The Connected Art of Selling Outcome-Based Solutions

Outcomes ROI neededThe typical linear and often siloed mindset that we have for much of our innovation thinking within our business organizations, has to rapidly fall away. We are in the ‘cusp’ of a fundamental change that technology, platforms and connected ecosystems will bring into the mix for connecting and collaborating in dramatically different ways than the past.

One of the implications will be our need in measuring and the metrics within companies. The measurement of inputs, throughout and outputs need to become far more focused on delivering speed and scale potential as the critical points. We are far more needing to focus on the outcomes as our primary point of measurement.

This is a further post on discussing outcomes as the focal point of our innovation measurements, following my recent one of “Shifting to Ultimate Outcomes”

Recognizing the emergence of the outcome economy

The outcome economy which is emerging has many implications within it and how we measure and value these will become increasingly important. Companies will need better data to calculate costs, evaluate its potential value and will be modelling far more the risks and tracking the factors required to deliver within any outcome-based value promised.

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Shifting to Ultimate Outcomes

OutcomesMany organizations are struggling with their metrics and ways to measure the progress and success of their business. From this writer’s point of view their innovation activity gets caught up in plenty of unintended consequences, to put it mildly, in wasted debate, discussion & bad decisions through wrong measurement criteria.

Firstly, we are still locked in the old paradigm of thinking this is an industrial economy where we set about measuring inputs to innovation (R&D expenditure, capital investment) and then focused on the intermediate step of throughput and then outputs (publications, production units, patent filing, end products).

We also perceive innovation far too much still as an activity within just one company – viewed as linear, with considerations for services more of an after thought (like ‘bolt-ons’). Production systems still remain far too often the driving force of performance judgement.

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Journeying across the darker side of the innovation moon

When you decide to make any trip, you need to have some sort of roadmap to navigate yourself by. The difficulty is when you decide to step into the other side of the often known, into the lesser known or completely unknown sides of innovation, where there seems to be no decent roadmap, the enjoyment is partly in setting about it and trying to create it, to piece it together.

I wrote about the dark side of the innovation moon in mid-2012 and why it should always make us curious. Within my blogs that I’ve written here on this site I have kept coming back to its initial stated aim of “building the DNA of innovation” This has become a real journey of ‘stated intent’.

My journey of the past 18 months

For me, in the past eighteen months or so, I have achieved much of what I wanted in ‘advancing’ awareness of innovation, mine as well as others, for those that cared to read my ‘wanderings’. I wanted to wander and explore innovation, go where it takes me, sometimes follow a whim , pursue an avenue of enquiry or rely on the known facts and see if they ‘stand up’ to examination, to analysis, to actual practical application.

While I’ve also travelled on this investigative journey I have equally had to stay ‘grounded’ in the work that allows me to make these ventures. This grounding is the work I do with clients in advising, coaching, mentoring or consulting on innovation. It often is from my exploring comes the very source or triggering points, that many need to have explained, to help them in overcoming their problems or roadblocks.

Often these conversations determine where my next foray will take me in my explorations. I am just always uncomfortable when there are open issues left over from these engagements, that I felt I did not have the best answers when asked. It makes me want to go and find better answers. It is in all honesty, a never-ending quest if you have an enquiring mind. Innovation is always restless and constantly evolving, so we also need to be. So I have to certainly be.

So much within innovation is hidden, it is implicit not explicit, it relies on the people element for its generation and that is so often reliant on gathering a set of experiences to translate this dispersed knowledge into all the necessary connections to make something different, something new, something that is needed in the market place.

Exploring the lesser known regions of innovation, amplifying the known

In my travels I’ve explored much of the less understood sides of innovation. I have set about to try to explain them. I’ve tried to relate them to the aspects of everyday innovation, give those novel and logical frameworks or some method and structures to approach them, so they can be integrated into this work. Some have worked better than others.

When you arrive back to a certain point, you take stock, you reflect, you judge what has made a contribution or not, what still needs explaining more. Don’t get me wrong this is not a one man quest to explain innovation but it is borne from a real belief we do need to push the boundaries of innovation.

