Commentary by Jack Hipple

There is a fundamental law of product and business innovation that says that systems integrate intotheir super-systems over time. What does this mean? Let's take an example. You are in the businessof making paint roller pans. You have worked hard over the years to add stability to these simpledevices so that they don't tip over on ladders, added coatings to minimize sticking, and even made disposable ones in the hopes that people will buy your paint pans. You may have even gotten togetherwith a paint roller supplier in a joint promotion at a local hardware store. Then you go down to your local Home Depot, Lowes, or Menards and see theBlack and Decker Paint Stick(R)requiring no paint pan. Your product has been replaced by the void in a hollow stick, normally thought of as only a means forreaching places too tall for the painter. Being replaced by a void must really hurt an ego!

This is only one example. Here are some others to trigger your thoughts:

1. The elimination of labels on men's underwear shirts (don't know about women's!) eliminating the needfor sewn labels and the materials used in making them. The shirt is the label.
2. The elimination of bank deposit slips through optical scanning of checks, eliminating the paper, all the chemical used in producing paper from pulp, and theprinting inks used in making them. The check is the deposit slip.
3. The incorporation of toothpaste into the handle of a toothbrush, eliminating the need for the toothpaste tube and all the metal used in making it. The toothbrush is the toothpaste tube.
4. The incorporation of a toothbrush head into the end of a flosser, eliminating the need for a normaltoothbrush and all the plastics used in making it. The flosser is the toothbrush.
5. The incorporation of a punch out spoon in the lid of a yogurt container, eliminating the need for a separate spoon and the plastics or metal used to make it. The lid is the spoon.
6. The use of the Internet for newspaper publication, eliminating the need for millions of pounds of paperused for printing, and once again, all the chemicals and machinery used in making the paper. The Internet is the newspaper
7. The incorporation of multi-functinality in office machines, eliminating the need for tons of plastic and metal used in manufacturing these separate devices. The fax machine is the copier
8. The incorporation of multi-functionality into home lawn products, eliminating the need for the plastic andpaper materials previously used in making these extra product containers. We have also seen the incorporation of a lawn care business under the umbrella of the services of a termite service provider, eliminating the need for two separate business structures and their associated costs. We now have a "home service" provider. The termite provider is the lawn care provider.
9. The selling of duty free products on overseas flights, eliminating the need for a "duty free" store on the ground and all the costs and jobs associated with building and running it. The stewards and stewardesses are the duty free shop.
10. The integration of a tire structure into a wheel by Michelin, eliminating the all the rubber, additives,and the jobs used in the production of conventional tires. The wheel is the tire.

What's the point here? There are two very fundamental ones.

1. First, if you are providing a service or product to someone, rest assured that no matter how much they like you and your product, someone inthat company or organization is trying to figure out how to get the function you provide without you. No offense intended, but there's a lot of money to be saved and possibly the invention of a new product or business that will delight their customers. Look at your product or service and and how or why it is used by your customer and ask how could its function (not what it is) be provided within your customer's product or business. Then help make that happen and patent the concept to allow for at least some royalty payments when your product is not needed any more. Or maybe buy your customer and implement the idea!
2. Secondly, if you're the buyer of something, start figuring out how to get the function providedby what you purchase without buying it--preferably by incorporating that function into what you already sell. This will most likely delight your customer and give you some patent rights that could be very valuable.

As an engineer and someone involved with TRIZ and innovation audits of organizations, I frequently find myself in discussions and conflicts with more right brained creativity individuals. I will define right brained as those who basically believe that in the fields of creativity and innovation it is quantity that is important. In other words, any approach that increases the ability to generate more ideas, the better.

I have been in these types of session where the quantity of ideas generated was the yardstick for success (not useful ideas, but total number of ideas). I have also seen some exercises such as walking around matrices that are supposed to generate significant new ideas. All of you have seen group sessions involving any number of techniques involving balloons, music, etc that are supposed to improve our creativity.

I think I have finally figured out how to have a rational discussion about these approaches vs. more structured, left brained processes. That discussion revolves around understanding the difference between attitudes and tools. To be more innovative requires a desire to do something different than is normally done, a competitor is doing, or something that might be needed in the future that is not obvious. There is no point in learning tools that may be needed to allow this to happen without a basic change in attitude. This attitude cannot be changed for any length of time by executive edict and especially not if the edict is not followed up by sincere and continuous support. If an organization has a long history of incremental improvement, listening only to current customers, and doing only what the boss says, there must be an attitude change, up and down the organization. Replacing people may be necessary.

Some of the soft tools such as breakouts, adventures, and internal parties and kickoffs, are frequently necessary to let people know that there is a step change coming and management is serious. However, if requests for freedom and financial support to do something new and different are denied because we will never do something like that, the boss will not like it, or we have no money to do that, then the truth will echo around the organization as fast as EM can travel.

There must be a fundamental shift to think and act differently. It is critical at this point to also understand and acknowledge what the climate is and that means understanding the profile of the organization, using one of many organizational assessment tools. If an organization is composed of 80 percent Myers Briggs sensors and strongly adaptive individuals as identified with Kirton KAI, the challenge to think outside of the box is going to be extraordinarily difficult. People will be frustrated and the results desired will be almost impossible to achieve. The attitude of wanting to change the status quo must be there. Someone who does not see the value in change is going to be difficult to motivate toward true innovation. By the way, it would be no easier for the opposites of these individuals to deal with a short term structured emergency or a quality control procedure analysis. If there is a basic shift in attitude, then we can discuss how to accomplish the goal of the change in attitude.

What is needed now are tools for innovation that support the change in attitude and environment. If the problem is not too challenging, simple tools such as CPS, or DeBono processes may be sufficient. If it is one that has serious contradictions, is complex, or has been approached unsuccessfully for years, it may take more complex tool kits such as TRIZ. There are areas of overlap between them and ways to combine can be very effective. Each of these tools requires a different kind of attitude shift. All require some level of belief in a structured approach and process as opposed to random brainstorming. To be effective these tools and processes must be used broadly, not just by the troops, but the senior executives who are touting the value of them without having used them. The first use of them should be at the executive level to analyze the challenge of innovation inside their organization.We need to understand there is a difference between attitude and tools. If we want innovation and change, we need to change both and it may require different approaches to each.

Many of you may have seen Google's earnings report announced on Friday, January 22. In the 4th quarter of 2009, their sales (just one quarter!) were $6.7 BILLION and profits of $2 BILLION. This was 5 times the profit of the previous quarter. Let's think about this a second. How would you like to make 30% profit on this large a sales volume without MAKING anything that you can touch and feel. Just information!!

Companies like Intel and Exxon spend over a billion dollars in capital just to build a state of the art chip factory or petrochemical plant. Now Google has offices and spends a lot of money air-conditioning the building that hold all its servers, but this is a fraction of what is required in traditional manufacturing of cars, steel, chemicals, and semi-conductors. And none of these industries make 30% on sales. In a very good year, they might make 15-20% return on their capital investment (not sales and maybe a 30% return on sales on a few real specialty products for which patents haven't expired). These plants have to be constantly maintained, updated for constantly changing environmental and safety regulations, and plans for ultimate disposal of the property and equipment.

Wouldn't it be a lot more fun just to collect and sell information? Isn't that a lot easier? Well, of course it's easier if that's all the further your thought process goes. If it was that easy, everyone would do it. Despite the challenges of Microsoft and Yahoo, Google is still number one and is stretching its business vision beyond web searches. This tell us that information, itself, it pretty cheap and a commodity. It's all around us. But to sift through it, analyze it, and get only what you want is the real challenge.

