1. Collaborate with your clients and let them take credit for your ideas.

2. Pitch ideas with a clear and logical flow.

12. Once you’ve sold an idea, stop talking and leave

Notes from Clayton Christenson, The Innovator’s Dilemma

It pays to be a leader in a disruptive innovation
• Leadership in sustaining innovations gives little advantage
• Leadership in disruptive innovation creates enormous value

But established companies typically fail in the face of disruptive change
• Companies get organized to satisfy current customer’s needs and to facilitate design and production of current products. This organization can then prevent the organization most conducive to developing a disruptive product (Henderson and Clark).
• Competencies developed for improving the current product may not be applicable for developing a disruptive product (Clark)
• Above two theories don’t adequately describe what happened in disk drive and excavator industries. Value Networks explanation: Companies tend to invest in innovations that fit the needs of their “value network,” which defines the hierarchy of importance of characteristics for current customers. Current customers reinforce this by not needing the innovation. (Christenson)
• New entrants find markets with different value networks for innovations
• Companies are more likely to seek additional markets upward rather than downward because up-markets are defined and promise larger margins and the investment the companies have gotten used to making for product improvements demand higher margins. Also existing customers move up-market and take their suppliers with them. This leaves a vacuum below, e.g., flash memory instead of disk drives. [Basecamp instead of MS Office]
• New entrants also move up-market which brings them into competition with established companies. New entrants tend to improve faster than established companies and so they will eventually disrupt.
• Middle managers avoid career risk of backing innovations for which no market or a down-market is identified. They screen out these opportunities so senior managers don’t even see them as an option. Even if a senior manager decides to pursue a potentially disruptive innovation, there will be resistance if not outright thwarting at the middle management layer (most likely passively through reluctance to allocate resources) [see HBS case on Kodak].

What established companies need to do
• Be able to recognize and enter different value networks
• Align disruptive innovation with the “right” customers by embedding the innovative project in a part of the organization (new if necessary) that serves the customers for the innovation and doesn’t have to meet same revenue/margin demands as incremental/sustaining innovation
• Be prepared to go through an iterative process that is failure tolerant because forecasting the market is impossible. This process should be a learning process that goes beyond focus groups to actual observation of new customers and new applications.
• Use the resources of the big organization but not its culture and processes
• Don’t try to push the growth of an emerging market (Apple Newton) and don’t wait until the market is large enough to be interesting. Instead match the organization size to the growing market so that its goals are satisfied by the organically growing market and so it’s cycles match the rhythm of the market. Acquisition may be the solution.
• Assess the capabilities of your organization and set up a structure (existing organization, lightweight teams, or heavyweight teams) that makes up for the deficiencies in the existing situation.

[Note: these “recommendations are repeated by Govindarajan in 10 Rules for Strategic Innovators]

“We’ve run into a bit of a crossroads with respect to defining the scope of our project. We’ve come up with 2 outlines (full details attached)…The group thinks that both ideas have merit; although the main focus of each project is quite different. Given that we haven’t been able to come to a consensus as a group, we were hoping to talk through both ideas with you on Monday.”

Both ideas aimed to get a set of products noticed in a crowded market. Some members of the team wanted the team to focus on developing an innovative distribution technology to distinguish the products from the overwhelming number of very similar products competing in a single channel. Other members wanted the team to focus more on improving the quality of the products while still recommending a new distribution technology. The relative merits of each are the subject of another post. For now I want to focus on what brought the team to the point of needing a third party to mediate.

In a previous post I gave an example of a Shaper pulling a team together and setting it straight. Here is a contrasting example of how the allowable weaknesses of a Shaper can create a roadblock.

The team member who had come up with the technology solution happened to be the only Plant on the team and, in true Plant form, he was strongly attached to this idea. Another team member, who happened to be a strong Implementer-Monitor Evaluator, had thought more strategically about the project and felt that the technology represented a potential solution, but that without critical complements – improving the quality of the product and incentivizing the sales team to buy in to the new distribution mechanism – the novelty of the technology would fade and the innovation would fall flat.

