I posted a commentary on search engine and IFR of a search engine here a while back; as search engine has found a place in my TRIZ examples, I thought of giving a shot to this news article (Google: The party is over) appeared in Fortune recently through another TRIZ interpretation. While I wouldn't state that Google is struggling to find the next innovation, statement like slowing down their core business of search is certainly intriguing me especially when some data points are given by the authors from their research.

What might have been going wrong with them, a very innovative company like Google? While failure like Google Wave is not a measurement to say they are going down, (In fact we all know that in the journey of innovation, you must fail), getting stuck with a conundrum of "search using Google is not the future" is a matter of concern especially if you generate 91% profit through search.

If we can do a simple 9-Windows thinking, considering Search as the system-present, can we see a subtle evolution happening there in the super-system, beyond technology evolution (If it is only technology, Google will certainly catch up) and business model innovation? As said in the article, if 5 years ago, we want a shoe, we will simply Google it, but now I just need to "tweet" or add it in the "what's on my mind" in FaceBook, and you get answers with "human touch"..

The technology enabling these systems (Twitter and FB) aren't great innovation according to me as in the search engine algorithm of Google; then what makes the search engine is not the future for Google? One element I see is the social system evolution as the game changer. What I mean the social system is the ability to have "emotion" in what you are doing like search. It is far better feeling to ask your friend or relative than a machine about something and get answers based on reference-able experiences, and those changes, enabled by platforms like Twitter and FaceBook is the new way in future. Now, could Google have come up with this earlier?

Perhaps yes if they have applied TRIZ trends :)

Well, the trend is that Search engine is transitioning to the super-system not because the current system has reached to its limit, but a newer system (like social system) is emerging faster and is almost outdated the current system. In a scenario like this, what a company like Google should perhaps try to do is to look at the way how in future people will communicate to each other with emotions.

Apart from the "Transition to super-system trend", we can look at other trends like "Increasing degree of ideality" (Try applying this in the super-system) too.

What else do you think Google can apply and come out with the next best search? Remember the "Resources" are aplenty for a company like Google.

FoodProcessing.com recently posted a terrific article profiling their 2010 R&D Team Winner: Hormel Foods. You must make time to read it if you are interested in learning how other companies approach innovation.

Phillip Minerich, Vice President R&D, is interviewed for this article. Here are two quotes from the article that reinforce the role big goals and skills (lateral thinking) play in the innovation process:

1. Billion Dollar Challenge

"Our CEO Jeff Ettinger challenged our team with the Billion Dollar Challenge--between 2000-2009, he wanted to add $1 billion of sales from products that did not exist before." recalls Minerich. "We reached the goal two years early, in 2007" During those eight years, overall sales grew 80 percent, to $6.1 billion, with 37 percent of that growth from products that didn't exist before 2000.

2. Skills--the Freedom to Explore and Be Creative

"All the responsibility and accountability is built on trust and encourages the freedom to explore and be creative. One of our team members, Dan Hirst, is a trained leader in Edward de Bono's lateral thinking training, which makes remarkable use of several skills that encourage not only out-of-the-box thinking, but removing the box barriers entirely. Everyone in R&D and many in the corporate office have been trained in this program."

To read the entire article: click

http://www.foodprocessing.com/articles/2010/rd_hormel.html

Enjoy the article. Read it a few times. There is a lot to digest.

Until next time ...

Keynnote: "Innovation is Successful Only When it is "On Code" (Clotaire Rapaille, Archetypes Discoveries Worldwide and Author: The Culture Code: An Ingenious Way to Understand Why People Around the World Live and Buy as They Do

Clotaire made an extremely interesting presentation on the internal "coding" of our thinking and brains, meaning why people do what they do and why they frequently say one thing and do another. An individual's "code"is defined as why they accept or reject new ideas and types of innovation. An example he started with is the difference in approaches to the challenges and opportunities in airline travel. The airplane builders, in trying to improve the qualitry of the air travel experience are thinking in terms of leg room and food service where the big issue in the mind of an airplane user is the time involved (travel, security, etc.) getting on to the plane much more than the flight itself, which in many cases is much shorter than the comiing and going from the airport. No airport at all is what would be desired. He also mentioned the different strategies employed by Boeing and Airbus with Boeing's smaller, but longer range 787 providing more non-stop capability. He suggested that we go beyond getting out of the box and get rid of the box (airport?). (TRIZ folks: Ideal Final Result: Something performs its function and doesn't exist!). Clotaire says that our code of analysis and reference is imprinted early on from our experiences and there's no second chance for a first experience. He pointed out his surprise that in the US conference rooms usually have no windows vs. lots of windows elsewhere. He pointed out the most important code within us is the one related to survival. In this regard, we have 3 brains: reptilian (both an inside version relating to food, care, etc. and an outside, and emotional one). He used the example of the very sucessful PT Cruiser from Chrysler as an example of a product appealing to both inside and outside codes of our brains. The exterior design was very round, shapely, and "feminine" (appealing to our emotional side) while the inside was more like an Al Capone escape vehicle. It was an example of a love/hate car crossing two codes in our brains. Digitial watches vs. hand watches in another example of appealing to different "codes". Then we have the cortex analytical part connecting with other people and facts, data, reality, statistics, and prices. This last part ontrols the other two functions and cleans the plate ccasionally (men and women very diffrent about this). Men tend to react to the aroma of coffee vs. its taste and a mother relates it to breakfast and feeding the family. An innovation in this area must be "on code"--aroma. He related this to the eleimination of the PT Cruiser when Chrysler was taken over by Daimler Benz who did not see the need for a "feminine" code product. He also speculated about the changes in store now that Fiat, an Italian company, was the owner. Chrysler employees must feel very schizophrenic! The American "code" is that they do not want smaller cars. From Geneva in Europe you can be in Italy, France, etc. within 30 minutes or at most 3 hours. In America we can drive for a week and still be in one country. Space and efficiency are both important. That's the "code". In Japan minimal space is the norm--there is no word in the Japanese language that we would interpret as "privacy".

Innovation has to make life simple. Adding one step of complication causes a 20% loss in market. No cables for anything! Approach a car and it starts!

Corporations have cultures and replicate themselves without awareness and then cannot adapt. Terrorists have no structure (vs. the Panzers in WWII Germany). With little investment, big results are achieved. The 9/11 incident involved the purchase of 10 plane tickets.

