Rethinking innovation from the ground up.

Enterprises around the world have been challenged with becoming genuinely innovative, trying to elevate their effort from improvement to innovation. With over 90% of groundbreaking innovation coming from startups, enterprises are trying to understand what startups do differently. Turning an enterprise into a truly innovative business has been globally one of the biggest challenges across all industries. It is time to completely rethink the act of innovation from the ground up – starting at the very top. Innovation is a CEO mandate because only CEOs together with their board can make the important decisions about TIME, CAPITAL, and STRUCTURE.

Time

The time it takes to get to new innovation. This is a paradigm shift we all need to be aware of. With the new data and processes, we know that in five years from now, you will need to completely start from scratch again, referred to as the innovation continuum. Think of discovering the next innovation opportunity, and find again new ways to satisfy customers. It is a continuum for building one innovation after the other and becoming a Generation Project that is set forward for the next leadership generation. Each time it takes five years to achieve broad market acceptance. That means you have a maximum of five years to innovate and compete or be out. The new mantra: innovate fast or get out. Once that innovation hits the market, there is a five to ten-year timespan, from idea to recognized market leadership. Important long-term decisions to continue investing in those innovations and the innovation continuum require the CEO and their board.

Capital

The capital market has radically changed in the past ten years. Companies such as Apple, Facebook, Google, Microsoft, Tesla, and Uber were considered overhyped but then achieved global market domination. Competitors could not compete because they did not know why those companies took over their market share. It is becoming more and more difficult to catch up with the market. Conventional companies are trying to fight their competitors with legal attacks, just because they don’t know how to compete with their innovation. The old game was competing with new improvements, which no longer works. Capital markets, its savvy investors, analysts, and fund managers have long understood that fighting innovation, when not even knowing how innovation works and how much is required to invest, is a very bad position to be in. Hundreds of millions of investments are necessary to get an innovation from early concepts to success in a global market. Successful innovations consumed more than $100 Million in funding. Unicorns, per definition, consumed roughly a billion dollars, some reached into two-digit billion-dollar investments. Only the CEO together with the CFO and the board can make financial commitments of that magnitude.

Structure

The pressure to innovate has risen dramatically in the past 10 years. Managers look at startups and think they can learn how innovation works. Innovation centers ended up becoming kindergarten-like playgrounds, an esoteric group of “thinkers and tinkers’’, hunting for the inspiration they hoped would come their way. Random experimentation and hoping to find a great idea never leads to groundbreaking innovation. Innovation is an outcome – not a desire. Without exception, the most innovative solutions were created to solve a specific and very present problem. Innovation success is not about an idea creation team and taking it to market by the existing organization. It is about creating an innovation center independent of the corporate organization that is responsible for identifying a viable innovation opportunity and bringing it successfully to market. This independent innovation center requires a highly diverse team of exceptional innovation talents that will get the job done. The team and a decision to create a separate innovation center independent of the corporate organization can only be made by the C-Level.

 

In conclusion, the innovation mandate is the strategic decision from the CEO to become innovative with certain guidelines regarding the long-term goals and designated audience for the innovation. The mandate is typically addressing innovation management and other corporate management functions with time, capital, and structure all taken into consideration.

 

For more information and how to set innovation in motion, download the latest whitepaper, “Innovation is a CEO Mandate.”

Enterprises around the world are struggling to create groundbreaking innovations, watch the latest Innovative Minds Event from Thurs. Oct. 21 “Innovation is a CEO Mandate” and hear from leading organizations about their struggles and why they feel it requires a top-down approach to be successful. Available to watch here.

Most innovation centers failed to genuinely innovate – Now let’s fix it

What worked for startups can now also work for enterprises. While the innovation process, purpose, and reasoning should be the same, the leadership structure is very different. Over the past four years, we learned so much about the difference between innovation in corporations and in startups that today realize: Enterprises had no realistic chance to be innovative – even when acquiring a startup. That difference requires an understanding of how innovative ideas are created, getting your c-level involved in crafting an innovation mandate, and redefining your innovation process to focus on your customer’s true needs and dreams. It’s time to rethink the act of innovation and pursue genuine groundbreaking innovation. 

How ideas get created

Neuroscience had the single biggest impact on our modern understanding of innovation. One key aspect is the realization that ideas don’t come randomly and there are no “magic ideas out of the blue”. The brain composes ideas from past experiences and those compositions represent the power and the limit of our creativity. We cannot have ideas about situations that we have never experienced. Every successful innovation started by observing and understanding an existing problem. If there is no problem to solve, there is no success to be gained. When we know how innovation is created, we can request certain results, we can request insights, and measure and manage the effort. Most importantly executives, now know what they can expect or request from an innovation effort. This understanding drives an entirely different ideation process and calls for a very different innovation process in general: it requires CEO and customers involvement.

