InnovationZealot.com

Innovation Ranked High by Most CEOs

2011-04-18T11:17:42-04:00

In an article titled "Most CEOs Prize Growth, But Other Priorities Vary" in today's Wall Street Journal, Joe Light outlines a Conference Board survey of 704 CEOs between Novenber and January. It is encouraging to see that innovation is ranking among the top three priorities in the manufacturing sector, but still behind cost optimization, a perennial favorite of those who put defense over offense in their businesses. However, with business growth placing first across all sectors, this also bodes well for the cause of innovation, which is a major contributor to profitable growth, and not just that of the "empty calories" kind - growth for its own sake, not necessarily profitable.

Innovation is being increasingly recognized as a primary factor in healthy, profitable growth - and that's good news.

Here's the full article:

Chief executives have to juggle multiple priorities, but according to a recent study, they tend to rank some higher than others.

Top of the list? Business growth followed by talent management and cost optimization, according to the Conference Board Inc., a nonprofit research organization.

Of the 10 priorities that CEOs were invited to rank, business growth far outpaced all other challenges in the No. 1 spot.

-end-

After growth, however, CEOs from different industries tended to show stark differences in priorities. Among financial-services CEOs, government regulation ranked as the second-biggest challenge, while across industries overall, regulation ranked fifth.

Meanwhile, innovation ranked third among CEOs in manufacturing and nonfinancial- services firms, while financial- services CEOs tended to rank that challenge near the bottom (not an altogether bad thing, with some innovation, e.g., derivatives, in the financial sector having caused problems - ed.).

Part of these discrepancies might be due to the intense scrutiny that financial firms have come under since the financial crisis, said Rebecca Ray, managing director of human capital for the Conference Board.

Innovation, while a hot issue for most industries, was associated with complicated financial instruments that contributed to the collapse of some banks, she explained.

Across the board, CEOs were unlikely to name investor relations and international expansion as top challenges.

CEOs tend to balance talent, efficiency and innovation as their main strategies to drive growth, but during crises, cost cutting can drown out the other two, said Stanford University professor Robert Sutton, author of "Good Boss, Bad Boss."

"I'm getting the sense that CEOs have squeezed out [all] the efficiency they can and now have to move to innovation and talent to grow," he said. Talent wars between high-tech companies have heated up, he said.

Among global geographies, CEOs based in the U.S. ranked government regulation as their second-highest concern, whereas European and Asian CEOs ranked regulation fifth- and seventh-highest, respectively.

Asian CEOs were the most likely to name talent as a top challenge, but European CEOs only ranked talent seventh.

"The emergence of talent as a key challenge [shows] the economy may be beginning to take a turn to a more healthy state," said Ms. Ray.

The Conference Board surveyed 704 CEOs between November 2010 and January 2011.

CLIENTS

2009-09-08T11:17:29-04:00

• Austin-Pierce, Ltd.
• AutoCom Associates
• BASF Engineering Plastics
• Car Training Institute (Germany)
• Conix Corporation
• CEP Products, Inc.
• Creative Liquid Coatings, Inc.
• ExxonMobil Chemical Company
• Federal-Mogul Corporation
• Grammer AG – Automotive (Germany)
• Injex Industries, Inc.
• Konal Engineering & Equipment Inc.
• M.A. Hanna Company
• PolyOne Corporation
• PPG Fiber Glass
• Recticel North America, Inc.
• Robert Eller Associates, Inc.
• Rostone Corporation
• Sloan Valve Company – Flushmate Division
• Southern Research Institute
• Teerds & Company (Netherlands)
• The Blackstone Group
• The Reserve Group

Nuts & Bolts Innovation: Bob Kierlin, Fastenal, and PlastiComp

2008-05-12T12:31:40-04:00

I recently had the opportunity to meet a delightful, innovative and successful gentleman, Bob Kierlin, while participating in a Global Technology Conference at PlastiComp, in Winona, MN. Bob, an investor in PlastiComp, is a successful entrepreneur in his own right, was kind enough to join our group and tell us a little about his company, and innovative philosophy that made it the success it has become.