The other team members recognized that the Implementer-Monitor Evaluator’s proposal actually incorporated the Shaper-Plant’s idea and there was room for him to work on a technology solution. But the Shaper-Plant’s third preferred role was also Monitor Evaluator and he had not relinquished this at all. He thought that trying to address product quality and incentives and technology lacked focus and he wanted to see the whole team pulling together on one aspect of the innovation – his. “Technology is innovation!” he wrote.

This would be an opportune moment for a Teamworker to show his or her colors – perhaps pointing out to the Shaper the collaborative option and that the two “sides” are not as far apart as he perceives. He had, after all, acknowledged the need to define what specific products would be delivered and to get the product sales people to use the new system. But this team lacks anyone with a Teamworker preference.

A Coordinator could also help resolve the dispute – reminding people of the shared goal and facilitating a decision. But on this team only one person is a Coordinator and his wife had a baby in the middle of all this so he was temporarily absent. Even when he was fully engaged, he tended toward another strength, yet another Monitor Evaluator, taking a back seat and offering his opinion when requested.

So, without the Teamworker and Coordinator roles to grease the skids, the team had come to a standstill or more accurately, a stand-off.

Our solution was to ask the two team members who had Teamworker and Coordinator as manageable but not preferable roles to make a “role sacrifice” and take on those roles. We asked them to collaborate on a project description that the whole team could agree on and we gave them guidance on framing the problem in terms of client needs that they could back up with research. They presented the team with a plan that focused on a particular high-quality product and a target client that they could use together as a proof of concept. The team reached consensus and has divided up the work, pulling in additional technology resources to scope that aspect of the project and free up some team members to address the needs of the sales people.

But the innovation programs I run put them into a very different situation. They are asked to “sell” new ideas that are often out of their area of expertise; ideas with limited precedent that don’t fit neatly into a customer’s view of the world. Compounding that, they must present their ideas to the most senior leaders of the organization, who are forming first impressions as they listen – about trust and confidence, as well as about competency and knowledge. This can test anyone’s confidence.

Success in this situation can depend as much on how you present as on what you present. Body language can have a great impact. I asked my colleague Don Khoury, an expert in body language, to view some of the presentations from an early stage of an innovation program – the first time ideas were being pitched – and comment just on what the participants were saying with their body language. Here are a few observations.

A hand on the hip, as these two did to begin their pitch, signals high confidence.

A “low confidence” or more vulnerable stance would be gripping the microphone with both hands and holding it in front of you as if to hide behind it.

Some hand gestures used to elaborate on points, such as chopping or holding a ball or showing movement from there to here, demonstrate command of the subject.

This would contrast with hand gestures that oscillate repeatedly.

Putting your hand in your pocket, as these two did at the end of their pitch, indicates “I’m finished.”

This can sometimes be interpreted as overconfidence, as in, “there’s nothing more to be said here.” Leaving your hands visible invites further discussion.

When we critique the innovation teams as they rehearse their presentations, they often find it surprising how body language can have a major impact on how their message is received. And because these teams typically work virtually until the final presentations, there is little opportunity for them to practice modifying poor habits. We’ve taken to inviting participants to send us videos.

They had pursued several opportunities to dead ends and were just getting started in another direction by interviewing a client/expert on a conference call. The questions came slowly with long stretches of dead air while each team member hoped someone else would speak up. As the idea was way down on their list, no one on the team had strong ownership and the questions stayed at the 60,000 foot level. The call ended with a perfunctory thank-you even though the interviewee was quite willing to remain engaged.

This was the time for the Shaper to step up and fortunately this team had one.* The Belbin Team Roles Shaper likes to lead and drive others to action. She’s the person who gets frustrated when things slow down and creates direction and shape for the team’s activity. True to form, shortly after the desultory call she sent a long email to the team. Here are some excerpts:

We are behind and need to make significant process THIS WEEK.

I spoke with ______ today about… efforts in _____ (see notes below). In summary, the opportunity has already been identified and resources deployed. Therefore, I think we should focus on _____.

Here’s where I’m at in terms of knowledge/holes (please add bullets)…
- key lessons…
- general strategy…
- current solutions…
- plans for expansion…
- applying successful strategies from other areas…
- our proposal…

At a minimum, we should aim to answer…by Friday. Based on expertise and time zones, I suggest the following division of labor…

This is classic Shaper behavior.

