Business Needs Innovation Ecosystems

The significant transformation taking place around exploiting technology and digital management has made ecosystems and platforms a mainstream prospecting need, in most of our businesses today. We must engage in what all of this means and its business impact.

I certainly believe the ecosystem approach will increasingly become the main value-producing stream for innovation delivery. Platforms, strategic partnerships, new business models all will be on the agenda of any serious global organization and ecosystems through platforms are the organizing environment to enact these.

Jeffrey Phillips and I have collaborated around different innovation thinking for some years and in a late August  2016 discussion, over Skype, we realized that what was emerging from our usual exchanges and insights was that the area of Innovation within Ecosystems was gathering pace and what did that mean for innovation in future business and practice implications?

In Jeffrey and my latest collaboration what became different, is instead of a series of stand-alone posts or thought papers, we would place this collaboration into a dedicated “ecosystem” posting site www.ecosystems4innovating.wordpress.com was created to reflect the world of ecosystems we need to explore.

Why not take a look, it is building in its diversity of understanding, exploring this fascinating area of platforms and ecosystems and what this means for innovation. I believe this is heralding in a “new innovation era”

Why the difference in having a dedicated website?

It is our growing understanding that all of ‘the dynamics of the innovation system’ we all operate within, is evolving all the time and in this particular intersection that we have chosen, is highly dynamic and fluid. Understanding ecosystems and platforms is evolving in front of our eyes. So to put our thinking and collaborative time into this we felt a dedicated website allowed us to post insights, knowledge, experiences and discoveries on a constant, evolving basis.

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In the blink of an eye, it gets something bigger

Fahrenheit212 anhd CapgeminiSo in the past week or so we have seen the announcement that Capgemini has acquired Fahrenheit 212, at present for an undisclosed sum, now that one was a real surprise.

I have a friend when he is presented with something that stops him and makes him really have to think he would say “intriguing”. This joining forces is one of those ‘intriguing” moments for me.

Capgemini have been leading much within the transformation process around technology with all things digital, they have been pioneering and offering some significant advice around transitions. It seems they are ‘pulling’ in the innovation promise with this acquisition to add to their solution offerings.

I wrote about their Applied Innovation Exchange announcement recently and how I felt it was thin, a more “a tenuous toe in the water” and I finished the post with “I hear you Capgemini on the intent…but “there is a real need to put some ‘red meat’ on the bone here,” and that is what they seem to be doing in a “blink of an eye,” with this Fahrenheit 212 acquisition, or at least allow the tissues to be grafted on and take hold, so it can challenge where and how innovation transforms the business process.

David meets and marries a Goliath.

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Is this really breaking the traditional model on Innovation?

Cap Gemini AIEI came across the recent launch of Capgemini’s Applied Innovation Exchange today, it left me puzzled. Firstly the latest part of their hub network opened up in San Fransisco in mid January, yet I’m wondering why this is the first time I have come across this?.

Putting that aside the website, the current point of reference, leaves me puzzled, a little unclear on its ‘compelling’ proposition. I think I get it but it simply strikes me as a launch as ‘thin,’ on really spelling it out for me, or surely the very clients, in its value and potential. It actually seems a very minimum viable product.  I just had to go in search of a better understanding.

The concept of having any “applied innovation exchange” coming from Capgemini should be promising, as somewhere to go, as they are a leading technology consulting practice. It ‘seems’ to be offering a connecting platform, well-established ecosystem advantages but it seems so understated here.

Why? It seems so tenuous, a toe in the water. I would have expected a much bigger bang here. The website told me just enough but I think it should have delivered more.

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Sinking the unthinkable

Innovation and the TitanicThe days of simply having ideas moving through a pipeline and coming out the other end as finished product and services seems part of our great past.

I believe Innovation is becoming overwhelmed by all the changes we are applying into innovation activity and its management.