Bob founded Fastenal, with the idea that small businesses might need a good, convenient source of nuts, bolts and other fasteners. He started the business with $37,000 in capital, with one store. Gross sales in 1968 was $18,000, and the company went public in 1987 (with sales of $20 million). By the end of 2007, Fastenal had 2,160 stores in 7 countries - with sales of over $2 billion; a gross profit of 51%, EBIT of 18.3% and a net profit of $232 million (11.3%). On any basis, it's been a financially successfully venture. Even better, it's been personally rewarding for its many employees, and an example for others to try following.

Here are a few things that Bob had to say about his experience and philosophy that I thought worth remembering and passing on (the following are from my notes on Bob's talk, as verbatim as possible):

An organization is a group of people who come together for a purpose.
An organization is people. Focus on the people. Don't hide behind "the organization".
There are two necessary things for an organization: 1. a common goal; 2. to use the potential of all the members.
Grow through customer service.
Use the creativity of all concerned.
No subgroups or divides (in the organization). All employees go in through the same door. No reserved parking places (if you want a good one, get there early).
Everybody gets the same health plan, benefits, etc.
Fastenal is in the people development business, and gives preference to people with no experience.
The company operates "the Fastenal School of Business". All employees go for two weeks, managers for five weeks. This has created a virtual "university of industrial distribution", and others always want to hire Fastenal's people. Bob meets with all prospective store managers personally for 2 1/2 hours.
Allow/encourage independent decision-making and autonomy (30% of store inventory is ordered autonomously by those at the 2160 stores).
Promote from within.
Encourage "chaotic communicatiion": anybody can call anybody, anytime (no organizational barriers).
Don't let initial failure stop you (one of Bob's original ideas was to put fasteners in vending machines - which didn't work out, but the rest certainly did).

Mr. Kierlin has been the Chairman of the Board of the Company and has served as a director of the Company since the Company's incorporation in 1968. In addition, Mr. Kierlin has served three terms as a Minnesota State Senator since April 1999. Mr. Kierlin served as Chief Executive Officer of the Company from 1968 through December 2002, and as President of the Company from 1968 through July 2001. Fastenal and its people have been noted for their accomplishments by Morningstar, Forbes, Inc., and other publications and remain a leader in their field, continually outperforming many comparable and larger companies.

In his closing comments, Bob said he was amazed that he has been able to do all this without ever playing golf. During the Q&A following the session, he was asked what he'd like on his headstone, and replied, "I'd rather be at Fastenal!" Great guy. Great company, by any measurement.

So, what's the innovation here? Primarily, good leadership and common sense (which I, and many say is not common enough) - applied vigorously and continuously. Bob and like-minded others have brought their experience and talents to PlastiComp, and are now helping Steve Bowen and his associates grow their company with its innovative technology in long glass fiber-reinforced thermoplastics - and with a similar common sense philosophy, based on people with a common goal. As Steve says, "It all depends on everything". Take a look at both companies' websites (links above), and you'll see what I mean.

Innovation in Lighting – LEDs Changing the Paradigm on Cars & Streets

2008-02-13T14:31:02-05:00

LEDs (Light-Emitting Diodes) are changing the paradigm on the streets – literally, with new applications in municipal lighting, as well as with growing usage on vehicles.

With their small size, energy-efficient and low-temperature light output, LEDs have become the favored source for lighting in computers and other electronic applications. Now they are being increasingly used in total vehicle lighting and municipal street lighting.

LEDs on Cars - from Back to Front

In the automotive industry, LEDs were earlier applied in, and have since become the primary choice, for CHMSLs (Center High-Mounted Stop Lamps) – due to their small size, ability to be packaged in small spaces, high efficiency/low heat light output, and longer life (up to 10X, resulting in little/no need to replace them in locations difficult to access).

Recently, LEDs have been growing in usage in other automotive lighting applications worldwide – particularly in rear lamps, allowing new design freedom, as well as vehicle differentiation (you may have noticed their faster "on" speed and higher visibility in brake lights). They are now increasingly being used in virtually all automotive signal lighting, including stop/tail, backup, rear fog, mirror-and front-mounted turn lamps, as well as interior lighting.

With the development of white LEDs, forward lighting applications were inevitable. On its new R8, Audi seems to be the first to use LEDs extensively in headlamps, for the low and high beams, as well as the front turn signals and DRLs (Daytime Running Lights) – all contributing to the unique appearance of the vehicle.

