Innovation

The twist-off beer cap and nine other simple innovations that surprise and delight

Originally published on December 29, 2015 as a Guest Column in The Globe and Mail: http://www.theglobeandmail.com/report-on-business/small-business/sb-managing/the-twist-off-beer-cap-and-nine-other-simple-innovations-that-surprise-and-delight/article27919422/

I read a great phrase the other day: “Innovation is not renovation.” I couldn’t agree more. Innovation goes beyond slapping a new coat of paint on a product or service. It’s about finding ways to add real value for your customers. Value that makes their lives better, easier or less complicated.

Many business leaders shy away from innovation because they think it needs to be complicated. In reality, the process is easier than they think because successful innovation harnesses the obvious.

The essence of innovation lies in understanding what clients need and capitalizing on market shifts. It’s about continually re-engaging customers by meeting their changing preferences, often before they even realize those needs have changed.

Companies should start by recognizing their many opportunities to practice easy, effective innovation. The following 10 examples may reset your brain. They’ll help you see how simple it can be to develop new products, services and processes that will make a splash in any market.

The common theme? All 10 of these examples surprise and delight customers by solving problems, old or new. When you spend day and night obsessing over customers’ needs, innovation really becomes an exercise in bringing the obvious to life.

The twist-off beer cap

Even though the twist-off cap has been around for 50 years, it remains a pre-eminent example of simple yet game-changing innovation. I was working with a group of engineers not long ago and asked them to suggest simple innovations that have changed their lives. The twist-off beer cap was their favourite. Before twist-offs were commonplace, life was harsh and cruel. Using the engineers’ words (not mine), once you misplaced the bottle opener early in the evening at a university party, you spent far too long searching for it through the night.

Side-mirror sensors

I’ve yet to drive one of the new self-parking cars, so I will cite an automotive innovation that’s a little more mainstream: the side-mirror sensors that light up when a car is in your blind spot and blink when you put your turn signal on. An ingenious step forward in driver safety.

Coffee sleeves

Simple, obvious, wildly inexpensive – yet only invented in 1993. These finger-saving pieces of textured paperboard may be the most elegant innovation of all.

Selfie stick: If people are going to insist on taking photographs of themselves and their friends, why not help them take better photographs of themselves and their friends? A classic example of a lightning-quick response to a sudden behaviour shift.

Netflix, Nook and Kindle

We are no longer patient people. So instead of making us visit a storefront or wait for delivery, these powerful enablers of entertainment allow us to access any movie, TV series, video game or book we want … now!

Airbnb

This global room-renting, house-sharing app lets you choose precisely the accommodation you want. It’s cost-effective for users and a new business model for owners. A classic case of disintermediation.

Remote car starter

Hey, this is Canada. On a cold, dark winter morning, a warmed-up car may not make your day perfect. But it’s a hell of a good start.

Tide Pods

No more searching for the scoop and guessing how much detergent to use. Set and forget: Someone else has done all the work.

HOV lanes

As long as we have internal combustion engines, fewer cars on those roads is good for the planet. Rewarding drivers for sharing the ride with passengers makes eminent sense.

Personal service

There is nothing better than high-quality service to build customer loyalty. One of Canada’s foremost service practitioners is Longo’s, an independent Ontario grocery chain. When a customer asks where an item is, Longo’s policy is not to have an employee just point to the right aisle, but to walk customers to the exact shelf where the product sits. At a Longo’s recently, I watched an elderly shopper ask for help. Longo’s team member led her to the right location, and then re-arranged the goods in the basket of her walker to assuage the customer’s fear that her softer groceries might get damaged. Little things make a big difference.

If you’re out to make a difference in your market, you’ll face two well-known barriers to change: the naysayers who argue “That’ll never work,” and those who say “We don’t have time to innovate.” Ignore the doubts. Innovation is easy when you target real needs with inexpensive, intuitive solutions. Look for simple wins. And keep the breakthroughs coming.

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Why your company is failing to innovate

Originally published on December 4, 2015 as a Guest Column in The Globe and Mail: http://www.theglobeandmail.com/report-on-business/small-business/sb-growth/why-your-company-is-failing-to-innovate/article27510973/

An executive recently said to me: “Our company has become very innovative. We have hundreds of ideas that we have analyzed and know are right for our future. We just haven’t been able to bring them to market yet.”