I would say the IM system is under even greater strain from the shifts coming from  the multiple applications of technology, new  approaches to design and modelling as well as all the necessary engagement and touch points.

Yet we are still expecting this deluge of change occurring to happily move our innovations through those past established, often manual processes, we have presently in place. I think not.  We are deluding ourselves, that all is well.

There are such changes occurring.

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Exploring the Drivers of Innovation Change

ChangeI always show a particular interest in statements claiming to have identified a relevant driver of innovation change, then to think through these. Can these be valuable and be associated to the portfolio situation within an organization’s need, in seeking different viewpoints of product or service change?

Opening up our thinking to change can drive our business offerings very differently.

Often within these drivers we do need to explore what is the underlying force behind them, it allows us to pause and think. As you think through what these different change drivers on what it might mean to extending your new product or service developments, these can prompt radically different and  imaginative solutions to consider..

Using the different drivers can give you new insights into your innovation activities plus also can prompt significant changes to freshen up your innovation portfolio. They are certainly a good place to start to get the creative juices flowing even more.

It is worth constantly working around different drivers of innovation change.

Periodically I would suggest you work through each of these and see if this changes your thinking or approach and you can then see a different angle or opportunity that might emerge that changes the thinking.

So let me share my opening nine identified drivers for innovation change:

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So why are we not facing up to the big challenges of today?

Societal ChallengesPerhaps why innovation feels somewhat flat (well for me) is our organizations and societies are utterly failing to allow us all to step up in innovation to tackle the massive, growing problems that are swirling all around us.

We need to shake out of our lethargy and really begin to attempt to solve the real issues of our time. Some organizations are clearly working on and trying to draw attention and gain greater engagement but we need a much greater concerted effort to focus on the big societal challenges.

Global warming, rising health issues, finally cracking cancer, malaria, dementia, finding different solutions to the ageing within society. How are we going to tackle the rapidly depleting natural resources, the future conflicts over water, food, or energy . These are big, hairy, audacious gaps to be resolved.

Many are avoiding the need too stare hard into the future as we are not re-equipping everyone with skills that combine inventiveness, innovation and creativity that contributes into their communities, we have got stuck in the “me”. A reality of depletion is racing towards us and it is not a pretty sight.

The growing radical innovation activity gap

We are facing the innovation gap as our problems keep growing linearly yet we must find ways to rapidly scale and deploy our knowledge in new, more dynamic ways. This requires society to learn how to apply effective innovation themselves, not just being whipped up, waiting for the latest gadget or incremental advancement to be put into their hands.

We need to build the desire of wanting to be part of rebuilding society; making our contribution to real advancement or feeling they were there, involved, part of the “times” when this shift to societal innovation was happening.

We need to be collectively moved by innovation and what it can offer.

Technology ideas and connectionsTechnology does hold a vital key, so does the emerging social media for reaching out to critical masses but let’s face it, today we are deploying the best resources (the best and the brightest) not in the area on solving big societal problems but in slavishly churning out the next technology or gadget. These actually mean nothing unless they become increasingly part of the solutions we really do need urgently, to tackle the big societal issues.

We certainly need communications, platforms, different media techniques and mobility as part of the initial global building blocks to putting in place the infrastructures to solve these societal problems. We need the tools, infrastructure, methods, and techniques to scale for solving societal problems not the latest incremental improvement for Apple, Facebook or Google. How about providing innovations that can deliver the parts that give us the power to tackle the problems of our time?

We need innovation tools, structures and methods that will allow us each of us to invent, to innovate, and to be creative in finding our contributions and solutions to societal problems. To go and apply these in practical solutions not just simply adopt them.

I liked what Eric Ries, author of the Lean Startup recently said: “What’s going to make it more likely for someone to start a start-up in the first place?” “Open data is one such thing. If you give people access to the tools, the information about what’s happening in the world, you give them the opportunity to stumble on more novel solutions”

I’d add you give them the empowerment and skills, they will provide the desire and energy.

