization for sustained competitive advantage. While the content has indeed expanded, the leadership themes continue to focus on capitalizing on the creativity of people and their talents to maximize the innovation of the organization.

Have a wonderful summer!

Please let me know what you think about the new direction. And please pass this newsletter on to anyone else who might be interested in its messages!


in this issue
  • Insights from my
    Australian Adventure
  • Measuring Innovation: The 2009 Innovation Summit
  • Innovating in a Recession
  • More on Mental Models

  • Measuring Innovation: The 2009 Innovation Summit

    A recent McKinsey Survey found that companies reporting the highest contribution to growth from their innovation projects use metrics across their whole innovation process.

    These companies are more satisfied than others with the ability of such innovation metrics to help their organizations be more innovative. These metrics do everything from aligning individual performance incentives to improving innovation performance to communicating with investors.

    If you are concerned about your organization's ability to measure innovation, please plan to join us at the Third Annual Innovation Summit, on Thursday, October 8th in Cologne, Germany.

    What can you expect from the Summit?

    1. Insights from company executives on the challenges and best practices of measuring innovation;
    2. The ten best practices from the latest research on measuring innovation;
    3. Guidelines for customizing your organization's innovation scorecard; and
    4. Opportunities to talk with others who are addressing similar innovation measurement challenges

    Because of the expected interest in this topic and the interactive nature of the Summit, attendance will be limited to 40 participants.

    This Third Annual Innovation Summit is being co-sponsored by innovation-europe and DAGAZ GLOBAL.

    Innovating in a Recession

    The following words of advice come from the website innovationtools.com as a result of a survey of innovation experts and practitioners about the strategies they recommend for maintaining innovation during these challenging times. I am summarizing their advice here to help you stay ahead of the curve despite the global economic challenges:

    * Redouble your focus on customer needs. Customers always have problems to solve, even in a downturn. Invest time learning how your key customers' priorities have changed. How can you eliminate their pain? How can you help them to contain their costs? Make sure you clearly understand how those customers determine value, and align your products, services and marketing with that value.

    * Look for opportunities to inexpensively test new ideas. Continue to experiment, but do your best to fail fast and cheaply. Look for opportunities beyond your firm's walls to continue your innovation efforts, but at a lower cost and lower risk. Partnering with other firms who provide complementary products and services is another smart way to share costs and risks.

    * Look for creative ways to extend your current products. Consider creating new value-added services for your products, and brainstorm ways to provide new customer experiences. Think in terms of other uses for your existing products. Look for small improvements to your products that can significantly increase their value, at minimal additional cost.

    * Take a fresh look at your supplier relationships. Many companies undervalue relationships with their suppliers as a source of creative ideas and solutions. Strengthening these relationships may help you to recover faster when the market upturn comes.

    * Don't just think about innovation in terms of products, services, and business models. Why not spend some time brainstorming with a cross-functional team on how to identify and reduce areas of waste, an effort that can uncover major opportunities for cost savings?

    Conclusion. Through these ways and others you may have come up with, you can figure out how to maintain your innovation momentum through this downturn. Doing so is a critical and high priority strategy that will enable you to jumpstart your competitors when the economy rebounds.

    More on Mental Models

    As long-time readers of the Practical Innovator newsletter know, Mental Models, those pesky filters that often unconsciously color our worlds, can keep leaders from being their most creative, most strategic best. So, it's very important to continue to be aware of our mental models and have techniques for managing them.

    The following recommendations are adapted from the article "From Mental Models to Transformation: Overcoming Inhibitors to Change" by Jerry Wind and Colin Crook (Rotman Magazine, Spring, 2009.)

    A great way to understand mental models is the following description: Each of us creates our own world, which is internally consistent and complete. Our eyes and ears are constantly gathering information, but our mind is not really processing all of it. "Unlike a camera, we are not actually decoding all the pixels; instead, like a cartoonist, we are drawing a caricature of what we see before us based on our mental models."

    Mental models can limit our ability to recognize both opportunities and threats, to be as creative as we possibly can. Being aware of these filters and mental blocks is more important than ever in a world of rapid change.

    Of course, as the authors point out, "the opposite mistake can also be problematic - seizing every new model that comes along, some of which turn out to be fads." As with so much else in the world of strategic and creative leaders, balance is the answer. "The solution often lies somewhere between revolution and the status quo."

    Once we recognize the central role that mental models play in our thinking and action, we then need to examine our own mental models. Are they the right ones, given how the world is changing? If they aren't working, how can we find new ones? The following are some tools that can help leaders overcome faulty mental models:

    Bring in the radicals: Even heretical ideas may open thinking in new directions. Too often we are hampered by our own ingrained knowledge and we need "renegades" to challenge our thinking. When Pentagon officials sought to understand possible terrorist threats, they turned to science fiction writers and film directors!

    Challenge assumptions: Dell and Toyota challenged the view that inventory was an asset and ended up creating more flexible just-in-time systems that transformed their industries. Think about how Napster challenged prevailing assumptions and what it has thus done to break the mental model of the music recording business. And what has happened to traditional newspaper advertising as a result of the challenges to prevailing mental models from E-Bay and Craig's List?

