Tue, 31 October 2017
Have we become addicted to innovation? I love the next new thing as much as anyone as evidenced by all of the stuff I've accumulated. As an innovators, the challenge is how to get the innovation timing right to satisfy the market and stay ahead of the competition.
The pull on companies to create the next great product or service is hard to avoid. Consumers are asking and your competition is on your heals. Its the innovation version of "keeping up with the Jones".
But innovation is not a one and done type activity. Once you start, the customer is always looking for what's next. The pace of innovation drives your activity and its not slowing down. In fact, its accelerating.
The Goldilocks Problem
As an innovators, can you or should you speed up your innovation refresh rate? This is a Goldilocks problem. You go too slow and your competitions will blow right past you. Go too fast and your customers cannot absorb what you are creating. You risk creating innovation exhaustion.
You need to get the innovation timing "just right".
Behind The Scenes Look At How I Do It
You are probably asking yourself, if this is so hard, what hope do you have in getting it right? Don't expect perfection. There is NO magic formula that when performed generates innovation planning success.
Innovation is messy and unpredictable. So how do you set the right flow?
Four Step Process To Set Your Innovation Timing
The above may sound simple but trust me, its a lot harder than it looks. Leaders within your organization will derail the funnel at ever turn. Be prepared to defend and protect the funnel.
Hard Learned Lessons
Some lessons I've learned when leading and managing innovation organizations:
Listener Question: Starting A New Business
This week, we took time answer a listener question:
[shareable cite="Roberta " text="Should I start my business as an affiliate or as a distributor ?"]I am stuck trying to decide between starting a new business (non tech actually, small regional chocolate creators) that is either affiliate which is limited start up fees and also limited % or distributor which requires a WHOLE lot more capital as well as commercial kitchen for storage, receipt of products and distribution, etc.[/shareable]
Answer: Yes. Listen to this weeks show to hear my advice to Roberta on starting a new business.
[callout]Listen below to this weeks show to get a behind the scenes look at getting the innovation timing right.[/callout]
Direct download: Behind_The_Scenes_Look_At_Getting_The_Innovation_Timing_Right_S13_Ep35.mp3
Category:Past Shows -- posted at: 5:37am PST
Tue, 24 October 2017
During some recent travels, I started noticing the comments and suggestions that "being part of Silicon Valley must be exciting". As I paid more attention, it came across as almost hero worship of Silicon Valley and the companies its has launched. It's like people believe that innovation outside Silicon Valley is a rare if not impossible occurrence.
I have to admit that when I first showed up in Silicon Valley in 1984, I was in awe. I felt that I had arrived and proven myself. It took me better than 4 years to open my eyes and see that it wasn't that unique or special. There are some advantages to being there but human creativity and innovations they create are not limited to small piece of land. There is innovation outside of Silicon Valley.
One unique characteristic to the valley is the access to billions of risk capital that people are willing to invest in new innovations. But risk capital is available in other places also. For example the State of Ohio Venture Fund which is helping new innovative companies stay in the state rather then feeling they need to go to the valley to be successful.
Innovation can come from anywhere such as the result Hurricane Katrina, a taxi drive in NYC working on new medical innovations and the solution to predictors killing livestock in Africa. While many of these innovations start out as solutions to immediate hyper local issues, they can and do turn into products and services that we all benefit from.
Remember that innovation does not equal technology. There are an unlimited number of ways to apply innovation to what you do.
How To Help
The challenge is how to help innovators who are outside of Silicon Valley to be successful while also impacting their local economy. Here are some ways we can all help:
[callout]Listen below to this weeks show on Innovation Outside of Silicon Valley.[/callout]
Tue, 17 October 2017
When it comes to looking and selecting the right ideas to get behind, we all suffer from biases and blind spots. When you look at the success rate for venture capitalists, the only expect to have one hit out 10. So, why do we repeatedly find ourselves backing the wrong ideas and what can we do about it?
While some if not many companies will fail, there are a corresponding set of great ideas that will never see the light of day. Why is that? Because those entrepreneurs can't get the support to turn their idea in to that next killer innovation.
Stop Backing The Wrong Ideas
This weeks guest, Ross Baird, shares what he calls the "innovation blind spot". This blind spot is based on three areas:
During the show, Ross shares how to counteract these innovation blind spots and why we need to stop backing the wrong ideas if we are to impact the important issues facing our society.
About Ross Baird:
Ross Baird is the founder of Village Capital, a firm that finds and invests in entrepreneurs solving the most important problems in society.Since founding Village Capital in 2009, Ross has supported hundreds of entrepreneurs in over 50 countries. Ross has spent his entire career on the founding team of start-up enterprises or investing in startups.
He also serves on the faculty of the University of Virginia, where he teaches entrepreneurship and impact investing.
[callout]Listen below to this weeks show on how to address your innovation blind spot so that you can back the best ideas.[/callout]
Mon, 9 October 2017
In a recent discussion with some colleagues, we get to discussing the current state of the US and global economy. Why has the economic recovery been so slow which has caused the middle class income to stagnate? In my opinion, its because the companies and jobs we are creating are not delivering high value products or services. What we need is innovation driven entrepreneurship.
The State Of The Current Economy
Entrepreneurship and the start-ups they create are the engine that drives economic growth and jobs. In 2016, 99.7% of all firms in the US were small businesses (private sector companies with less than 500 employees). These same small businesses create 33.6% of known export value and employ 48% of private sector employees. In addition, 60% of all new jobs are created by small businesses.
That's a lot of impact on the economy. So what is going on? When you dig underneath the numbers, the reveal some shocking issues.
