If you work in IT, you can do lots of interesting and innovative stuff. You could virtualize your data center, or speed your backups up by 50 percent.

But who will notice? Better yet, how many of them will care?

Although the projects may be worthwhile and, indeed, be rewarding for the techies working on them, they fall in to the category of “IT innovation of IT,” according to Prof. Joe Peppard.

“This is not to denigrate this kind of innovation; it is important for CIOs to reduce year-on-year the cost of IT supply,” he wrote in his paper, Avoidng the Traps of IT Innovation (PDF). The problem is that “such innovation typically does not result in innovating the business,” he said.

Director of the Information Systems Research Centre at Cranfield University, Peppard has identified how IT can become an help spur innovation in the business. This can be product/service, process, or management innovation, or enhancements around the customer experience or the introduction of new business models.

But will IT do that?

A recent Information Week article reported on an annual skills survey carried out by the magazine. Asked which they considered to be the most critical, IT managers, for the fifth year in a row, put aligning business and technology goals at top of their list at 80%. Things like analyzing data and preparing reports came in at 56% and 48% respectively.

But at the bottom of the list was seeking out new business opportunities. Just 24% of managers said that was important — and that was down from 29% in 2008. That does not bode well, according to Peppard:

“Our research reveals that successful organizations proactively ‘manufacture’ the serendipity often associated with generating ideas.”

This can be done by a separate IT unit charged with innovation that follows a systematic innovation process, Peppard said.

But what of those left behind?

But back to on IT innovation of IT. The Register has a more cynical take : Don’t waste your time on work no one can see because no one cares. Only do it when powerful people ask, according to the tongue-in-cheek article.

Calling this work method, Continual Visible Productivity (CVP), The Register urges IT workers to plan their work in ways where it can be most seen. This system is so successful it is not only shared with bosses but encouraged by them:

“The joy of CVP is that its cynicism is so pure you can openly share it with your boss – he is under constant attack for the cost of IT which to “the business” seems so rarely to actually produce anything. A staffer who makes him look good is far more valuable than one who knows more C++ syntax, so his fear of you leaving goes up without you doing anything.”

Illustration, Five Cogs of Innovation, courtesy of Jurgen Appelo on Flickr.

May 23: Doing Business in the UK

May 24: Workshops Series for SME Business Owners

“As Accountants we have become increasingly aware of the difficulties facing SME Business Owners in managing and dealing with the challenges they are facing through the current economic environment.”

In response to this situation, MCN is now launching a series of workshops, in order to make its in house expertise and experience available in a cost effective and time focused manner, to help Business owners address and find solutions to the many challenges.

Liam McNamara, who is MD of MCN Associates has been through many of these challenges himself through his career having successes and failures. He will share these experiences and the lessons he has learned throughout the workshop series.

Price: €50.

Venue: Burlington Hotel, Dublin.
For further information or to make a reservation please contact: Lotte Lyne
Office 01 2309000 | Mobile 086 352 7606 | Email: lotte @ mcnassociates.ie

Innovative and industrial R&D services

The WiSAR Center is a research and development facility located in Letterkenny, within LYIT grounds. WiSAR is nationally recognized as the center of excellence in wireless technology; medical, motion, heat and light detection sensors. Its focus is to provide innovative and industrial R&D services to Irish companies.

If you have a business idea (in the area of wireless sensors) that you’d like to follow up but don’t have the technical know how or the funds to peruse that idea, WiSAR can help.

Working with Enterprise Ireland, the aim is to help companies create new business opportunities through innovative R&D. Enterprise Ireland would provide the funding for your idea, and should it become a commercially viable product, EI would provide a commercial fund to help your company develop the product. Please note that EI funding is free of charge and wouldn’t force any financial liabilities on you, or on your company.

If you like further information feel free to contact:

Sufian Al Aswad, M.Sc B.Sc MBA

WiSAR Centre Manager

+353 86 408 5521

Picture of Donegal courtesy of LeeRoy_ca on Flickr.

There is a huge performance prize right under the noses of most organizations. It can start anywhere between 60 percent and 100 percent, before a “cultural multiplier effect” kicks in.

The reason the improvements go untapped is because of the performance gap between strategy and implementation, according to Michael C. Mankins and Richard Steele in a 2005 Harvard Business Review article (PDF).

They argue that both should be inextricably linked. In addition to identifying areas where strategic performance falls down, Mankins and Steele lay out seven rules to stay on track (see sidebar).