    Travel and explore new ideas: Howard Schultz created the idea for Starbucks after an inspiration on a trip to Europe.

    Create interdisciplinary diversity: Break the silos. As with rivers and mountains in the natural world, barriers between models can sometimes be crossed, bridged or tunneled through. In the business arena, there are often huge chasms between different functions within an organization, such as marketing, sales and operations.

    Bridging such gaps through interdisciplinary initiatives can have a dramatic effect. For example, some companies are now drawing together R&D, marketing and operations in new product development. Elsewhere, marketing and finance are now collaborating on improving marketing metrics. By bridging silos, organizations can fundamentally change the way they address critical problems and outmoded mental models.

    Experiment: We must also continuously engage in experiments, or what the authors call "R&D of the mind." While some of these will be planned, some will be natural, with insights arising from studying the environment around us.

    Change the Infrastructure: Mental models are often hard-wired into an organization. Supporting new models involves looking at all aspects of organizational architecture, including incentives, processes, culture, information technology and competencies.

    Conclusion: What lessons have you learned from the current economic recession? You may have cut your overhead or scaled back as a result, but have you rethought the mental models underlying your business?

    "Before early mariners such as Christopher Columbus could set off on their explorations, they needed to reject the model of a flat Earth with waterfalls at its edges. It was not the limits of navigation that prevented others from crossing the Atlantic to discover these new worlds; it was the model of the world itself. Until this model was challenged and rejected, new maps could not be drawn or new worlds be discovered. While navigating the ocean was a huge obstacle, breaking the old mindset was an even bigger inhibitor to change.

    "How is flat-world thinking limiting your own possibilities? What new threats and opportunities can you uncover with a shift in thinking?" Companies with staying power have leaders who can challenge and, when necessary, change their mental models to embrace new worlds.

    Insights from my
    Australian Adventure

    In May of this year, I spent three glorious weeks in Australia, with most of the time devoted to exploring Western Australia.

    Among the many experiences I had on my trip was a visit to Fremantle, an oceanside town just outside of Perth, the capital of Western Australia. As I walked along the streets in this peaceful town, I came upon the sign shown above. While the sign was meant to advertise a company that provides technical support for the mining industry, it resonated with me and hopefully will with readers of the Practical Innovator. How often have you mined your creativity today? What does it take for you to successfully mine your creativity?

    According to Professor Amy Edmondson at Harvard Business School, fear of failure is a major impediment to innovation. Edmondson calls this a lost opportunity. "Any business that experiments vigorously will experience failure -- which, when it happens, should be mined to improve creative problem solving, team learning, and organization performance."

    How can you mine the creativity in your organization and capitalize on failure? "Above all," Edmondson said, "management must create an environment of psychological safety, convincing people that they will not be humiliated, much less punished, if they speak up with ideas, questions, or concerns, or make mistakes."

    My trip also gave me an opportunity to have several conversations about different perspectives around innovation. I heard many examples of innovative approaches in Dubai, India, and China. I also heard something quite disturbing: the general perspective is that the US has lost its innovation edge! Which makes it even more important for all of us to be concerned about mining our creativity and that of our organizations!

    Also among the highlights of the trip were three lovely days spent with Susanne and Alan Dennings, on the family farm in Ongerup 5 hours southeast of Perth. There I finally got to see Malleefowls, at the Yongernow Malleefowl Centre and in the wild!

    For more of an update on the Malleefowl and the Malleefowl Preservation Group, please see my website: www.breakthroughcreativity.com and click on malleefowl!

    The following quotes were heard at an innovation conference at Kellogg School in Chicago, Illinois in November of last year:

    "Innovation is absolutely critical in today's environment. But innovation means more than just new products and services. It also includes thinking about business systems and leadership in new ways."
    -- Betsy Holden, Senior Advisor to McKinsey & Co.

    "An innovative firm requires a culture that encourages ideas from throughout the company. It also demands the right incentives to ensure people feel comfortable in bringing ideas forward. Fear stifles innovation. If you punish failures and don't invite ideas, that will kill innovation."
    -- Miles White, chairman and CEO of Abbott Laboratories,

    "To make creativity and excitement happen, a company must incent for it, measure it and hold leaders accountable to be innovative. Our company's success derives in part from our leaders being 'innovation nuts.' But it takes more than a few top people thinking outside the box. Innovation is what we're about, but if our people on the shop floor don't know that, we're not going to go anywhere."
    -- Carol Bernick, Executive Chairman of Alberto-Culver

    63% of global CEOs surveyed by Price Waterhouse say that creativity and innovation are the hardest skills to find in employees!

    "Innovation is less about great ideas than an organizational competency to act on great ideas. It's not what you say -- it's what you do, and the more you do it the better you get at it."
    --Michael Sachs, Chairman and CEO, Sg2

    Lynne Levesque Consulting

    A global consultancy dedicated to accelerating the strategic and creative performance of leaders and their organizations -- in ways you've never seen before!

    And now collaborating with international colleagues to form DAGAZ GLOBAL, designed to help leaders and their organizations achieve greater growth through implementing and measuring innovation.

    For more about DAGAZ GLOBAL
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