Blog Post

A very warm welcome to innovation and risk taking here on the innovation-creativity web site. Good leaders need to be focused on innovation so as to keep ahead of the game but also they need to be able to weigh up any risks associated with introducing the innovation.

We’re all aware of the risks associated with innovation. The financial crisis between 2006 and 2011 was predominantly blamed on excessive innovation.

Product recalls of Toyota’s innovative Prius car during 2010 received lots of press attention.

An easy option is to shy away from innovation and risk taking. Innovation is however inherently risky. And to not do it at all is not a great stance for a leader to take.

Organisations want leaders who are willing to take the big steps and dare to implement the changes that make a difference. It’s just important that when you do make the changes you consider the risks that could hit you.

It is ok to fail once in a while. In fact most innovations come about as a result of learning from past failures. The trick is to not make wild, irresponsible gambles. Don’t play it too safe but weigh up your risks and take planned, positive, calculated steps forward.

FAILURE MODE AND EFFECT ANALYSIS

One of the tools that I like to use to analyse the risks associated with an innovation is Failure Mode and Effect Analysis or FMEA for short.

With an FMEA you basically review most of the components, assemblies and subsystems for failure modes and their causes and effects. These are recorded usually in a spreadsheet as a form of qualitative analysis.

It’s a great tool for planning ahead in terms of what could fail, what are the consequences of the failure and how likely it is to fail. This is a great starting point to first try and design something that avoids these failure modes completely or to at least enable you to prepare in advance what you can do to mitigate the failure.

BEST CASE, WORST CASE

If you are going to take a big, bold step with an element of risk then document best case and worst case scenarios. What’s the very worst thing that can happen? And, conversely what’s the very best thing that could happen. You need to be prepared to be able to accept either outcome.

If you are prepared to accept the best case and worst case outcomes then make the decision but also document your justifications for making that move.

COMPATIBILITY

With any innovation you need to evaluate if it’s the right thing for your organisation. Is it compatible with your organizations values? Does it align with your organizations strategy? Don’t make this evaluation on your own. Discuss it with your best people.

WHICH INNOVATION?

When deciding what to focus your efforts on… What your next innovation is going to be… Again work with your best people. Put a SWOT analysis together and then organize a brainstorming session. Ask people to throw ideas into the pot without worrying at all about any risks. What would they do if they were fearless of the outcomes? Invite people outside of your core team for a fresh perspective.

In some cases, an imitation strategy can almost be as effective as an innovation strategy. Copying someone else’s idea by building your own version of it is quite often good business.

Research shows that approximately seventy percent of innovations are in fact copied and this number is increasing over time.

If you’re adopting a strategy of imitation then the trick is not to wait for the right idea to come along instead you should be actively looking for the right idea to copy. Preferably an idea with which you have great understanding and familiarity with but this doesn’t have to be the case.

IMPROVE WHAT YOU ARE COPYING

When you copy someone else’s idea you need to be thinking about more than just a straight forward copy. Think instead about how you can make it bigger or smaller or faster or with more functionality than that which you are copying. Are you able to create the product cheaper or can you add many more features and sell it at a premium? Good imitators often make copies that are both cheaper and better.

LEGAL ISSUES?

When copying some other idea be aware of the legal issues but don’t let that completely put you off. Patents provide only limited protection – they are costly and almost impossible to enforce. Patents often give a lot of information away for the imitator. Information that can be modified so that you are able to produce a similar product that doesn’t violate the patent itself.

TO BE GOOD AT IMITATION STRATEGY…

You need to first drop the stigma. Most of us are brought up in a society where we are told that copying is bad. It’ something that is frowned upon and seen as not the right thing to do.

You also need to not focus too hard on the item that you are copying. An exact replica is not good and is highly likely to fail. Add something new and unique to the idea where ever possible.

If you’re copying an idea used in one geographic location to a completely different one then make sure you do your due diligence. Do a bit of market research to determine if the idea will work just as well in a new location.