The issue of performance monitoring caught my interest because I am also reading the Steve Jobs biography by Walter Isaacson. In their HBR article, Mankins and Steele say fewer than 15 percent of companies regularly track business results against forecasts.

This leads to a performance gap that can be closed by continuously monitoring performance. High performers monitor resource deployment against plans, often in real time, and use continuous feedback to improve performance.

This all implies a lot of measurement, and building a solid rationale for spending decisions.

Then there was the approach taken by Jobs

When designing the iMac in the late 1990s, the late Steve Jobs and his designer, Jony Ives, settled on a translucent computer cover. Each case cost over $60, more than three times that of a standard computer case. As Isaacson wrote:

“Other companies would probably have demanded presentations and studies to show whether the translucent case would increase sales enough to justify the extra cost. Jobs asked for no such analysis.”

He did have to “fend off the objections of the manufacturing engineers … who tended to raise practical cost considerations,” Isaacson said.

But if Jobs wanted it, Jobs got it. Knowing your mind and infallibility, however, are not synonymous. Jobs was equally insistent that CD trays be removed in favor of a slot because it looked better.

But this happened just as CD burners were hitting the market and the subsequent explosion in people burning their music to CDs. As a result, Apple could not cater well to music lovers and it fell behind in that area.

It would be easy to argue that Jobs and/or Apple are special cases. They are in many respects, but they are also widely admired and emulated. So much so, that Isaacson wrote The Real Leadership Lessons of Steve Jobs for the April 2012 issue of the HBR.

One of the lessons outlined was to “put products before profits.” Recounting the early days of Macintosh development in the early 1980s, Isaacson said Jobs never worried about maximizing profit or cost trade-offs. It led to some very costly overruns, he said, but, “In the long run he got the balance right: Focus on making the product great and the profits will follow.”

As Jobs told Isaacson:

“My passion has been to build an enduring company where people were motivated to make great products. Everything else was secondary. Sure, it was great to make a profit, because that was what allowed you to make great products. But the products, not the profits, were the motivation.”

That was Apple’s strategy: it’s unique position and what differentiated it from its competitors. That has led to high profits. Once achieved, that advantage has to be maintained. But with continuing high profits and a 2012 cash reserve of $100 billion, the odds seem tilted in favor of the company on Infinite Loop.

Graphic copyright of and reproduced from Harvard Business Review magazine under fair use doctrine.

Not many entrepreneurs who need a quick break get to plant potatoes or fire up a chainsaw. The normal city-centre environment just doesn’t cater for that kind of thing.

But Hub House, a rambling pile on a large lot in Dublin’s suburbs, is a facility with a difference. Run as a non-profit with no public funding,  Hub House fills a need for fledgling businesses and solo contractors, according to founder Peter Tanham (@PeterTanham).

Although it has only been running for six months, there are four businesses using the facility now.

He and business partner, Garrett Reynolds (@garrettdr), were the guests at April’s Last Tuesday (or Entrepreneurs Anonymous) meeting in Dublin.

With rents they believe are the lowest in Dublin, startup teams get a real office space and other facilities. Solo contractors, meanwhile, can work in a social atmosphere “rather than in complete isolation or in their spare bedroom,” Tanham said.

Although it seems like a rural location, the house is close to two motorways and the Luas tram.

It suits new businesses moving out of incubators, allows people to share experiences and vent frustrations. It can also help people build teams as they put new businesses together.

One such outcome has been for Tanham, who has a background in marketing, and Reynolds, with technical skills, to form Paper Wasp Media, a digital media agency. Tanham said it was difficult to find a technical co-founder. Every time he asked fellow entrepreneurs how they found their techies, they all seemed to have known each other since childhood, he said.

Working long hours, six days a week on a startup “can be quite intense,” Reynolds said. Although there are games and other facilities in the house, his distractions are outside. “If you’re not doing any work, go dig the garden or go get the chainsaw,” he said.

Image of Hub House taken from the website.

1840

The world’s first sticky stamp, the Penny Black, entered official use in the UK on May 6, 1840. It also introduced the idea of pre-paid postage, regardless of the distance traveled. Until the new system was introduced, the recipient paid when the letter arrived.

1856

Sigmund Freud, the father of psychoanalysis, is born in Moravia, then part of the Austrian Empire and now in the Czech Republic. According to Wikipedia, he was born Sigismund Schlomo Freud, and grew up poor but his parents did what they could to provide for his education.

Freud developed theories about the unconscious mind and repression, and went on to create the field of psychotherapy.