Then we have the hidden potential behind social media and big data

Can you imagine a world where we all can communicate and contribute into these global societal problems. Combine technology, the internet and social media and you have begun to connect up the parts or the whole planet. The exciting prospect is then ‘feeding’ all this data into finding patterns for solutions. Solutions that are relevant to you, your immediate community but also to the wider ones.

The ability to scale, glocalize, adapt and diffuse

Social innovation struggles today with scale and replicating success in one place and making it work in another. This replicating might be the barrier, perhaps we should not apply other solutions just extract the parts that can work for us. This extraction needs knowing what is valuable to you or applicable, what is not. The need is to educate everyone to ‘break down’ the context and we need to teach numerous different skills to allow this to work. Then you need to work on where are the synergies that can be tailored and applied to local needs. Diffusion and adoption comes into the picture here too.

Dealing with value creation and growth but in radically different ways

We seek value creation, most usually by creating demand, pushing for increasing consumption. Growth is measured by our productive gains. Is this the right way to measure ourselves and how we set about preserving our precious resources? No, we need to challenge this, a real paradigm shift that alters our lenses looking out on the world.

Changing our thinking for a new world of preserving our precious resources

Fresh ThinkingToday’s modern economic activity does need challenging and it is through rethinking much of our view of judging success. Success in preserving, in effectively trading precious resources needs a fresh set of thinking, a new economic understanding. This thinking is way beyond my preserve, there are far better qualified people to offer suggestions than me on this. All I know is that innovation, creativity and invention must all play their part.

Some of my emerging thoughts relating to where innovation can fit are:

1). Stepping back and putting innovation to its better use

We have a world were transparency is finding its place. We ‘witness’ unfolding events faster than ever, they are nearly instantaneous. Governments are really struggling on this new transparency. We can manage this in new ways, instead of trying to control the flow of ‘selective’ data through repression. We need to open up all the positive activities occurring every day that others can learn from. We need to focus on the positives, not dwell on the negatives.

2). We need to provide places for experimentation

There needs to be places, instruments, resources, knowledge platforms that help us all to discover. We need a dynamic flow to discover needs, expose variability, enable experimentation to happen and construct ways to measure improved performance

3). We need to granulate and customize activities

The world is far to big to manage as one, even our countries struggle in adapting policies. We constantly reduce down the positive impact by this ‘crazy’ compromise of adjusting great ideas to meet the broader position. We need to segment down, we need to allow what has the best impact for a given community to be allowed to happen.

4). We need to put to use the non human aspects to speed up decision-making

Computers, sophisticated analytics, automated algorithms all can play their part in any redesign of our activities to preserve our critical resources. Modelling decisions that have impact within the world need to be more freely distributed. Not only knowing our ‘footprint’ on the planet but bringing together communities footprints and redesigning the sharing of the burden. We can optimize so much to help us develop better decisions, knowing the broader impact placed upon communities and beyond.

5). Innovating the future needs new business models, products and services

The growing movement in a number of more enlightened businesses towards only using renewal resources is gathering momentum. It is changing business models, products and services. We need to change from being a ‘throw away’ society into ones that re-use, repair and don’t chase increasing consumption but work to reduce consumption to save energy, water, critical resources etc. We do need a far more radical innovating agenda.

Connecting into the already under way experiments and improving them

Slope of Enlightenment 2There are many different ways we can apply innovation into tackling today’s real societal problems, there are lots of experiments under-way, we somehow need to connect into them in global ways.

We need to make the real efforts of connecting all these dots – we need to design a world where surplus has to be rapidly replaced with managing dwindling stocks. It calls for a concerted, connected and comprehensive manner where technology, ingenuity and our innate ability to be creative, innovative and determined to discover real breakthroughs that can contribute to solving societal issues.

The place our innovation focus has to go is in global engagement

Connected WorldWe need to know far more of where to go, what to connect into, how we can contribute. We need to engage society across a broader agenda of our challenges. Today these are diverse, dispersed, dissipated and disparate set of activities.

