Innovation

To become truly innovative, Canadians need to become better at thinking creatively

Attractive businesswoman in clean room with city view looking at whiteboard with colorful sketch. Creative and analytical thinking concept. 3D Rendering

Originally published on March 20, 2017 as a Guest Column in The Globe and Mail: http://www.theglobeandmail.com/report-on-business/small-business/sb-managing/ottawa-can-help-but-to-become-truly-innovative-canada-needs-to-embrace-entrepreneurship/article34348521/

With the federal government getting set to unveil its new innovation strategy in its March 22 budget, a scholarly article on “Canada’s Low-Innovation Equilibrium” has asked whether anything short of a crisis can jump-start our efforts to produce the better, smarter products and services we need to keep our economy growing.

The author is Peter Nicholson, one of our brainier Canadians: a physicist, computer-science prof, banker, former Nova Scotia MLA and policy adviser to former Prime Minister Paul Martin. In a highly readable article in the journal Canadian Public Policy, he points out that the business community’s generally downstream, “branch-plant” status has enabled Canadians to maintain a prosperous standard of living despite neglecting the necessary business of developing new products and services. That would explain why a century of policy efforts to stimulate innovation have failed.

But we may not be able to coast much longer. Pointing to “transformative” new technologies such as IT, biotech and nanotech, as well as the need for more and benign energy solutions, he publicly asks how long our business and political leaders can keep neglecting innovation.

I do not question Dr. Nicholson’s analysis. But he is an intellectual, firmly tied into our academic-government-corporate elite, and I believe he’s missing something. Innovation isn’t just corporate R&D flowing out of tax policy. Innovation is an attitude. It’s a way of looking at all aspects of life around us – problems, constraints, delights and discoveries – and wondering how you can use them to create new and better ideas, processes, products and services.

For most of us, business or individual, the greatest innovations will not spring from laboratory experiments or quantum computing. They come from finding new ways to do things better.

Case in point: two of the best-selling products coming out of the ABC-TV show Shark Tank are as humble as you can imagine. Consider “Scrub Daddy,” a smiley-faced scrubbing tool that changes its texture with the temperature of the water you wash with. Inventor Aaron Krause has now built a company around his silly sponge with a portfolio of innovative household products, many sourced from an inventive public.

The other breakthrough: the Simply Fit Board exercise board, developed by a mother and daughter team. The simply curved balance board lets you strengthen your core while doing basic twists and squats. The plastic, neon-coloured boards cost $9 (U.S.) to produce and sell for $40 at Amazon and Wal-mart, a profit margin that enticed investors Kevin O’Leary and Lori Greiner into a bidding war.

I’m not saying that big science and corporate R&D aren’t important. But as the politicians and economists argue over policies and incentives, Ottawa must acknowledge that individual Canadians and entrepreneurs have a huge role to play in boosting innovation. Let’s find creative ways to turn Canadians into more active, curious, creative thinkers and tinkerers. (Look at how the CBC’s Dragons’ Den, the precursor to Shark Tank, has stimulated entrepreneurial creativity.)

And let’s also remember that to become expert innovators, Canadians must do more than come up with good ideas. They must actively bring them to market – which means learning more about business models, market research, production, finance, selling and marketing. These skills must be taught in schools and inculcated throughout society. The federal government is not responsible for education, but it has many levers it can pull – such as workforce development and corporate incentives to better understand market need and product potential, and sponsorship of national pitch contests – to expose more Canadians to the fun and profit of entrepreneurship and creativity.

Bottom line: Innovation is about asking questions, defying social norms, creative thinking, understanding other people’s needs, brainstorming new business models, and learning to be flexible and resourceful when market testing shreds your dreams. These are all apolitical but essential life skills that we will need to prosper in an increasingly competitive world. Innovation is not just for ivory towers, but for kitchen tables, spare bedrooms and garages across the country.

Ken Tencer is chief executive officer of design-driven strategy firm Spyder Works Inc. and the co-author of two books on innovation, including the bestseller Cause a Disturbance. He holds the Institute of Corporate Directors certification (ICD.D). Follow him on Twitter at @90per centRule.