(click on picture at left to see animation - source: AL Lighting)

Lexus is also using LED headlamps on its flagship LS600h projector design, and Cadillac has announced use of complete (high & low beams, turn indicators) LED-powered front units on its 2008 Escalade Platinum Edition.

LED Street Lighting in Ann Arbor (read on)

Ann Arbor Leads the Way with LED Street Lights

Here in Ann Arbor (which we residents like to think of as an innovative place to live & work), the city is leading the way with LED usage in street lighting, and the national media is recognizing the innovation.

In a recent Wall Street Journal article entitled " Nine Cities, Nine Ideas - Local governments around the globe are coming up with some of the most innovative ways to cut energy use. There are lessons here for places of all sizes." (February 11, 2008, page R1), Jim Carlton writes:

Officials in this town of 115,000 near Detroit took a close look at their $5 million-a-year municipal electrical bill two years ago and realized they were shelling out $1.5 million -- or roughly a third of the total -- just for street lights. Then they realized they could save substantially by simply swapping standard bulbs for a newer technology: light-emitting diodes, or LEDs.

Unlike standard lights that use heated, incandescent bulbs, LED light is cooler and is produced by a semiconductor. The bulbs last as long as 10 years, or five times longer than traditional lights, while using about half as much energy, Ann Arbor officials say.

The LED technology has been around for decades, and the lights have become common in computer indicators and traffic lights. But until about two years ago, LEDs weren't practical for street-lighting purposes because it was difficult for them to produce white light, says Govi Rao, chairman of Lighting Science Group Corp., a New York-based LED provider.

In 2005, Ann Arbor tried out one technique for making white light: blending red, green and blue beams. City officials installed some of the makeshift lights in the City Hall parking lot. "They looked like they were cobbled in somebody's garage," recalls David Konkle, energy coordinator for the city.

Then manufacturers came to the rescue, developing aesthetically pleasing white bulbs by coating blue LEDs with phosphor. City officials spent $15,000 to install the new lights on a few streets downtown and in a residential neighborhood.

One of the few complaints was from a resident who said the new lighting no longer illuminated his home on the street; LEDs shine light directionally and are typically pointed down at the ground, unlike incandescent bulbs, which cast a glow all around. "We told him we're not in the business of lighting his home," Mr. Konkle says.

Most other people liked the new LEDs, and the city recently obtained a $630,000 grant from the Ann Arbor Downtown Development Authority to replace all 1,046 of the street lights downtown. The city estimates that replacing the downtown street lights alone will save more than $100,000 in reduced power costs annually as well as 294 tons of carbon-dioxide emissions -- equivalent to the carbon dioxide that about 35 homes generate annually from electricity use.

After that, Mr. Konkle says, the rest of the city's lights will be replaced as the technology develops and prices drop. City officials say they could cut their light bill by as much as $700,000 a year by replacing all of the 7,000 or so streetlights in town.

A Paradigm Shift in Two Major Areas of Lighting

These two examples of innovation (categorized as "radical" or "nonlinear", as defined by a new replacement of existing, e.g., incandescent technology) will likely continue to grow – changing the paradigm in their application areas. Major drivers for this change include the increasing worldwide awareness of the need to reduce energy and costs, as well as the other benefits of LEDs to the automotive and other industries. Providers of LED lighting & accompanying electronics will grow, thrive and prosper. Those lighting suppliers who have not already added LEDs to their portfolio and remain tied to incandescent and related technologies will likely not. As was the case in earlier paradigm shifts (such as the change in automotive forward lighting from standard-sized, glass sealed beam incandescent headlamps to today's vehicle-specific plastic units with replaceable bulbs), cars – and now street lights – will likely increasingly move to LED light sources. Innovation is inevitable.

Following the Money - Connecting Innovation to Consumers (The Only Ones that Really Have It)

2008-01-30T15:45:03-05:00

I have long maintained that before or as we start working on an innovation, we should look at, and establish its target market, all the way to the ultimate paying customers – and ask ourselves what the benefits (vs. product/service features) to those customers are, that would cause them to actually pay money for them. It's the critical connection.