We don't use outside resources enough to break our "codes". Having seven engineers on a "brainstorming" team is 6 too many, he says. Find a priest, a baker, a car dealer, etc. Multi-cultural diversity to understand "codes" is important. The Japanese perception of cleanliness in a bathroom is different than a Chinese perception since Chinese bathrooms are so much smaller and the focus in on how clean the celliing is since that's the only thing that can be seen. (When was the last time you looked at your bathroom ceiling?). The Japanese and Americans have very different "codes" about time.

It takes only one second to create history. December 6 and 8, 1945 were distincly different for both the US and Japan. He made other comparisons of Japanese and American "codes". Doing things right the first time in the US is "boring. Americans don't read instructions--they make mistakes. The Japanese read the instructions 500 times. We frequently don't use the additive strengths of the different "codes" in people. Be suspicious of any CEO who only knows one language.

In the US we are only interested in what's impossible. That's what we need to ask our teams to do (Note to TRIZniks: the Ideal Final Result)

Jim reviewed his research in the use of collective random intelligence highlighting a study done by placing an oxen on display and asking all passerbys to guess its weight. After collecting hundreds of ballots, the "average" guess was 1197 pounds vs. the actual 1198 pounds. No one guess was correct but the average was. We need to tap into colective intelligence and reach across all inputs. He pointed out that studies have shown that crowd predictions on elections are more accurate than Gallup polls 75% of the time. How do we make sure we "reach across"? Use diveristy (multi-cultural, age, gender, type of training) and expand the range and type of diversity you're considering. Everyone is not making the same mistakes!

Most meetings are echo chambers. He related how the term "devil's advocate" came about. In the early days of the Roman Catholic church's practice of naming "saints", there was great concern about the significance of this decision and a single dissenter was always included in the discussions and just as importantly, the "dissenter" was constantly changed. People dissatisfied with their "team" experience tend to be ones who like consensus and prefere homogeneious teams that can reach consensus easily. Good decisions arise from conflict. This needs to be made explicit at the start (Personal input here--if we made more proactive use of psychological assessment tools, this would be much easier). Imitation and group think are potentially dangerous in innovation. He mentioned a study done in Times Square where one person looked up at the top of a building and 5% of the surrounding crowd looked up. When 5 people looked up, 20% of the crowd did. When 8 people looked up, 45% did.

Be careful about oral responses and talkative people in group decision meetings. Knowledge and incites come from unexpected sources and people and leaders cannot dictate this in advance.

This group discussed their individual company approaches and processes for corporate wide idea collection. Avery Dennison has an "idea bank" which collects employee input and ranks against business needs. Award systems are used but not strictly related to dollar impact. There are special rewards for ideas relating to REPLACING current products and businesses. (Personal note: that's a great idea!). Motorola has an inventory of 16,000 ideas via an Open Idea Market. No special rewards, relying on WIIFM, helping, sharing. Clorox makes heavy use of both internal and external social media.

This session used a very interesting format which may be of value to you. The speakers were on a small stage in chairs, and after their brief oral (no slides)presentations took questions. The person asking the question was invited to join the panelists and participate in the Q/A, providing a "build" on the idea inputs. It suggested to me a possible format to replace the management lecturing presentations followed by Q/A in many companies. The employee asking the question would join the management group, replacing a manager who then beome part of the "audience". Might provide some interesting dynamics!

Sony described their efforts in future scenario planning, primarily based on bundled functionality and bundled services. As a service provider, Pitney Bowes uses the concept of a "challenge architect" in thinking about the service process they provide. They see the "democratization" of innovation. This is a reinforcement of trends mentioned by many other speakers. They use a RGB framework to categorize ideas (red--now, green--procede, blue--blue sky concept). They listen to the "voice of the retailer". Sony pointed out the change in photography trends as an electronic camera allows the user to take many more pictures and then delete them later (Personal TRIZ note: cheap and disposable principle). This is a miniature version of the information age challenge of having too much information and trying to sort what is valuable.

Dr. Vandebroek sumarized Xerox's corporate strategy as combining the customer's wishes and wants with Xeroxx capabilities to produce breakthrough products, services, and $$. She also mentioned their partnership with Fuji in Japan and mentioned their R&D budget was $1.5B and having 50,000 patents and generating them at a rate of 10/day. Xerox sales are $22B and it employs 130,000 people.Business focus is documents, document management, and business proffess outsourcing.Their Palo Alto Research Center (PARC), formally an only internal Xerox research center now gets 50% of its revenue from outside Xerox. Their R&D budget is split approximately in thirds: exploration, incubation of new businesses, and current commercial product lines. They use Customer Innovation Councils with P&G, cited as an example. They collaborate on space design, types of printers, solid ink waste. One of these efforts reduced printer power use from 400kwh/day to 70. She mentioned that there are 3 TRILLION pages/yr. being generated and less than 5% has been digitized. There are 9B times more electronic data than is in books

Internally, employees are required to participate in their "dreaming" process. They observe and categorize opportunities by remote knowledge workers and mobile knowledge workers.

They have recently purchased Lulu self-publishing. A book can be published in 5 minutes and downloaded within 20 minutes.

This talk highlighted the importance of platforms as an innovation engine. A picture of the original Sputnik satellite in 1957 was shown but the point was not the satellite (and its repercussions in the West) but the fact that the signal from this satellite was not hidden. Now satellite signals are use to accurately locate submarines and form the basis for GPS navigation. GPS is now a platform, not just a signal. Ideas are also networks. They start as a network of neurons firing and then making new connections. The history of the Philadelphia Coffee House where Ben Franklin and other early American inventors gathered to not just drink, but to exchange ideas. Platforms build and cross pollinate. We now have Google maps, Twitter, SMS cell phones, HTML, http:, etc Four Square is new business concept using all of these. Clusters, not corporations, are what is important. These are not necessarily exclusive.