According to the encyclopedia, “Freud’s theories have been criticized as pseudo-scientific and sexist, and they have been marginalized within psychology departments, although they remain influential within the humanities.”

His name and theory has, er, slipped in to everyday language with the expression, Freudian Slip. This is where you say one thing and mean your mother. Some more examples are in the compilation below (NSFW).

1871

François Auguste Victor Grignard, Nobel winner for Chemistry, is born in France. During World War I, he studied chemical warfare agents for both the manufacture and detection of poison gas.

1889

The Eiffel Tower opened to the public during the 1889 Exposition in Paris. According to Wikipedia, it is “320 metres (1,050 ft) tall, about the same height as an 81-story building.” When complete, the wrought-iron structure was the tallest man-made structure in the world. It held that title until the Chrysler Building was built in New York in 1930.

Although it met opposition from artists at the time, the tower is now the most-visited, paid monument in the world.

1937

The Hindenburg Disaster took place on this day in 1937. The giant airship exploded in to flames while attempting to dock in Lakehurst, New Jersey, after its flight from Germany.

Captured in spectacular newsreel footage and reported in radio commentary, the disaster claimed 35 lives and brought the airship era to a close.

Image of Penny Black stamp courtesy of Wikimedia Commons.

There was once a prospective entrepreneur who spotted a niche in the boating market. After nurturing his idea for a while, he was persuaded to do some research to see if it was feasible.

But when he went and spoke to marina owners and operators, they were noncommittal. Boat owners were non-plussed. Then, at the Boston Boat Show, he saw a business owner at a booth selling the same idea. He had been struggling for three years to make a go of it and was just scraping by.

Entrepreneurs are a scared bunch, said Brant Cooper (@BrantCooper). They are usually scared their idea may not work. Sometimes they are scared it may work too well. Other times, they are scared their idea will be stolen.

Speaking at a Dublin Institute of Technology College of Business seminar, Cooper is author of the Entrepreneur’s Guide to Customer Development and the upcoming Lean Entrepreneur.

Entrepreneurs “are scared to find out their dream may not come true,” Cooper said. Another start-up asked advice on an educational site they had developed. Cooper suggested a button with a call to action to gather metrics.

“I don’t want to put a button up there. What if they don’t click it?” the entrepreneur asked. “If they don’t click it, you don’t have an idea,” Cooper replied.

That is why the potential boating entrepreneur — who came back to Cooper and his business partner happy and relieved that he would be spending no more time on an idea with little potential — was unusual. Such courage is rare, and the pair gave the entrepreneur a fictional Old Yeller award, Cooper said.

Based on a book and then a movie from the 1950s, Old Yeller tells the tale of a boy and his beloved dog. “It’s a super sad story where they had to kill the dog in the end,” Cooper said to laughter.

• Image of Brant Cooper courtesy Kaufmann Foundation.
• Image of Old Yeller is a publicity shot copyright Walt Disney Co.

This is Part II of the report on Thursday’s innochat where a group of innovation experts and practitioners tackle some of the innovation challenges facing organizations. Part I is here.

Turning to her third question, moderator Gwen Ishmael (@Gwen_Ishmael) asked how the different types of innovation being discussed — incremental, breakthrough and transformational — impact execution.

“Breakthrough innovations are fragile and require incubation. You can’t just throw them in to Stage-Gate or they will die,” said David Culton (@davidculton). Harvey Briggs (@OBX_Harvey) agreed. “Stage-Gate misapplied will kill a great idea,” he said.

Ned Kumar (@nedkumar) advised companies to build an innovation framework and to understand the different types of innovation they can pursue.Cathryn Hrudicka (@CreativeSage) said organizations should look at themselves as outsiders. If that fails, they should bring in “outside visionaries” to help.

Execution can come from any source in the right environment, said Vala Afshar (@ValaAfshar). “In a social business, with clear transparency and acceptance, every employee has the opportunity to drive innovation,” he said.

“Put a disruptive or transformational team in place, separate from ‘Business As Usual’ organization” and experimental teams across departments, advised Hrudicka. “It’s best to have a champion/owner for innovation backed by a cross-functional team [it's] good for problem solving and buy in,” said Alicia Arnold (@alicarnold).

Saul Kaplan (@skap5) warned about terminology. “One person’s tweak is another’s breakthrough and still another’s transformation,” he said.

“Why try to control innovation,” wondered Lois Martin (@LoisMarketing). “Isn’t it innovation because it isn’t controlled?”