Innovation is a CEO mandate

Genuine Innovation is a long-term engagement. It usually takes less than six months to create an innovative solution, but on average 5 to 10 years to be recognized as an innovation in the market. Innovation is the duality of brilliant ideation and relentless execution. Even the fastest startups took 7 to 10 years to become market leaders. Moreover, most of today’s innovations of significance consumed more than a billion dollars to become successful. Capital requirements of that size cannot be decided by an innovation department. With today’s knowledge of how innovative ideas can be stimulated and how those ideas could be brought to market, repeatability, the act of innovation is changing profoundly – even for startups. With that, another key consideration needs to be made: An innovation team that comes up with a new idea must also bring it successfully to market. The existing sales, marketing, production, and logistics departments do not offer any leverage – it’s the opposite; they cannot bring a highly innovative solution to market and sell conventional products to conventional buyers. It’s about Time, Capital, and Structure decisions that CEOs together with their boards can only make.

For more information and additional insights download the “Innovation is a CEO mandate” Whitepaper.

It’s all about the customer

By working with thousands of startups, we learned that innovation success stemmed from a deep understanding of the customer’s problems. This knowledge, combined with our understanding of how innovative ideas are composed, made us realize there was a need for completely rethinking innovation. While corporate innovation labs either spend lots of time finding ideas, experimenting or randomly ideating, the top unicorns developed brilliant ideas based on their research and moved on to relentless execution. Corporate innovation labs try to solve problems they believe exist. They follow the model of “wouldn’t it be cool if we could…” and they love to play all kinds of “thinking games”. They heard about “fail and fail fast”, “pivoting” and “experimenting” without ever questioning if that is actually delivering results.  They copy the 90% of startups that fail without even knowing. 

Successful entrepreneurs look intensely into what their designated audience is doing, what they like and dislike, what they think, and how they see their future. They may not build what their customers asked for, but develop and deliver a solution that is in their dreams. 

Stop looking at what others do

find out what your customers are dreaming about.

Solve the problems they have that others could not solve yet.

 

You can catch up with the market to survive by following what others do. But the financial market will recognize it accordingly. A follower won’t beat the innovator. Rethink the act of innovation – define the innovation culture at the top, listen to your customers and stop being a follower.

Authored by: Alyssa Wengi

 

The Innovation Master Plan, a blueprint for innovation success. 

After building four innovative businesses, two growing into the billion Dollar revenue range and later helping several hundred startups to become innovative; we decided to create this Innovation Master Plan as a blueprint for innovation success.

The foundation of this Innovation Master Plan is the Deep Innovation Design method. The method is highly influenced by neuroscience, how our brain composes ideas. Creativity and innovation are done laterally in our brains. Lateral thinking and lateral processes are becoming of strategic importance in empowering teams to create the disruptive concepts, businesses need to stay competitive.

The full details and additional insights can be downloaded as a Whitepaper.

(1) Pillars of Innovation

When having a chance to learn from neuroscience how ideas get created in our brain and extrapolate the impact of that learning, we also see several aspects of innovation like purpose to innovate, the time and finance to innovate as well as the overall outcome in a very different light. Also, the entire innovation process can be seen in a very different light and the necessity for a stringent process is rising. The least used but biggest power of our brain is lateral thinking. When putting the key learnings together, the pillars of innovation become an important part of innovative thinking.

(2) Preparation for Innovation

When preparing for innovation there are several key components to take into consideration, starting with an Innovation Readiness Check. By completing a simple checklist you can determine if your top executives are on board, understand your current access to customers, and grasp your readiness to create groundbreaking innovations.

Leadership buy-in is key to your success. Genuine Innovation is a long-term engagement. It usually takes less than six months to create an innovative solution, but on average 5 to 10 years to be recognized as an innovation in the market. Innovation is a CEO mandate. Without a dedicated innovation strategy that comes from the very top of an organization, no innovation is realistically possible.

Next, craft an innovation mandate and an innovation strategy. An Innovation Mandate is similar to a declaration, mission statement, or manifesto. It is therefore not just the wish to be more innovative but building an entirely new operation within the company that may be able to compete and disrupt an existing business for the benefit of the market and the benefit of staying highly competitive. Once the executive team agrees on becoming an innovative business an innovation strategy needs to be crafted. Such a strategy is not focused on a certain innovation target, product, audience, or technology but the strategic position of the company, the fact that innovation is not a single event but a continuum, and what value the company sees in innovating.

Finally, assemble an innovation dream team and establish an innovation culture. Every business starts with a team. Our research and our own experience have shown that a highly diverse team will always beat a team of specialists. Make very clear what the goal and objectives are. The team must know the magnitude of that venture and make sure there are unique rewards for the team. Intelligent people argue with logic and facts, not ego and self-interest. The smartest people don’t work for money but for self-fulfillment. Have a base innovation culture statement ready before you attract talents. Then shape it together with the team you hire.