The disruption was the flash microchip, but the challenge was culture barriers and roadblocks. In 1975, the first digital image was captured on a TV.The charge coupled device in the late 60's allowed the exploration of image capturing in an electronic fashion. Initially there were no specific business goals. The first digital camera has .01 megapixels, only B/W, and a 120X160 mil active area, and required a custom setup. There was no budget (he had to personally buy the CCD), they had no dedicated space and only 1 technician. The prototype was the size of a toaster, had a digital cassette, and used 16 batteries. With the Kodak "culture" of perfect image quality, the quality of the picture at that point was a major barrier. In 1977, a technical report was written, a patent filed in May 1977, and the first digital camera patent issued in Dec 1978 (#4131919)

The internal reaction was curiousity and caution and there was hesitation to show around. It generated more question than answers (no film? no paper? It's too far out). People don't want to view an image on a TV! How to store the images? (No mass market PC's at that time) How to make reliable? The paradigm is the paper picture is reliable almost forever. The PC, the Internet, wide bandwidth, photoprinting in the home were all paradigm changes. The context of its use was not imagined. In 1976 the question was asked, "when will it impact consumer photography?" In 10-15 years, they went from 10,000 to 1 million pixels and 200X improvement in resolution. There was zero interest in memory cards. There was much more support outside of Kodak than within. The development of digital circuitry in terms of speed, power, and size were just not imagined. Image compression (.jpg) was another enabler. It removed 90% of the image that the eye couldn't see anyway and allowed the introduction of artificats. The D5000 camera introduced in 1989 ran into significant cultural issues ("you can't change film sales", "call it in an image accessory, not a camera"0. The bottom line issues are to understand the corporate culture and view your innovation in their context, have friends (they're had to find!), and be honest and positive with your internal PR. Don't make yourself the issue. Remember all roadblocks are temporary and plan for what's next. Be patient, persevere, and be persistent. The key learning was the need was an image, not the film. Now the internal gospel is "no more film projects"! This was a fascinating presentation by someone who has more patience than anyone I have ever seen make a presentation since Art Fry's Post It Note story.

For those of you who are not aware of or don',t shop at Target, you are not aware of the concept of the "Guest" in the store. At Target, the guest (not the "customer") is at the center. It's an ethos vs. a process. Open innovation is part of Target's DNA along with the emphasis on diversity of intellectuality. Challenges they have been dealing with include balancing the Target store brands vs. the brand names. Their market demographics are getting older and more diverse.

They encourage teams to share results across the company, and strive to diversify the interests and include critical thinkers. Some time ago, they arrived at what they called the "Moment of Truth" and that is that the guest comes first and the vendors/suppliers are second. "Speed is life"--need to learn quickly. "We must not forget what we learned" as the economy gets better--don't let up!

Target now has a Director of Guest Insights to ensure they continue to gather information from the "guests'" perpective.

This division of GE sells CT and MRI machines and has a very engineering focused R&D team. Their challenge is in selling their technologies and products and bringing ethnographic research into their planning. 90% of the time the product technology is there but the design aspects come at the end They have sent a number of their engineers to a design course at Stanford to try to improve the understanding of the product/customer interface to their engineers. In other words, what is the customer "experience"? It's usually not very pleasant, frequently requiring sedation, especially for children under 6 and adults who are claustrophobic. They have made some interesting changes in the design and the experience to try to change the perspective to one of an "adventure" for a child (make it a spaceship with stars projected for example), and introducing comforting sounds and smells, as well as decorations. "We need to get away from the image that we're "torturing people"! Part of the Stanford course involves teaching some basic creativity skills to their engineers to improve their ability to be more right brained in their design thinking to hopefully produce a more user friendly experience, not just a better product.

Day 3 tomorrow!

Phil McKinney, the chief technology officer of Hewlett-Packard's personal systems group, may not be familiar with the Theory of Inventive Problem Solving (TRIZ) - an innovation methodology - but he is talking about a key TRIZ tool in a new interview: the ideal final result.

The article quotes McKinney as saying: "Devices today are always some kind of a compromised device--never...perfect. I want a big screen, but it weighs too much. I want 50 hours of battery life, but I can't pick up the battery. Ultimately, it's how do you build a device that requires the user not to have to make any compromise."

Begin the innovation process by determining the ideal outcome - the best possible of all scenarios. Starting from a position of compromise and concession immediately restricts the creativity and overall potential for new product, process or service development.

Instead, work backward from the ideal. Consider what it will take. And when you run into contradictions along the way - solve them using the inventive principles of TRIZ.

This week I'll be reporting from the TRIZ-Future Conference 2008, "The Synthesis of Innovation," presented by the European TRIZ Association, CIRP The International Academy for Production Engineering, and the University of Twente at Enschede in the Netherlands. CIRP has 550 members in 40 countries, so their participation will be significant in spreading the TRIZ message. There will be a special TRIZ session at the next CIRP conference, as well.

I came to Enschede by train from the Amsterdam Schipol airport, so I can't report on the scenery—8 of us from Taiwan, Iran, Japan, US, UK, and Turkey had a great time talking about TRIZ! This is what we have called in the past the "generous definition of Europe." In the morning light, we could appreciate the beauty of the campus and the Dutch countryside.

The Wednesday morning program of tutorials continued the generous definition of Europe:

1. "Introduction to TRIZ for Technological Applications" by Hongyul Yoon, South Korea
2. "Introduction to TRIZ for Business and Management Applications" by Valeri Souchkov, Netherlands
3. "A systematized use of Su-Field Analysis" by Iouri Belski, Australia

All three audiences were quite participatory, and were a mix of university faculty, TRIZ practioners, and TRIZ students. The University of Twente demonstrated new conference communication technology—each visitor got an MP-3 player that functions as a USB memory. When plugged into the computer, it gives a 3-dimensional tour of the campus, it searches for new information and delivers it to the computer—we got the morning tutorials immediately after lunch .

This is where I usually insert my editorial remarks on the indirect benefits of attending TRIZ Conferences—you not only learn the new information, you learn the methods of presentation that a variety of teachers are using, and you learn what other people are interested in, both from their questions in the sessions and from the conversation over coffee and meals and walking between the sessions and the hotels. Start planning now for the 2009 meeting—some people need to request budgets now for meetings throughout the year! And some people can only attend a meeting if they are presenting a paper—start organizing your research and case study work now! End of Ellen's editorial!

Today I mixed papers from sessions 1 and 2 in order to get a mix of theory and practice, and to find out what some of my friends have been doing since the last conference.

