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How to innovate (and how not to), part 6: Refine your process

Where does innovation come from? And which method works best? Jihee Junn continues her look at the many and varied approaches to innovation in the sixth part of a series.

The challenge with creative work is that there are many factors beyond your control. Innovation can be hectic, disorganised and haphazard, which at times is how radical new ideas come to fruition.

But, for established companies, the unruly nature of innovation can seem daunting. Despite the desire to think outside the box, pre-existing structures and ingrained business models can make developing or implementing innovation an impossible chore. Previously Unavailable, New Zealand’s first specialist innovation consultancy, says that while 84 percent of companies consider innovation critical to their future, just six percent say they are satisfied with their innovation efforts to date.

Perhaps signalling a new approach to innovation, Previously Unavailable touts a tangible and organized step-by-step approach. Using a process known as Black Box, which was developed following a study of best practice learnings from institutions like the Harvard Business School. The study sought to understand the common barriers and pitfalls that stifle innovation in larger organisations. Hence, Black Box was formed to counter those challenges with clear and robust processes.

Velox Innovation, a team of “innovation coaches”, works on similar principles. It’s a company intent on accelerating development through tangible methods. Programmes, workshops and innovation systems are all proactive ways of creating innovation and doing so faster. That’s not to say these methods aren’t imperfect, because even when everything gets done right, there’s still a chance it might fail. But innovation can still happen on a step-by-step process, and there are resources and firms that exist precisely for that.

ASB’s Russell Jones believes innovation works better when it’s part of the DNA of a company, so it incentivises that attitude, both structurally and financially. “Increasingly, we’re building in the scope of experimentation and asking staff to put a hypothesis together and then test the idea.”

Christoph Drefers, one of the brains behind Pass The Idea, a cloud-based innovation and collaboration platform that uses the wisdom of a global crowd to produce solutions around a specific challenge, says research shows the most innovative companies all have processes to bring ideas to life. And while innovators are often seen as great risk takers, that stereotype doesn’t work either. “Are ideas free flowing things that come to you at a misty mountain? There can be a fascination with the breakthrough moment and that’s a lack of understanding about how innovation works and therefore expectations are not realistic. Innovation is messy and the answer to it is the idea of mixing, where you need this and that ... It’s a game of chance so you try to improve your probability and putting the structure around it is definitely helping your chances. If you look at the history of innovation, the big eureka moment is very, very rare. It happens, but it’s definitely the exception. And it’s not how corporates work. The eureka moment classically will involve a lot of risk. And intuition. The majority of the innovation you run into is the collision of existing ideas that create something new.”

Drefers says the common reflex when you’re a leader and you have problem is to call a meeting. And research shows that doesn’t work. But where do those ideas to fill the funnel come from? Companies come up with ideas in a variety of ways. Sometimes it’s reacting to feedback or competitive signals, sometimes it’s something from another market that might change the customer experience and, increasingly, it’s a response to feedback. “There’s no shortage of feedback,” says Jones. “The tricky thing is to analyse whether we’re dealing with problems.

Because being first with useless ideas doesn’t help anybody ... We spend a lot of time on complaints. It’s such a rich source of data. And spending time with that can lead to some a-ha moments. There’s nothing more galvanising than seeing the thing you’re pretty happy with versus the pain you’re putting your customers through. It’s pretty sobering to see what they’re dealing with. And we don’t want to forget that.”

Figuring out whether the idea adds value to customers is the biggest filter it now uses in terms of working out what to take forward. Not surprisingly, given it’s a financial institution, how much it’s going to cost to implement is a big part of that too, alongside others like complexity, or the degree of change required to existing systems.

Drefers says most companies don’t actually know where their ideas come from. Sometimes marketing does some research, sometimes you listen to the sales team, sometimes the exec team has an idea, but there’s usually companies have nowhere to keep all the ideas. So if your innovation process is based around muffins and a whiteboard, it might be time to formalise the process. But if it’s a goal to have everyone in the business contributing to innovation, the research suggests “you need to put the processes and tools in place for everybody to participate in it”.

“You don’t get there by calling a meeting with no structure. It’s really helpful to have a go-to place where these ideas live, for everybody, not just the CEO.”

Like creativity, some believe that innovation is one percent inspiration and 99 percent perspiration (or, to use a slightly different equation from Woody Allen, “80 percent of success is showing up”).

And Drefers agrees. “Innovation is like sport. I can’t just tell you, ‘be a better rugby player’. If I was a coach, I need a structured approach, a regular programme and then your skills will improve. And creativity is exactly the same … There’s a lot of evidence that it can be improved.”

Idealog’s official rating: 8 / 10 – Progress is a process.

Method 1: Wait for the eureka moment

Method 2: Follow the word of God

Method 3: Try, try and try again

Method 4; Fail fast, act small, embrace big

Method 5: Become the centre of an ecosystem