Innovation is the duality of brilliant ideation and relentless execution.

(3) Innovation Life Cycle

An innovation effort is a long-term engagement that deserves thorough planning. None of the highly innovative disruptors has hit the billion-dollar mark within just a year or two. The complete innovation life cycle is best described with an innovation journey map. That map shows the very origin or starting point of an innovation effort and all the major episodes of the innovation life cycle, all the way to global market acceptance. Even the greatest idea ever is no innovation unless it is recognized as such in the designated market. Like every journey, innovation has a destination. However, in our case, the destination is “Innovation Continuum”.

To help navigate the journey, BlueCallom created a methodical approach that starts at a point where a team may have no idea where to start, includes getting market feedback, from that point creates an innovative concept. From there the concept gets verified in the market and with positive feedback, it is much easier to finance. Then we are building prototypes that we call MVPs (Minimum viable Products) and bring those to market. After the market introduction, we spend a lot of effort in scaling the innovative business and go global. We purposefully do not go step-by-step through that journey but work in episodes and may jump back to an episode as needed. It’s part of the lateral thinking process. This is why the Innovation Journey map is not a linear path from one activity to the next but allows the freedom to go back and forth.

Putting the Innovation Master Plan to work

To implement a successful innovation master plan be PREPARED:

  1. Complete an Innovation Readiness Assessment
  2. Get the buy-in from the CEO
  3. Develop an innovation strategy
  4. Assemble your Innovation Dream

Finally, EXECUTE the entire Innovation Life Cycle. Start with the Innovation Opportunity Discovery all the way to bringing the innovation to market. There are many good reasons why the conventional sales and marketing teams cannot successfully bring disruptive innovation to market while working on the conventional and main solution offering.

Time is money – literally, execute relentlessly and focus on a 1% growth rate per day, creating exponential growth.

To download the complete whitepaper, please visit here.

 

The different innovation flavors and terms are confusing and oftentimes are only used to distract from an inability to innovate. But what is the meaning and how can you focus on genuine innovation.

Groundbreaking vs. Disruptive innovation

Those two flavors of innovation are rather close. Yet, when looking under the hood, there is a slight difference.


1) Disruptive Innovation assumes creating a new market that will eventually disrupt existing players in related existing market segments. Indomie noodles for instance created an all-new market in Africa. The automobile is another example of disruptive innovation, creating an entire market that displaced coaches and other transportation. On the one hand, the opportunity to create a new market is becoming smaller and smaller. On the other hand, disrupting existing markets is exponentially growing as most technologies or products reached an age that it is time to completely rethink what is out there.

2) Groundbreaking Innovation does not necessarily create a new market but breaks new ground in an existing market as well as possibly create a new market. Groundbreaking Innovation is always disruptive whether it is in a new or existing market. Tesla is a great example as the car market existed but is newly defined by Tesla. Same with Space-X. It existed and was developed by NASA and others, but was newly defined through disruptive technologies by Space-X. Apple’s iPhone is another example. The phone market existed but Apple disrupted that market with groundbreaking innovation, the iPhone. Groundbreaking innovation is always disruptive. Groundbreaking innovation is simply not limiting innovation to a specific case but genuine innovation in general. The personal computer did not disrupt the computer industry, even though it thought it would. Instead, it created an all-new computer market. Groundbreaking innovation addresses innovation needs to disrupt a market or create new markets. A nap cafe for a 20 min sleep for instance would not disrupt anything but create an additional and new groundbreaking business segment.

Groundbreaking innovation is not limited to new or existing markets. Radical innovation is similar to groundbreaking innovation but is focused on addressing existing markets.

Fake Innovation Flavors & their Risk

There are floating many more flavors of innovation such as gradual innovation, architectural innovation, and improvement innovation. Breakthrough innovation is described as an innovation from within a company that pushes something to the next level and can be considered similar to gradual innovation. These flavors of innovation are a big risk to innovation because all it is just an improvement. Gradual innovation, improvement innovation, or architectural innovation do not produce genuine innovation. Moreover, they bear a high innovation risk because they make those who are trying to innovate believe that the result is a type of innovation. However, if a competitor develops a genuine innovation, stays under the radar for a while, and disrupts that market segment, the fake innovation will implode immediately and the disrupter enters the market without any problem.

Most consumers cannot differentiate between innovation types and they do not care – there is no reason to even look at it. They chose the best product for them. With large business customers, it’s a bit different but still like consumers they are not impressed.  The financial market however looks more closely than ever before at what the innovation effort is, as they calculate valuation based on the long-term effects of innovation. Fake innovation is not only immediately uncovered, it leads to extra distancing from the brand because the company either does not understand what innovation is or purposely faking innovation. Both have very negative connotations.