Strike one, strike two and strike three. This executive doesn’t know any more about innovation than he knows about hitting a 100-mph fastball.

Innovation is not simply about having an idea. It’s about commercializing ideas: Bringing them to market in ways that benefit your company and your customers. Having an idea may be insightful or even creative, but it certainly doesn’t make you innovative.

It shouldn’t be this hard. What could be simpler than having an idea and acting on it?

But according to Forbes magazine, it’s just not that simple. In a February, 2015, article entitled “Why U.S. Firms Are Dying: Failure To Innovate,” Steve Denning writes: “A new survey from MindMatters conducted this month suggests that many American companies are still in an ‘innovation crisis.’ ”

In the survey Denning cites, “only 5 per cent of respondents report that workers in innovation programs feel highly motivated to innovate. More than three of four say their new ideas are poorly reviewed and analyzed. And less than a third of the firms surveyed say they regularly measure or report on innovation.”

In my work with large and small companies, across many industries and countries, there seems to be three common and significant barriers to success.

The first barrier is transparency

We are better at hiding our ideas than bringing them to market. We write them on sticky notes, scrawl them on loose pieces of paper, or input them into notes apps on our phones – and then forget all about them. To be an effective innovator, you need inclusive transparency. You need to solicit ideas from your team and post them in a visible place in your office, along with the criteria used to judge them, identification of the leader tasked with bringing each project to market and the progress of each project. With this approach, innovation is an open-and-shared process, with consistent measurement and reporting.

The second barrier is improper resource allocation

Mr. Denning’s articles also reports: “More than four of five respondents (81 per cent) say their firms do not have the resources needed to fully pursue the innovations and new ideas capable of keeping their companies ahead in the competitive global marketplace.” Don’t overpromise. If you have resources to achieve just two projects, choose the best two and commit to them. Too many companies bite off more than they can chew. Trying to do too much usually produces nothing – other than creating one more perceived failure in your organization.

The third barrier is the lack of an innovation culture

Innovation may depend upon the activation of market-ready ideas, but it is driven by organizational attitude. Successful corporations today need an innovation culture that inspires people to seek new possibilities and embrace change in their day-to-day work. As Mr. Denning notes: “The challenge is systemic: While more than half the respondents (55 per cent) say that their organizations treat intellectual property as a valuable resource, only one in seven (16 per cent) believed their employers regarded its development as a mission-critical function. The lack of recognition for contributions to innovation is also striking: Almost half (49 per cent) believe they won’t receive any benefit or recognition for developing successful ideas.”

Don’t expect your team to act on new ideas in their spare time. It sends the message that innovation is a hobby, not a commitment. To achieve breakthroughs, you need to carve time out of your team’s workweek to devote to new projects and directions. (Google famously gives its best engineers a day a week to work on innovation ideas of their own creation.)

Your employees’ innovation successes also need to be recognized, both publicly and at their next performance review. There is nothing better than a public thank you – except maybe a share of the profits – to make people feel appreciated. These moves also reconfirm the organization’s recognition that its own people are the source of future success.

Innovation isn’t an idea on the back of a napkin; it’s a framework of resources and rewards that focuses your entire team on ideation, experimentation and product-market fit. A shared innovation agenda gives your organization greater ability to grow revenue, control costs and engage entire teams. Innovation also improves the customer experience, through the continuous introduction of new and improved product offers and services.

When the innovation process is shared and understood, there’s no more expecting unprepared batters to hit fastballs. When it comes to innovation, it takes a team to hit the ball out of the park.

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A good crisis can make for great opportunities

Originally published on September 4, 2015 as a Guest Column in The Globe and Mail: http://www.theglobeandmail.com/report-on-business/small-business/sb-managing/a-good-crisis-can-make-for-great-opportunities/article26204036/

A few weeks ago, I went to Brazil to speak to a large group of manufacturers on the perpetually-topical subject of innovation in a time of crisis. The forum, held by FIERGS (Federation of Industries of Rio Grande do Sul), addressed the well-known struggles of the Brazilian economy. Unfortunately, those same issues are now being faced by the Canadian economy.