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How a hackathon can encourage your employees to innovate

Group Of Multi-Ethnic People Working On Digital Devices Around Table

Originally published on March 16, 2017 as a Guest Column in The Globe and Mail: http://www.theglobeandmail.com/report-on-business/small-business/sb-managing/hackathons-arent-just-for-hackers-any-more/article34146640/ 

Everyone in business has heard the expression that if you’re not disrupting your market, someone else will soon be disrupting you. But this raw challenge doesn’t help most leaders understand how they’re supposed to get started in the creative-destruction business.

But Steven Stein has figured it out. The chief executive officer of Toronto-based Multi-Health Systems Inc. has created an in-house “hackathon” to encourage innovative thinking and transform ideas into new products.

Stein is a true believer in creative destruction. He founded MHS 33 years ago to disrupt the psychological-testing industry by automating conventional paper-based tests for the personal computer. Today, MHS is a global industry leader, with 160 employees and clients in more than 75 countries. But Stein knows his company remains vulnerable to new entrepreneurs with better ideas – so he’s shaking up his team to ensure they develop those bold new products first.

It was an off-site strategy session for senior leaders that launched MHS’s innovation project. “Two years back, we had a presentation on disruption,” Stein said. “We went home and had nightmares about how new people could kick us out of the market.”

Stein and his team knew hackathons were popular, if sometimes messy, events that help small teams turn new ideas into working prototypes fast. Even when they don’t produce new products, hackathons can be powerful problem-solving exercises that can build positive attributes such as agility, risk tolerance and trust. So Stein appointed a team, led by president Hazel Wheldon, in the summer of 2015 to put MHS on the hackathon circuit – and make it fun and engaging.

Since then, MHS has held two hackathons at its Toronto headquarters, and created a five-person “innovation hub” to select the best ideas and turn them into customer-ready products. Innovation is a long game, and the first market tests are still in the field. But Stein believes the process has already been successful. “The biggest benefit is the excitement it created,” he said. “People loved working with new people. It’s been worth it just for the engagement, not just the products we got out of it.”

Could your company pull off a similar innovation coup? Here’s how MHS did it.

  • After researching how other companies managed innovation events, MHS’s hackathon planners developed guidelines and rules. They decided on a one-day hackathon on a January Monday – with the 15 teams competing in a “Demo Day” the following Friday, in conjunction with MHS’s annual awards dinner.
  • Teams formed in groups of five to eight in early fall, so they would have lots of time to develop ideas and research solutions prior to the big day. To help the teams focus, planners identified four sectors as most likely to be disrupted: big data; mobile apps; gamification; and process improvement.
  • As the employee teams took shape (each one restricted to one programmer and one employee from user experience), the planners scheduled a series of “lunch and learns” through the fall. Topics included creating prototypes, writing business plans and making killer presentations.
  • The incentives? The team with the most promising idea (as judged by Stein and a panel of internal and external judges) would win $5,000. There would also be a $2,000 second prize, and a third prize of $1,000.

On hackathon day in January, 2016, the 15 teams had until 6 p.m. to finalize a prototype and hammer out a business plan. MHS supplied food and colour-coded team T-shirts, creating a festive atmosphere. Participants were laughing, sweating, debating and tweeting – so much so that competitors started noticing. For 2017, MHS had to say no to tweets that gave too much away.

All teams presented to the judging panel on the following Friday. Each team was allowed a five-minute presentation, followed by five minutes for answering questions. Stein was thrilled by the winning ideas: an inexpensive “candidate competencies” test for employers to help MHS hack its way into a highly lucrative market; a mobile “early warning” solution that let psychologists share with patients (or their parents) preliminary test results in minutes instead of weeks; and the identification of new markets for some of the firm’s underused mental-health surveys through sales to the insurance industry.

Stein said some of these ideas might have daunted the team prior to the hackathon. “But now these guys have mapped them out. They said: ‘We can do it. Here’s how.’ ”

The next step was for the implementation team to review the finalists’ ideas and adopt the most promising projects. For now, MHS is funding this project through unbudgeted foreign-exchange gains; Stein hopes the group will start paying its way before the Canadian dollar turns up again.

