BQF Innovation

Innovation and Kowledge Management

Guest speaker  - Professor Michael Kelleher.

This presentation and interactive session will illustrate a model of knowledge management that will enable participants to understand the key elements of KM. Secondly, the presentation will offer insights into how knowledge management can underpin innovation through supporting connections between people, sharing ideas and learning lessons from what works and what needs improving.

Some examples will be provided from the Scottish Enterprise project that sought a knowledge management model for innovation as well as current work underway at Selalfield.Participants will be able to assess their own organisations’ capacities to integrate knowledge management and innovation.

Places at this meeting are limited please contact Pat Myles on 020 7654 5013 for further information.

Paul Sloane

Try this little test:

 http://www.dothetest.co.uk/

It has some interesting lessons for innovation and thinking.

 Paul Sloane

Most business leaders plan modest incremental growth each year. They set expectations that they are confident can be achieved.  This way everyone can get a pat on the back when the plan is reached.  Growth in revenue in line with the market at 5% and growth in profits of 6% is the sort of thing.  Many directors would be delighted with this sort of result.    The trouble with this approach is that it reinforces incrementalism.  The easiest way to get 5% growth is by pumping up the existing products or services.  We can add some line extensions.  The easiest way to wring out some extra profit is to improve the efficiency of the current model or to squeeze down on our suppliers.  There is no incentive here to look for big opportunities, to find entirely new sources of revenue, to conceive new business models. The second problem is that companies, just like children, tend to conform to the expectations that are set for them.  If 5% growth is considered a good result and 7% is considered a demanding ‘stretch’ target then few in company will believe that anything greater than 7% is possible.  Just like children who are constrained by their parents’ lack of belief, the people in the business match their collective norms. 

Outstanding companies set outstanding expectations.  Businesses that want to break out of the pack demand more of themselves.  This is what GE Capital says about expectations, ‘It is expected that we will grow our earnings by 20% per year or more.  When you have objectives that are outlandish it forces you to think differently about your opportunities. If one guy has a 10% target and another has a 20% target the second guy is going to do different things.’

Drastic expectations reinforce the innovation goals.  If people realise that just doing what everyone else in the market is doing is not enough then they will respond.  Average expectations about the company encourage people to think and act averagely.  Drastic expectations encourage people to think innovatively and act like entrepreneurs. 

 Paul Sloane

We are running another Master Class on Innovation and Creativity in London on May 12th.   Key topics I will cover include:

Paul Sloane

There is a wide choice of social networking sites for business people.  I use Linkedin, Facebook, Plaxo and Ecademy but I find it hard keeping up with them all and I am sure that I am not getting best use out of them.  Maybe they just demand too much time.  Linkedin has been useful - especially for getting in touch with former colleagues.  Ecademy has helped me get some business.  Which do you use and do they help you get ideas, contacts or new business?

Here is an interesting comparison of Linkedin versus Facebook.  Linkedin is focused on business individuals whereas Facebook has grown out of a student group environment. ComputerWorld put both sites to the test with six different business tasks and it compares how well they do.  The results might surprise you.

Paul Sloane

For the past 7 years the European Commission has compiled an assessment of the innovation competitiveness of all the EU states and some other countries as comparisons.  The 2007 report has recently been published and you can read the full report.  The key factors that are used to compare the performance of countries are as follows:

Innovation drivers measure the structural conditions required for innovation potential, Knowledge creation measures the investments in R&D activities,  Innovation & entrepreneurship measures the efforts towards innovation at the firm level,  Applications measures the performance expressed in terms of labour and business activities and their value added in innovative sectors, and Intellectual property measures the achieved results in terms of successful know-how.