Giacomo Bersano, T.Eltzer, and R. Uhl reported on their method of integrating TRIZ with risk management to increase the success ratio for innovation projects. New data from the French ministry of industry showed that 23% of companies stopped innovation projects, 30% were seriously delayed, and only 10% were fully successful. He used the function modeling method from GTI to look at the complex relationships that lead to the failure of innovation projects, which identified the lack of good data as a key issue. TRIZ analysis of the contradiction between the need for precise data (and the requisite time and money) and the need for speed to market led to several suggested methods for resolving the contradictions. These methods have not yet been applied to new innovations—perhaps we can have a paper next year with the results?

Darrell Mann returned to a favorite theme from past papers, with technological updates, in the paper "Smart Materials Solve Contradictions: Connecting the Right Materials Solution to the Right Market Need." Darrell used a wide variety of examples (vacuum cleaners, automobile suspensions, room air conditioning, bullet-proof vests, shin pads for sports) to address the fundamental issue of discontinuous change rather than optimization. Smart materials that are flexible when not stressed, and rigid when stressed resolve the contradictions because they have non-linear response to the impulse. For heat control, Darrell introduced smart conductors that change conductivity (the molecules rearrange themselves) as a function of temperature. Rheo-chromic and mechano-chromic materials change color as a function of stress—there are different applications for reversible and irreversible changes. He organized the stimulus and response fields in a matrix, which can serve as a guide for patent searches to find the materials which demonstrate the needed phenomena.

Simon Dewulf, Vincent Theeten, and Bernard Lahousse use case studies of novelty products to illustrate their thesis that simplicity is an overriding concept in TRIZ. Simon created a cross-index of properties and functions, and build a geometrical device (think morphological matrix with spider charts in the cells) to look at the opportunities for achieving the desired functions in the simplest possible way. More performance, less harm, more convenience, lower price are the 4 criteria that almost all developers want (on behalf of their customers), which can be used to rank the techniques found in patent searches. The audience enjoyed the de-colored beer (de-colored sugar syrup) and the metal foam (bread dough, whipped cream) and the flexible piano and dozens of other examples. Too much time was spent demonstrating features of their software, rather than the basic principles of the paper.

We then reconvened for the second keynote by Zinovy Royzen, "TOP-TRIZ: Theory, Applications, Training and Integration." TOP TRIZ is a further development of classical TRIZ which includes problem formulation and Tool-Object-Product modeling, development of standard solutions into standard techniques, further development of ARIZ, and utilization of resources. Royzen presented six cases that demonstrated the practical applications and the depth and breadth of the method.

The day concluded with a reception, and I'm told that those with fewer time zones travel than I continued drinking and talking late into the night.

Booz & Company announced its new Global Innovation 1000 report today –"Beyond Borders." The report focuses on R&D expenses across the globe as a key innovation indicator. Their top 10 companies include: Toyota, General Motors, Pfizer, Nokia, Johnson & Johnson, Ford, Microsoft, Roche Holding, Samsung and GlaxoSmithKline. A few interesting findings:

• "Fully 91 percent of the world's 1,000 largest R&D spenders conduct innovation activities outside the countries in which they are headquartered."
• "Even as the companies based in the U.S. performed $80.1 billion worth of R&D in other countries, companies headquartered elsewhere poured $42.6 billion into R&D conducted in the U.S."
• Three industries make up 70 percent of the R&D - automotive, computing and electronics, and healthcare.

The report can be downloaded as a PDF here: http://www.booz.com/global/home/what_we_think/reports_and_white_papers/ic-display/42809114

What do you think? Do the results surprise you? Are those the companies that come to mind when thinking of innovation? Does R&D have a direct correlation to how innovative a company is? Is there too much outsourcing in innovation?

Saturday dawned (well, 8:30) with more than 100 people attending the workshops on innovation, lean, six sigma, collaboration, and international business. The informal theme of the Friday session was emphasized by several of the presenters: let's stop talking about "it" (innovation, or quality, or whatever!) and start doing "it."

Jeannine Siviy, Deputy Director of the Carnegie Mellon Software Engineering Institute kicked off the plenary session by addressing "Innovation in Engineering Process: Multimodel Harmonization." She explained the problem of multiple model environments, in which a variety of models for corporate management and improvement are deployed at different hierarchical levels, across functions, using a variety of methodologies. For example, one company might have improvement initiatives using six sigma, ISO certification, improving enterprise governance, changing configuration management, and using CMMI (software methodology improvement.) This creates competition for resources, contradictory metrics, and duplication of work without any increase in benefits. The harmonization research is creating a unifying structure based on a philosophical orientation: go for performance first, the compliance will come, rather than an elaborate checklist approach. The case study of the approach used by Lockheed Martin was very helpful, and was also an illustration of the "positive deviant" method explained by Roberto Saco on Day 1.

Darrell Mann traveled to Zacatecas by way of Australia and the US (next stop Austria!) Darrell needs no introduction to the TRIZ Journal and Real Innovation readers. The Forum audience was very receptive to his presentation "Breakthrough Software Design and the Need for Breaking Rules." He used Infosys specifically and India more generally as benchmarks for development of IT in all areas. (89,000 employees. 8000 new last year, one million applicants for the new jobs.) He compared the well-known software design patterns to the TRIZ principles for innovative problem solving, and reported on research that expands the patterns by a factor of 500. Darrell reported that the research shows that there are millions of systems, but only hundreds of problems and tens of successful solutions (no surprise to our TRIZ readers.) He presented a new acronym that was helpful to the people hearing about TRIZ for the first time:

PERFECT –IFR. Get rid of trade-offs

ESCAPE –from the box. Disrupt your patterns of thinking.

RESOURCES –use all resources to solve the problem, and don't forget that the knowledge of the situation is a resource.

FUNCTIONS—understand the job the customer is trying to do.

EMERGENCE-patterns of evolution. The audience was very impressed by the universality of the patterns

CONTRADICTIONS – Eliminate them! Software uses the same 40 principles, but re-interpreted for the nature of software

TURTLES—Systems are fractal (the turtles are part of a long joke.)

Readers who want more of Darrell's great examples are invited to go to the free downloads section of www.systematic-innovation.com

The after lunch speakers shared success stories from businesses in Mexico, and some of the resources that are available for businesses that need help starting innovation or quality initiatives, or both.

Jorge Perez-Rubio from the AMA training and consulting organization challenged the participants with "Leading Innovation: a unique opportunity for Mexico," emphasizing the unique resources of people, education, location, and natural resources that Mexican companies can access.