Innovation Stories

Ishmael’s final question asked what stories need to be told to gain support for each type of innovation. In his talks about IT in the business, Prof. Joe Peppard often talks about an organization’s culture and how that can be determined by the stories people tell each other about the workplace.

An anecdote about a company innovator, for example, can tell how that person measured risk and went on to bring an idea to life. But Peppard said that, in addition to tone, the story’s outcome sets the firm’s direction. The innovator could fail and be advised on how to do better next time, for example. Or the innovator could be shown the door. Either way, the story is easily understood and the message is clear.

“Stories are always key to organizational culture,” said Hrudicka. “The Polaroid camera came from a three-year-old asking why you had to wait for pictures,” she said. Judy Gombita (@jgombita) suggested setting an “organizational narrative” to include the three innovation elements.

“You don’t need to tell stories to gain support for incremental, but you need to sell your vision of the customer need for disruptive,” said Jeffrey Phillips (@ovoinnovation).

Kevin McFarthing (@InnovationFixer) said the stories could be about customers and their needs, habits, emotions or insights. “Stories, not numbers,” he said. “A story needs to address the six human needs: security, variety, significance, connection, growth and contribution,” said Venkata Sashank (@svsashank).

But Steve Koss (@SteveKoss) was not convinced. “Storytelling is over rated at times. How many times have you encountered Pinocchio or have staff that carry x-files to spot one?” he said.

Oenology

“You can’t keep new wine in old wineskins, and you can’t manage disruptive ideas in existing processes and decision models,” said Phillips. “It is, in fact, easier to disrupt a business you already know than a business you do not,” noted Jose Briones (@Brioneja).

Sommelier Jenny Neill (@JennyNeill), however, picked up on the wine theme. “You actually can’t use old wineskins because they’ll break from the acidity of the wine,” she said. Phillips then explained that the wineskins were a Biblical reference.

“So are wine tanks ‘scaleable’ innovation?” McFarthing asked.

“Not scalable but perhaps reusable innovation. But certainly not Biblical,” Phillips quipped.

“Biblical innovation sounds scary,” said Briggs.

John Lewis (@JohnWLewis) then joked, “Isn’t that creation — which is beyond creativity!”

Image by Brilliant Forge on Flickr.

With a dollop of biblical, wine-making and cavemen references thrown in, the question of “how might” a company innovate exercised minds around the world for an hour today.

Running on Twitter as part of the weekly #innochat session, a group of innovation experts, practitioners and gawkers (like myself) looked at where organizations fall on the innovation spectrum and what challenges they face there.

Although innovation can come in many guises, this week’s moderator, Dallas-based Gwen Ishmael (@Gwen_ishmael), asked the experts to assume there were three points on the innovation continuum: incremental, breakthrough and transformational. The discussion then hinged on the question of “how to” innovate rather than “do we?”

Where are most organizations?

Summing up the consensus, Ishmael said, “It sounds like most of us agree that incremental innovation is most common — safer, easier, more defined.”

“The focus is on incremental becuase it can be measured in the early stages,” said David Culton (@davidculton) in Rhode Island. Harvey Briggs (@OBX_Harvey) agreed. “Incremental is both the easiest and most comfortable, thus tends to get the most attention,” he said.

“With all good intent, I think they mean to innovate aross the spectrum, but without definition, it ends up incremental,” said Jeffrey Phillips (@ovoinnovation) in Raleigh, NC.

Culton said the focus on incremental is safer because “with breakthrough [innovation] there is too much senior management skin in the game.” Anything other than incremental “requires business model innovation,” said Briggs. “Which is why radical innovation often struggles,” said Kevin McFarthing (@InnovationFixer) in Oxford in the UK.

Speaking of his work, Jose Briones (@Brioneja) in Dallas said, “Yes, I do follow the innovation as continuum approach using value delivered as the differentiator.”

“Too many companies conflate all innovation types in to one bucket and wonder why all they get are incremental solutions,” said author Saul Kaplan (@skap5), also in Rhode Island. Briones said that is because companies use a Stage-Gate filter “to manage them all — with predictable results.” Even companies that try radical innovation “fall in the trap of managing them like incremental and most fail at it,” he said.

While most organizations will claim innovation is good, Matt Recio (@mattbrat1) in Atlanta said that is a no-brainer. “Even cavemen learned that you innovate or die!” he said.

My contribution was that incremental innovation should not be knocked since it had served Japanese manufacturers so well. McFarthing agreed, but said it should be part of a larger innovation porfolio.”All companies should manage innovation as a portfolio,” Briones agreed. Incremental “must be complemented with radical and breakthrough, otherwise we get Blackberry,” he said.