If you're a supplier in the automotive industry and "follow the money", you will find that it may not be where you think. Tier 1 systems suppliers don't print it or have it. They get it from their car company customers. Car companies don't print it (the only ones who get to do that are the government folks), or have it yet either. They get it from their customers: the people who actually part with their money to buy a car. That's where the money is – not only for cars, but ultimately for just about every new product or service.

So, if you can agree that innovation is doing new things that customers will value, then that's where to start: at the end of the chain, following the money to the ultimate customer.

Here's an example of one automotive supplier who seems to be doing that, as written by April Wortham in Automotive News, January 28, 2008:

Brose seeks to connect more with drivers
DETROIT —
Germany's Brose Group wants to get closer to consumers.

Brose, best known for window regulators and door systems, is offering new products that give drivers and passengers more contact with the brand.

Among the technologies displayed on a Brose concept vehicle at the Detroit auto show was a unit that allows the driver and front passenger doors to be opened or closed by remote control. It's the same idea as a power liftgate found on many SUVs, but Brose added features that combine convenience with safety.

For example, anti-collision sensors detect an obstruction in the door's path, such as a child's hand or a vehicle in the adjacent parking space, and stop the door from fully opening or closing.

"Until now, a lot of Brose components were inside the door or the seat structure, not in direct contact with the consumer," said Bryan Russell, spokesman for Brose North America Inc. "But with Brose's first show vehicle, we're getting closer and closer to the consumer."

Reaching out
Brose Group products that give motorists more contact with the Brose brand include
-- Anti-collision sensors that detect obstructions and stop remote-controlled vehicle doors from fully opening or closing.
-- Power folding rear seats that create an extended flat cargo space with the touch of a button.
-- Power adjusting cargo tray that extends for easier loading.

The trend toward third-row seating has driven several Brose innovations for the rear of the vehicle. They include power folding rear seats and a power adjusting cargo tray that extends with a touch of a button for easier loading.

Most of Brose's new products derive from its existing components and technology, said David Clements, development director for Brose door and closure systems in North America. For example, the motor and hardware used in the power adjusting cargo tray are found in power adjusting front seats.

Sharing parts and technology helps lower costs and make the products attractive to customers, said Marcus Klopp, Brose vice president for new product development.

Klopp said the price of the gearbox and electronics in the cargo tray is 60 to 80 euros ($88 to $117 at current exchange rates). "But the customer could sell it as an option for $400 to $500," he said.

Said Arnd Herwig, vice president of engineering for Brose North America: "It isn't that our engineers developed something that will just get another engineer excited. These products deliver either real comfort or safety to the end user."

-end of article- (read on)

Klopp's "customer" here is the car company, and they (or a tier 1 systems supplier) are Brose's direct customer. However they nail it when Klopp says, "But the customer could sell it as an option for $400 to $500." ...and Herwig adds, "These products deliver either real comfort or safety (the benefits) to the end user." (the ultimate customer, and the one with the money who values these additional benefits enough to pay the car company that $400 to $500). He makes a good point. Typically, car companies (especially the Detroit 3) always ask, "How much will it cost?", when they might also determine the other half of the equation, e.g., "How much could we sell it for?" - as determined by the value of its benefits to their customers. Car companies often term such innovations, "priceable options", and the whole equation considers not just the cost, but the end value & price, also generating room for all in the chain (including the dealer) to make a reasonable profit.

All the car companies (and many of their larger suppliers) either do their own consumer market research or hire some capable outside company to do it for them – and include such useful and potentially valuable methods as conjoint analysis, anthopological interviews, and other analytical tools to determine the potential value of a new offering. If you want to know more about this approach, I recommend contacting fellow independent and expert in this field, Brian Ottum, Ph.D.

In the meantime, and since we (and every employee in the enterprise) are all consumers (and therefore end customers for innovative products and services), we can start by simply asking ourselves, colleagues, friends, etc., "Would we be willing to pay for (the benefits of) this new product/service – and if so, how much?" It's a start, and a "sanity check" that can be easily done before we go off to spend valuable time and money on our latest and greatest new idea.

Innovate! Connect!

Innovation and Inverse Thinking - Turning a Familiar Problem-Solving Tool into an Innovation Tool: The Success 8D*

2008-01-11T17:03:09-05:00

Those of us trained in engineering and related disciplines have learned how to solve problems, and do so much of the time. If there aren't any, some of us (particularly managers) will even create problems (mostly unintentionally or unconsciously) so we can ride in on our proverbial white horses and solve them (or at least appear to lead others to solve them for us). Problem solving is what we know how to do, and we're good at it. While that's necessary, it seems to be only one half of the business equation. Innovation is the other half. Here's how to use a familiar tool differently to innovate.