Information is a critical resource. We know this but not everyone recognizes this. Sometimes it's egos that get in the way--we don't collect information that might be bad news or we "spin" it (now don't get huffy here, but consider the last several elections where the results ("information" as well as votes) are trying to tell the politicians something and possibly not just that "they don't get it").

I'll bet that many of you collect tons of information in your process control computers and your customer interviews. What do you do with it? Store it? Or analyze it? How? Do you recognize all the informational resources around you? When was the last time you asked one of your employees their opinion about something vs. telling them to be a "team player"? Have you ever asked your folks what skill or talent they have that you are not taking advantage of? Have you ever asked them about what they observed on the midnight shift? What they saw on the last customer visit that wasn't on the agenda or meeting plan? Have you considered what else you might do with the information that's already out there?

Let's consider a very recent example to illustrate these points. If you are a public agency responsible for traffic control and emergency medical repsonse to a traffic accident, how have you managed this for decades? You sit in readiness and wait for someone to call in an accident. Then you respond appropriately. This takes a certain amount of time. What if you could shorten that time? Clear the road quicker? Possibly save someone's life because you responded quicker with an ambulance? What information is at your disposal that could accelerate your response? Before I tell you the answer, think about this for a few seconds without reading further.......

What do people do today (that they didn't do 5-10 years ago) when a situation like this happens? Don't they get out their cell phones and call someone? Maybe it's their kids--"I'll be late to pick you up". Maybe it's a colleague with whom a meeting is scheduled. "I'll be a little bit late". Maybe it's picking up someone from work. "Don't worry, nothing happened, just stuck in a traffic jam--not sure what's going on". Everyone who does this generates an electromagnetic signal that is going to a cell phone tower. The dramatic rise in the level of cell phone calls is a resource and it is measurable. So if there is a sudden increase in cell phone calls, there's an accident! I know where to go because there calls are triangulated by geography and the signals now tell me where to go, almost instantly. Air Sage is doing this and selling the service.

I also recall a talk some time ago by someone from McNeil Pharmaceuticals about their putting cameras in the homes of people who were using their OTC medications (Tylenol(R) for children for example) to observe what customers actually did with their medicines, not what a consumer panel said they did. This allowed them to re-think packaging, dosing instructions, etc. The information was there all along, but no one bothered to make the extra effort to collect it. (It's a lot easier to just send surveys out, isn't it?).

Think about how football strategy has changed now that someone up in a booth, being able to see the whole playing field, can wirelessly communicate to the coach and tell him what the opposition did that he couldn't see from his ground position. What else is possible to do with this new resource of cell phone signals? Norwich Union Insurance is using this information to know when a car is on the road vs. in the garage. Why pay for accident insurance if the car is in the garage? How about monitoring how fast your teenager is driving? (This now combines cell phone signals with the "new" resource of GPS satellites).

What are the lessons here? First, information is an important resource. Second, it is easy to get overloaded. Thirdly, analyzing and sifting through information is what is critical. Fourth, new informational resources appear frequently (the cell phone example would not have been there 20 years ago), so it's good that we take re-inventory resources and ask how this new resource could be used. Last, and most important, ask those around you what they see and observe. Ask yourself if the information you have is really direct information or indirect. Information and its analysis can be the difference between success and failure in innovation.

We head into 2010 with uncertainty. Things look like they may be turning up a little, but many people are still cautious, considering all the financial turbulence. In times like this, it's always best to fall back on things and principles we know will stand the test of time. Let's review a few of them as we plan our business and innovation strategy for 2010:

1. Cost reduction pressures will not cease, especially with continued globalization of business and technology. So how do we decrease costs? We lower the price of what we pay for raw materials, capital, and people. We beat up on our suppliers. Incremental improvements in these areas come from renegotiating contracts, changing delivery times, reducing overtime, automating--all the things that have been known for years and everyone else knows too. So what can you do that is special? Don't reduce costs--eliminate them! How do you do that? By not using the materials or resources at all. Now I don't mean brutal downsizings--there has been enough dumb non-innovative practice of that. I mean the scientific concept of "trimming." Black and Decker uses the empty volume in a paint stick to help people avoid paying for buckets and paint pans, while at the same time not paying for wood or aluminum volume not needed. CNN uses I Reporters to save all the time of jetting around their reporters around the country and gets the news faster and at NO cost! Put the toothpaste in the handle of the toothbrush--save the plastic as well as the cost to the consumer of buying a large tube they won't finish in a year's time. Email your bills--don't spend postage. Get rid of the tire--use the Tweel (R)! This is downsizing done with logic and science. It may or may not reduce people costs, but it sure opens the door for patentable products, margin improvement, and increased appreciation by your customers.
2. Keep from being "trimmed." Your customers may/should be doing the same thing. So what are you doing to help them get there? How can you reduce their costs, not just yours? How could the function performed by your product be done in a way that doesn't use your product? Think about that before they do. This may force a hard decision about what business you're in, an acquisition that may be needed, or a new approach to your business. If you don't do it, someone else will. Be first to figure out how the function your product performs can be done without it. This is very hard business strategy thinking but it's essential for survival in these times. Don't spend time working on a better "non-spilling" paint pan--it's not going to be needed.
3. We've been brutal with people and their loyalty. How are you going to get it back? How do you change the culture and memory from "shut up and do as you're told or you won't have a job" to "we really need you and your input and ideas".
4. We've written columns about style differences in people. We use all kinds of psychological assessment tools but we really don't USE them. They are discussed and the paperwork stored in a drawer somewhere.We put teams together without any thought to its composition except for the titles and backgrounds of the people. They are asked to work on problem 1. But problem 2 (how the team "gets along") is swept under the table and the problem 2 energy saps that necessary to deal with problem 1. People have different styles of relating as well as problem solving that are very hard wired. Measuring these and making sure that the composition and dynamics of the team are critical to success. Make this the year that this issue comes out in the open and is dealt with pro-actively.
5. Globalization pressures continue to increase. Inventors are figuring out how to deliver PCs and drinking water to third world countries in ways we have never thought of in the West. Potable water is delivered by sucking through a straw with carbon/other adsorbent materials embedded. No central drinking water facility. How much money does that save? What if these approaches are modified and scalable to other situations? Maybe we can learn from these approaches.
6. Egos are still with us. Make this the year you stop using acronyms and jargon to discuss your problems and make them sound fancy, unique, and sophisticated to any one who does not know the special language. Let your hair down and talk to a sixth grader about your problem. Then you'll find out that your problem is not all that special and that video games are the same as air traffic control systems, dissolving heart stents are the same as decomposing garbage bags, and high precision grinding diamond dust generation is the same as blowing the stems out of peppers.

ISPIM (International Society of Professional Innovation Management) Meeting, New York, NY Dec 7-9, 2009: "Stimulating Recovery: The Role of Innovation Management"ISPIM (http://www.ispim.org) is primarily a European based innovation organization with a combination of academics, consultants, and industrial practitioners. They hold two meetings a year and occasionally one of these is held outside of Europe. This year's meeting was hosted by the Fashion Institute of Technology in New York City. FIT is a very practically focused art and industrial design school. Below are commentary on several of the presentations over the first 2 days which I attended, and editorial comments with both my general innovation and TRIZ hat on.