Recommendations

  1. Stay away from using gradual, architectural, improvement, or other fake innovation types. It does not help in any way and is not really innovation.
  2. Ask yourself what would be a possible disruption to your business and how can you pre-empt a possible disruptive attack? The answer is simple: Be the one who moves first and don’t allow a position of following others.
  3. Learn more about ideation, deep innovation design, the innovation duality of brilliant ideation, and relentless execution.
  4. Develop an innovation strategy that addresses the terminology, how to achieve innovation, c-level empowerment, team composition, budgets, and more.
  5. Reach out to the BlueCallom team and ask for free advice or even better participate in a free Innovation Readiness Assessment.

 

Enterprises don’t need to fear disrupters,
but the disruption in the capital market

A growing number of enterprises feel the headwind from capital markets. Up and coming businesses get valuations far above conventional businesses that may be more than ten times as big. Those warning signals all too often are simply ignored. But that could become a fatal mistake.

Innovation takes 7 to 10 years

Theoretically, enough time for any established market player to respond and fight back. But it isn’t quite that easy. If you look at the early years of the then, new automaker, Tesla, you notice that the established players sold more cars in some metropolitan cities in a month than Tesla sold globally in an entire year. Airbnb sold so few vacation rentals a year that established hotel chains didn’t even notice. Early freelancer platforms connect some inexpensive workers with businesses who had a short-term need in a way that the established recruiting firms didn’t even take the time to understand their business. Now, some people may say this is ignorance. But taking the sheer number of companies and enterprises that have tried something and failed into consideration, an enterprise cannot respond to any brain spark that may happen in this world. However, one group does take that time and effort for a very different reason.

Financial Market Analysts get Extremely Smart


In the past years, top investment firms completely disrupted the financial market. Yet it went almost unnoticed. With far more detailed insights, more intelligent tools, and evolving algorithms, they are able to predict the success probabilities of new market entrants/enterprises to a degree that was unimaginable just a few years ago. CEOs, Board Members, Unions, Investor representatives, and enterprises as a whole will need to shift gear when it comes to innovation. Future-oriented investment decisions drive market caps (value of a company) into new directions. It’s no longer only in the tech space but now also in all other industries like the auto industry, the tourist and hospitality industry, in the business services where a substantial shift is happening: The capital market favors innovation over profitability and size. One newcomer in that market is investment management company ARK-Invest who states on their website “We Invest Solely In Disruptive Innovation”. And the reason is obvious; in the next 10 years, it is more likely that those new and innovative businesses will win, than the established and slowly evolving companies.

Innovation is Entering all Industries

We randomly choose Hospitality, Automotive, and Business Services in our research. You can see how companies with rapid growth into a large industry segment, while there is no or no adequate response from the current market leaders are seen by the capital market today.
AIRBNB
2007 first 3 guests – the company was founded
2009 21,000 guests
2018 300 Million guests
2021 market cap $93 Billion *
2021 Hilton market cap $36 Billion *
TESLA
2012 2,000 or so cars
2015 35,000 cars
2020 1,000,000 cars
2021 market cap $570 Billion *
2021 Daimler market cap  $84 Billion *
FIVERR
2010 Some 1,000 jobs at $5 each
2012 estimated $6 Million
2018 estimated $100 Million in revenue
2021 market cap $7 Billion *
2021 Kern Ferry market cap $3.1 Billion *
at $2 Billion in revenue
* = June 15, 2021

Is the world insane? Then, what was with the market caps of Intel, Cisco, Microsoft, Google Facebook, and so forth. What happened to their competitors like DEC, Amdahl, Zilog, Alta Vista, AOL, or MySpace? Today the disrupters are identified much earlier and get evaluated much earlier to higher levels. Not to help them and not to kill others. The new behavior is only a logical consequence of the desire to be in a rising giant early. The advantage for established enterprises: They get a brand new early warning system. But even then, there is a potential for huge mistakes as you can see in our mini case study below.

Innovate or Get Disrupted

Trying to counter-attack a market intruder that has a disruptive business model or disruptive product, by trying to build something better is not leading to any success. A weak attempt to focus on “Gradual Innovation”, which is nothing but improvement, is definitely not an adequate response either. The only way to counter an innovation from a competitor, no matter what size or age, is by another groundbreaking innovation. Improvement is important – but it isn’t withstanding an innovation. Trying to be better than the new innovator is only an improvement and makes the former leader a follower of the new innovator.