SUCCESSFUL IMITATION EXAMPLES

Visa, Mastercard and American Express which were copies of Diners Club.
Internet Explorer, Safari and Chrome browsers all came after Netscape Navigator.
Google search came after Yahoo.
Microsoft excel which was originally a copy of Visicalc
Microsoft MS-DOS which was basically a copy of CPM

A warm welcome to the ‘how to judge creativity’ section of the web site.

Judgement and creativity is an interesting topic. On one hand, you need to avoid being judgemental in order to let creativity flourish, but on the other hand, at some point, you have to make a judgement on whether or not it’s the right thing to do.

IS JUDGEMENT OK?

So judgement is OK as part of the creative process but just not at the start of the process. Freedom from judgement at the start of the process is extremely important otherwise it would hinder the flow of new ideas.

Ideas often lead to more ideas. Start judging ideas too early and people will start to shut down their creative thoughts and soon you will have no new ideas coming into the process.

DOES JUDGEMENT HAVE A PART TO PLAY IN THE CREATIVE PROCESS?

There are some schools of thought that suggest judgement should be left out of the creative process entirely but in my opinion, the problem with that is you end up with nothing to really focus on. You have many ideas but no priorities.

So yes, judgement does have a part to play in the creative process. It’s just that you need to ensure that your judging is done in the latter part of the creative process. After all the new ideas have been thought up.

Judging creativity gets you to an endpoint. Ultimately you need to produce results from your creative exercise and it’s the judgement of what best to focus that will get you those results.

HOW TO JUDGE CREATIVITY?

When judging creativity you need to think about the novelty of the idea. Just how new and unusual is the idea? Does it excite you or interest you? Is it completely new or will it only be new to the organization or area to which it will be introduced?

You also need to consider if it’s fit for purpose. Will it work? Will it do what was intended for it to do?

Could it be improved? Consider combining the idea with other ideas that were submitted. Would this work? Would it improve things?

If the creative idea has been thought up as a result of a problem statement then how well does it solve that problem?

How feasible is the idea? In your opinion is it likely to succeed in the market place or social setting to which it will be introduced?

Then if you work for an organization you also need to consider if it fits in with the overall strategy and core competencies of that organization. Is it something that your organization can handle? Does the organization have the right skill sets and resources available to make the idea a success? Will it add value?

I like to put a cross-reference grid together when judging creativity. Use a spreadsheet or a table in a word processor and put your ideas in the rows and the qualities or attributes that you want to grade the ideas against in the columns e.g. novelty, usefulness, cost, value add, overall fit, solves the problem, etc. then score each idea against the attributes. In theory, the idea that scores the highest you should run with. If some attributes are more important than others then consider multiplying by a weighting factor.

Open market innovation is a term that was first coined by Darrell Rigby and Chris Zook. Its basic premise is that companies can reach beyond their internal environment. So rather than relying on the company’s research and development department for the latest innovations the company reaches out to the market using such techniques as licensing, joint ventures, and strategic alliances or innovation partnerships to bring ideas in or to put ideas out.

It is also a term promoted by Henry Chesbrough who defines it as

a paradigm that assumes firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology

The advantages of seeking external sources to import and export ideas not only increases a company’s ability to innovate but also should assist staff retention. Creative people will be more motivated if their ideas are being used externally in terms of licensing arrangements with outside firms rather than simply being tossed to one side. Such licensing arrangements can also provide the company with additional revenue.

Obviously there are risks from such open market undertakings too. With the main risk being not able to effectively monetize from the ideas that are collaborated across organizational boundaries. This risk is best mitigated by putting a deal structure in place to protect your company’s best interests.

Done effectively open market innovation can extract creative ideas from government laboratories, universities, suppliers, customers and even the public as a whole. General Electric have effectively involved external sources for ideas by creating a web site where businesses, entrepreneurs, scientists, innovators, students and anyone else can submit ideas to help create a cleaner, more efficient and more economically viable power grid. Ideas are submitted via an ecoimagination web site and the best ideas are assisted with financial investment.