The innovation hub – two psychologists, two programmers and a UX person – fine-tuned initial prototypes for hand-off to sales, which arranged pilot programs with real customers. The team set itself quarterly goals to ensure it was doing its job; in innovation, knowing what to stop working on is just as important as spotting winners.

“Over all, there are eight or nine projects we’re moving ahead with,” Stein said. With two hackathons now under his belt, a pipeline of new projects and a re-engaged work force, he said the whole process has been a winner. “It’s turned us from a disruptee to a disruptor.”

Ken Tencer is chief executive officer of design-driven strategy firm Spyder Works Inc. and the co-author of two books on innovation, including the bestseller Cause a Disturbance. He holds the Institute of Corporate Directors certification (ICD.D). Follow him on Twitter at @90percentRule.

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Isn’t it time to start thinking outside the cliche?

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Originally published on April 9, 2016 as a Guest Column in The Globe and Mail: http://www.theglobeandmail.com/report-on-business/small-business/sb-managing/isnt-it-time-to-start-thinking-outside-the-cliche/article29537629/

Every time I hear somebody use the phrase, “Let’s think outside the box,” my frustration boils over. Such statements remind me why so many businesses today struggle and even fail.

People who believe they need to think outside the box have all missed a fundamental reality: It’s been a while since there was any “box” in business. There may be a status quo, but nobody goes there any more. It’s been replaced by continuous change.

The need for continuing innovation and course corrections should be glaringly obvious to all leaders and managers. I mean, really: Did somebody miss the fact that we can all communicate directly with our customers now in real time? Or that our wristwatches are now digital business and life assistants that speak to us and guide us through the day?

If we have to create a metaphor to replace “the box,” it might be a virtual-reality video game. These digital diversions are fast and all-absorbing. They engage all of your faculties, and get more difficult with every level.

We need to learn, understand and process the fast-changing business environments just as we navigate the next level of a game. We must constantly adjust, react to new threats, and take advantage of emerging opportunities. One slip and it could be “game over.”

How do you keep pace with continuous changes in the marketplace? For me, the one guaranteed success strategy is staying focused on your customers. In a World of Warcraft context, your customer is your game score. Delighting (or failing) your customer is how you win or lose.

With today’s immersive digital games, you slip easily into digital avatars or personae that bring you into new worlds of fantasy, combat or sport. Refocusing on your customer involves a similar transition: creating new models of customer behaviour that enable you to better understand their feelings and experiences, and thus engage them in stronger and deeper relationships.

Customer success today requires continuous commitment to developing and refining customer personae (models of your most important customer types) and customer journey maps (models of your customers’ experience as they move from initial contact to purchase to continuing relationship). These two approaches help you develop deeper knowledge of who your customers are, how and why they buy, and what challenges you face in keeping them as customers.

If you hope to take your business to the next level (as in the video game context), you first need to improve your knowledge of your customer. Be more curious. Ask more questions.

Customer personae bring each of your identified target groups to life in a personal and meaningful way. Developing customer personae means creating authentic, insightful descriptions of each target group that include:

  • Relevant details about their key needs;
  • Understanding of their unmet needs, or where your next opportunities lie;
  • Identification of “hot button” issues that can make or break sales opportunities and continuing relationships.

At my firm, once we have a clear understanding of who our clients are and what motivates them to purchase, we create a customer journey map for each identified target group. This means understanding all of the steps they go through in deciding to purchase our products and services:

  • Identification of need
  • Sourcing of solution provider
  • Modelling the customer’s decision-making process
  • Uncovering “tipping-point” factors
  • Driving purchase decisions
  • Assessing post-purchase satisfaction

So important are these customer-recognition insights that we post them on our office walls. They remind us why we are creating solutions in the first place. They articulate the decisions that our customers make and the steps that they have to follow to purchase and be happy with that purchase.

Once we understand that customers are always looking for something better, we can leave behind the “outside the box” cliché and start thinking inside our customers’ lives and aspirations.

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