Dr. Rita Gunther McGrath from the Harvard Business School discussed "Growth in Uncertain Times". She made a very interesting presentation on thinking ahead in starting up a new business--asking the important questions first and looking at upward integration for value, which is not a new concept for those familiar with this line of evolution in TRIZ thinking. She illustrated this point vividly with the example of Build-A-Bear, a toy store company (and also on line now) in which a shopper chooses a "basic" bear and then outfits it with whatever clothes, ribbons, etc. that wants, in the store.

This model (the same one used in "cutting your own" Christmas tree farms, or the Chucky Cheese franchises (where the emphasis is on the party and not the pizza) allows individualization of the shopping (and innovation experience) and generates 70 times as much sales volume per square foot as a typical Toys R Us store, upon which they had benchmarked and simply could not generate the sales volume desired in the space they could afford. This also allowed "quantification" of the fantasy as seen by the shopper. Another point during this presentation, as this company's development was reviewed, was the constant tracking of assumptions in a new innovative business.

We all make assumptions and Build-A-Bear made a list of there assumptions, dates, changes that occurred, etc. and then reviewed these on a rigorous time basis. All this takes is a simple spread sheet. The learning here is to constantly review the assumptions made and react before their changes become crises.

A very simple new business innovation tool.Dr. Jody Holtzman from AARP discussed the challenges faced in trying to expand innovate within the traditional structure and original mission ("retired persons") of AARP. The dropping of the "retired persons" from the organization title and moving simply to the AARP acronym has not been successful in removing the stereotype image and prevents a barrier to new business and product offerings to younger individuals. This non-profit organization currently has 40 million members with $1 Billion in annual revenues, 65% of which comes from the sale of auxiliary products, endorsed by AARP. Membership dues, by themselves, are a losing proposition.

The linkage they have discovered for new product offerings and potential broadening is the 18-34 old age segment which is linked to their traditional older membership by the "sandwich" generation issues associated with elder care and college costs. In the US, 10% of people aged 18-34 still live with their parents, 1/2 of whom are retired. AARP has now formed 400 on line communities to share ideas, listen, launch test visions of new products and services. They have 400 on line communities for market research under the heading of Lifetuner.org This is providing support and market research to overcome resistance from senior management. They "fly under the radar", and work remotely, but still report to senior executives in the organization. These on line communities are a vehicle to learn and minimize cost of failure of new ideas. The expert advice supplied as part of this effort is not linked to any sales effort.

An observation made by Jody was that people question methodologies but not results. The key in this effort has been to link the needs of younger people to the current needs of their present membership. (TRIZ principle of using existing resources) This effort has allowed this innovation effort to not threaten the current organization business and structure. There's a lesson here for innovators---linking innovative ideas to an existing business or structure, not only not to be threatening, but also enhance existing product offering. A point made by Jody was that what seems to be "radical innovation" for a given organization may not really be radical innovation in its traditional sense.

It's important to know the difference.Dr. Gina O'Connor from RPI reported on a long term research study tracking the life of internal venture groups, showing the familiar story of less than a 5 year life in the early days of these programs (this author has led and published a similar study also reviewing the psychological profiles of these groups vs. the corporate surroundings). Beginning in 195 through 2000, these efforts took on a different character, using multi-disciplinary teams to produce "radical innovation". After 2000, these efforts focused more on capabilities rather than specific products or businesses, allowing them to respond to a broader variety of challenges. This mirrors the emphasis in TRIZ on understanding the function of a system and analyzing that vs. focusing on a specific product.

Her vision of a radical innovation hub includes a mandate and scope, the skills and talents required, appropriate processes and tools, and integration with decision makers. These observations parallel those made in the 2001 study of failed innovation champions published in Chemical Innovation.Robyn Raybold from Microsoft provided some fascinating statistics on the Web as well as the thinking behind their new Bing search engine product. Since 1997 there has been a 10 million fold increase in content on the web, an increase from 700K to 160 million web sites, and an increase from 256 million to 1 trillion URL's. During this time there has also been a huge increase in video and audio content. She also stated that their research showed that searches drive by visual content and images was 23% faster than with word content.

An example of what they have tried to do with Bing (Note: I have no first hand experience with this search engine) would be someone searching in the new car area would automatically be provided picture and rating information without being asked for it. (TRIZniks: the need identifies itself and comes to you without asking--the IFR). The decision to design the system this way was in part driven by data that says that 25% of user clicks on a web search are to go back for additional information, only 65% of users are satisfied with their search experience, 50% saying their searches take too long, and 42% saying their searches need refinement. An example used was the narrowing of search from "New York" to "New York restaurants" to "Chinese restaurants in New York". She also made the point that a lot of people used to be satisfied with the first cell phone from Motorola (true--do you remember how big and bulky they were? But they did something you could not do before. Think about the original microwave ovens that cost $499 and all they did was boil water!)

66% of people make decisions based on web searches. 43% of searches are in the health care area. It's interesting that in the food industry food products such as Prego now have over 20 variables and Bing is going in the opposite direction with consolidation. Again, from a TRIZ perspective, one can make breakthroughs and make a product or service more ideal by either adding useful complexity or by consolidating and simplifying. A bit of trivia that I found fascinating was that on average, web users check the weather sites 2.6 times a day!

Dr. Howard Moskowitz, in his talk and participation on one of the panels, made the analogy of our progress in innovation as the same as moving from astronomy (observation) to physics (understanding the basic science of the universe). In his primary talk, he made the point that the US has virtually given up manufacturing and that the only thing left is knowledge to distinguish it in the future. He also shared his experience in observing and working with customers and clients and made the excellent point that customers do not tell you in clear detail what they want. Better coffee can mean strong and dark or weak and milky and unless you've actually watched them make their coffee, you can't be sure. He's a fan of the fail early, quick, and cheap school and developing what he calls "rule developing" experiments (sounds like the 40 Principles!)

Dr. Jayakanth Srinivasan from MIT reviewed his work with Rockwell Collins emphasizing the combining of lean principles with innovation. He mentioned the "10X" principle, meaning that a true breakthrough idea could be stimulated by such thinking. This is very similar to the IFR concept in TRIZ except TRIZ goes further! Part of this operates as a suggestion box program independent of the business units (I have my doubts about this). His model is a combination of open innovation, technology scanning, and internal R&D. A quote from 1927(Schumpeter): "Changes of the combination of the factors of production as cannot be affected by infinitesimal steps or changes at the margin. They consist primarily of changes in the methods of production and transportation, or in the production of a new article, or in the opening up of new markets or of new sources of materials". A lot of wisdom from a long time ago!