BEFORE EMBARKING ON OPEN MARKET INNOVATION YOU SHOULD…

Define your objectives. Have you got a particular problem domain that needs solving? Have you got great ideas that don’t tie in particularly well with your businesses core competencies but don’t want to see these ideas go to waste? New consumer needs to satisfy?

Consider what networks you already have available. Is your organization a member of any external groups? Do you employ interns through the summer from the local university? Does your Internet facing web site encourage participation from the public? Do you meet with your top suppliers / customers? All of the aforementioned are avenues that you can explore for sharing ideas.

Consider adjacent products that may complement and enhance your existing brands. Procter and Gamble did this with their Crest brand, they expanded from Crest toothpaste to Crest electric toothbrushes, Crest floss and even Crest whitening strips.

Fast innovation surprises competitors and therefore assists in gaining competitive advantage by increasing overall speed to market which in turn should ultimately increase profitability.

The rapid introduction of new or enhanced products or services leaves competitors with two options: they can either continue as planned, introducing a product or service to a market with a very much reduced opportunity or they can re-direct their efforts on to other projects.

Providing quick innovations delights customers by frequently improving their perceived levels of added value.

Of course producing innovations so that they meet the required delivery date and so that they create a differential offering with a high probability of success is no easy task.

Fast innovation does not mean hurried innovation.

One method used by many large organizations for accelerating the innovation process is rapid prototyping.

Another method is to re-use wherever possible. What aspects of the innovation process are you able to re-use? One is of course knowledge that is already available elsewhere – such as open innovation or knowledge directly from your customers or suppliers.

A further method is to adopt some of the techniques but forward by the lean movement. One simple but clear definition for Lean is

“…the relentless pursuit of the perfect process through waste elimination…”

Here you would apply lean tools and techniques to the innovation process to reduce any waste that is inherent in the process.

Lean defines seven types of waste that can exist in a process…

Type of Waste	Description
Over Production	A product has been made for no specific customer
Waiting	A product is sat waiting to be processed
Transport	Moving a product between locations
Inventory	Waste in terms of the costs to store the product
Over-processing	Process steps that do not add value
Motion	The excessive movement of people
Defects	Errors during or within the process

Fast innovation also incorporates some of the tools and techniques from the six sigma realm including VOC or voice of the customer and QFD or quality function deployment.

VOC to ensure that you are building the right thing and QFD to ensure you are focussing predominantly on what is most important to meet your customer’s CTQ (Critical To Quality) aspects.

Please note that as an Amazon Associate I earn from qualifying purchases.

In the book, Fast Innovation – Achieving Superior Differentiation, Speed to Market, and Increased Profitability by Michael George, James Works, Kimberly Watson-Hemphill, and Clayton Christensen

Three innovation imperatives are proposed:

Differentiation: “Providing the customer with superior performance per unit of cost.”
Fast time-to-market: Quickly creating new innovations to displace the commoditized old and getting to the market quickly enough to earn high margins from the product or service.
Disruptive innovations: Embracing disruptive innovations in order to empower growth and break away from the competition.

This book’s key focus is on fast time to market and suggests that one way to get faster at this is to reduce the number of projects that you currently have active.

US Residents can purchase this book from Amazon by clicking here and UK residents by clicking here

The invention of the Frisbee came in the 1950s when its inventor Walter Frederick Morrison conceived the idea for an aerodynamic plastic disc while throwing a metal cake pan on the beach in California to his wife, Lu.

Since that date then there have been hundreds of millions of Frisbees sold across the world.

The Pluto Platter

Originally the Frisbee was named the “Pluto Platter” and was sold directly by Morrison at local fairs. The novel aerodynamic shape enables Frisbee’s to travel long distances and to hover in the air.

The invention of the frisbee has led to it being one of the most popular pieces of sporting equipment sold. In the patent document that details the design of the “Pluto Platter” it is called a flying saucer.

How The Name Frisbee Originated

A Californian firm Wham-O bought the rights to the Pluto Platter in 1957 at the same time the company realized that many of the kids who were using the toy were nicknaming them the “Frisbie” after the name of a popular pie. In order to avoid copyright infringement, the company decided to change the spelling and re-brand the Pluto Platter or “Frisbie” to Frisbee.