Victor Hugo Arellano Lopez, Director of Operations for Texas Instruments de Mexico, reminded the audience of TI's long and distinguished innovation history (revolutionized the exploration for oil, invented the integrated circuit, developed infrared cameras, created new industries with the DSP and DLP—even won the Emmy for how technology changed entertainment!) He showed how TI de M's employees are the foundation of its continuous innovation and quality improvement efforts, and gave examples of the reward and recognition system that is a fundamental part of TI's process.

David Rios Jara explained "Regional Innovation Systems" which had been benchmarked for products, services and management models. Experience in Europe for small and medium-sized enterprises was considered particularly relevant to Mexico. They found that regional systems are better than trying to build big national or mult-region systems— they are more in touch with the technology and resources of the region.

Fernando Avila, Quality Assurance Manager of the Tequila Sauza Company gave the concluding address, "Foundations of Value: Statistics, Quality and Competitiveness." The audience appreciated his strong focus on quality defined as satisfying the customers' needs, and his entertaining stories about the tequila business. His conclusion that quality alone is not sufficient for competiveness was well-received.

Temo and the entire staff of CIMAT got a very well-deserved round of applause from the audience for an excellent program.

In 2009, Real Innovation's sister website, iSixSigma, will host its first annual Summit and Awards in Miami. Although there are some who debate whether innovation and process improvement can work together, we know that as successful as they can be on their own, combined they are unstoppable!

If your company also practices Six Sigma and systematic innovation, take the time to nominate a breakthrough innovation project for the Largest-Breakthrough Improvement Projects. Your project could be recognized at the awards breakfast AND highlighted in the March/April 2009 issue of iSixSigma Magazine.

The audience was immediately fascinated by the opening talk by Prof. Charles Cooney, director of the Deshpande Center for Technological Innovation at MIT. The Deshpande center is a unique institute that sponsors academic research on the process of innovation. Cooney surprised the audience with his claim that both the academic and venture capital communities are risk averse (in different ways) and that rather small grants in the right way at the right time can bridge the gap between them. None of the money goes to developing business plans—that comes much later in the innovation cycle. His "value chain" is easy to remember: "Idea®Invent®Innovate®Impact " and his lessons learned list has a small number of critical risk reduction steps at each interface. Most interesting to the Business Innovation Conference audience were

1. The method of evaluating the proposals for potential market application, 2-3 years in advance of venture capital investment.
2. Replicating the model in multiple countries and universities, which is just starting now.

I was the chair of track 2 for the rest of the morning, so readers interested in track 1 should consult the conference website, www.businessinnovationconference.com. Kim Johnson, consultant from Minneapolis-St. Paul (and PMI, and PDMA, and Scanlon network and …) started track 2 with a great anecdotal talk about 3M's GRIT—the Grass Roots Innovation Teams. Those not familiar with 3M were amazed by the "McKnight Principles" from 1948, which had a very "modern" tone regarding the innovation culture of the organization.

Langdon Morris from Innovationlabs presented a structure for creating an innovation culture. He used many visual metaphors and analogies to explain his model, which the audience found very helpful, and illustrated the theory with the Coca Cola innovation case study. The difference between the Status Quo Culture and the Innovation Culture are remarkable—no need for me to take notes, since Langdon generously offered the audience (and our friends) free downloads of his book "Permanent Innovation" and the conference paper, from www.permanentinnovation.com

Bill Burnett from W. Burnett LLC presented "Steps to become an innovative company" that had some points in common with Morris' method and some significant differences. The story of Nummi (the joint GM/Toyota automobile assembly plant started in 1985) is relevant, since it demonstrated radical change with the no change in the worker population. Nummi had the highest rate of suggestions (product and process improvements) and the highest rate of line shut-down (to prevent quality problems from continuing) in part because of policy changes to remove fear from the system, and in part from creating an infrastructure so that the employee got positive feedback: suggestions were implemented, problems were fixed. A key strategy (illustrated with several stories) was removing vocabulary that has implications of Adult-Child (manager-worker, superior-subordinate) and replacing it with Adult-Adult vocabulary (colleague, teammate, team member).

This was a very full conference agenda—even lunch had a speaker. Tony Reyes, CEO of CartonCraft, gave a delightful, informal talk on how he acquired a company doing less than $5 million/year in business and grew it to triple that size in 5 years by creating a culture of daily innovation based trust and learning. Photo: Tony Reyes networking with the participants.

"Market factor co-evolution" is the theme of Tom Duening, director of the Entrepreneurial Program at Arizona State University. He took us back to basics, to Drucker's statement that "the objective of all healthy enterprises is to strive constantly to create greater customer value." Their curriculum includes "opportunity recognition"—the breakthrough was realizing that there a method for opportunity recognition, and it is teachable and learnable. He used the examples of Cirque du Soleil and Yellowtail Wine, from the Blue Ocean strategy book to illustrate the method of seeing opportunities.

I had the challenge of introducing TRIZ in one hour to the Business Innovation Conference attendees who had never heard of TRIZ—we told delegates who had knowledge of TRIZ to go to the other session. We should get a lot of new TRIZ Journal readers from this, and many people going back to their organizations to ask new questions.

Praveen Gupta had a very interactive session on Measuring Innovation. The audience challenged all the methods of measuring innovation and the need for making the measurements. He brought the whole range of views together by pointing out the relationship between outcomes and process measures.

Even the reception had a keynote speaker! Patrick Whitney, Director of the Institute of Design at IIT talked about the role of design in translating customer needs for services and products into concepts that can be developed, produced, and delivered.

Business Week's annual list of the top 25 innovation companies came out the same week (April 28, 2008) as the Fortune 500 list. Big difference: the Fortune 500 has an explicit algorithm involving revenue, profit, and other measurable factors. The Innovation 25 is based 80% on the opinions of people who BW has decided to poll (executives at previous winners, mostly) and 20% on financial factors (3-year averages of revenue growth, margin growth, and stock value).

If the purpose of the list is to provide best practices and lessons learned so that people in lower-ranking companies can decide how to become more innovative, I don't think that this algorithm achieves its purpose. Yes, it is nice to see Tata in the top group, based mostly on the radical concept of the under-$2500 car, which includes a large number of business innovations, distribution innovations, and manufacturing innovations, as well as product innovations. But GM? The editors say that it is because of the electric car experiments, On-Star communications, and the new emphasis on styling. But the same week that they announced losses for the quarter of more than $3Billion? Maybe they are being rewarded for innovating during a recession/downturn, which is another major theme of this year's articles—real innovators have to ignore the quarterly pressures from investors and make long-term commitments.