There's no tool like an old tool.

Most of us who have been in or around the automotive industry during the past few decades have become familiar with the 8D (or Eight Discipline) Report), a commonly used quality tool. If you've ever been an automotive supplier who sent some "nonconforming" (the quality euphemism for what used to be known as "screwups") products to a customer in an era of ~0 PPM, and were called on the carpet at the customer (and internally) to sit through the resultant version of The Inquisition, then you know what I mean. Don't get me wrong here. It is a good thing for its purpose.

For you history buffs, and according to Wikipedia:

The U.S. Government first standardized the 8D process during the Second World War, referring to it as Military Standard 1520: "Corrective action and disposition system for nonconforming material".

It was later popularized by the Ford Motor Company in the 1960's and 1970's. 8D has become a standard in the Auto, Assembly and other industries that require a thorough structured problem solving process.

The 8D Problem Solving Process is used to identify, correct and eliminate problems. The methodology is useful in product and process improvement. It establishes a standard practice, with an emphasis on facts. It focuses on the origin of the problem by determining Root Cause.

Recently, the 8D process has been employed extensively outside the auto industry. As part of Lean initiatives, it is used within Food Manufacturing, High Tech and Health Care industries.

Like all good processes, the Problem 8D has been refined, reconfigured, amended and thoroughly implemented. It's even been computerized and automated. You can find just about everything about it easily on the internet. Here is the basic version:

Steps

D1: Assemble a cross-functional team of experts.

D2: Define the Problem fully.
   Also known as the Problem Statement & Description

D3: Implement and verify Interim Containment Actions (ICAs) as needed.
   Also known as Temporary Fixes.

D4: Identify and Verify Root Cause.

D5: Choose and verify Permanent Corrective Actions (PCAs).
   Preventive Actions are also chosen.

D6: Implement and validate PCAs.

D7: Prevent recurrence of the Problem/Root Cause
   (e.g. in Surrogate Process & Management Systems).

D8: Recognize the efforts of the Team.

Old tools are good tools. New projects may require new tools.
Hereâs a new tool, disguised as familiar old one.

Several years ago, in a fit of inverse thinking, and when working with groups of engineers and otherwise good linear, problem-solving thinkers at automotive supplier clients, I thought, "What if we used this familiar, proven old tool differently?" It's been said that when the only tool you have is a hammer, everything starts to look like a nail. What if we changed the way we look at the tool? What if we used it differently? What if we looked at the nail differently? What if we saw them both with a new perspective? What if we used the tool to focus on understanding, analyzing and replicating success instead of failure? What if we centered on creating opportunities for tomorrow vs. fixing mistakes made yesterday? What if we just picked the 8D tool, and changed a few of the words? Same song, different lyrics. What would happen?

Disciplines are OK, but let's start by loosening it up a little. For the D's, for Discipline, we could substitute O's for Opportunity. We could also use I's for Innovation ( = doing good new things that customers value), but more about that later. Innovation can be a little messy (and that's not a bad thing). Keeping the 8 Disciplines here is useful - and keeps the process people happy, so we'll stick with the D's for this example.

Instead of starting with a problem, mistake or failure, let's begin with the premise that the enterprise has had a success or two in its life, or it probably wouldn't be here. Using the familiar 8D process, with the premise (and a few words) changed:

Steps

D1: Assemble a cross-functional team of experts (& non-experts, who don't know it can't be done, and think laterally as well as linearly. Sure, they'll argue. Good. A little constructive controversy helps. Having a champion also helps here, as it does in the conventional 8D.)

D2: Pick the best successful product/service in the recent past. Define the Success fully. (What were the key factors, ideas and actions that made it happen?)

D3: Implement and verify Known Success Actions (KSAs) (if we really need another acronym) as needed. Also known as Surrogate Success Actions (Useful later, in D7.)

D4: Identify and Verify the Root Cause of the Success (What was - the one thing that was here? How is it translatable to a new project that we are beginning to think of now?)