Andres Stuckl from Swiss Post (post office) discussed their approach to open innovation. Two key thoughts. "Industry related factors determine the need for open innovation, while internal culture determines how it is implemented.Sabube Brunswicker from the Fraunhofer Institute discussed how we have begun to use open innovation concepts in looking for technology, but not sufficiently in looking at the open innovation process itself. This was the only paper to mention TRIZ and of course TRIZ is a tool kit and mental mind set that can assist us in looking for parallel universes with similar problems not thought about previously. The key elements of an open innovation program, according to Brunswicker, are (1) define where is the open innovation needed, (2) where to look [Note: this is a key area for TRIZ assistance through generalizing the function that is needed], (3) what to source--the specific function required, and (4) governance and control (details and mechanics of the search). Key factors to be considered in these activities include trend and competency analysis, abstraction of the problem [Amen!], and domain and firm selectionMy short presentation on inventive principles and TRIZ generated a lot of discussion and I was very surprised at the lack of awareness of TRIZ, especially with all the TRIZ activities and organizations in Europe, including many large corporate and organizational users such as Siemens, Nestle, and the Fraunhofer Institute.The next meeting of this group is in Barcelona in March of 2010. http://www.ispim.org

Why do we go to movies? Because for less than $10, we can see famous movie stars that we could never afford to pay to come to our house for a private showing. Why do we use copier machines? Because we could never afford the time or money to hand write all the copies we want. The Gutenberg printing press was one of the most significant inventions in history. Why do we buy records or CD's? Because, as with movie stars, we could never afford to pay for these singers to sing for us individually whenever we wanted. Copies are cheaper.

Why do we benchmark against the industry's best? Because we hope we will learn something that we can apply to our own situation without having to pay for all the consultants and hard work that was done to get there. We want to "copy" them without having to invest all the time and money they did to learn what they now know.

Making copies is also a significant inventive principle and every once in a while we need reminded of that. Over the past few months, two very clever new products have appeared which solve some long standing every day problems.

1. The first is the problem of people stealing sandwiches from group refrigerators within a common lunch area. What would make you NOT want to steal a sandwich? Maybe because it's not the kind of food you like, so you look for someone else's sandwich more to your liking. But what if the sandwich had mildew on it? You wouldn't touch it with a ten foot pole, would you? A very new sandwich bag is now on the market with pre-printed mildew stains on the film! Not expensive to do and commands a hefty price. Check out: http://www.thisnext.com/item/7BBC47F6/4ED4FA3B/anti-theft-lunch-bag We "copy" the mildew. The mildew performs its function without existing. Note that there are some interesting product improvement opportunities here. What are they?
2. What's another minor inconvenience? You're on a diet and need to measure portions with special cups or spoons and then put the measured portions on a plate. Several new products have come to market in which the portion sizes are painted on the plates or controlled by sectioning. Type in "diet portion control plates" into your browser and see all the products, or take a look at one of your airline or holiday catalogs. Again, the plates now provide the function previously provided by the extra utensils.

In Europe, a painted image of a highway "slow down" hump that's not really there causes cars to slow down. Where else are two items needed to accomplish something where one could be eliminated and its function provided by "copying" it on to or within another system? What product do you have that could perform the function of something else? The other product gets eliminated, you get to raise your price, and maybe even get a patent. What a deal! Copy something! Eliminate the second thing. Raise your price for the "new" product that does two things instead of one.

What is the red zone? In American football over the past ten years it has come to mean the last 20 yards to go before a touchdown--the 20 yard line of the opposing team. Why is this important? Well, the defense gets a little more stingy and there's less ground for the offense to spread out. The defense has less ground to cover and defend, theoretically making their job easier and the offense's harder. The game becomes a little more exciting as a team gets closer to scoring or having to compromise for a field goal.

This past week, I saw an advertisement for one of the satellite dish packages for "red zone" football coverage. If you subscribe to one of their football packages, you are automatically alerted when some other game, that you are not currently watching, is in the "red zone," just in case you want to switch and watch the other game. You don't have to channel surf to see if there is another game more exciting than the one you're watching. Interesting concept, isn't it? The information that you need only comes to you when you need it.

In my last commentary, I mentioned the I-Report system that CNN is now using to have thousands of amateur reporters submit stories. Now this isn't going to happen unless there is something of interest, so CNN can, to some extent, can relax a little in the need to send hundreds of reporters out in the field--when there is something of interest, it will come to them.How much time and money do we waste being constantly on "alert" for what we need or want? Where else have you seen this principle (information comes to you only when you need it) used? We now get alerts from airlines via our mobile devices when a plane is delayed. We get coupons Emailed to us from vendors based on what they know we buy. Where else might this "information only when we need it" principle be used in innovation, from the standpoint of both customer and supplier?

Let's say you are a user of a supplied part from another company. Most of the time you're probably talking about price. Do you have a mechanism for supplying to your supplier critical change in specifications or need on a moment's notice? If you are the supplier, what mechanism have you provided to assist your customer in doing this? Even in pricing, we see Orbitz automatically issuing refund checks when another customer books the same reservation at a lower cost. The customer doesn't have to go looking for the information--it comes to him automatically.

In your own internal operations, what mechanisms do you have in place to let your employees know of a sudden change in the organization's business? A customer's critical need? What mechanisms do you have in place to instantly find out what personnel issues or rumors might be of concern to your employees? Not a suggestion box--something pro-active that alerts you instantly so that you can be supportive and empathetic.What information do you need? When do you need it? How can you get it only when you need it? How would your business change if this was possible? Are you surprised by competitor innovations? How could you find out what their plans are? What are their patent filings? Where are their people showing up at meetings? Who are they talking to? About what? Don't wait for the information to come to you--at that point it's a touchdown; you want to know when someone else is in the "red zone".

Accurate, timely, and low cost information can be a critical component of innovation and market research. Think about the following things that all of you have experienced or seen in the past few years. First "I Report" on CNN News. People all over the country are empowered, with no money (!) to become reporters for the CNN television network and get their photos seen on the air. What an ego rush! Your name (briefly) and your picture are seen by millions of people around the world for a short period of time. You can tell all your kids and relatives. How much money did CNN save in not needing as many reporters out in the filed? How much better was the reporting by having actual local pictures taken on the spot?

Second, airline reservations. If you make one nowadays, you receive an advance check in notice via EM. If you do not react to this, your reservation is not canceled, but I suspect that your seat goes into the "oversold" pool and helps the airline decide how much to overbook the plane to possibly make some more money.

Third, www.despair.com, the hilarious inverted Successories imitator, has just started sending out their proposed lithographs WITHOUT a caption. Thousands of people, with a simple $500 incentive, send suggestions in. The list is narrowed to 5 and then a run off election is held, all electronically. The final result and winner's name is shared with their entire mailing list! What an ego boost to see your caption on an item that will sell for hundreds of times more money with no additional benefit to you. How much market research money has been saved?

Fourth, retail surveys after purchase. I did one of these after a purchase at a local Target store. The incentive was the opportunity to receive a $5,000 gift certificate (only one per month is given out). As I went through the survey, which was quite extensive, they were learning all kinds of useful things, not just about that particular shopping trip, but about my preferences, how and where (else!) I shopped, and much more. Now $5,000 is a lot of money, but I'm guessing that's less than ½ the cost of the salary of an experienced, full time market researcher in their Minneapolis headquarters. What a bargain!

What's the lesson here? What do all these innovations have in common? They are doing the opposite of conventional behavior, i.e. sending out reporters to find people, guessing at the number of actual fliers, spending their own money dreaming up ideas with only our limited brains, trying to guess and spend a lot of money on market research. They also have a common root in trying to get better information. So what's the lesson? The next time you need information think about how you can get it to come to you as opposed to spending your money chasing it down.

Have you seen the recent frequently running ad from Post Cereals about Shredded Wheat? It hypes the the fact that shredded wheat is virtually unchanged from its original form decades ago and by golly it's going to stay that way! The spokesperson puts the word innovation up on a flip chart and says "we put the NO in InNOvation"! (And we're proud of it!).

Have you seen this in any other corporate meeting you've been to lately?What's the significance of this? Why should we pay attention in this current climate that innovation is the savior of all corporate business problems? Well, sometimes, innovation must be thought about in the context in which it is being considered.