Similarities To A Clay Pigeon

Interestingly the Frisbee has many similarities (at least in terms of its aerodynamics) to a much older invention, that of the Clay pigeon which was invented by George Ligowsky back in 1885.

Frisbee Inventor

Frisbee inventor Morrison who was known to his friends as Fred died at his home in California on February 9th, 2010. In memory of Morrison the Wham-O company paid tribute to him with a quote on their web site:

”As Frisbee discs keep flying through the air, bringing smiles to faces, Fred’s spirit lives on. Smooth flights, Fred.”

Redesigns

In 1975 Alan Adler a sailboat designer and lecturer of engineering at Stanford University challenged himself to redesign a Frisbee.

Adler had much knowledge of aerodynamics and noticed that the thick edge of the Frisbee created a lot of drag (which means friction with the air). He also noted that a Frisbee acts as an airfoil (American) or Aerofoil (English) which basically means that when it flows through something such as air it creates an aerodynamic force or lift.

frisbee being thrown

Adler experimented with slimmer, lighter Frisbee’s. His goal was to try and get a Frisbee to fly even greater distances than before. His first experiments were thin, plastic disks with a slight curve. Unfortunately, even though Adler managed to reduce the drag from this design the modified Frisbee wouldn’t fly straight.

His next experiments included plastic discs with a hollow middle, i.e. a ring-type shape. Having no middle made the Frisbee lighter still but also introduced a new problem as a ring flying through the air is actually 2 airfoils. The front half meets the air first followed by the back half.

To overcome this new problem Adler shaped the two separate airfoils one for the outside edge of the ring and one for the inside edge. With the aid of computer design and after ten years of experiments Adler finally perfected an improved Frisbee which he named the Aerobie.

The world record for flying an Aerobie a distance is 1,200 feet or 369 meters.

Definition Of A Frisbee

In Chambers 21 Century dictionary a Frisbee is defined as:

”A light, concave, plastic, saucer-shaped object that spins when thrown, used for recreation, usually in a park, on the beach, etc., and also for competitive sport. 1950s based on the name of the Frisbie bakery in Bridgeport, Connecticut, whose pie tins presumably inspired its invention.”

A good entrepreneur definition to begin with is that put forward by Oxford Dictionary…

A person who sets up a business or businesses, taking on financial risks in the hope of profit.

Derives from French

Entrepreneur derives from French. It can be split into two parts. The first part is ‘entre’ which literally translates to ‘under’. The second part relates to ‘prendre’ which means to take. Putting the two parts together it translates to ‘under-take’.

To undertake something means to commit oneself to and begin an enterprise or to take on a responsibility.

So it basically means a person who undertakes the risk of a new enterprise.

Entrepreneurship

In English if you add ship to the end of a word it indicates quality, state, status, skill, or collective body. So entrepreneurship is the process or skill of beginning a new enterprise or responsibility.

What Does and Entrepreneur Do?

I think it’s also important to say a little about what exactly an entrepreneur actually does. An entrepreneur is someone who spots new opportunities. Someone who comes up with new ideas for products, processes or services to respond to a customer need. But also, someone who is able to successfully introduce these new ideas into the market.

Entrepreneurs are individuals that make the innovation process actually happen. They are often able to do this regardless of the obstacles that are put in front of them.

Most successful innovations arise from the identification of opportunities. Innovations rarely come by chance, more often than not they come as a result of deliberate and purposeful search.

Entrepreneurs are quick to act on opportunities that are presented to them. Such opportunities could arise from a number of areas, including

demographic changes such as a change in consumer demand – such as that from an ageing population.
Technological advancements – New technologies can often bring new markets to complement or support the technology.
New knowledge – this could relate to new knowledge about new technology such as the point raised above or even new knowledge in relation to a new business process or a new way of performing or making a process work better.
Market demand for improved or better products within a particular domain.

Other Entrepreneur Definitions

Webster defines an entrepreneur as

one who organizes and directs a business undertaking assuming risk for the sake of the profit.