D5: Choose and verify Permanent Success Actions (PSAs). Repetitive Actions are also chosen.

D6: Implement and validate PSAs - to repeat the success in our new project.

D7: Insure recurrence of the Success/Root Cause (by using earlier KSAs/SSAs to create PSAs, then internalizing them into the individuals, development and management systems.)

D8: Recognize the efforts and success of the Team and Individuals. Innovation is a team effort, but depends on individual competencies and creativity. Rewards may be different here, as innovators and problem solvers likely have different currencies.

Celebrate together in simple ways meaningful to the team, e.g., go out for a beer together when you're done. Involve a manager/sponsor or two. Lots more good ideas & actions result. Again, don't forget to influence and change the Surrogate Processes and Management Systems accordingly and as appropriate, so they will begin to foster success everywhere.

I've tried this a few times, and it works. Small (preferably cross-functional) teams have done this in a day or less, and come out with one or more (typically three) innovative & actionable new projects - with identified leaders, doers, time lines, and a process that satisfies the other management folks. As always, continuous and thorough follow-through by all concerned is necessary for success.

Why does it work? I think it's because 1. we're taking a familiar tool and format, beginning in the comfort zone, then working gradually out of it into a new, opportunity & innovation-focused comfort zone; and 2. we're working on an "upper", instead of just fixing a "downer". As Malcolm Gladwell showed in The Tipping Point: How Little Things Can Make a Big Difference, our good ideas and enthusiasm can be contagious, spread virally and cause a positive epidemic.

So, here's a tool that can help change the game from problem-focused to opportunity-focused; from problem solving to opportunity creation. It may help insure the future of the enterprise and enable it to thrive, not just survive. Fixing yesterday's mistakes may be necessary to survive, but alone, it won't help you win. Adding ways to create better tomorrows completes the picture - and is more fun. Innovation begins with new thoughts and actions. The Success 8D*. Try it. Innovate! Thrive!

Quotable Quotes

2008-01-08T19:47:24-05:00

Here is a collection of quotes that I think are directly or indirectly applicable to innovation. Some are old, some are ancient, some are new, and they're in no particular order. Some have editorial comments. Please let me know if you have others you'd like to add - including your own editorial comments, related stories or original quotes.