Likewise, a major theme of most of the become more innovative articles is the need to free employees from strict supervision and give them opportunity, tools, time, and encouragement to experiment with opportunities for innovation. Apparently that's true for all except #1 on the list, Apple, which is known for the imperial-decree mode of innovation that has been so commercially successful.

I have great admiration for some of the individual innovative products/services that are showcased, and I invite readers to use them as practice study objects for TRIZ and other innovation methods. For example:

Flip video camera: Great example of "trimming" (no legacy functions—fresh look at minimal requirements) and "nested doll" (USB connector fits inside the body) and "change optical properties" (both for the flat lens and the color-coded instruction button)

Mini-Hummer: Pattern of evolution of making things smaller and smaller

Same for GE shrinking a 15 lb electrocardiograph that took 3+years and $5.4Million to develop into a 3 lb unit that took 18 months to develop for less than $500,000. Lots of business innovation (use off-the-shelf logic chips instead of custom, target rural clinics in low-income countries instead of specialty doctors in high-income countries, and putting the research in the countries to be served) as well as technical innovation.

This column is called "commentary" because it is personal observations and opinions, not detailed research. So, you have my opinion—BW's "Best 25 Innovators" isn't useful for those who are trying to figure out how to make their own companies more innovative. What's your opinion?

Question 1. Is this list useful?

Question 2. Do you know any other list that is useful?

Question 3. What companies' innovation stories have been helpful to you to improve your own organization's innovativeness?

Use the "comments" button below, and if we get more than 10 comments (a Real Innovation/TRIZ Journal rare event) I'll do another article on OUR readers' opinions.

It is always interesting to hear the insights of leading innovation practitioners. The article, "Instituting Innovation: Tell-all advice from 4 leading practitioners", posted on Core77 doesn't disappoint in this regard. Here Arkadi Kuhlmann, CEO of ING Direct Bank; Ken Koziol, Corporate Senior Vice President for the Restaurant Solutions Group at McDonalds Corporation; Matt Mayfield, Senior Director for Mobile Devices of Motorola; and David Lawrence, Senior Manager of the Bicycle Product Development and Marketing division of Shimano, contribute their thoughts on how to build an innovation program.

In each case, an approach to innovation has been taken that is aligned with the general character of the company. Factors such as culture, innovation readiness, and industry rate of change influenced the decisions of which direction to take. And while the four companies demonstrate examples of the incubator, diffused participation, and tactical project driven approaches, there are common threads that run though all of the examples.

There is recognition that innovation is a process, not an event. In this process, there are many different actors which contribute different skill sets along the way. When building your innovation process, it is important to think about the different stages of innovation as a product moves through early stage ideation, conceptual materialization, validation and delivery, and the various skills that you need to have represented in the innovation team to be successful.

All four of the practitioners agree that innovation needs to speak to the customer to deliver value and hence success. Listening to your clients and understanding what they are trying to tell you are critical elements in any successful innovation practice. Oddly, the author of the article, Brianna Sylver, distinguishes this from seeking innovation through technology advances. However, the two approaches need not be at odds, they can be very synergistic. High value technology innovation is always driven by a need. Understanding the repeating patterns of technology innovation can be of tremendous value in finding the market winning approach to answering a customer need.

Once an interesting concept is identified, working with the organizations culture is key to achieving productive support. Contrary to the just do it approach which is often advocated, these executives advise to not emulate Sisyphus with futile efforts working against the corporate terrain. Instead, learn how the change mechanisms in your organization are structured and which methods will engender the best response.

The topic of measuring innovation success is also discussed. However, proceed with caution when considering the comments here. The discourse highlights an example from Shimano of a new coasting bike that has not met financial expectation. This is used to bolster the argument that short term profit should not be the only metric of success. In general, this is a valid point. Success metrics should be well balanced and capture the whole view of the innovation program goals. However, we should fall into the trap of trying to redefine success in order to salvage a poor result. In is import to be coldly objective in evaluating outcomes. The criteria of success should be defined from the start, and in so doing we should heed Clayton Christiansen's advice to be patient on revenue, but impatient on profit.

Related to defining good success metrics is the notion that your innovation program should always be aligned with the company's business objectives. It should go without saying, yet this is where many organizations go astray. As they strive to think out of the box, they begin to think themselves out of business. Koziol says it very well, "You need to always be in sync with the company's strategic vision. You just can't afford to be off strategy."

All in all, this is some great advice from four practitioners who are accountable for innovation in their companies. While each has created a program to fit their environment, there are common lessons for us all. As you think about these lessons may mean to your own innovation program, keep in mind that while each of these companies has elected to focus on one model of innovation, many companies achieve great success with hybrid models that blend the best aspects of all three of the approaches represented by this group.

[Crossposted from www.InnovatingToWin.com]

Writing for realinnovation.com makes me look around for new ideas to write about. It occurred to me that my neighbor, who a few years ago showed me a charger for cell phone was also working on a spa system for last two years, made me an offer to take the Aerobic Spa bath. Reluctantly, I agreed. I thought let me see how he evolved from a less than a pound heavy charger to 400 pound aerobic spa equipment. I thought I might like to look at the work of an innovator. After I took the bath in his Aerobic Spa, I loved its benefits. Before I talk more about it, let me tell you the story of this innovator.

Jim McGinley, the innovator has worked for more than 20 years in electronics in manufacturing, marketing, and management. At some point Jim accepted the early retirement package, and started his venture along with his partner Don Rimdzius, who is an electrical engineer, and holds the MBA. Don has experienced in working with large projects. Jim and Don decided to create something new. So, they make a list of ideas or potential projects related to better power utilization. As use of cell phone has been growing exponentially, the market opportunity led to the development of a Travel Charger. Two years of labor led to the development of the Travel Charger. They built prototype, and demonstrated to several large potential customers, the big OEMs like Motorola. Working with large customers appears to be very attractive due to the size of its order, but difficulty of getting a lucrative contract can turn out to be very discouraging. Jim and Don just waited and waited for a large customer's contract, and eventually put the Travel Charger on hold. This situation, however, did not dampen his innovation drive.