We do need innovation to enter the mainstream of our everyday thinking, to be something we feel naturally comfortable undertaking, as part of our make-up for our growth or prosperity. I often feel those that ‘see’ innovation that listen and engage, still make up the minority. It is those that don’t understand innovation, and I feel this is the majority, including most of our leaders, who simply pass over it, these are the ones we must find ways to draw into our circle of influence.

Presently those that are not fully picking up on the value of innovation are happily assuming others are fully active and totally switched on to all that makes up innovation potential. We need to get them involved. They have not fully realized they are as essential to contribute to a sustaining future, based on innovation solutions, so we can collectively tackle growing societal problems. We need to move ‘many’ from being the problem to being ‘engaged’ in mapping out the innovating future so innovation can fulfil its latent potential .

Drawing in the vast majority so we all become innovation savvy

The sad truth is, until we bring innovation up in each person’s thinking, we stumble along. The joy of any investigative journey that you undertake, is that you meet fellow travellers along the way. I am blown away at all the creative and thoughtful innovation thinking going on but sadly, still have to ‘put up’  with that not so imaginative thinking that goes equally under the guise of innovation writing.

I’m not just talking about those tired old lists of handy, instant solutions to follow that conveying that promise that this will help you to master innovation, but the many trivial comments that are just beyond twitter length. These often do not serve innovation well, or for the person grabbing at them feeling that if they clamber on board, they can float along quite safely. How wrong they are, they are simply drifting along, most probably moving further away from their real objective.

We all need some form of roadmap or blueprint I feel for innovation and life

We do need our roadmaps, our blueprints of innovation. They are essential when we decide to undertake a journey. If you don’t have the essential of a compass, spare food and drink, warm clothing, good walking or mountain shoes then you should not venture out into the mountains. I am more than fortunate, to live in an area surrounding by mountains and you give them a certain respect, I think innovation deserves that as well.

So I have taken stock of this journey I’ve been making in the name of innovation. I’ve written about 120 articles (blogs) in this time, applied the learning wherever possible. Some of the results have been highly satisfying, even gratifying, others upon reflection simply did not work out as well as they should have done, I felt they did not get the ‘resonance’ I had desired or intended.

Clearly I set out in my search and have ended up eighteen months later, very clear on one absolutely basic point for innovation. If we do not come together and gain a common language for innovation, not as a throw away buzz point, but as a unifying point, we will never be able to teach and transfer innovation to all the others that have not bothered to pick up on understanding the innovation language.

Why is a common language for innovation important?

Innovation has so many pockets of confusion and traps to fall into for adding to our inefficiencies. We still see so much fragmented energy, plenty of differences of approach and potential misunderstandings. It often saps the very juice of innovation. Organizations have plenty of unproductive capital, even when they hack away at all the undergrowth. Resource allocation required for good innovation remains patchy, under-served and often starved. We all become increasing busy at fixing what we have, trying to understand those hidden costs, spent energies and lost opportunities.

Until we arrive at a more uniformed approach to innovation, improve the management of innovation and its development within our systems, structures and processes we stay stuck in constant re-invention and duplication. Seeking a common language allows us to form ‘stickiness’ in value, it becomes the glue to align the parts that make up innovation and forms the whole we seek.

Reflecting on a journey, translating it into clear outcomes

I think I should stop journeying and focus down in the future just a little more. There are real focal points of need that will be required for us all to live through in 2013. Having available possible solutions, providing some objective advice (hopefully) so as to discuss and demonstrate these for clear points of impact can be more beneficial at this time. My journey needs to become more based on an ‘expedition’ to deliver even more tangible benefits and outcomes to all that care to engage.

Moving into 2013

So 2013 will be for me, one that becomes a ‘converting and driving’ of many of the areas I have been investigating in the recent past. Exploiting and extending, experimenting and exploring.  It allows me to extend further in that constant sense of renewal I always feel we need to have when one year closes and another one beckons.

Any ’journeyman’ always welcomes those moments of recuperation before that need to go back out and ‘push out’ on the next adventure. Certainly for me innovation is certainly that, full of excitement where you can be enterprising and intrepid, thoughtful and determined.