Do you remember "new" Coke(TM)? Millions of dollars were spent reformulating (innovating?) the basic ingredients and formulation for a decades old product because someone in marketing thought that a change was needed and the "innovation" in the flavor was judged to be "better". What happened? Have you seen this product on the market after its first few months or so?

There are certain inviolate issues, feelings, and standards that, despite their irrationality in the minds of some, ARE standards and innovating just to be different can be a costly mistake. We would probably all agree that the metric system makes more sense than the British system of measurement. Will it ever come into common use in the US? Not in my lifetime--so in my opinion inventing some product or software that depends upon that conversion and acceptance would be a huge mistake and waste of money. In the engineering world there are hundreds of standards for comparing and measuring things. Some of these tests make no sense today, but changing the way something's performance is measured can take decades to change.

If raspberries and other materials were mixed in with or embedded in Shredded Wheat, would it still be Shredded Wheat? When you are innovating, make sure you know the landscape of unwritten, sometimes psychologically based standards and barriers that are just simply not worth the time you have to bring new products to market. Make sure that the definition of success in innovation has strong input from your customers and not just your marketing and sales people. If you're innovating in the Shredded Wheat(TM) space, make sure you've eaten some of them and understand why someone may or may not want to change.

In a column two weeks ago, I made some serious suggestions regarding thinking about innovative discoveries and their ultimate outcome prior to investing tons of money. Let's take the other tack to see both sides of innovation and discoveries.

We can't afford to chase every idea that comes along and that's why we have to ask the right questions early on. And we can't rely on serendipity to provide all the new products and business growth that we need. But we need to keep our eyes and ears open. We cannot rely solely on QFD interviews and Six Sigma studies to provide all the breakthroughs we'd like to have. All of us have to keep our antenna out and our senses tuned in to make sure that we're not missing a major opportunity. And that in turn comes from hiring the kind of people who see things that others don't and are willing to explore down a path a bit before quitting (you do have some of these folks don't you? And you do reward them don't you?).

Let's remember a few examples that are now the roots of billion dollar businesses, none of which would exist if hadn't been for unique individuals making links between unexpected observations and potential customer needs. First Teflon(TM). A DuPont scientist experimenting with low boiling fluorocarbon gases noticed that a cylinder regulator showed no pressure. How could that be? He could have just assumed that the regulator was defective and gone about his work. But he was curious and opened up the cylinder and found some white powder. Again, he could have assumed that someone made a mistake and contaminated the cylinder, but no, he took a sample, analyzed it and characterized it. A plastic that didn't melt until 450-500F. Wow! Such a thing did not exist---and the rest is history. A multibillion dollar business with numerous spin offs in the household area as well as process piping and others.

Then there's the famous Viagra(TM) story. Merck, in late stage clinical trials of a medication to improve circulation. The human subject interviews could have stuck to the script but the interviewers heard something interesting from many of the clinical patients---"I don''t know about my heart, doc, but let me tell you what else I notice...." Apparently, the original developers of Viagra forgot that blood flows everywhere. And we now have a billion dollar drug.

And how about Goodyear and tires? An accidental mixing of sulfur and rubber at home in Charles Goodyear's kitchen at home and the observation that the lump had turned into a rubbery mass which was flexible at both high and cold temperatures. Vulcanization! Tires that would survive and be comfortable in both winter and summer.

I remember a Dow development scientist casually looking out the window at an airport and noticing that someone was applying a colored film to the tail of a jet to get the logo--he wasn't painting. The company made films but had never even given a thought to airliner decals as a market.

I could go on and on but the point is not to over program your people and their objectives. While we have strategic goals and objectives, make sure that you've told your people it's OK to see and report things they see that are different and interesting. Don't assume that your business managers know it all. Keep the curiousity antenna up!

In my days as Discovery Research Director at Dow Chemical, I was given a large chunk of money reserved for research and new product projects unrelated to the current business areas. This money was taken from the line R&D budgets of the existing organizations in an attempt to get the organization's attention to focus on something other than commodity chemicals that showed 1% growth rate as far as the eye could see.

Now this wasn't the only way that companies tried to stimulate their organizations into doing something different, but it was an interesting and productive one at the time. Now, of course, it wasn't quite that black and while, but it did set up an interesting dynamic that did in fact force R&D leaders to think about the future and not just the next six months.

This operated like a venture capital fund in that Discovery Research would pay for the research for the first year, 50% the second year, and 33% the last year. At that point there had to be a "home" for the successful product or technology. This didn't necessarily need to be a normal business unit, but there had to be some kind of reasonable answer which might be licensing or a JV.Researchers with all kinds of interesting new ideas came out of the woodwork and pitched for the funding to pursue their causes which could be funded outside the grasp of their current laboratory director. There would be drawings, process descriptions, chemical mechanisms, etc. which made for fascinating and stimulating discussions which went on for quite a while, followed by a question from me having to do with some understanding of why this project could not be supported by the existing business budget. If this hurdle was passed, then the next key question was this:What if everything you imagine might happen actually works?

Fast forward 3 years from now--you are entirely successful with every technical aspect of your work. Then what? If this question could not be answered with some kind of certainty (this did not have to be endorsement of a business unit, it could be a key piece of licensable technology to others or a generic capability useful across many business units that no particular one was willing to support), they why start the project? What if this works? What will we do? What will we need to do? Do we know how to do it? Can we learn? From whom? Do we need a partner? Who? Do we know who to talk to at this company? Let's do it in parallel with the technology development and not serially.

Sometimes we get so fascinated by the innovation and creativity journey that we forget what the end of the road looks like. It needs to be a commercially viable concept to someone (not necessarily to the inventor). In this fascination with what is new to us, we also forget to look at parallel universes and approaches, limiting ourselves to what we know. I have written about this previously, but it's worth harping on again.

There is ALWAYS more than one way to do things or accomplish a goal. If we are not aware of these other approaches, we at least will have the wrong pricing strategy when we go to market with an innovation. The customer could care less about the product or process--they have a FUNCTION to perform. They care about the lowest cost way to achieve this function.Let me be clear--I am not against creativity and innovation. And there are rare incidents like Teflon(R) and Post It Notes(R) where serendipity played a key role, but you don't want to bet the future on how many of these will come from your R&D staff.

Creativity and innovation are the heart and soul of what I am and what I do. But I have seen millions of dollars wasted (and you have too) on technology and concepts that were not thoroughly thought through. The time and money could have been much more productively spent on the ideas that were thought through, greatly increasing the productivity of R&D.

So the next time, you get excited about the kernel of a novel idea, assume total success in its development (100% yield, etc.) and then ask your self these simple questions--What will we do if it works? What will others do in response? What will be required? Who do we need to talk to? About what? If you are totally clueless about answering these questions, DON"T START until you can, and then spend that same amount of money elsewhere.

Reading The Wall Street Journal and listening to the business news the last few days makes me think we are in a cardiology unit. I have never heard the expression "stress test" used in a business context before, let alone so many times in a few days.

But let's think about this.What is a stress test in a physical or medical sense? Someone with a heart circulatory problem is injected with a radioactive dye and then asked to run on a treadmill at an ever increasing speed while their system is monitored in real time to check to see if the blood flow is adequate. What an interesting analogy! In the banking situation, the government is going to synthesize an artificial situation and decide whether the bank can sustain itself under a financially stressful situation. If not, they will not be able to return the TARP funds (which many banks are attempting to do right now) and will have to remain under "care" of the government.It's easy to run an organization under steady state, isn't it?