MERCEDES BENZ CASE STUDY
The Daimler AG was an investor in Tesla. But eventually lost interest and sold the shares. Tesla was built on 5 unique aspects: 1) A very fast electric motor 2) New high capacity batteries 3) A big display giving space to all kinds of information 4) A digital experience that went far beyond the proprietary “Board Computer” and 5) A customer experience not seen from the conventional carmakers.
The competition only saw the electric motor and battery. They also did not see the timeline that it took 5 years from introducing the first Tesla to getting it at least a bit off the ground. Chevrolet killed its EV short after launch because they thought the market does not exist. Mercedes ignored it completely, then began to invest and built the EQ series. But it was only the replacement of the motor and tank for an electric motor and batteries.
Only with the EQS, Mercedes finally pushed the innovation button in many ways – BUT – chose not to really talk about it. Still, a market leader by the volume of cars they produce, Mercedes became a follower and did not push their innovation but what Tesla has since 10 years: Motor, Battery, and a “hyper display”. The digital experience and also the customer experience fell behind. And the innovation they made was not even mentioned. When the tough gets going the going gets tough.

Instead of standing their ground and continuing rejecting a large display in or on the dashboard and introducing their innovative head-up display – they competed in a space that has no future for both cars. Instead of drumming up their real innovation, they ignored it because they did not understand what customers want. The innovative MBUX system with a large display mirrored on the windshield, supported by a perfect and unique augmented reality system was not part of the competition. The leader turned into a follower and the capital market recognized it. How is this possible?

Things you can do to correct the current direction

Innovation is everything but a small club of thinking and researching innovators playing in their innovation labs.
1) It needs an innovation mandate from the CEO.
2) It needs a robust innovation strategy that is blessed by the board
3) It requires innovation managers with exceptional talents and abilities – not skills.
4) An innovation process that empowers the team to develop brilliant ideas and then conducts relentless execution.

THE FIRST STEP however is an innovation readiness assessment that makes sure enterprises have the foundation for what is coming.
BlueCallom offers free Innovation Readiness Checks with no obligation at all.

WHY DO WE CARE EVEN BEYOND OUR OWN BUSINESS
Part of that first step is the understanding that by 2050 we will want to change our energy supply, the energy grid, or whatever we can create, we need renewable energies and tap into energy sources we don’t even think of today. We will want to create transport infrastructure for people, goods, and service infrastructure that is far beyond our today’s abilities. We need to have digitized commerce, business transactions, return services, and handling that is far more intelligent than today. We want to make sure that our health systems, health understanding, and sources for health failure are much better structured, organized, affordable, and available. While we could theoretically feed all people on earth even with a 20 billion population it works only if we can integrate those 20 billion people as contributors to our global society, economy, and humanity. Today only a handful of people seriously try to engage in terraforming mars or build a lunar station. That is far too less to be effective and far too less to prevent new monopolies.

Innovation opportunity for enterprises. What worked for startups can now also work for enterprises. Even the innovation process would be the same. And purpose and reasoning should be the same too. The only difference is the leadership structure. And that requires a new understanding of what actually makes the difference between the two company types today.

No – it has nothing to do with size or capital, And yes both are driven by human beings.

Over the past four years, we learned so much about the difference between innovation in corporations and in startups that we today realize: Enterprises had not even a chance to be innovative even when acquiring a startup.  The full details can be downloaded as a Whitepaper

HOW ARE INNOVATIVE IDEAS CREATED
When thinking of innovation it is most helpful to understand how homo sapiens is performing the creation of innovative ideas. Without knowing how innovation is done, it is hard to manage the process and innovation remains to be a process. The key learning is that ideas are composed by our neurons from past experiences. There is no mechanism that just “creates” ideas.

INNOVATION PURPOSE
Without exception, the most innovative solutions were created in an attempt to solve a problem. Random experimentation and hoping to find a great idea never led to groundbreaking innovation. Innovation is an outcome – it cannot be a desire.

RETHINKING INNOVATION
When we know how innovation is created, we can request certain results, request to provide insights, and measure and manage the effort. Most importantly executives know what they are asking, even where and what to innovate.

INNOVATION READINESS
When you know the “what and how”, you can make sure that your business is ready to innovate in the first place and prevent unnecessary costs and delays.

INNOVATION MANAGEMENT
After all – innovation management can be performed like most other mission-critical activities, teams can be selected in accordance with the requirements and tasks and results become predictable and timely.

INNOVATION FINANCING
Successful innovations consumed more than $100 Million in funding, some reached into two-digit billion-dollar investments. Obviously, this is done in stages and in line with progress, KPIs, and timelines. Comparing it with a $500,000 startup would be a huge mistake because that was only their starting point.

FOLLOWING IS NO INNOVATION
Obviously, you can catch up with the market to survive. But the financial market will recognize it accordingly. A follower will not beat the innovator – not on the market cap.