*In fact the team had two Shapers but one of them had assumed the Resource Investigator role. He was the one who set up the meeting with the client/expert and his focus was outside the team.

In those precious first few days, what can you do to get your team working together effectively? How can you make sure that your team capitalizes on the strengths of each member – not just in terms of what they know but also in terms of what they can contribute to getting the project done? How can you quickly develop team behaviors or “norms” that enable effectiveness?

Often one team member will bring previous experience to bear and impose that way of working on the team. But innovating with a group of strangers is not a team task or structure that anyone is likely to have experience with. Another way for the behaviors to develop is by gradual evolution, with team members trying out certain ways of working and others responding either positively or negatively. But there’s not enough time for that and the behaviors that tend to evolve that way are typically more focused on the team getting along and getting things done on time rather than about doing innovation better. (Richard Hackman writes about this in Leading Teams.)

In years of forming and coaching these innovation teams we have experimented with various strategies and tools for accelerating their effectiveness. Currently we use the Belbin Team Roles Profile as a first step. (Mohr Collaborative is accredited to administer the Belbin Team Roles profile and to conduct Belbin Team Roles workshops.)

The individual profile requires each team member to complete a 15-minute self-perception inventory and ask six observers to complete a 10-minute assessment in which they select descriptive adjectives from a list. The results rank the team member’s preference for nine “team roles.” These roles comprise specific behaviors that a team needs to function effectively. For example, “Resource Investigators” are good at seeking input from outside the team and building networks while “Completer Finishers” are good at tasks that demand high accuracy and close attention to meeting deadlines. Meredith Belbin’s research showed that teams perform better if they have a balance of all of these roles.

We use the results as one of a number of criteria for forming teams. We also provide the results to the participants and, after a brief foundation in the theory underlying the roles, we coach teams through analyzing their team’s role preferences and planning steps to address imbalances.

Here is why we like the Belbin model:

• It is team focused. It focuses people outward on how they work with other people and how they are perceived, not inward on their own personality traits
• It is results-focused. Rather than starting with personality traits and extrapolating how those might interact on a team, it starts with the behaviors that a successful team needs and asks people how their team can fill those roles
• The underlying research is based on empirical observation. Belbin observed (every 30 seconds!) individual behaviors of teams in management simulations for nine years.
• The results hold up well. Belbin was able to consistently predict the relative performance of competing teams with 80% accuracy.
• The model is intuitive and makes sense without significant background study
• The observer data gives the results credibility and highlights incongruities between the role people perceive they are playing in a team and the role others see them performing. Most people admit that the observer data paints a more accurate picture than the self-perception.
• The inventory is quick – no 375 multiple choice questionnaires – and doesn’t force choices where none of the options apply
• The team roles easily map onto the innovation behaviors we want to foster

We find that teams rapidly engage in a discussion of the tasks that need to get done and who are the best people to do them. They get past the fear of pointing out individuals’ strengths and weaknesses because the discussion focuses on the team and the framework of team roles depersonalizes discussions when conflicts arise throughout the team’s time together. Most important, participants report that the insight they get into their preferences can be immediately applied and has lasting impact on their performance.

Seven of the nine projects pitched to senior management at the closing session are now moving forward. These include an outsourcing solution in Brazil that has already garnered significant interest there and in other regions, a cross-border service for benefits payments (this came from one of the most geographically diverse teams representing Argentina, Italy, Dubai and the US  who have been asked to continue working on it), a solution for retailers with international customers, and a particularly well-received proposal for the carbon credit market. Internally focused projects included a global platform to streamline distribution for which a prototype will be available by the end of this month and a dashboard to centralize partner information.

These results combined with those from a program that wrapped up in July makes 2009 one of our best ever years for innovation projects getting funded – not something many people predicted at the beginning of last year!

While most participating executives recognize the importance of innovation, many are not implementing the talent strategies they need to drive innovation within their companies.
When asked about their company’s efforts to encourage innovation, more than six out of ten survey participants (61%) acknowledged they either had no talent strategy currently in place to drive innovation or did not know if they had one.

