Here is a brief excerpt from an article written by Scott Anthony for the Harvard Business Review blog. To read the complete article, check out the wealth of free resources, and sign up for a subscription to HBR email alerts, please click here.
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Is there a corporate leader who doesn’t extol the virtues of innovation these days? Yet if innovation is so important, why do so many companies have so much trouble with it?
The reflexive response is that it is a human capital problem — that is, that most people just don’t have what it takes to successfully innovate. I reject that view. Academic research in fact shows that almost anyone can become a competent innovator (with sufficient practice). I’ve seen countless examples of ordinary individuals displaying the creativity, ingenuity, and perseverance of the world’s great innovators.
Those people can only be effective in the right context, but, ironically, many of the things leaders do to encourage innovation actually kill it. Look carefully at your company and you might spot one of four types of unintentional innovation assassins.
[Here's the first of the four.]
1. The Cowboy. Itching to create a corporate culture tolerant of creativity and innovation, the Cowboy says something along the lines of, “No boundaries! Just great ideas!” Of course, companies should continually evaluate and push their boundaries. But every company has a set of things it simply will not do. Saying innovation has no bounds when it does just leads people to waste time working on ideas that — honestly — have no hope of ever being commercialized.
Instead, consider issuing highly-focused challenges. For example, a few years ago Netflix offered a $1 million prize to any team that could improve the performance of the algorithms that determine which movies it should suggest to consumers by at least 10%. More than 250 teams rose to the challenge, and two actually exceeded the target. Focus is one of innovation’s best friends.
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The good news? Since unintentional innovation assassins are easy to identify, they are also easy to disarm. Constrain the Cowboy, bound the Googlephile, ground the Astronaut, and make the Pirate walk the plank — and watch innovation efforts soar.
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To read the complete article, please click here.
Scott leads Innosight’s Asian operations. His fourth book on innovation, The Little Black Book of Innovation, was published by Harvard Business Review Press (January 2012). You can follow him on Twitter at @ScottDAnthony.
Here is an excerpt from an article written by Scott Anthony for the Harvard Business Review blog. To read the complete article, check out the wealth of free resources, and sign up for a subscription to HBR email alerts, please click here.
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“Make sure you ask the right questions at the right time.”
That’s one memorable piece of advice from a leader at a global innovation powerhouse. Unfortunately, it is a piece of advice that is heeded too infrequently inside large companies.
At many companies, the idea evaluation process revolves around detailed Excel spreadsheets, comprehensive PowerPoint documents, and an orchestrated sequence of pre-meetings leading up to a decision meeting. This kind of disciplined approach works very well when companies have knowledge that lets them be precise in their analysis, and executives have the relevant domain experience to make informed decisions.
Applying this same discipline to nascent opportunities in new spaces can be disastrous. People spend days discussing Excel spreadsheets that are nothing more than mathematical relationships between made-up numbers. Managers working on ideas discover that detailed PowerPoint documents are their biggest enemy, because the details act as bait for nit-picking devil’s advocates. Endless pre-meetings crowd out action-based learning.
The general way around this problem seems simple enough — have a process by which you evaluate ideas in different ways at different stages of development (most call this a “stage-gate process.”). You might have a “front end” process where you rapidly iterate and evaluate lots of ideas and a more detailed “launch” process to optimize the few that make it through the early rounds. This kind of process can help successfully move an idea from a Post-It note to the market
What does that actually mean in practice? The rest of this post will show how Innosight’s venture investing arm sifts through ideas, as a kind of guide. (Next week’s post will apply lessons from this approach to large corporations.)
Innosight’s venture capital “team” is a two-person shop in Singapore. I sit on the Investment Committee, along with Harvard Professor Clayton Christensen, primarily getting involved when we are getting close to a big decision about a current or potential portfolio company. The core team, Pete Bonee and Piyush Chaplot, scour Singapore to find the best investment opportunities. In the past two years, they have looked at more than 200 potential investments.
The first decision is whether to have a meeting to evaluate a company. Answering this question is pretty simple. Our fund specifically looks to seed businesses that have the potential to disrupt existing markets or create new ones. So, if Pete or Piyush believes that the material they’ve seen to date (which can be a one-page executive summary, a 20-page pitch document, a rough website, or even an email description) fits our strategy and has some potential, they will proceed with a meeting.
Then, the bar goes up. The next decision is whether to formally investigate the company. We’ve developed a qualitative screen with about 20 characteristics that blend the theory of disruptive innovation with what we have learned in five years of investment and incubation activities. Based on what we’ve seen, we evaluate whether the idea is negative, positive, or neutral in each of those characteristics.
[To read the complete article, please click here.]
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Scott Anthony leads Innosight’s Asian operations. His fourth book on innovation, The Little Black Book of Innovation, has just been published. Follow him on Twitter at @ScottDAnthony. To check out more blog posts by Scott Anthony, please click here.