RELENTLESS EXECUTION
Innovation is one of the intellectually most demanding jobs. Not only does it take 100% focus, it also requires relentless execution and the motive to do so. The Innovation Culture, team selection, and motivations are the ultimate driver of successful innovation.

The BlueCallom Deep Innovation Design method was modeled and shaped based on all the findings from our research and our own experiences, building 4 innovative businesses and helping hundreds of startups to get there too.

Whitepaper Download here.

 

 

Calculating the value of an innovation

One of our early objectives was to easily describe the value of our work. It is not easy as Innovation has so many moving parts and the fact that enterprises around the world are feverishly trying to find better ways to achieve groundbreaking innovation and not just improvement is a testimony for its complexity. We tried to distill our value contribution down to neuro ideation, innovation opportunity discovery, innovation-to-market method, innovation financing, reporting, Innovation KPI framework, multi-user digital canvas technology, genetic computing technology AI usage, and a few other things. One aspect recently rose very prominently in conversations with users and customers: a very close relationship between brilliant ideation and relentless execution. However, there was an inner conflict: It is described in a blog post written a few years ago: The Initial value of an idea is zero. How could something of no value sparked multi-billion dollar businesses and disrupts entire industries if it has no value? It just needed to turn on of course but what value is it then? It reminded me of something I learned in quantum mechanics, that I quantum state can be seen as having two states at the same time. Every idea can too. As we learned from neuroscience, an idea is a clearly defined “object in our brain that is composed of past experiences”.  The trick is to use it or not. Unused its value is zero and used its value turns into one. The value of one is still not a lot but multiplied with execution that leads to exponential growth makes the one incredibly valuable.  Let’s not get deeper into quantum physics as it is just an analogy but look how this concept changes our understanding of innovation.

The two key aspects, that make or break groundbreaking innovation:

  1. Finding a brilliant idea that leads to innovation
  2. Making the idea a reality and bringing it to market with relentless execution

Harnessing the duality of ideation and execution is where BlueCallom makes the biggest difference. Moreover developing the BlueCallom Equation, paved the way for making innovation predictable, creating Innovation Forecasts, calculating an Innovation Lifetime Value, and an Innovation ROI. Groundbreaking Innovation (G)  = Ideation (I) * Execution(E)².

G = I * E² 

The meaning of G

For the development of innovation processes, we needed to make a statement of what we understand by the term INNOVATION, in particular groundbreaking or disruptive innovation is not Improvement. It became even more important when trying to find a way to calculate an innovation value. There are hundreds of different definitions of what innovation means. The following definition is made to make our methods and technology clear, and also what our equation is addressing.

Innovation is the introduction of a
groundbreaking elevation in the way
people do things and ensuring
a successful global distribution.

It often results in disruption, how
industry segments conduct business.

Innovation is not the same as Improvement. For more clarity, we use Groundbreaking Innovation (G)

The creation of I

To get to groundbreaking innovation you need an amazing idea. And since we know, thanks to neuroscience, how innovative ideas get created, we can go one major step further: Making the innovation a reality. Not only by building a prototype but bringing that innovation to life in global markets. Some years ago I wrote a provocative blog post: “The initial Value of an Idea is ZERO” and that has not changed. There have been many known cases where people bought an idea for $1. With that payment, the idea had legally changed ownership. So we can assume that the buy-in of a team developing such an idea has the value of one – assume any currency. The idea is the must-have ignition to innovation, yet has no big value to anybody – yet. The value is created through execution. Every startup knows – it gets embossed in their neurons by every investor. And there is an important effect to be observed: Any successful innovation – ever created – was following an exponential growth rate. Hence the E².  But with no execution: 1 * 0 = 0 – in other words, the lack of execution makes the innovation value zero.

The significance of

  1. Innovation Timeline
    Innovative solutions take quite a while to get accepted in the market. And there is no shortcut. The larger part of the market participants is rather careful and conservative. It took a few years until the name Tesla even made it to News. It took even longer until Amazon became a household brand. The first two years, Computer 2000 and TechData had a tough start. But 10 years later both bypassed 8,000 competitors which never understood the level of disruption our business models had. Today the merged and combined company is doing nearly 40 Billion in revenue. The inflection point when the so-called “Hockey Stick” kicks in and turns the slow start is recognized as part of an exponential growth curve, it is too late for many companies to seriously compete.
  2. Innovation Management
    Managing an “Innovation to Market” process is an ART and a SCIENCE. One of the key aspects of the science part is the understanding that innovative products will never be purchased by conservative customers, which is the largest audience. One of the arts to get it to scalable results is to know when the broader audience is ready to engage. Today the function of “Innovation Management” is widely underestimated or even completely misunderstood. Innovation management could also be called “Innovation Value Management”. It is all about creating value from a disruptive innovation that has usually the DNA of a unicorn – no matter whether it is a corporate or startup unicorn.
  3. Equation
    * An idea, as a result of any kind of ideation, has a fixed initial value of zero.
    * Once a team is intending to use the idea and make it a reality, the value of such an idea becomes one (1).
    * As soon as the innovation is given to users and they see a value for them and start using the product, the value increases above 1. Here it can potentially grow exponentially based on the energy somebody puts into execution. The energy that is put into execution should become proportional to the value growth of the innovation if the execution is done right.