There are some 38 countries listed.  Here are the top 20:

1. Sweden
2. Switzerland
3. Finland
4. Israel
5. Denmark
6. Japan
7. Germany
8. UK
9. USA
10. Iceland
11. Ireland
12. Austria
13. Netherlands
14. France
15. Belgium
16. (EU Average)
17. Canada
18. Estonia
19. Australia
20. Norway

The report states that  the innovation gap between the EU and its two main competitors, the US and Japan, has been falling but remains significant. The US keeps its lead in 11 out of 15 indicators and Japan keeps its lead in 12 out of 14 such indicators.  A comparison over time shows that the EU is experiencing an increasing lead over the US in Science and Engineering graduates, employment in medium-high and high-tech manufacturing and Community trademarks, and a stable lead in Community designs. The EU is experiencing a declining gap with the US in broadband penetration, early-stage venture capital, ICT expenditures and triad patents. But the gap with the US is increasing in public R&D expenditures and high-tech exports.

The report is rather dry and it involves some estimates that can be challenged.  It would be better if China, India, Brazil and some other countries were included but their data is not available.  However, it is the best comparison we have and contains some very revealing data.

Paul Sloane

Here is an interesting article on collaborative innovation in the Exchange Morning Post.

It draws on the collaborative experiences of Advanced Micro Devices and IBM, Renault and Nissan, Nike, Reuters and others.  Key lessons are that success takes time and depends strongly on a shared strategic outlook and a deep level of trust.

Paul Sloane

We had an excellent meeting on Feb 5th.  It was kindly hosted by the Royal Mail at their offices in Old Street.   The meeting started with a talk from Robin Mar of Royal Mail who gave examples of the successes and difficulties that they have had with innovation.  They introduced a prize competition in order to reduce absenteeism among their 180,000 employees.  Despite some scorn in the press it was a big success and reduced absenteeism by 26%.  Robin shared some other examples including their driver risk assessment scheme and some highly innovative direct mail initiatives.  Among the issues he discussed were inertia, risk aversion and insularity.

Matt McNulty of consultants Mouchel then gave a presentation on their innovation efforts.  Some of his intriguing examples included allowing traffic to use the hard shoulder on the M42, which Mouchel recommended to the Highways Agency.  When Mouchel had a problem with silo mentality at a client they came up with a board game which people played to learn the interdendency between departments.  Mouchel have 250 innovation champions to aid the idea generation and implementation process.

We finished with an interactive exercise on Transformers - a technique to force creative thinking in a process or procedure.  The teams came up with some great ideas and the feedback was excellent.  Copies of the presentations are available to BQF members from Pat Myles.

 Paul Sloane

Here is a marvellous little video clip that I got from Frank Calberg.  See what you think.

Paul Sloane

There is an interesting report on leadership and innovation on the McKinsey site.

Based on a recent survey they say that most senior executives are dissatisfied with their  ability to stimulate innovation.  They recommend a that a disciplined focus on three people-management fundamentals may produce the building blocks of an innovative organization.  A first step is to formally integrate innovation into the strategic-management agenda of senior leaders to an extent that few companies have done so far. In this way, innovation can be not only encouraged but also managed, tracked, and measured as a core element in a company’s growth aspirations.  Second, executives can make better use of existing (and often untapped) talent for innovation, without implementing disruptive change programs, by creating the conditions that allow dynamic innovation networks to emerge and flourish.  Finally, they can take explicit steps to foster an innovation culture based on trust among employees.  In such a culture, people understand that their ideas are valued, trust that it is safe to express those ideas, and oversee risk collectively, together with their managers.  Such an environment can be more effective than monetary incentives in sustaining innovation. 

The sample of 600 managers and professionals indicated that the top two motivators of behavior to promote innovation are strong leaders who encourage and protect it and top executives who spend their time actively managing and driving it.  Indeed, senior executives believe that paying lip service to innovation but doing nothing about it is the most common way they inhibit it.  The report says leaders should:

1. Define the kind of innovation that drives growth and helps meet strategic objectives.

   
2. Add innovation to the formal agenda at regular leadership meetings.

3. Set performance metrics and targets for innovation.

4.  Build innovation netwworks

5.  Develop a culture of trust

Paul Sloane