When was the last time your company or product line was subjected to "stress"? A competitor came out with a new product? A new patent issued that blocked your entry into a new area? A merger occurred between two smaller competitors that now makes you #2 and not #1 anymore? A key executive hired by a competitor? An unfriendly takeover proposal arrived by certified mail without warning?

It seems to me that it's a worthwhile exercise to create these kinds of stress artificially on a regular basis and see how your organization responds. This is no different than the fire drills you did in school or the emergency drills that I remember from my days in the chemical industry. It's really hard to remember how to put on a Scott Air Pack if you haven't done it in a long time and you're rushing because you see a chlorine gas cloud coming.

Why not do business stress tests? At your staff meetings, make a list of potential wild cards (and of course now you would add to that list the unavailability of short term credit, wouldn't you?) and announce that you will be having "drills" on these subjects in random order or that you will send out a "what if" note associated with a key business headline in that morning's Wall Street Journal.Try this out in the innovation sense as well.

All of you have those yearly and quarterly plans for new product development and innovation. What could upset them? Change your R&D strategy overnight? This will help you determine if your organization's thinking skills aren't honed significantly. You then might find out that your people aren't reacting but thinking about possibilities ahead of time and coming to you with ideas.Pretend you're the Treasury department and put your organization under STRESS.

In a recent issue of Industry Week (3/16/09) a major point was made about using employee input for continuous improvement without using capital. I would suggest a broader use of this principle through the use, not only of the people resources you have, but a reminder about a powerful, but simple "stretch your mind" concept known as "trimming".

When we look for resources for continuous improvement, we tend to think about either reducing purchased materials and supplies, energy costs, and labor or improving the yields of these same inputs to our process. How often have you really, sincerely asked your employees some really challenging questions such as:1. How could we increase throughput rates by 25% with little or no spending?2. How could we improve the efficiency of our energy use by 25%?

Why do you assume that you and the senior staff have more knowledge than those executing the business activities on a daily business? Maybe in a few areas you do, but certainly not in all. (I must admit that this was in part triggered today by the firing of the Chairman of GM by the President who has an outstanding career record of running profit making corporations).

Sometimes you don't get honest answers to these questions because your employees think that if a process or organization becomes significantly more efficient, their jobs may be in jeopardy. Why not offer a guarantee? I saw a real life example of this at a TRIZ innovation workshop in St. Louis, attended by 3 emergency response operators. At the end of the course, I asked everyone in the room what they were going to do with their learnings when they returned to their workplace. Everyone else in the course spouted off a long list of actionable items, while these individuals said they were going to share nothing. I was dumbfounded and asked them why. They replied that, if they did, their department would become more efficient and they would lose their jobs. What a tragedy and waste! You don't have any situations like that, do you? How do you know?

Another way we normally approach increasing capacity is to start with a base of how much it costs (in operating and capital costs) to produce what we already do. Then our engineering staff calculates how much money we need to spend to increase capacity, reduce energy consumption, increase our distribution network, or to reach new customers. Then we estimate the positive cash flow from these benefits and calculate an ROI to allow us to make a decision.

Several columns ago, we put forward the concept of "trimming"--the arbitrary removal of a part (say an expensive part) of a product or system and then force ourselves to still accomplish its function with the parts that remain. Several simple examples are the "toothpaste in the handle of the toothbrush" product, the "clean the shower while you shower" product, and the the self-reporting of news that is seen on television today. In each of these cases we would have asked the following questions:

1. How could we get the FUNCTION of the toothpaste tube with just the toothbrush? How much money does that save? How much more money could we charge for such a toothbrush for travelers?
2. How could we clean the shower while we are showering instead of using a separate process and time?
3. How could we make the news report itself using the resources already there without our reporters ( the resources by the way are individuals on the spot and their egos at seeing their pictures on TV--a lot cheaper than reporters!).

Now the reporters can focus on higher value work such as news analysis.Times are tough. Capital is tight. Money is tight. No one seems to really know when all the money we are putting into the banking system will stop filling reserves and actually be available for spending. The government in some strange ways is trying to unlock the financial pipeline to get more capital into the system. Why not do it without the capital and stop waiting? If you can accomplish some increases in capacity without significant capital, you'll be ready long before your competitors are.

These thinking concepts don't just apply to manufacturing processes. They apply to ANY business process. How can you increase your marketing contacts with no increase in spending? Ask your people and trim. How can you decrease warranty costs with no increase in spending? No increased capital? Ask your people and trim. How can you retain customers? Ask the ones who left and trim (make it easier for them to return and stay). Ask and trim!

It's all around us. The language of hard times is everywhere, in every journal, every newspaper, in the State of the Union address, in your stockbroker statements, and in your daily conversations. In a short, but insightful article in Chemical and Engineering News on February 2, Melody Voith summarized the dilemma facing industry and how different companies are approaching the situation.

In my last commentary, I described the brute force approach being used by some companies and the huge loss of human energy and resources that result. In Melody's article, some more creative approaches were described. One of the most striking and simple was that used by DuPont, which also saw the signals early and set a plan in motion before a crisis occurred. Each employee was asked to identify 3 things that he/she could do to immediately conserve cash and reduce costs. How much more positive than laying a large number of people off and then asking the rest the same question!

This approach illustrates the use of the TRIZ problem solving principle of "Do it in Advance", as well as that of "trimming". If you recall this simple tool, we just look at a system and arbitrarily remove a part of it and then ask how we can retain the function that was provided with the parts of the system that are left. We are normally applying this thinking in products such as the Michelin Tweel(TM), the toothbrush with the toothpaste in the handle, the cleaning system without a bucket, a fireplace without a fire, and many more.

But the principle works in a business and strategy sense as well. This needs to be done in the right way to pay off big time. We can say we need fewer sales people if customers will come to us on the web. Now that the need for some of the sales force has been eliminated, we could just lay them off. Or we could take them and explore new applications and markets that we always said we didn't have time to look at. We could use them to assist in that long range planning that we know is so important, but never got to. They could look at patents that get in our way and suggest the ones to circumvent.

One of the more interesting innovation tools that can be used is to ask everyone in your organization, "What skill do you have that we are not aware of or are not using to its full potential"? This will generate a very interesting discussion list for you.Layoffs and downsizings are easy. Using resources in a clever and competitive way is not, but far more productive in the long term.

In the past two weeks or so, there has been a torrent of layoffs, plant closings, and restructurings unknown in recent times. Two major layoffs that caught my eye with my chemical industry background, were those of Dow Chemical (5000) and Air Products (1500). These numbers are in the neighborhood of 10%+ (maybe more) of total staff. It's not clear how many of these people had technical backgrounds, but I think it's safe to say that a good many were. Probably around 4400.

Many of you, especially in the US, may remember a hit TV show that ended a few years ago called "The 4400". It mesmerized many people on Wednesday nights. This was a story about a ball of light exploding when it hit earth and releasing 4400 men, women, and children--all of whom had lived on earth previously from a few months to 50 years, none having aged a single day when they were last seen. These folks were rounded up, quarantined, and eventually released to their families. Soon after their release, some of the returnees begin to experience unexplainable, and in some cases, uncontrollable new abilities. These mysteries, needing to be solved, became the basis for the ongoing series. Does this sound familiar?