We need to bring these together, perhaps to form a new ‘collective’ world organizational as a body that consolidates, connects and diffuses societal challenges. One that is not layered with bureaucracy and governmental nominees but one powered by a new social platform that allows each of us to connect and explore, to learn and engage.

This needs to be built more than likely by the millennial generation, who are clearly  seeing societal challenges as their global innovation task to tackle and resolve. They are more than likely better equipped to understand social engagement and learn to connect and deliver the tools to do the jobs into everyone’s hands. They understand the power of ‘connection’ through today’s application of technology, social platforms and application of the knowledge being learnt and adopted in practical use. We need them to engage and lead.

What do we need to do to lift innovation onto that slope of enlightenment?

Seeking SolutionsWe need to firstly acknowledge our growing global problems that need tackling through more radical  application and solutions. We need to learn to scale, learn, deploy, apply– we need to put our own intelligence into innovation. We need to move the innovation needle significantly, individually and collectively.

Relying on organizations providing their solutions in a radically different world of challenges where they are stuck in delivering their steady state of ‘ever consuming’ incremental thinking is not good enough. We need a new evolution and revolution, applying new innovation thinking by putting radical innovation solutions back on the global agenda that reduce our throw away consumption and focus on preserving what we have.

We need to regain a collective sense of momentum and a belief that we are truly working on something that changes our lives and helps save the resources we need to live in this world.

The Innovating Era: Creative Destruction or Destructive Creation?

Creative Destruction

We have been entering some perilous times recently and I can’t imagine when Joseph Schrumpeter outlined his groundbreaking efforts for explaining “creative destruction” he or anyone else, could image this being flipped around to what we are facing more today, that of “destructive creation”.

Schrumpter saw “creative destruction” as the renewing, through new innovation, society’s dynamics that would lead into higher levels of economic development and welfare. At the same time recognizing that this destroyed a few of the incumbents to the benefits of many more newcomers and increasing value creation for broader society.

Today it seems we are caught in the reverse of this- the process of “destructive creation”- where it benefits a few rather than the many. This sets out often to destroy or greatly diminish the usage value of existing products and services before it is optimal to actually do so, and in the process incurring often significant costs not taken into account at the time. These unforeseen issues have consequences that negatively affect parts of society not foreseen or contemplated at the time.

The shift has placed the emphasis on the role of destruction rather than creation in driving innovation activity. This is getting uncomfortable, innovation then becomes not so good for you perhaps? This is becoming the game for a few to make money, to corner markets, to dominate and wanting to achieve monopolistic positions and not so worried over the wealth creation aspects of creating jobs, building communities, cherishing certain values.

We need to be on guard in understanding the fundamentals within innovation as it should advance for the good of society, not be actually working to its detriment. Actually who is benefiting from the distribution of new wealth? The developed world is seeking desperately ways to regain growth but it needs to be more equitable, not in the hands of a few that determine our choices but increasingly seem unaccountable for their actions.

Firstly a couple of examples of “creative destruction”

A really good one was the arrival of the personal computer, the economy significantly profited without significant economic upheaval. It raised productivity and ushered in significant value for many.  The typewriter of course quickly became obsolete for this “creative destruction” and certainly the organizations investing in this lost out.

Another one has been the general advancement of technology. For example within the telecom sector where we were able to benefit from massive increases in managing data, calls and volumes around the world to connect us all up into a global economy. Old switch boards, chunky mainframes and old communicating technology were thrown out and this advancement in technology allowed the scarce resource of people to be employed differently and more productively. Technology has provided huge advancements but it also has its downsides.

The problem both of these examples have though is they are technology lead. Technology has been racing ahead. With the active encouragement of “policy innovation” and its stimulus we have been building more complexity as technology became more powerful. Complexity is everywhere. You add in scientific advances it has been a powerful combination effect of promoting social change- often radical social change. All positive, or has it been?