"Don't just anticipate the future. Create it!" - anon. (...but often claimed and used.)
"Don't explain why it can't be done. Discover how it can be done." - MoTao, 404-329 B.C.
"An idea is salvation by imagination." - Frank Lloyd Wright
"Innovation means committing to revolutionary ideas. You have to be willing to accept failure." - John Hake, Global Design Director, Nike
"Defending yesterday - that is, not innovating - is far more risky than making tomorrow. An established company which, in an age demanding innovation is not able to innovate, is doomed to extinction." - Peter Drucker (or, in three words: innovate or die.)
"Ideas are capital. The rest is just money." - anon.
"The beginning is the most important part of the work." - Plato
"Man is most nearly himself when he achieves the seriousness of a child at play." - Heraclitus, Greek philosopher, 500BC (See Dr. Seuss, below.)
"Conventional wisdom is an oxymoron." - David Neeleman, CEO, JetBlue Airways
"It is not necessary to change. Survival is not mandatory." - W. Edwards Deming
"Because its purpose is to create a customer, the business enterprise has two, and only these two basic functions: marketing and innovation. Marketing and innovation produce results. All the rest are just costs." - Peter Drucker (Having been involved in marketing and innovation most of my adult life, I love this one!)
"All growth is a leap in the dark, a spontaneous, unpremeditated act without benefit of experience." - Henry Miller (Innovation is often like that, but so are a lot of fun things.)
"The man who has no imagination has no wings." Muhammed Ali
"Probable impossibilities are to be preferred to improbable possibilities." - Aristotle
"He that will not apply new remedies must expect new evils, for time is the greatest innovator." - Francis Bacon
"If you have enough information to make a business case, you're too late." - Bill Gates (He's done OK.)
"Innovation is a team sport, but it depends on individual competencies." - anon.
"Only a fool would make predictions - especially about the future." - Samuel Goldwyn (I wonder if he knew Yogi Berra?)
"The most effective way to cope with change is to create it." - anon. (...but also often claimed/used.)
"Nothing great was ever achieved without enthusiasm." - Ralph Waldo Emerson
"Never be afraid to try something new or challenge conventional wisdom. Remember, amateurs built the ark. Professionals built the Titanic." - anon.
"The only sustainable competitive advantage comes from out-innovating the competition." - James Morse
"An idea is not a reality until it becomes an action." - Jean-Paul Sartre (...and he really existed.)
"The goal is not to speculate on what might happen, but to imagine what you can actually make happen." - Gary Hamel (one of the best authors on innovation out there today)
"When the rate of change outside is greater than the rate of change inside, the end is in sight." - Jack Welch (I learned a great deal of what I know from Jack & company at GE.)
"Don't compete. Do something different." - Charles Handy (Irish author/philosopher specializing in organizational behavior and management)
"The biggest limitation we face is how fast we can innovate. We're constrained by how fast ur brains can work." - Jerry Yang, co-founder of Yahoo
"The problem is never how to get new, innovative thoughts into your mind, but how to get old ones out." Dee Hock, Visa
"People who seem to have a new idea have often simply stopped having an old idea." - Edwin Land, founder of Polaroid (I worked for him at Polaroid once long ago, but disagreed with another of his quotes: "Marketing is what people do who don't have an idea.)
"Innovation distinguishes between a leader and a follower." - Steve Jobs
"If you're a traditional employer, beware: You're a way station for talent just until the economy clears up." - Bruce Tulgan, founder, RainmakerThinking and author of Winning the Talent Wars
"Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it's the only thing that ever has.” - Margaret Mead, 1901 -1978 (...or a small group of innovation zealots!)
“I like nonsense,it wakes up the brain cells. Fantasy is a necessary ingredient in living.”
Theodore Geisel a.k.a. Dr. Seuss, 1904 -1991 (works for me, whether it's reading his books to my grandkids, or taking this advice to offset the often too-serious world of business.)
"Competition is not healthy. I don't like it. It's not good for me or my business. I think I'll just do something new and different, and confuse those guys." - Irving Jacobs (a successful guy from NYC that I met in the plastics business many years ago - but never forgot.)
"Our favorite quotes are those that resonate with us somehow - and catalyze us to think new thoughts and take new actions." - Conrad Zumhagen, Innovation Zealot

Reader Contributions

"Speed is God, Time is the Devil" – Silicon Valley saying
"The sooner you fall behind, the more time you'll have to catch up. The historical records show that humans have never, ever opted for slower."– Stephen Kern, historian
"Wealth in the new regime flows directly from innovation, not optimization; that is, wealth is not gained by perfecting the known, but by imperfectly seizing the unknown." – Kevin Kelly, in New Rules for the New Economy

The three items above come from the short book, Carpe Mañana by Price Pritchett, courtesy of reader Mark Symonik, Jan. 20, 2008.

And a few more, recently contributed by colleague and friend, Paul Kerivan

"Minds are like parachutes. They only function when they are open." - Sir James Dewar, Scientist (1877-1925)
"If you can't describe what you are doing as a process, you don't know what you're doing." - W. Edwards Deming
"When all think alike, no one is thinking very much." -Walter Lippmann (1889-1974)
"Making the simple complicated is commonplace; making the complicated simple, awesomely simple, that's creativity." - Charles Mingus, jazz musician & composer
"The important thing is never to stop questioning." - Albert Einstein
"It's kind of fun to do the impossible." - Walt Disney

Innovation Zealot

2008-01-08T17:02:29-05:00

A PLACE FOR THOSE WHO WANT TO INNOVATE

Conrad Zumhagen is an innovation zealot who works as a catalyst and coach with people in the automotive OEM supplier, plastics and other industries who want to innovate – faster, easier & more profitably. More information on his other activities is available at www.zumhagen.com

in·no·va·tion n.
1. the act or process of inventing or introducing something new
2. something newly invented or a new way of doing things
Innovator: syn. Leader, pacesetter, modernizer, trendsetter

val•ue n.
1. a fair return or equivalent in goods, services, or money for something exchanged
2. the monetary worth of something : marketable price
3. relative worth, utility , or importance : degree of excellence

zeal·ot n.
1. somebody who shows excessive enthusiasm for a cause
syn. a supporter, believer, devotee, advocate, fanatic

Innovation is doing new things that customers will value.