I just need a ‘touch more’ of the enterprising to come out in 2013 as my stated intent and be more focused on those impact points we are all in search of. Tackling the issues, challenges and problems where I hopefully can contribute clear solutions too, one way or another.

So my goal is to be “the innovation translation point” for providing the needed impact and focus by supporting and delivering different solutions to the challenges we will be facing in the year ahead. Simple huh! Why not set a challenging target?

Please enjoy your Christmas and New Year celebrations, I certainly will.  Thank you for all your time that you have invested in reading my thoughts, its highly valued and greatly appreciated.

The seperation effect required for innovation

I have recently been in some different discussions about the merits and balances required to manage incremental and radical innovation. Partly this is in preparation for a workshop later this month but partly from a conversation I am having with a sizable, well respected organization, with its head office based here in Europe.

In the conversation within the organization we were discussing the breakdown in their treatment of incremental and radical and they suggested this was being managed within an “ambidextrous structure” yet I was not convinced. I have to point out this was only a part of a broader story on the difficulties of managing conflicting innovation demands that they were having. One key constraint in their thinking I feel was not having distinct units as they were trying to manage incremental and radical through the same process and that, for me, is a basic mistake.

I feel to truly claim an ambidextrous organization you have to be working towards the conceptual model offered by Reilly and Tushman on the “Ambidextrous Organization”

Reilly and Tushman’s argument was to truly flourish, not only do you need to maintain a variety of innovation efforts but  it does need more of a recognition of the full organization to manage these differently, not in isolation or selected parts of your organization. You need to consciously address the differences and build those into the twin process of managing incremental and radical. Let me offer my take on this.

Simultaneous the need is to manage the differences in Exploration & Exploitation.

I love how two words have such potential in their meaning and approach. It is the same as ‘divergence or convergence’. They clarify distinct differences, you don’t merge them, and you treat them as one leading into the other (divergence into convergence) or running in parallel (exploration & exploitation) for good reason.

The exploring and exploiting does needs separation. In organizations that practice ambidextrous design they separate the new, exploratory units from their more traditional, exploitative ones, allowing for different processes, structures, and cultures to emerge but it is at the senior management level they maintain tight links. This way you can pioneer more breakthrough or even disruptive innovation while allowing the incremental gains to be focused, and optimized without this consistent set of  distractions of trying to balance the two within the same resource pool or trying to squeeze it through the same assessment and time line process.

It is very different when you have to go on exploratory expeditions which are harder to determine and the last thing is having the constant pressure of balancing for time and between types of innovation. Exploration & Exploitation approaches need really different measuring metrics also.

It is at the senior leadership level any conflicts are managed not within the unit or organization department or even by a head of the unit if the organization does not manage in this ‘ambidextrous’ way. If you attempt to manage these together I think you don’t extract the full benefits you can gain from a more dedicated focuses working on distinctly different innovation needs.

What does radical mean to you?

The other issue I have is the use of ‘radical’ within the discussion. This can create such different meaning for each of us and can certainly be preconceived, so it already becomes hard to let go or change. Also ‘radical’ is often felt in larger organizations as something that simply does not fit as they are not a radical organization but a careful, often too cautious one. So ‘breakthrough’ seems to be a more natural fit and sits opposite of ‘incremental’ far more in my mind and it seems most others, worried over the ‘radical’ label. For incremental you exploit  through upgrading, adding more choice or building on what you presently offer, whereas you explore far more for breakthrough projects.

You can rightly point out there are numerous different type approaches and I recently wrote on what is the appropriate design within our organization ( ) using radical I know. Your type is partly determined by your structure and its degree of optimization of its potential flexibility and what you need to achieve.

So what are differences to be recognized for Exploring and Exploiting?

The understanding has to come back to alignment, the alignment to strategic intent (of the innovation need) and the recognition of distinct differences in critical tasks. It is defining the differences is the role of the leader, who is either managing incremental or breakthrough innovation,as they should focus on different competences, controls, rewards and the environment you are expected to work within, to deliver these as effectively as possible. It is difficult to ‘flip’ between the two as they call for distinct mindsets.

