Innovation and CreativityInnovation Management
Introduction
“The Other Side of Innovation” by Vijay Govindarajan and Chris Trimble, published in 2010, addresses the vital and often overlooked challenges of executing innovative ideas within established organizations. The authors focus on the gap between generating ideas and successfully implementing them, emphasizing that innovation requires unique management strategies distinct from everyday operations. Below is a structured summary of the book, covering its key points, examples, and actionable advice.
1. The Innovation Gap: Bridging Idea and Execution
The authors begin by distinguishing between generating innovative ideas and successfully implementing them, referring to this challenge as ‘the other side of innovation’. They argue that the execution of innovations demands different structural and managerial approaches than those used for routine operations.
Actionable Advice:
- Create a dedicated innovation team focusing exclusively on the new initiative, separate from the existing organization to avoid daily operational distractions.
2. The DNA of Execution: Dual Structure
The book introduces the concept of “Dedicated Team” (Performance Engine) vs. “Shared Staff”. The Performance Engine excels at routine tasks and efficiency, while a Dedicated Team is necessary for innovation projects.
Example:
- NPI Process at a Consumer Goods Company: The company established a “New Product Introduction” (NPI) team separate from everyday operations to bring innovative products to market efficiently.
Actionable Advice:
- Establish a dedicated team for each new strategic innovation initiative. Clearly define their mission, separate from routine tasks to focus on creative problem-solving and implementation.
3. Leadership and Talent Mix
Innovative projects require specific leadership and a mix of talents different from what successful ongoing operations entail. The authors highlight the need for leaders who can inspire, manage ambiguity, and facilitate collaboration among diverse talents.
Example:
- BMW’s Project i for electric cars: Leaders with a passion for sustainability and innovation were chosen to head this initiative, combining engineers with designers and business strategists.
Actionable Advice:
- Select leaders for innovation projects who are adept at navigating uncertainty and can inspire a cross-functional team towards a common vision.
4. Planning for Innovation: Iterative Learning vs. Linear Execution
Innovation thrives on an iterative learning process rather than rigid planning. The authors stress on planning experiments to learn and adapt quickly.
Example:
- IDEO’s Prototyping Approach: The design firm utilizes rapid prototyping to test, learn, and iterate on ideas quickly rather than sticking to a strict initial plan.
Actionable Advice:
- Plan for iterative development. Frame initial plans as hypotheses rather than fixed blueprints, enabling learning and adaptation through continuous iterations.
5. Separating Innovation Metrics
Measuring the success of innovative initiatives requires different metrics from routine operations. The authors argue for a customized set of metrics that reflect the unique challenges of innovation projects.
Example:
- Metrics at Philips Healthcare: They used experiment-based success metrics like learning milestones achieved and prototype efficacy instead of traditional performance metrics for their innovation teams.
Actionable Advice:
- Set distinct, relevant metrics for innovation projects that track learning, experimentation outcomes, and incremental progress rather than only financial performance.
6. Resources and Funding
Allocating resources to innovative projects should follow a stage-gate process, releasing funds incrementally based on achieved milestones.
Example:
- Google’s 70/20/10 Rule: Google’s rule allocates 70% of resources to core activities, 20% to adjacent projects, and 10% to transformational initiatives, ensuring a balance between ongoing operations and new innovations.
Actionable Advice:
- Adopt a stage-gate funding model, ensuring resources are allocated progressively as the project demonstrates success in various experimentation stages.
7. Building a Culture Supportive of Innovation
Fostering an organizational culture that supports risk-taking and flexibility is crucial for successful innovation.
Example:
- 3M’s “15% Time”: The company allows employees to dedicate 15% of their work time to personal projects, which has led to significant innovations such as the Post-it Note.
Actionable Advice:
- Encourage a culture of experimentation and learning by providing employees with time and resources to pursue innovative ideas outside their regular job responsibilities.
8. Overcoming Resistance and Silos
Innovation often meets resistance within organizations due to fear of change and entrenched silos. The authors advocate for actively managing these resistances through incentives and integration mechanisms.
Example:
- SAP’s InnoJam: SAP hosts events where employees from different departments come together to solve specific challenges, fostering collaboration across silos.
Actionable Advice:
- Break down silos by creating cross-functional teams and offering incentives for departments to collaborate on innovative projects.
9. Maintaining Balance: Innovation and Efficiency
Balancing the need for efficiency in day-to-day operations with the flexibility required for innovation is a challenge that can be managed by segregating roles and responsibilities appropriately within the organization.
Example:
- Toyota’s Lean Startup Approach: Toyota manages this balance by dedicating certain teams to gradual process improvements while separate teams work on breakthrough innovation.
Actionable Advice:
- Segregate structures and processes for efficiency-driven operations and innovation projects to ensure each can thrive without impeding the other.
10. Institutionalizing Innovation Capabilities
Embedding innovation into the company’s DNA ensures sustained performance in both good and challenging times. This requires continuous investment in innovation capabilities and a commitment from top leadership.
Example:
- P&G’s Connect + Develop Program: P&G institutionalized their innovation process by sourcing ideas from both internal and external networks, making innovation a company-wide initiative.
Actionable Advice:
- Institutionalize innovation by creating platforms, systems, and dedicated teams that continually support and drive innovation across the organization.
Conclusion
“The Other Side of Innovation” by Govindarajan and Trimble elucidates the complexities and necessities of executing innovative ideas within established organizations. The authors provide numerous actionable strategies and real-world examples, emphasizing the need for distinct management, dedicated teams, iterative learning, and cultural support to bridge the gap between concept and successful implementation. By following the detailed steps and insights from the book, organizations can effectively navigate the rough terrain of innovation towards achieving sustained growth and competitive advantage.