2013-08-02

One Big Innovation Stumbling Block

Innovation is the process of idea management:

Of course, you need ideas.

But once you have them, you have to select which ones are most promising because we never have enough time and resources to execute them all.  

And we do have to execute – that’s a critical step.  

Because innovation takes longer than we expect it to, we have to keep the people within our organisation engaged with the process as it is happening (often an issue in big firms).  

And in addition to all of that, we have to get the idea to spread.

Most organisations have plenty of ideas - their innovation failures happen in other stages of the process.  There are tools available to measure how well you do in each of these steps.

This is what the results look like for many firms:



The scores are the average for each group, and low scores are better.  If there is a score of 5 in a category, then the firm is as good as they could possibly be, but if the score is 15, then they have major problems.

This firm has their biggest problems in selecting which ideas to pursue – and this is a very common, very big innovation stumbling block.  This is important because if you are choosing the wrong ideas to execute, it doesn’t really matter how many great ideas you have, or how good you are at executing them.

Poor selection can ruin the whole process.

10 Ways to Select Ideas

If this is a problem in your organisation, here are 10 ways that you can select ideas.

Most interesting to you: this is the way that many scientists choose problems to work on, and it’s pretty common in startups as well.  The advantage to this approach is that by choosing the most interesting idea, you keep your engagement level high.  The drawback is that the most interesting idea isn’t necessarily the one that creates the most value for people, so this approach can lead to major idea diffusion problems.

Guess: this is surprisingly common (just like it is in choosing prices).  There aren’ many clear advantages to this – I guess the main one is that this is the easiest process to follow.  So it can work well when market uncertainty is really high, or if you have an incredibly deep understanding of customer needs.  The drawback is that in every other situation, processes with a bit more analysis work much better.  Another version of guessing is going with whatever idea the CEO likes best.

Most valuable to customers: you can get information on this in a few ways: customer validation, focus groups, crowdsourcing, customer co-creation.  The big advantage to choosing ideas based on customer input is that it gives you a pretty good idea about what your potential market is – so getting your new idea to spread is easier.  The drawback is people often don’t know what they want, so this approach only gives you incremental innovation.

Innovation portfolio: if you use an innovation portfolio, you try to ensure that you have in development a good mix of incremental ideas, extensions into adjacent markets, and radical innovations.  Google and many others aim for a 70/20/10 ration across these three categories.  The disadvantages to this approach is that it can be a bit bureaucratic, which can slow down innovation, and it only works when your organisation has a lot of ideas to work on – it’s no good for startups.  For nearly every other organisation, though, this is a terrific way to select ideas.

Formal process: formal selection processes can take different forms.  This category includes things like stage-gate, using idea management software, sending all ideas to an Innovation Coach, and so on.  The advantages and disadvantages to these approaches are very similar to those for innovation portfolios.  The trap to avoid here is starting with tool – instead start with your strategies, objectives and culture, and then find a tool that works in your context.

Solve the most urgent problem: like guessing, this approach is both common and deeply flawed.  It works ok in a crisis.  At other times, this approach will lead to strategic drift – which can be disastrous.

Experts: you can use experts to help you rate the ideas that you are choosing from.  These can be internal experts with either deep technical knowledge or great innovation experience.  Or it can be external experts or stakeholders.  This process can work well for bigger, riskier ideas.  But it’s much too slow for small ideas.

Voting: again, this can be done internally or externally.  You can crowdsource your feedback like threadless, or use innovation jams using your own people plus important stakeholders,  or have people vote within a piece of innovation management software.  The advantages and disadvantages to this approach are the same as choosing what’s most valuable to your customer.

Experiments: this is my favourite.  One good way to choose ideas is to prototype or try as many as possible on a small scale.  Then do more of the ones that work, and make sure that you learn from the ones that don’t.  The advantage here is that this is a very data-driven approach, it works well when you face uncertainty, and even little bets can lead to radical innovations.  The advantage is that you have data on what works and what doesn’t, which is the best way to choose ideas that merit further development.  The disadvantage is that you burn resources (time, money) on the prototypes that don’t work.

Combination: many organisations use a combination of these tools.  Google uses “choose the most interesting to you” with its 20% time rule – engineers can work on whatever projects appeal to them.  But then they use an Innovation Portfolio approach to make decisions about which ideas to scale up.

How to Choose One

Actually, you can use one of these tools to choose the best tool.  You could be experimental – make a hypothesis about which approach will work best for you, then test it.  Or you can ask a panel of experts.  Or guess.

The main point is to evaluate which method you’re using right now.  If you have an idea selection problem, then figure out a new one to try out, and try it.  Track data on your success rates, so that you learn.  If things don’t get better, try another tool.

Which method does your organisation use?

Take Our Poll

 

Are there any I’ve forgotten? I’d be curious to hear what you’re using.

Related articles

Risks of Incremental, Differential, Radical, and Breakthrough Innovation Projects

Innovation is a Practice

Innovation Isn’t an Idea Proble

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