Today, we are dependent on complex technological systems to manage much, often incomprehensible to most if not all of us. Let me give you a couple of examples of the growing downsides we are seeing.

Let me provide some examples of “destructive creation”

Destruction form of creation

Derivatives- that dirty word that we have been struggling with over the past few years, that has been causing much within our current global downturn. At its heart was a system no one quite understood that created mortgage leverages, financial convertibles and it was in this proliferation of complexity and uncertainly these highly leveraged investments had become totally incoherent to us. The “destructive creation” part then kicks in often in unexpected ways with tragic consequences for many in lost jobs, lost homes, lost lives and lost investment money for  many, while a few made massive gains.

Asia was another example; its lightening speed in its growth had lead to a recent financial crisis simply triggered by capital account converting that shifting into a myriad of different financial instruments. The downside of that had not been anticipated in policy intervention and we had a significant scale of financial destruction that was not creative but destructive in its effect to the economies for some time. Again many people lost out, for some, recovery from this effect never occurred -it changed their lives, often to start again.

Although we are told there are sound risk models in place to assess and antiscipate, we certainly can’t look upon the promise from these with the same naivety in the future after a number of recent events. Much seems unpredictable in hidden consequences. But I would ask “have we lost the plot a little here”, perhaps we can’t really predict and control anymore, when the complexities we have built still continue and add even more layers. We need to accept more ‘destructive creation’ will occur.

The destructive effects presently going on in Europe

Let’s take Greece and its ‘melt down’ of the past twelve months. Could we have predicted the massive social unrest and serious economic decline in the approaches taken by the parties responsible for managing an orderly recovery?  How many times are we hearing “structural adjustment” to cover massive upheaval and watching a civil collapse happening on front of our eyes. Thousands of previously healthy businesses in Greece are being starved of finances, of demand and caught up in such social upheaval. This is destructive creation for the many who have got caught up in the ‘collective adjustment’ applied.

How will the Euro shake out in the coming months when our leaders just seem unable to get their heads around its complexity? This is a proliferation of complexity fuelling uncertainty. Is this because we have been great inventors and innovators or poor at working through all the consequences as analytics alone can’t explain these things in coherent ways, we just watch “destructive forces” being applied in the name of social and structural adjustment sweep away whole swaths of creative good as well.

The pursuit of growth and wealth is fine but are we balancing the conflicting values, consequences and upheavals well enough in the equation, otherwise it tips from this “creative destruction” over into “destructive creation” and that is not a healthy place for innovation to be.

The obsession with innovation- myself included!

Presently our Governments are obsessed with innovation- it sometimes feels it is the only game in town for future growth. Let’s just keep adding novelty and ever increasing value to get our economies going seems to be the mantra.  The problem is we seem to be destroying more than we can build at present, yet a ‘few’ gain from these seeds of “destructive creation” while a majority don’t. We need to flip this back to “creative destruction”.

How much of a society cost are we prepared to pay? Should all this be laid at the door of innovation? We need to inquire about, to explain and understand these forces, both the positive and negative far more. You can get to a certain point where you hit innovation saturation and we will begin to reject it unless we see its value invested within our community, not in others far away.

The replacement rate is speeding up

The other part of “destructive creation” is the attention we are all paying to the replacement rate. The way we discard our mobile phones, cars, household goods and creative increasing ‘toxic’ waste has its destructive creation part. These were foreseen, even have been actively encouraged to promote our economic well being but are they?

I know Steve Jobs and what he built at Apple is regarded as a beacon of success but there is a darker side to this. High rates of innovation, often not truly needed, can be disruptive to the larger society as a whole. A few jobs, many outsourced into low cost environments is leading to a jobless growth in the rest of the industry, it is destroying the usage value (useful life left) of existing products to the benefit of the few, rather than the many.  Some might call this a “shutdown game” establishing conditions that negatively affect values of other products, or is that still called offensive marketing, knowing exactly what the customer needs? I’m not 100% convinced.