David Shaw’s definition in his article Entrepreneurs…Winning Strategies Aside in the Ivey Business Journal is as follows,

An entrepreneur implements ideas, concepts or processes in operating ventures and promotes them to achieve their growth potential.

Peter F. Drucker defines an entrepreneur as

one who always searches for change, responds to it and exploits it as an opportunity. Innovation is the tool of the entrepreneur which they use to exploit change as an opportunity for a different business or service.

To finish, Shane and Venkataraman put forward an excellent definition…

The scholarly examination of how, by whom, and with what effects, opportunities to create future goods and services are discovered, evaluated, and exploited. Consequently, the field involves the study of the sources of opportunities; the processes of discovery, evaluation and exploitation of opportunities; and the set of individuals who discover, evaluate, and exploit them.

A warm welcome to the problem-solving steps web page.

You often hear people say that “There are no problems, only opportunities”.

Of course, this is not exactly true it does, however, emphasize the fact that when problem-solving we should look towards the positive aspects of what should be done right now rather than dwelling on the disruption that the problem might create.

Reasons for mistakes should be analyzed and efforts should be made to try and prevent others from making similar mistakes.

In your day-to-day role, you may be faced with a continuous stream of problems, when this is the case it is good practice to consider the following problem-solving steps…

1. Define The Problem

The first and probably most obvious problem-solving step is to actually define the problem.

Sounds obvious I know but it’s a very important step that many people often overlook.

Think in terms of what has gone wrong or what is about to go wrong. Collect user or customer viewpoints/complaints of the problem if possible.

2. Define What Needs To Be Done

Think about both what needs to be done right now and in the future to deal with the problem.

Try and define what needs to be done in metrics if possible i.e. reduce the number of defects from 15 in a 100 to 1 in a 100 or increase speed of the network to a minimum of 5 MB/s.

Get agreement from the person or people affected by the problem that getting to this agreed metric would be an acceptable solution.

3. Discover

Find out what has actually happened. Compare this to what your understanding is of what should have happened.

Stick to the facts here, people can be emotional and self-protective when it comes to problems. Try to put yourself in the other person’s shoes so that you can understand their motivations, thoughts, and reasoning behind what led to the problem.

Again try and focus on metrics – try and translate complaints and other problem descriptions into actual measurements.

Analyze all the constraints that could affect the situation, both internal and external.

Document all of your discoveries with time, date and the source of the information.

4. Analyze

Pull out your documentation and start looking at the facts.

What is relevant to the problem?

Are there any obvious reasons why the problem occurred?

Record any assumptions.

If helpful put a process map together and highlight in red problematic areas.

analyze

5. Consider Alternatives

Are there any alternative courses of action? If so consider the merit/value of each.

How well will each resolve the problem?

How much will each cost? Think of the quality v cost v time triangle – this can be a difficult juggling act and may require much communication with your major stakeholder. What is an acceptable level of quality? Increased quality often results in increased time and/or cost.

How complex are the alternatives?

Do the alternatives introduce any new problems? Or have additional, unconsidered benefits.

If you have many alternatives then consider doing a QFD (Quality Function Deployment).

If you have one choice or another then consider doing a plus-minus interesting analysis.

How will the various stakeholders react?

6. Develop Hypotheses

A hypothesis is a proposed explanation for what has caused the problem (the observed phenomenon in scientific speak).

7. Evaluate The Hypotheses

Look at your proposed explanations and try and determine what is true and false.

8. Document Solutions

Document the various solutions you have considered, use diagrams if appropriate to provide additional clarity.

If you have original ‘As Is’ process maps of the problem now start putting together your ‘To Be’ process maps.

9. Scorecard

List your solutions in a spreadsheet, add weightings related to ease of implementation and quality of the solution.

Then grade the solutions and multiply by the weightings. Total up and choose from the top two or three highest-ranked solutions based on your knowledge, intuition and gut feel.

10. Project Manage

Create a detailed plan and allocate resources required to implement the plan.

Remember project management is a skilled discipline in itself so ensure your people managing the project are appropriately qualified to effectively see the project through to successful implementation.