An innovation zealot is a person with a passion for innovation.

If you are one (or want to be one), let's talk

Types of Innovation

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Here is one way of looking at the different types of innovation. One type isn't necessarily better than another for a given occasion - just different. Each type can apply to a product or service. The above example uses "widgets", e.g. a product, as an illustration of the concept.

INCREMENTAL INNOVATION
Component: Making an improvement on an existing product or service, for example:
Adding a camera feature to a cell phone

Increasing the displacement of an engine to increase horsepower and/or torque

Adding a new ingredient to a plastic formulation to increase its strength

System: Improving service or the process that makes the product, for example:
Reducing the number of steps necessary to manufacture the cell phone

Increasing the speed of machining the engine block

Implementing a lower-cost process to manufacture and deliver less-than-bulk quantities of plastic compounds

RADICAL/NONLINEAR INNOVATION
Component: Developing a new product based on an entirely new concept that didn't exist before, for example:
The iPod (a case of "Invention is the mother of necessity", and a "gotta have it" product).

Gasoline-electric hybrid and fuel cell-based automotive powertrains.

An entirely new polymer that does something existing ones couldn't, e.g., polycarbonate in the '60's: a virtually unbreakable, transparent, high heat material that enabled new applications for plastics.

System/Business Concept: Introducing a new way of doing things, for example:
Wireless phone providers essentially selling airtime, and providing cell phones at low prices as the means to use their services on an ongoing basis

The establishment & growth of car-sharing services in cities or at colleges - for those who don't want or need to own a car, but need one on a regular or occasional basis (an alternative to conventional car rental).

Stereolithography - a process for quickly creating a first product prototype by using 3D CAD data and liquid polymers to generate a part in minutes, vs. days or weeks.

A major innovation is a breakthrough that changes the rules of the game and the terms of competition.

What's the best type of innovation? The one that provides the enterprise the best results in a given situation, and creates the best value for customers. Small or large, incremental or radical, they all count - but only if they are acted on and implemented.

Thinking about things in a new way is the first step.

P.S. - Speaking of "The Box" - it's been talked about so much, that it has become a cliche. Still, I maintain that valuable innovation can be done from "in the box", or "out of the box", so don't let either stop you from doing good new stuff from wherever you are - in the organization, or "the box". If you're inside the box, do what you can from there. However, as our parents told us, it's always good to get outside and play once in a while.

WWW.INNOVATIONZEALOT.COM

DIFFERENTIATION: CARS AND COFFEE

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Different isn't always better...

...but better is always different.

Pontiac Aztek (2001-2005), total production: 115,322

PT Cruiser (2000 - ?), total production: 1.2 million and counting

Differentiation is an important part of, and usually a result of good innovation. Sometimes, just making a point of differentiating the brand based on a single, identifiable factor can make a big difference.

Commodities. An often-used word these days, particularly in the automotive industry. Similar to Henry Ford's saying, "If you think you can do a thing, or if you think you can't do a thing, you're right." if you think your product or service is, or is not a commodity, you're right. Some say their product or service isn't a commodity. A good test is whether or not it has to go up against the competition on price. If it does, it is. If it doesn't, it isn't. Purchasing people love commodities. Marketing people and innovators don't. Differentiation can be created. Differentiation by innovation is even better. Personally, I don't believe in commodities - and that everything can be differentiated. Some would argue.

In the automotive supplier world, Brembo has done an excellent of differentiating themselves as the high-performance leader in brakes - resulting in their being the brake system leader in higher-performance cars, with many OEMs featuring and marketing the Brembo name on their cars, including on the red calipers with the Brembo logo.

Here's an example of a product & service that used to be considered a commodity: a cup of coffee. That was before Starbuck's got into the act.

Commodities do not have to be.

Differentiation adds value.

Starbucks seems to have done pretty well with all that - growing from one store in Seattle in 1971 to 13,782 worldwide in 2007 (so far). Their sales and earnings reflect that growth.

So, you can differentiate what may have been thought to be a commodity. In the Starbuck's case, they certainly did that - and changed the whole coffee drinking culture in America.

One criteria for a good innovation (whether product, service or process) is that it is differentiable enough to set itself, you and your business apart from the crowd.

WWW.INNOVATIONZEALOT.COM