With the recent announcement that Canada is in a “technical” recession, these two resource-driven economies are slowing to a crawl. The good news? For me, there’s never been a better time for businesses to embrace innovation. And the best way to succeed in this perpetually challenging area is to look at innovation through the lens of crisis – or turnaround – management.

Innovation has always thrived in hard times. Desperation forces people to question the status quo. In good times, people may be less inclined to rock the boat, but when investors and customers are bolting for the doors, you have no choice. That’s probably why some of the world’s great companies were founded during recession – businesses such as General Electric, IBM, Disney, Microsoft and Adobe.

One of the world’s most successful innovators, Apple, wasn’t founded during a recession. But the same principle applies. When Steve Jobs returned to take the reins in 1997, Apple was facing crisis: too many products, too little focus, not enough revenue. What saved the day? Steve Jobs shaved Apple’s product lines by 70 per cent. Even the best companies can become bloated and undisciplined during the good years and forget the core competencies that made them great.

To stay true to your strategic core, you could do worse than look to the process of strategic turnarounds. Once a company has accepted that it has lost its way, a successful turnaround requires an extraordinary commitment to self-analysis, questioning, reflection and day-to-day change. The same turnaround tools can be adapted to meet the enormous market pressures all businesses face today.

The main reason many companies fail is lack of focus. They start off doing one thing well, and then get attracted to – or distracted by – other opportunities. Some may be successful, others not. But all of them distract the business owners and leaders from what they set out to do. And all too often these shiny new opportunities are well removed from the business’s original roots. That means there is little synergy with established operations, and way too much to learn – about new products, suppliers, distribution channels, markets and customers. It’s falling into this pit of guesswork and improvisation that leads most companies to call in the turnaround experts.

It takes courage to admit that your company needs to reverse course. But successful turnarounds require everyone involved to face the brutal truth.

The best turnarounds usually begin with a strategic review that asks: What are our strengths? What do we do best? Where are we losing money? What operations are most profitable? Where can we grow? Successful change also requires that you reconsider some of the specific actions that got you into trouble. Stop doing the same old things; one definition of insanity is doing the same things and expecting different results.

Here are some of the key elements of a successful turnaround:

  • You need the right people on the journey. A winning turnaround starts with shedding employees who aren’t contributing sufficient value, or lack passion for their job. Once you get rid of the complainers and the complacent, your company has a better chance to bounce back.
  • You need a “change champion” to manage the turnaround – someone who owes nothing to the old, failed ways of doing things, and is prepared to listen carefully, consider many new ideas, and take direct action. His or her objective must be to stop the bleeding and get the company moving in the right direction. This is usually a hard job for the original owner/manager to do. Regardless of who takes charge, they require a formal process. As outlined in my book, The 90% Rule, that means knowing where your organization came from, knowing what it’s best at, and finding more ways to create value for more customers.
  • Focus is key. Trimming marginal operations is imperative – as Steve Jobs knew when he cancelled 70 per cent of Apple’s product lines in order to focus on only the best and biggest opportunities. In crisis, protect the core. Pull the plug on non-core activities.
  • Review prices and margins. Many companies are afraid to raise prices or set minimum margins for fear of losing customers, but it’s the best way to figure out who your best customers really are, and to clear out the unprofitable ones. Every penny of these exercises goes directly to the bottom line. No surprise, then, that the companies I have seen do this all wish they had done it sooner.
  • Refocus on the customer: What do your customers want and need? What are their biggest pain points, and how can you relieve them? Get out and talk to the customers. (It’s a shame so many companies wait till they’re in trouble to do this.) Once you have identified new ideas, opportunities and solutions, let the customers know the new directions your company is taking – and how they contributed to its success.
  • Keep employees well informed of the company’s plans and decisions. In the absence of facts, fear breeds confusion and negativity. Keep everyone informed, involved, and marching forward.
  • Paint a clear picture of what you’re trying to do and the process you are following. Share this vision with all your all stakeholders (customers, employees, suppliers, investors, bankers, etc.). You want everyone to know that there is a better future ahead, and that their sacrifice, hard work and faith will not be in vain. Make sure to offer a specific reward at the end, whether it’s increased job security, bonuses, profit-sharing, and/or a blowout party to end all parties.

Diamonds can only be created under great pressure. Whether your company needs a major rethink or you are simply looking for new opportunities for growth, crisis thinking can create the new opportunities you and your team are looking for.

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