This is not surprising as innovation and talent retention are typically driven by separate parts of the organization, with HR and Learning and Development leading initiatives for retention and the line business focused on innovation. As we wrote previously, our clients recognize the link between the two and continue to make significant investments in programs that serve this dual purpose. These initiatives require close collaboration around identifying, developing and rewarding talent and making sure that they see a career path before them with opportunities to lead innovation.

Much has been written this year about the importance of innovation in a downturn. Those firms that continue to invest in strategic innovation position themselves to emerge stronger as competitors falter. Our clients are aware of that and they have high expectations for the proposals that our program generates. But their primary motivation is talent retention. These programs offer them a way to recognize and reward their top talent when they can’t afford to do so with traditional compensation.

Research shows a positive relationship between layoffs and voluntary turnover. When people are being laid off, more people also choose to leave. A May 2008 article in Harvard Business Review found that as little as a 1% layoff of employees triggered, on average, a 31% increase in voluntary turnover. And the people who choose to leave are often those the firm can least afford to lose. They are the ones capable of taking on the additional work. They are the ones responsible for continuing revenue. And they know it.

In our programs, the participants have all been designated as “high potential.” They were receiving offers from competitors when times were good and smart competitors continue to try to pick them off. They are constantly evaluating not just the security of their job like most people but also the soundness of the firm and whether opportunities will continue to evolve for them.

When we give them an opportunity to develop their own idea and then pitch it directly to senior management, it sends an unequivocal message that they are valued, that their ideas are valued and that the opportunity does exist for them to take a more visible role and influence the direction of the firm.

More important, joining a cohort of the best and brightest from across a large organization is typically a big eye opener for relatively junior people who have developed tremendous knowledge and expertise within their area but have had little opportunity or encouragement to look beyond their silo. Participants routinely tell us that the most valuable aspect of participating was discovering that their firm has so many people with whom they would like to work. For many that makes the difference for them between staying and leaving.

The New York Times published a fantastic infographic, How Different Groups Spend Their Day, that can keep a data junkie like me entertained for hours. The chart shows the results from the American Time Use Survey that asks thousands of Americans how they spend every minute of their day.

How Different Groups Spend Their Day

You can break down the data to view only certain types of people, e.g., specific age groups or states of employment or family size. You can also view specific activities, e.g, sleeping, eating, working. As I played with the data I was struck by one particularly thin line, Relaxing and Thinking, which is described as “doing nothing” or “sitting around.” The data shows that we as a country spend about 16 minutes a day relaxing and thinking. Not surprisingly, employed people spend less, 11 minutes per day. People with advanced degrees spend the least as a group at 8 minutes and people age 15-24 are also at the low end of the range at 10 minutes.

Consider that data in light of recent research described in the Wall Street Journal: A Wandering Mind Heads Straight Toward Insight, which finds that

In fact, our brain may be most actively engaged when our mind is wandering and we’ve actually lost track of our thoughts, a new brain-scanning study suggests. “Solving a problem with insight is fundamentally different from solving a problem analytically,” Dr. Kounios says. “There really are different brain mechanisms involved.”

By most measures, we spend about a third of our time daydreaming, yet our brain is unusually active during these seemingly idle moments. Left to its own devices, our brain activates several areas associated with complex problem solving, which researchers had previously assumed were dormant during daydreams. Moreover, it appears to be the only time these areas work in unison.

“People assumed that when your mind wandered it was empty,” says cognitive neuroscientist Kalina Christoff at the University of British Columbia in Vancouver, who reported the findings last month in the Proceedings of the National Academy of Sciences. As measured by brain activity, however, “mind wandering is a much more active state than we ever imagined, much more active than during reasoning with a complex problem.”

So creativity and insight happen when our mind is “wandering” yet we allow ourselves precious little time for doing nothing. Ten minutes a day or a third of our time, which is it? I don’t know many adults who spend a third of their time daydreaming. My eight-year-old daughter, on the other hand, would definitely bring the average up but children under 15 aren’t included in the survey data.

How much more creativity and innovation would happen if we just left ourselves more time to think? Much has been written recently about the detrimental effects of working too hard and the benefits of time to do nothing. And while there may be some forward-thinking companies promoting sabbaticals and more flexible hours, they are fighting an uphill battle to change habits and social norms that are cultivated from childhood. Unfortunately, we seem to be moving in the opposite direction with even worse consequences than losing our creative edge.