It sure does to me and I have seen this through several cycles. It wasn't but a year ago that chemical companies on the Gulf Coast were paying hiring bonuses to new ChE's. What will this new 4400 crop do? The same thing they have always done, albeit with a little more difficulty than in the past. Most will be quarantined in with re-employment companies, resumes will go out in the hope that someone is expanding and not contracting (and there are some of these folks!). Some will totally retire and play the stock market, while others will early retire and possibly sign up for a consultants' registry for short term work. Others will start an entrepreneurial dream they've always had in mind and were never able to pursue. Some will join risky venture start-ups. Others will go back to school to gain education in a parallel universe that has always been of interest.

It is highly unlikely, from my knowledge of people who have been through this, that any of the 4400 will return to the same industry segment from which they came.Think about the cost involved in these 4400 people. At a minimum gross cost of $100K per year, this is like the engineering, research, and manufacturing staff costing $440 MILLION dollars per year. This is larger than the research or engineering staff at all but the largest of companies. Now from the standpoint of the previous employers, this is a huge cost savings.

From the standpoint of a new business opportunity, what a resource! Maybe all these folks could be assembled into a new chemical/materials company called "The 4400 Company". Maybe they could "self-assemble" into a huge consulting firm for the chemical industry--their knowledge will probably be forgotten and will be needed again at some point in time and they will be paid far more as consultants than they were as employees.

I don't begrudge the hard decisions necessary in a publicly owned/traded company vs. say those of a private company (Cargill, S.C. Johnson for example). They don't have the same flexibility to be patient. But I do think a little more time could be spent on thinking about how to creatively USE these intelligent resources vs. viewing them as a source of cost savings.What ideas do you have?

I recently attended a re-certification course in the Kirton KAI™ assessment tool. This is one of many psychological assessment tools designed to measure "style" in a person's behavior or approach to a situation. This one focuses specifically on an individual's problem solving style as opposed to social style (www.kaicentre.com for more information). Other assessments that you may be aware of include Myers Briggs, HBDI, Fyro B, etc. If your favorite isn't listed, no offense intended!

In the orientation to this class and in the accompanying literature a key concept was introduced. Not a new concept but a way of expressing it that I had not heard before and that's worth some thought on all our parts. The concept is Problem 1 vs. Problem 2. Let me explain.

We assemble a team of people together for any number of reasons. Sometimes it's as simple as to schedule a series of meetings or presentations, choose who we want to do certain assignments, etc. These tend to be pretty simple. But more frequently, there are some human relations aspects to the problems, some different styles of approaching a problem, different backgrounds and experiences, biases and prejudices, and any number of other issues. We still have Problem 1 (strategy, serious personnel assignments, organizational or technical problem), but now we also have Problem 2. Problem 2 is the way people analyze a situation, relate to each other, view a problem, or some other biological/psychologically hard wired aspect of how a situation or others are viewed.

We can measure these things but they are typically not changeable by an individual. Coping behavior can help, but some of the group's energy is now spent dealing with Problem 2 and less of the energy is spent dealing with Problem 1. You all know team situations where Problem 2 has become so large that Problem 1 dwarfs in comparison. In some rare situations, a Problem 2 may become so severe that people forget what Problem 1 was! Mergers and acquisitions sometime collapse because of this issue. We often don't take the time to use psychological profile information that team members have or to consider how useful it may be. What is the point of gathering the information if we don't use it?

I once worked with a company where all the Myers Briggs and KAI profile information was on a tent card as you walked into someone's office. You knew immediately, in a very personal way, who you were talking with and now they would approach problems, people, and situations. What would it be like to only have Problem 1? If all the group's energy was spent solving Problem 1 and not dealing with Problem 2? What would that be like? More productive? Would more useful ideas be produced? More serious discussion occur? More understanding of various opinions and why they were held? More use of diverse opinions and viewpoints? No wasted time dealing with hidden agendas and trying to guess where someone was coming from?

I suggest that, no matter what tools you use to analyze behavior and approaches, sharing this information openly and candidly will minimize Problem 2 and allow your team to concentrate on Problem 1. You might even be able to use this information in a pro-active way by utilizing the diversity in styles of behavior in a positive way.Get on with Problem 1 by understanding and dealing openly with Problem 2!

In a recent Sunday papers around the world, a large full page, color (not cheap!) advertisement was shown displaying a new mascara brush from Lancome: http://www.lancome-usa.com/makeup/mascara/oscillation.aspx

When you watch the video at this site, you will hear things like: "Pulls lashes apart" "Coats all sides" "Vibrates at 7000 cycles per minute" "Let the oscillation do the work" "Repeat to improve the results" Now ask yourself--are you listening to a mascara application commercial or an ad for a vibrating toothbrush from years ago? A vibrating sander commercial from 30 years ago? How long have we had vibrating toothbrushes that massage gums, operate at thousands of cycles per minute, replace the work of hand brushing, cleaning all teeth and gum surfaces? What is it about eye lashes that are different than teeth and gums? I would submit not very much.

Why does it take 5+ years for a cosmetic company, whose goods are usually displayed in the same aisle of the store, to make the connection between oscillation and separation? I submit that the answer is that we think that our problem is unique and that no one could possibly have solved it before. We use special words to make us think our problem is special. In this case, mascara (solids coating), eyelashes (flexible fibers), and color (solids).We find it so incredibly difficult to want to admit that maybe the solution to our problems may already exist. We never ask ourselves, "who else has a similar problem?" How do they solve it? What's the FUNCTION we are trying to perform (not put mascara on eyelashes, but coat fibers with solids). Who else does, FUNCTIONALLY, what you need done? How do they do it? What can you learn from them?

I'd like to share with you a very simple, but powerful strategic analysis tool that I'll just describe as the "tic-tac-toe" approach to strategic analysis. It comes from my experience with TRIZ, but it's a much broader thinking tool and can greatly support your efforts to think strategically about innovation and where your organization is heading.

Put yourself, your product, or your business in the middle of the 9-Box diagram. Above you is the customer you supply. Underneath are your suppliers and the materials you buy. This box could easily be 12 or 15 boxes depending upon the depth of the supply chain and the steps involved in making your product or the needed raw materials needed for your product or service, but for simplicity we'll just consider 9. To the left of your current box in the center is your past technology. To your right is the future. This same logic applies to the levels above and below you.

I propose that if you cannot complete in some detail all nine boxes, you do not know your business very well. Let's look at a couple of simple illustrations. First the automobile. You are Ford, GM, or Toyota at the middle level. To your left is some aspect of previous car design, say windshield cleaning (note that we need to talk FUNCTION and not how it's done). To the right might be the future of windshield cleaning and how it might be done (variable speed? responsive to auto speed? No wiper?). Above you is the integrated system, in the middle say, the car (of which the windshield is a part). Below you are the raw materials you buy to make a windshield wiper, say rubber strips. In the lower left is a description of a previous wiper raw material, say natural rubber (with little flexibility and a tendency to become brittle). To the right on the bottom are the materials envisioned for the next generation of wiper blades. In the upper left hand corner might be the car of the past with no wiper blades and to the right might be a windshield "cleaning system" (note I did not say wiper blades, I am describing the function needed and not how it's done), possibly not requiring a wiper blade at all (think about how this might be done).