While 60% of all jobs today are created by small businesses, back in 2001 that number was 69.8%. At the same time, the average median income has been effectively flat since 1998 when you account for inflation.
So we are see a slowing of start-ups creating new jobs and the jobs they are creating has caused the median household income to stagnate.
Innovation Driven Entrepreneurship
We need more than just more start-ups who create low paying jobs. We need businesses that brings innovations to market that deliver such high value that customers are willing to pay a margin premium.
This is what I'm calling innovation driven entrepreneurship or some may call it innovation driven start-ups.
These start-ups don't have to follow in the model of Silicon Valley and be focused on technology. Innovations can cover a wide range of areas. I recently came across a very innovative idea for a new approach to a bicycle that I think could open that market to new customers who are not ridding today.
Another example is innovating education and how we prepare students with STEM skills that will prepare them to compete in the emerging creative economy. Check out what Zaniac is doing.
What I'm not talking about is an entrepreneur copying some existing business or franchising a business for their local community. These are all good and play a role in the economy. But these small businesses are typically not going to drive a disruptive product or service that will return a margin premium.
How Do You Start An Innovation Driven Start-up?
We've covered on this show a number of ways to think about discovering ideas and then executing to turn those ideas into a killer innovation. When it comes to innovation driven entrepreneurship, think about in two parts:
Innovation: Find a problem, ideate a solution (product, service, business model, etc), test it with others then adjust and repeat the process.
Entrepreneurship: Find and focus on a customer who needs your innovation, serve that customer, find another customer and then repeat until you achieve scale.
While this sounds simple, it is incredibly hard. You will face disappointment and setbacks while also experiencing the thrill when a customer says they love your innovation and actually pays for it.
How Can I Help You With Your Start-Up?
I want to help you take your idea and create a business that turns your idea into an innovation. Given the sheer number of people, I can't do this 1:1. So I've joined a community that hangs out in a private Slack area full of innovators and entrepreneurs. There is where you can find the expertise you need while also sharing you expertise with others.
Check out The Innovators Community to learn how you can be part of the community.
[callout]Listen below to this weeks show on how innovation driven entrepreneurship can drive the economy.[/callout]
Tue, 3 October 2017
Over the years, I noticed that I seem to get a similar set of questions from the participants at my talks, workshops, and innovation boot camps. What this tells me is that there are a set of common questions about innovation that are on everyone's mind.
Here are the 9 common questions on innovation that I get.
How do I define innovation?
Innovation is when an idea becomes real to the point where someone is willing to exchange value to get it. Ideas are easy. Turning them into something that has impact is really hard.
What is a killer innovation?
Some people over the years have criticized and attacked my use of the word "killer". When I started the show back in 2005, the word "killer" was used to describe things like "killer apps" which is translated to -- "best app".
My definition of killer innovations is an innovation that is a significant and highly profitable departure from current offerings or practices that would be difficult to duplicate.
So ... incremental innovation is of no value?
NO. There are multiple types of innovations and incremental is just as important as the others. An incremental innovation is when you build on top of an existing innovation with something new and unique.
Incremental innovations are highly valuable since most organizations depend on these incremental innovations to pay the rent while the next disruptive innovation is being worked on.
Why is innovation so difficult?
Its not just about the idea. There are a lot of pieces that must come together to turn an idea into a game changing -- killer innovation. And most of these things you are not in control of.
What are some of the things you cannot control?
One thing critical to innovation success that you cannot control is timing. You may have the best idea but if the market is not ready, technology is not ready, government regulations are not ready -- you're stuck.
Remember that Steve Jobs and Apple did NOT invent the smart phone. Depending on who you talk to, it was either Nokia and/or Palm. Steve and Apple just got the timing right.
[shareable]The difference between a good and a great idea is rarely the idea. It's the timing.[/shareable]
What are some of the things you CAN control?
Your team. Innovation is a team sport. Who you hire -- who you allow to be on your team -- will be the most important decision you make.
I look for passion and culture fit. I can teach skills. I cannot teach/inject passion. And if you're a jerk, then there is no room on my team for you.
What is one of the biggest mistakes more organizations make when it comes to innovation?
Creating a culture where "failure" is not allowed. Innovation is all about failure. If you aren't failing, you aren't innovating.
Best in class teams and organizations have a 90% failure rate. If your's is lower, then you are not stretching. You are making the safe bets.
If you're failure rate is above 90%, then take a look at how you are selecting and managing your idea funnel.
How can organizations get over their fear of failure?
By celebrating failure when they occur versus hiding them. In a previous role, I actually put in place a bonus system that would reward failure. You need to send the message that a willingness to take risks and try is just as important as the successes.
WARNING: If an organization has a history of punishing failure such as firing or demoting people whose project didn't succeed, then changing the culture will be incredibly HARD if not impossible.
What is another mistake most organizations make?
Most senior leader lack patience. Innovation is HARD and as a result, its hard to predict when a breakthrough will occur.
No matter how good you think you are at predicting and managing projects, when it comes to innovation -- it takes long than you think. Get used to it.
Bonus question: Who are the best people to be innovators? Who should I hire?
EVERYONE! Everyone is an innovator. It doesn't matter the role, function, education, background or skills. Innovation is a skill that you can learn, practice and become proficient at.
Now -- some will be better at it than others but that is because they work at it. They practice it. They exercise their creative muscle everyday. Do you?
If not, then don't set back and complain because someone else is "more creative" because of some special gift. Your ability to innovate is in your control.
To exercise your creativity muscle, check out this speech on creative thinking.
[callout]Listen below to this weeks show on the 9 Common Questions on Innovation[/callout]