This also explains why some of the innovative products are perceived as “Overhyped” in the eyes of normal observers.  Only after carefully analyzing the innovation’s growth path and rate, capital markets react and may look unrealistic. This was experienced with almost every Silicon Valley IPO and afterward, those technological advances became the new normal and ever more often dominating entire markets. The   in the BlueCallom Equation can now also explain that behavior of seemingly hyped values that turned out to be valuable over time. The BlueCallom Equation is represented in the BlueCallom Deep Innovation Design model as well as in the architecture of the BlueCallom Innovation Management Software (code name ‘deep’).

Debunking 100+ Innovation Methods

G=I E² is more than just a formula for groundbreaking innovation, describing the duality between ideation and execution.  It is describing the foundation of any successful innovation effort or process.

  • Innovation Team Structure
    Brilliant innovation and relentless execution is not a job that a person can do on the side. It’s the opposite – innovation development is one of the most demanding engagements in any business anywhere in the world. The equation also makes clear what the innovation management’s responsibility is.
  • Execution – Execution – Execution
    It demonstrates the value relation between the idea itself and the execution process after the idea was created. It’s all about execution and that has never been even a consideration in innovation management.
  • Time is of essence
    It shows the importance of the factor time in the execution from zero to the max. In conventional innovation playgrounds, teams had infinite time. The outcome was zero. Unicorns ran like crazy and that made a huge difference.
  • Innovation KPIs
    How innovation teams achieve probability calculations, ROI, etc. to develop more robust innovation plans.  Only robust KPIs can indicate performance. The number of idea contributions, the value of the contribution, market validation, innovation confluence data, timelines, budgets, degree of disruption, adoption rates, growth pattern, and more. The number of projects can’t be one of them.
  • The end of Innovation Kindergarten
    The equations expose why empirical experimentation, pivoting, random brainstorming, and other “exercises” just could never lead to groundbreaking innovation. Lego games and dancing, meditation, and other relaxation is really nice – but cannot be the core of the top job of any industry leader.

Open innovation is a frequently-used term that brings a variety of imagery to mind: collaboration, intellectual property, startups, and co-creation. But most importantly, it involves “combining internal and external ideas” to bring new business concepts to life. As an innovation strategy, it serves as a pathway to integrate external perspectives (i.e., from users)  into the development of a new business offering. 

Simply put, open innovation involves accessing and exchanging knowledge between people in your organization and people working externally. The goal is to support innovation by generating new, high-quality ideas that can help create a long-term competitive advantage in the market. For an established company, it can be implemented by collaborating with individual people, other organizations, suppliers, and even startups. The flexibility of how open innovation is pursued truly makes it a one-size-fits-most strategy! Do you agree? Please let us know your opinion in the comments. 

Why Pursue Open Innovation? 

Companies choose to engage in open innovation because of the various opportunities for growth, learning, ideas, and other benefits of increasing innovation activities. Also, mitigating the risk of innovation is one reason companies pursue open innovation. If the market is involved in the innovation process, achieving idea validation then ensures that a new innovation will be accepted by its market. Below are some of the key advantages: 

Speed Up the Innovation Lifecycle 

Applying open innovation as a strategy to developing a new product can speed up the time from conceptualization to commercialization. When a company introduces the necessary external experiences into the innovation process, this combination of resources and knowledge together leads to a faster innovation lifecycle. For a product-oriented company, speed-to-market is crucial for success, so it can be a great fit for this type of firm.  

(1) Gain New Knowledge 

Open innovation is centered around gaining access to new knowledge, which can be accomplished by partnering with external organizations or individuals with a specialized skill-set. By applying new knowledge to a company’s project (or product or problem), the introduction of new ideas and perspectives can lead to new value creation and innovation. As a side benefit, access to new knowledge and learning opportunities can help employees evolve their careers in your company. 