11. Control

The final problem-solving step is to monitor the implementation.

Evaluate the success in terms of ensuring that it continues to solve the problem.

If you have been focussing on one or more metrics as a means for determining whether the problem has been fixed or not then consider using control charts produced on a regular basis to highlight that the fix is still within desired specification levels.

(Image Credit orkboi)

PMI is a lateral and creativity thinking technique developed by Edward De Bono that is a development of the pro’s and con’s technique that has been used for centuries.

It is designed to deliberately direct your attention to the positive, negative and interesting aspects of a particular idea, subject or decision.

To complete you make three columns… “Plus”, “Minus” and “Interesting.”

Under the plus column you list all of the positive aspects of the idea, subject, topic or decision.

Under the minus column the negative aspects and under the interesting column anything else that you think is worth noting but does not fit easily into the other two columns – items that are neither good or bad but more neutral observations or points of interest / comments.

It is a great tool for focussing your attention and thinking on different elements of the thing you are analysing.

After you have used this technique you should be in a better position to make a decision about the matter in question.

It is particularly useful if you have already made your mind up as it helps you to double check your judgement.

Example

I am considering relocating my family from Canada back home to the UK.

The table used to assist the decision making process is given below:

Plus	Minus	Interesting
Family in UK (+9)	Have to sell house (-6)	A web based career would mean I could swap between the 2 countries(+3)
Easier to see UK friends (+6)	More crime (-2)
Parents will babysit for free (+3)	Less space (-2)
+18	-10	+3

This isn’t an exhaustive example – I’m sure I could add many more pros and cons for each. Hopefully it is enough though to give you a picture of how the technique can be used.

Personal Development

PMI is a good tool to use for your personal self development.

Throughout life we all get to get to those major turning points or forks in the road where you have to choose one path or the other. Think of new jobs, schools, courses, projects, moving home, big purchase items, starting a new business, etc.

What are the positive, negative or interesting aspects from that the change in career, new course, purchase, project or business opportunity?

Undertaking this analysis might change your action plans.

Interesting Aspects Of An Idea

Interesting aspects of an idea can move you to another idea completely. A good example of this occurred in 1944 when a group of MIT scientists at the radiation laboratory were working on a radar that could detect a tower six miles away.

The scientists found that when the humidity increased the radar failed. Noting the interesting fact about the radar being in tune to the natural frequency of water vapour they decided to look for other useful applications. Their work ultimately led them to the creation of the first microwave oven.

Lateral thinking is a term created by creativity guru Edward De Bono in 1967.

The term is in the concise Oxford dictionary where it is defined as: “seeking to solve problems by unorthodox or apparently illogical methods”.

In business this is sometimes referred to as out of the box thinking.

In his book “Serious Creativity” De Bono explains that he felt that lateral was a good word to describe a type of thinking that wasn’t linear, sequential or logical.

It is about changing concepts and perceptions so that rather than trying to do the same think harder or better you change your thought path to one of achieving the same goal by doing something different.

“With logic you start out with certain ingredients just as in playing chess you start out with given pieces. But what are those pieces? In most real life situations the pieces are not given, we just assume they are there. We assume certain perceptions, certain concepts and certain boundaries. Lateral thinking is concerned not with playing with the existing pieces but with seeking to change those very pieces. It is concerned with the perception part of thinking. This is where we organise the external world into the pieces we can then ‘process’.” – Edward De Bono

It is also about using your imagination so as to try and look at something from a new perspective.

Also in his book De Bono describes an interesting example… Granny is happily knitting a sweater but the toddler is disturbing her by playing with the ball of wool. One parent suggests putting the toddler in her playpen to prevent her from annoying granny, whereas the other parent suggests putting granny in the playpen. This lateral (sideways) move achieves the same goal.

So overall it is about creative problem solving, trying different perceptions, different concepts and different points of entry in order to move us out of a typical line of thought and move us towards a new creative solution.

Either combined with thinking laterally or as an alternative you may want to solve your problem or problems in a more logical, orderly manner. If this is the case then please refer to the problem solving steps page.