Shareholder value is our focus point but what about the shut downs, those old, empty, rusty building that seem to be increasing not decreasing. We are faced more with de-industrialization issues than seeing re-industrialization coming from the present ‘destruction’ forces unleashed upon us all today. What is the cost of disruption and destruction of whole communities in social costs, in our investments for the future when we can’t ‘feel’ or see the benefits of “creative destruction” emerging?

There are many industries that start out thinking they are on the path to “creative destruction” but somewhere along the road got flipped into “destructive creation”. Often this was not the intended path but it became the consequence. Adding more just reinforced the greater destruction leaving it less creative, except in pockets of expertise.

Pressures suddenly built. Competition fell away, they went into troughs of uninspiring innovation for some time. Consumer software upgrades come to mind here, killing off perfectly good software to force us into upgrading but actually pushing us to search for alternatives, killing off useful gained knowledge and continued utility. Where is the cross over point in “creative” and “destruction”?

The quicker we adapt, the sharper we suffer declines somewhere else- technological choices and social consequences- new gadgets vs. decline in privacy for example. Yet the total industry consequence of one party dominating in “destructive creation” is only seen that much later on when the total decline cannot be stopped. It is often not one parties fault unless they are deliberate in their design but we are losing the ability to understand all the consequences of decisions, with unforeseen knock-on consequences .

For instance, if our banks don’t change as society is perceiving they should, and the policy makers seem unable to work through the complexity of this level of change, then society has two choices: remain with the present system where a few seem to gain over the majority, or seek out a change in the financial lending system so society again puts back “creative” at the front of “destruction” to benefit the broader community.

Let’s be honest, the banking industry has not been so innovative in many ways, besides enhancing wealth creation by the use of financial instruments or just to constantly sustain the existing ‘world order’. Will an alternative to our existing financial system evolve and or disrupt, but at what destructive cost?

Disconnects are all around.

There is, when you look around, a lot of seemingly partial and disconnected aspects to our advancement. Where are we in our debates on climate change, stem cell research, toxic chemicals, landfills and plenty more.

How will we manage the feeding of the world in years to come? How will we manage the old and sick. How will society re-integrate growing groups who are getting disenfranchised? All of these can be destructive or built on constructive ways that ‘create’ orderly change. Yet, they seem bogged down in complexity, opposing forces and we are not breaking through these in new order ways. We somehow must.

There are always it seems contesting sides and consistent daily arguments from all sides in complex arguments about how the world would work and why their solution provides the answer. The problem is we simply don’t know. We seem to be losing comprehension of the bigger picture. I’m not sure when you try to describe the big picture it really is so coherent and that is one of our big problems.

Issues are just far too complex.

We are facing more uncertainly and incoherence than ever. Should we call a moratorium on innovation or is it just invention? Can we afford too?

It is interesting observation, we do seem to have moved back to enjoy narratives, myths and cult stories more than in the past, is that a yearning for something from the past in our  lives where one person tells a story that just made sense as it seemed full of wisdom and real good for many?

I think we, as humans, have been reduced down and until we can regain mastery over the complex, needing a structural and societal adjustment or we otherwise will continue to suffer the consequences of “destructive creation.” I think we might start yearning for the good old days of just “creative destruction.” Is technology leading and we are lagging? Can we regain control?

So some commentators have suggested that we have to reawaken our imaginations and really think deeply about our values. Then innovation can perhaps return to being context-specific working in positive enhancing ways to improve society as a whole and not be used for a selected few. All I hope is it will let us ensure we put the emphais back far more on the “creative” innovation part and not the ‘destructive’ nature we have been moving towards recently.

Certainly inspired and some points drawn from a paper “Destructive Creation and the New World Order” by Paul Harris & Daniel Sarewitz