“Incremental from a greater vision is one thing. Sadly, I think incremental with no vision is the pattern,” said Lois Martin (@LoisMarketing) in Atlanta.

Where should organizations be?

“That is really a situational question determined by overarching strategy, market trends and maturity, and also the stomach for it!” Culton said. Ned Kumar (@nedkumar) in Memphis, Tenn., said organizaitons with a separate innovation group are further along the spectrum. “Firms skew towards incremental otherwise,” he said.

In a comment reminiscent of Porter’s dictum that Operational Effectiveness is Not Strategy (PDF), Culton said less risky, less valuable incremental innovations are easily copied by competitors. Briggs added, “You should be simultaneously improving your offerings while developing their replacements.” A company’s “position on the spectrum should be a strategic commitment, not an accident or response to a threat,” said Carlos Chacón (@carloschacond) in Caracas, Venezuela.

“Yet incumbents are notoriously wrong about predicting the rate of change and competitive threats,” said Sandra Maxey (@sandymaxey) in North Carolina. But “aiming for transformational tends to be the realm of the start up. Sometimes it’s hard for established companies to play there,” Culton said.

Part II of this discussion is here.

• Caveman illustration by Jason Schleifer on Flickr.
• Cavemen photo by Beautification Syndrome on Flickr.

“The moment you put money in, it changes from paint balling to live fire,” said Danny Moore of investing in a start up.

Principal of Lough Shore Investments (@loughshore), Moore is a former entrepreneur who sold Wombat Financial Software for $200 million to NYSE Euronext in 2008. Now a venture capitalist in Northern Ireland, Moore’s goals are to “bring ten great companies to exit or IPO by 2025.”

Speaking at the very successful Angel Meetup (@AngelMeetup @XcellPartners) held recently in Dublin, he had five tips for entrepreneurs:

Manage the business

In other words, look after the basics. Sometimes called the “boring stuff,” it means managing the business and being careful with cash flow. Carried out successfully, this is likely to pique investors’ interest, Moore said. “If you don’t need the money, they’ll be knocking on your door.”

Proof of Traction

There are very few Instagrams that get bought for $1 billion less than 18 months after they launch. However, investors will look at growth patterns. The best buyout stories are those of companies with revenue acceleration, Moore said.

Be Honest & Transparent

Although entrepreneurs like to tell horror stories about venture capitalists, many VCs have been defrauded by start ups, Moore said. “There isn’t a serious investor who hasn’t been sold a pup, or a litter of pups,” he said. If investors feel information is incorrect or being withheld, they will not invest.

Realistic Growth Projections

Although a naturally optimistic bunch, entrepreneurs should not let their projections stray from reality. Deals can fall through at the eleventh hour if investors don’t believe projections.

Partnership

Once the commitment is made, entrepreneurs and investors need to work in partnership, Moore said. Repeating the quote attributed to Einstein that compound interest is the “most powerful force in the universe,” Moore said investing and returns on investment require patience.

Image of Lough Neagh copyright Lough Shore Investments website.

1993

Mosaic, the browser credited with popularizing the web, was released on this day in 1993. Although the internet had existed for decades, Mosaic displayed images inline and was ported to Windows.  This made brought the web to the general public.

It was developed by the National Center for Supercomputing Applications (NCSA)^[4] at the University of Illinois Urbana-Champaign. Many of the original authors went on to develop Netscape Navigator.

1944

The first combat rescue using a helicopter was on this day in 1944. U.S. Army Lieutenant Carter Harman used a Sikorsky in the China-Burma-India theater to rescue a pilot and three British soldiers. Although the helicopter could just seat the pilot and one passenger, Harman took two at a time in the rescue mission.

1915

On the darker side of human inventiveness and innovation, the use of poison gas was stepped up in the First World War with the release of Chlorine by Germany against French positions. Although the gas cloud caused the French to break ranks and leave a 7 km gap in the front line. German troops, however, were just as wary and they failed to exploit their temporary advantage.

1912

Pioneering Irish aviator, Denys Corbett Wilson, was the first person to fly across the Irish Sea. Taking off in Wales, he landed in Co. Wexford 1 hour 40 minutes later. A previous attempt almost succeeded when,  on 11 September 1910, Robert Loraine crashed in the Irish Sea just 300 metres short of the Irish coast.

Image of Sikorsky courtesy of Wikimedia Commons.