While at home, Jim knew his Mom had tried to develop an aerobic bath to address her health issues. It did not appear to be working well, so Jim and Don decided to work on developing the Aerobic Spa. They learned about various methods, and invested significant capital again and developed the Aerobic Spa. It has actually three parts, the Bath Chamber, the Controller, and the Filter.

After taking a bath successfully, I became curious about how these two guys who first were working on a $25 charger quickly switched $50,000 Aerobic Spa. Such a difference between two innovations, I wanted to know the secret. I understood that it took a lot of investment, a lot of sacrifice, and then a lot more effort in marketing and selling. The day I interviewed them, they heard from a large OEM to evaluate the Travel Charger, and also are about to get the first order for Aerobic Spa.

Like any innovator, the bigger challenge than creating new products is to market and sell. Jim and Don have been marketing their innovations through Internet, Sales Reps, Advertising, and the word of mouth. When I heard about aerobic spa, I tried it out, and I loved it. I have already introduced it to many of my friends. I know how it feels like to be an innovator who has to build his customer base one customer at a time. Estimating thousands of customers in the business plan never works.

If you know an innovator, or have experience in making innovations work, tell us.

Last month I had an opportunity to speak on innovation at the IIT Chicago's Bangalore campus. It is amazing to see talk and walk going on in this area there. Then I visited Prakash Kappoth, Senior Manager – Knowledge Management, whom I met at RealInnovation and Raj Datta, Chief Knowledge Officer, both at MindTree Consulting to share lessons in innovation. Interestingly, MindTree has been practicing innovation methods, innovation community, and social networks already in India. From our brief discussion, it appears that MindTree has implemented elements of the innovation process including the organization, technology infrastructure, knowledge sharing, idea management, and recognition and reward.

Innovation Chat with a CEO

Continuing my innovation exploration, I had an opportunity to chat with Ashok Chaturvedi, the founder Chairman and Managing Director (CMD equivalent of CEO) of The Flex Group (www.uflexltd.com), a multi-national packaging company based in India, exporting films, packages, and laminates to about 90 countries, and expanding operations globally.

Ashok Chaturvedi, CMD, UFLEX Limited

Letting my jetlag be responsible for omissions, the following Q&A represents what I could capture during our short interview session:

Q. What does innovation mean to you?

A. In flexible packaging, innovation means gain market share and improve bottom line by creating new packages, and is all about creating uniqueness coupled with ability to capture that uniqueness. We create new packages which customers find it better than found anywhere, and these are difficult to replicate. Innovation includes technology, material processing, and design. We have ignored our intellectual property earlier, but now we are patenting our packaging solutions going forward.

Q. What is your strategic commitment to innovation?

A. I head our innovation team and strongly involve for developing new products. There is a team of key individuals focusing on innovation. Innovation does not mean cost cutting exercises. I do not believe cost cutting is the same as innovation. To me, innovation means new products that drive process and technology innovations. For example, P&G requested an innovative package to improve an existing package for better shelf space utilization. We were able to develop a flexible packaging that highlights the product, takes less shelf space, and appealing to the customer.

Q. How satisfied are you with returns on innovation?

A. We are very happy with our strategic innovation effort. Innovation is the only way to keep the bottom line good, and market share grow. Without innovation manufacturing will become a rote activity, and lose its momentum and margin. Innovation always keeps you younger. With innovation we can protect the price, and serve our customers better.

Q. How is innovation managed?

A. As I mentioned earlier, I am heading the R&D division in Flexible packaging division. My job is not just to manage finance, or make key decisions. My primary job is to drive innovation. I am developing a team of innovators in flexible packaging. The team is expected to produce many innovative solutions that will be commercialized in 2009. The company profile will change in 2010. Last year we introduced nine new products scheduled for introduction in the next 18 months. We recently received a global patent for slider head zipper assembly with laser score and a metallic barrier.

Q. How is innovation rewarded at UFLEX?

A. We are paid to innovate, it is our job.

The Battle of Poltava was a resounding victory for Peter the Great. He defeated Charles the XII and 14,000 Swedish cavalry with a superior force of 45,000 Russian soldiers. The battle lasted all day with the outnumbered Swedish soldiers making several valiant efforts against the superior Russian forces. Ultimately the Swedish soldiers had taken too many losses to effectively continue the battle and Charles retreated to Moldavia for five years before he could finally return to Sweden. The captured Swedish soldiers were taken to St. Petersburg and they helped to build the great city.

From October 1941 to January 1942 the Germans attempted the invasion of Moscow and then suffered a counter-attack after the city had been defended. Operation Barbarossa called for the Nazis to capture Moscow in four months but the brutal Russian winter and the lessons of Napoleon were ignored. The Battle of Smolensk slowed the Wehrmacht down and the tide was completely reversed at Moscow.

What are the implications these battles have for the modern corporation? Charles of Sweden underestimated the skills of the new Russian cavalry under the innovative leadership of Peter the Great. Hitler underestimated the Russian resolve and the Russian winter that decimated his blitzkrieg. Corporations also make similar mistakes in judgment. Leaders assume that prior supremacy will sustain the organization even when an upstart challenger enters their field of excellence. Charles assumed that the legacy of the powerful Swedish cavalry could not be matched by the new Russian horse soldiers. The skills of the entrepreneurial organization are not to be underestimated. Peter the Great made this point at Poltava. The power of a discontinuous innovation will propel the upstart to the market space and the mature market share will erode. Customers have proven to be disloyal unless they have become advocates of a particular product or service. Other organizations believe that their superior capital will protect them from any onslaught. They also believe that a swift response to competition will quench any threat. The next generation of an existing product or service remedies all challenges. Or at least they hope this is the case. The fickle and ever-changing competitive landscape can render these advantages useless as the money follows the features and benefits of the function being provided. The prevalent corporate force can find itself unprepared for the challenges ahead as the Third Reich experienced as it forayed into Russia.

If Charles had not underestimated his opponent he would not have brought 14, 000 soldiers to battle 45,000. If Hitler had not assumed that his previous victories would be replicated in Russia without consideration of the famous Russian resolve and the accompanying infamous Russian winter things would have been much different. So too, if the corporate leaders of today will prepare for the foe that is coming after their market share, they will not be defeated. Complacency will be their undoing. Leaders must embrace the science of innovation as they have the sciences of productivity and quality. This is the first step in dodging that exile that Charles found himself facing.