Again it is the power of the difference in thinking about these. Using the comparison of exploitative versus exploratory in this two word comparison that I love, does give you the real differences in the focus that needs to be recognized and undertaken.

Exploitative focus Exploratory focus
Incremental Breakthrough
Cost Growth
Operational Entrepreneurial
Formal Fluid
Rigid Adaptive
Linear Self-organizing
Attainment Grasp
Efficiency Experimenting
Development Research
Continuous Discontinuous
Inside-the-box Outside-the-box
Analytical Investigative
Examine Explore
Verify Detect
Extract Probe
Protect Challenge
Productive Milestones
Lower-risk Risk-taking
Directive, top-down Visionary, involved

I’m sure you can extend this list even more but the point is that the difference in mindset is significantly opposite. Can you apply these within the same business group or unit? I seriously doubt it.

Eating from the same innovation stew pot everyday might not be the best solution.

As we think of innovation we have to be careful not to limit ourselves, not just in approach or types but in the way we set about and manage this. Trying to bring all aspects of innovation activity into one ‘pot’ means you end up with a often underwhelming stew. It simply fails to really deliver, as you failed to do the necessary separating and distinctive preparations that all the parts needed to be achieved as your end result, to meet the different market needs that are around.

You need to seperate. Innovation that sets about protecting the core, building and strengthening it and that that pushes and extends the business beyond this really do need really different mindsets in approaching and managing across the organization.  Not just in  isolated pockets struggling to balance the different demands being placed on them.

Within these ‘collective’ silo’s they can’t differentiate distinctly enough and until this is fully understood it constrains and adds unnecessary pressures. Unless you address this  it is never fully appreciated across the organization on what is needed to be going on and how you should support and measure it’s results. Bundled up it all becomes a compromise.

There needs to be this realization that incremental and breakthrough are so different in activities, processes, structure, cultures and metrics to achieve the optimized effect. Having a clear seperation in managing incremental and breakthrough innovations is more effective and efficient but please don’t tip them in in the same pot, but distinct and seperate innovation ‘cooking’ mediums, to achieve a more outstanding and differentiated set of results where compromise was not down to being mixed into the same general approach.

Economic growth is an outcome of the innovation trajectory we set.

Today managing innovation is complex; often success is measured and valued by the creative destruction of others. The ability to ‘evolve’ is very determinant on the knowledge base, either within a given economy or within a ‘federation’ to bring together as something new, offering more value than what is on offer today. Innovation is highly dynamic in its constant change but also in its needs of constant co-ordination of its parts.

Nations are Very Different

No one nation can just copy another, the same as one business entity cannot simply copy another, each has distinct characteristics, a history and a certain set of ‘physical’ boundaries on where it is located. Different cultures, different histories set each Nation apart.

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Can innovation lead us to economic recovery?

After some recent #innochat debates (  around innovation including the future of Nations, of the US, and of innovation itself and how it needs an organizing framework to work more efficiently,  I wanted to dig a little deeper, to get my own head around all of this. We do have real problems in the world and we need to find solutions but something strange is happening and I was not sure I understood it. So I’ve been on a little investigative journey that is beginning to make some good sense, well at least to me.

A host of financial contagion has been heaped upon us progressively in recent years.

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Renewing Innovation through the Social Innovation Agenda

The challenges are growing in their social dimension across Europe, the United States and a host of other countries, both developed and developing, that are needing new fresh responses. Social demands will inevitably increase as nations are being confronted with budgetary constraints, increased deficits and mounting debts to resolve. Social needs will become more pressing and innovation, social innovation, will increasingly explore opportunities to extract ‘more from less’. Innovation can play an increasing part in resolving social challenges that are increasingly confronting us.

Starting a new movement on social innovation in Europe

Recently I became a member of . I certainly  feel this is going to offer something exciting and vibrant. It is a growing community of thinkers, creators and innovators with the knowledge and skills to change the way we face Europe’s most pressing issues. Contributors to the site will take a strong hand in shaping the direction of social innovation across Europe, breaking down silos and raising a unified voice. I need to find my own part in this, as there are multiple ways for contribution, which I’m still presently figuring out.

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