If you cannot complete all 9 boxes to some degree, you do not understand what is going on in your universe. The history of technology evolution clearly tells us that products and systems are integrated upward into their super-system. Said another way, your customer, despite what they might tell you, is trying to figure out how to get the function or value you provide without the use of your product or service.

If you are not thinking the same way, you are in for a rude awakening one of these days. Bank deposit systems that eliminate the need for deposit slips and envelopes are arriving. Want to be in the envelope business? Deposit slip printing business? Wouldn't be a lot better to be in the optical scanning business rather than reducing the cost of envelopes? You've have heard the story of the buggy whip manufacturers who were making better buggy whips when the box above them moved to the right in one of these diagrams and better, cheaper buggy whips were irrelevant. The car provides a transportation service which is occasionally used to meet with other people. Maybe working on better Internet based communication systems is a smarter long term business, but that's hard for GM and Ford to do, isn't it?

To push a bit further, consider a cube and not a one dimensional diagram. Parallel ways of getting the same result. Cars are not the only way to get from here to there. Airplanes are another. If you make airfares low enough, who cares about the comfort factors of a car? Draw a simple tic-tac-toe diagram on a piece of paper and put your product or service in the middle box. To the left write in the past generation of this technology or service. To the right describe what you think future opportunities for improvement and development are. Now, one box below, write in a raw material or service you buy and use. While you are thinking about the path of evolution of this product or service, begin thinking about how your product or service could be performed without using it.

Now look at our customer above. What function does your product or service provide? Where is their product or service heading? How could they get the result they get with your product or service without you? What will their next generation need be? Do you have any idea how to provide?

How many of you have seen one of Jeff Foxworthy's comedy monologues? You know one of his favorite spots is his description of a certain behavior (usually not all the flattering, but funny), and then saying, "Here's your sign!", meaning that everyone then knows who you "are". His version of this for who's a redneck is particularly funny.

Do people know who you are by what you do? Can others predict what you will do by your past behavior? The answer's usually yes. Why is that? Because each of us has different behavior traits and ways of evaluating and reacting to situations based on some aspect of our DNA, which is very ingrained. We can change natural behavior when we want to and have sufficient incentive to do so (a crisis situation or possibly when someone of higher authority imposes it on you), but it isn't easy and if required for any length of time, will result in severe emotional or psychological consequences.

These kind of traits and behaviors are frequently measured by a variety of psychological assessment instruments such as Myers Briggs, Hermann Brain Dominance, etc. I do not want to start a debate or argument about which of these is "best", only to have a discussion about what we do with them. For that purpose, I am going to discuss the Myers Briggs or MBTI (other similar instruments come from 16Types and Insights). You are free to choose one of the others, if you like my approach, and adopt the thinking.

When someone gets back their Myers Briggs assessment, it comes in the form of four letters: "E" or "I" (are you extroverted or introverted in your style of interaction), "S" or "N" (are you a sensor or intuitor, meaning what types of inputs are most meaningful to you---facts and data, or feelings, impressions, emotions?), "T" or "F" (how do you communicate and send out information--facts and data or with more concern for feelings?), and lastly "J" or "P" (how do you close on issues---deadlines and action lists or possibilities and general scope?). Those of you who are certified and trained in this instrument will recognize that I have greatly simplified things, but bear with me. Unfortunately, most people, after receiving this feedback and probably participating in some interesting group learning exercises, promptly file the paperwork away and seldom do anything pro-active with this valuable information.

When I facilitate innovation sessions and ask about this information, almost everyone remembers having taken the assessment and then with a little time can remember the four letters. When asked what they did with it, 100% of the time, the answer is NOTHING! It's an interesting fact that 80% of corporate managers are STJ's (facts, data, results, deadlines), 75% of the world are "S's", and most innovators are "N's". NP's are a very rare breed.

That's why so many innovation leaders eventually leave corporate America and go with startups or start a small consultancy. The conflict between "S's" and "N's" is the most significant difference of the four.So what's your style (sign)? It tells you and everyone around not only how you approach innovation, but how you react to others in the same arena. If you're an STJ, you LOVE Six Sigma. If you're an NFP, you want to know how all the changes in the organization are going to affect the people.

So what about style and innovation? Do you analyze markets and new ideas by just looking at facts and data? Would you rather go out in the field and talk to people and watch them use a product? Are you interested in the next year's sales growth or what totally new applications there might be for a product or service that you can't put certainly around right now? There's a competitive threat on the horizon. Are you more concerned about how you are going to manage a downsizing or how you might use your resources in a different way? How flexible are you in considering new businesses based around your core competencies?

It's interesting, that over time, people clone themselves. It's a lot easier to get along with people who think like you, isn't it? I am sure that's what the management at Enron thought.I said earlier that your style is very ingrained and is difficult to change, so I am not asking you to think about a lobotomy transplant, but I AM asking you to be aware of what you are, what others are, and filling in YOUR gaps with input from others, knowing your biases. Hire some people who see the world differently, especially in any innovation effort, and use their difference in perspective. Teach them how to understand you and how to use the differences to make one plus one equal 3. Use your style and the differences with others proactively and your innovation efforts will be far more productive.

With my activities in TRIZ, I am constantly thinking about function rather than jargon or business description. What function does my product allow someone to do? Not what do I sell them or what do they need. The function of the automobile is to move someone from place A to place B---or is it to allow someone to meet with someone? The function of a letter is to write to someone---or is it to request something, communicate something? The function of an insurance policy is to pay bills—or is it to provide piece of mind and security? The function of a web site is to share information—or is it a vehicle to sell advertising?

It's important that as we consider innovation in the context of our businesses that we think hard about what business we are truly in. In a Fortune article last year (July 9, 2007, p69), a senior executive at Xerox was interviewed about the company's future with the backdrop of its stock price being virtually unchanged if you go back 15 years and only doubling in 20 years when the S&P 500 increased by a factor of 8. The interview focused quite a bit on the "vision" for the company. A quote from this interview, in response to the question, "What is your vision?" was this: "It's helping our customers deal with their document-intensive processes. That means making sure they have the INFORMATION (my emphasis) they need where they need it, with the history and the context of the information they need…I want the document to be smart enough so that I don't need to worry about it". Wow, are we making progress from a copier company! Information, smart (not copied) documents.

The interview went on to describe a smart document in the legal profession as one that would be able to searched in a legal discovery process via a tool they call Intelligent redaction. Those of you with TRIZ in your DNA will recognize this as a complicated way of saying that the "document identifies itself, using the resources already present". In the legal area, where we still have a propensity for paper documentation, this is a big step forward, but what if Xerox's business is totally "information" and not paper or copies in any way? What should they do? How about mass customization of information? They are making a move in this direction by working with magazines to customize subscriptions, but why not mass customize (I only get the type of articles I want on line, NO paper, my price is proportional to number of articles I actually read or download and print, the advertising and coupons are specific to me or my geographic area) INFORMATION, not documents. Has Xerox purchased an on line information storage company? It's hard for a company like Xerox to walk away from paper, isn't it?

What business are you in which hasn't been thought of in terms of its functionality, rather than what it sells? What could replace the function you are performing? Who could you acquire that would improve the functionality of what you provide? (That's what Xerox did when purchasing Amici, which had the e-discovery technology for lawyers—notice that they still bought someone associated with paper). Think real hard about this. What is the functionality (not stuff) that you provide? How else could it be done? Could you do it? Should you buy someone who can? How could someone achieve the function of what you supply without your "stuff"? Figure it out before it's too late.

RSS