What are other companies doing to be more innovative? I am often asked this question. To find out, I attended a recent event which hosted two speakers - Rich Vincent (CLO) and Ivars Ozolins (Executive Development) from Nestle U.S.A. to learn the Nestle answer for you. They titled their presentation, "Bend it Like Nestle". Here is a high level overview for you.

Nestle is a very successful global company - $100 billion last year. We all know success can hinder the quest for innovation. So, to reinforce the need for innovation, Rich and Ivars started by researching changing American business trends from the birth of modern organizational science in 1948 to present times - global hyperflux.

In essence they did the background work and created a presentation that painted a compelling business context for product innovation at Nestle U.S.A. They had to grab the attention of senior executives. This took persistence. They wanted top level CEO/President support. They got it.

The Nestle U.S.A. process: A "3 Level Innovation Creation System" which is supported by the business units who hand select high potential employees to participate, and a venture capital (VC) board who review new ideas and approve funding to move selected ideas forward towards commercialization.

Level 1 - 5-Day Introductory Experience: The focus is learning about innovation and working on developing a new idea. Towards the end of the workshop new product ideas are pitched to the VC board.

Level 2 Short Term VC Project: 90-day single person projects start for those whose idea was approved by the VC board in level 1.

Level 3 Explorer Project: For ideas advanced by the VC board to this level, the individual works on a 6-12 month "garage" project. A support structure is in place to provide help with commercialization.

As usual, the toughest part of the system is creating a high performance environment driven by skills, accountability and commitment.

A key learning: Terms can paint pictures of expectations. The Nestle innovation terminology is now making its way through the organization which assists others in becoming more innovative: "change the game", "burn the bridge", "rapid prototyping" are some examples.

The Nestle Approach: create the business case for product innovation, get the support of the top executives, create a VC board that has to fund ideas, put in place a system for innovation, provide support for those individuals whose ideas are advanced through the system, and provide world class innovation training.

Future Forward: What can you learn from the Nestle system? Can you identify gaps in your system? If so, what are you going to do about closing those gaps? Until next time...

TRIZ Journal and Real Innovation Commentators talk a lot about the methods of innovation, but we don't talk very often about the sense of mission and commitment that are frequently needed to keep an idea alive while all those methods are being used.

Dean Kamen is well-known in the invention community – his Segway is an icon of "out of the box" creativity, his stair-climbing wheelchair was featured at one of the first Altshuller Institute meetings, and his use of his personal fortune to sponsor invention workshops and contests for schools has gotten extensive press coverage.

Go ahead – watch the video. It takes 5 minutes, so I won't make the commentary any longer. Think about what Kamen and his people did in 13 months. http://www.ted.com/talks/view/id/82

TRIZ lesson: did you spot the use of trimming? He mentioned it twice.

An article in today's Wall Street Journal discusses the importance of queueing theory in innovation – in this case keeping product pipelines flowing in order to not be bogged down by ideas. The George Group (consultants) helped Avery Dennison Corp. build slack time into its planning processes and create a few products faster. The article mentions four tips from the George Group:

1. Run a leaner pipeline.
2. Build slack into schedules.
3. Cross-train employees for vital functions.
4. Look for ways to build on existing knowledge.

All good ideas and important when developing innovative products, but they avoid the crux of the matter – decision-making. How does a company decide whether an idea is worthy enough of developing into a product? What are the metrics that a company should use?

Building slack time into any schedule is important, because life happens. Things go wrong. Unexpected complications arise. One direction can lead to twelve unexpected directions. Too much slack time or, rather, undirected slack time, can lead to more problems than an innovation can solve.

Adjusting a system to accommodate slack time and a timeframe that accommodates failure is necessary for any innovative process.

Real Innovation Commentary fans (that's everybody, right?) know that I get obsessive about lists of the most innovative--Business Week's design awards, Popular Science's 100 best new things of the year, Technology Review's editors' choice for the 10 innovations that will have the most impact in the next 10 years, and dozens of others. Part of the fascination is the contrast between popular journalism and the disciplines of TRIZ: half the fun and frustration of the popular lists is trying to figure out what the criteria for selection were, and how the candidates were found in the first place.

There's no such puzzle with TRIZ--the criteria for the evaluation of a concept are well-defined. Some authors are now working on refining the definitions (Val Souchkov has an extensive article in the May issue of the TRIZ Journal) I haven't seen significant problems with the classical methods--generally a group of beginners can get calibrated with each other in their own specialty area within an hour and a half or so.

The list in the April 2007 issue of Wired Magazine set off these musings. The criteria: "They're masters of innovation and technolgy, global thinkers that dominate their industries and point the way to the future." That looks like a nice headline, but doesn't really help me distinguish between Google at number 1 for both 2006 and 2007 and News Corp. at number 5 this year, up from 9 last year, because it bought MySpace but hasn't yet figured out how to cash in.Nintendo came onto the list at 6 this year, not listed last year, on the strength of the Wii's acrobatic controller, which is selling a million sets a month! But trying to figure out why that ranks 3 spots higher than GE with the comment "Edison's heirs keep doubling down on products too big, gnarly, or capital-intensive for companies that haven't been ruling Big Tech for a century." Or 18 spots above list newcomer NTT DoCoMo, praised for fast response to customer needs (Linux for mobile, 100 Mbps) with "not everything big telcos do is evil."

Real Innovation is all about innovation that readers can use. Reading lists like this doesn't help me understand innovation better--I think it just adds to the over-load that the "I-word" is starting to suffer.

Readers: Do you have a favorite list of Innovation winners? Why do you like it? Does it help you be more innovative in your own environment? Or am I getting too serious, and these lists are just intended for entertainment? Let's use the Forum to discuss this!

Dell just launched Ideastorm, a website for stimulating and gathering the brainstormed ideas of its customers – and anyone else interested in furthering Dell's success.

Site visitors can submit ideas, vote on a particular idea's value and comment on proposed ideas. Since its launch on Friday, February 16th, there are 585 ideas, 20,231 votes and 736 comments – impressive since the site has only been available for three days.

Additionally, there is a section (not yet in action) for Dell to report on its response to the suggestions that will be undertaken by the company. Customers will be a part of the progress of their ideas and read along from an idea's conception to its realization.

This is a forward-thinking method for including customers in the design of products and services. Keep checking to see if any of the public's ideas become the next Dell innovation.

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