In the Deep Innovation Design methodology, the ideation process involves an analogous search in which innovation participants compare unrelated (but similar) industries, companies, or sectors in order to derive inspiration by translating the understanding into their own company’s dynamic. Analogous search can also be accomplished through open innovation by incorporating unrelated (but similar!) partners, suppliers, or organizations into a company’s innovation process. The introduction of a radically different way of accomplishing a task or workflow could lead to successful innovation! To learn more about Deep Innovation Design, you can check out this TED Talk or read more in this blog post

(2) Benefit from the Customer Experience

Collaborating with selected customers (i.e., highly engaged users) is an effective way to generate new insights about customers’ usage of your products, services, and/or perspectives on your competition. Interacting with highly involved customers opens the doors to innovative ideas. These individuals likely have experience-based opinions around your company’s current offerings or other ideas on how to improve. Including customers in your innovation or ideation process increases the likelihood to compose and capture original ideas. Since an idea is a composition of past experiences according to recent discoveries in neuroscience, involving the experiences of the end-user can augment the ingenuity of the innovation team. Customer interaction through open innovation can lead to differentiating your company further from the competition, save time, and mitigate risk. 

Are you interested in more resources? We welcome you to explore our upcoming webinar: The Strategic Value of Open Innovation on March 11, 2021. 

(3) Risks to Pursuing Open Innovation 

Of course, it is important to mention the potential hazards of engaging in open innovation. Some companies may choose to avoid openness in their approach to innovating in order to eliminate the risk of revealing company know-how with external parties. As such, vetting potential partners, vendors, and collaborators is important before exposing internal processes and practices! However, the benefits and possibilities produced by open innovation significantly outweigh the risk of sharing too much information. 

Thank you for reading! What do you think are the pros and cons of implementing open innovation? Please share your ideas in the comments below. 

When applying for a job at BlueCallom, you will find the same behavior in the World Innovations Forum and our previous companies. We ignore CVs for more than 15 years now. Interestingly enough, you find the same with Facebook, Google, and many others: “Your CV is of no value” to us. And since not only applicants but also peers are asking WHY, here is a more detailed answer.

Your CV is of no value to us.

  1. People can write in their CVs what they want.
  2. Some applicants even use a professional CV writer to do it for them.
  3. Employee references can even be legally enforced to be “positive” in some countries.

When lying is not only OK but enforced by law, the value gets down to zero. It’s even worse. We no longer can help applicants why we rejected them due to  “Political correctness” or worse, lawsuits due to XYZ discrimination (replace XYZ with virtually any reason) have turned employee protection into employee disadvantage.

Your skills are not mission-critical to us.

Skills are things you can learn. And well-developed skills are all too often hard to unlearn. We are an innovative company and a thought leader in the innovation space. What we do today was unthinkable yesterday and is of less value tomorrow. At BlueCallom, you will need to be a lifelong learner. In the interest of our future development, lifelong learning of our team is essential. To make that easier, we make learning part of your job. Whatever you did in the past is clearly important and is part of your “experience collection,” which gives you the repertoire for ideas and ingenuity. But any repeat job you did in the past is of no value to us. But ONLY if you are up to par with every aspect of today’s world. Hence, your CV is of no value.

Your decade-long experience is counterproductive.

Unfortunately, if you have 10+ years of experience with anything, we cannot afford to untrain your neuro pathways. Untrain and train new things is a massive effort, and we are not yet big enough to have the resources to take care of such a process. You may call it age discrimination because you know this is a great way out of needing to change, but it won’t help you here.  And therefore, the list of all the jobs and with it your CV is of no value.

We know, in the past 200 years, all the above, very much like your educational degrees, had been essential for your career. But not for us and maybe soon for other businesses. Your education trimmed you to learn and repeat, become good at something, and then develop it to perfection. In the last 50 years, knowledge has multiplied thousands of times, and right now, global knowledge doubles every 24 hours. Learning all that “knowledge” is obviously impossible – all you can learn is where to find it.

What are we looking for if the CV is of no value?

The next two decades will bring major employee advances.

In the next 20 years, we will experience office automation progressing as much as we have seen industrial automation in the past 50 years. Today there are rarely production facilities where thousands of workers march into the plant in the morning and out in the evening. Instead, today, we see long lines of cars leaving the office in the evening and going in, in the morning. Yet this is only because organizations have been evolving that way. In fully automated offices like ours, where customers automatically get their products and pay automatically, no office workers are needed.

We are looking for creativity/ingenuity.

We train our sales force to maximize individuality in customer interaction. They need to be creative, have an amazing attitude, a broad understanding and constantly help get our offering as close as possible to our customers’ dream solution. There is nothing to automate. Our marketing teams are constantly learning about the needs and dreams in the market, new tools, and new techniques. Our marketing needs to be as unique as it can get every day. We don’t repeat campaigns. Even though our product needs to be suitable for millions of innovators worldwide, each configuration, each function, each episode in the process needs to be a perfect fit for a perfect outcome. Each of our products will be definitely unique without being custom-made, which would make it unaffordable.

Talent, attitude, openness, and passion for making it a reality are what we are looking for. Everything else, every skill, can be learned by any average human. We know you can become what you envision to become, no matter what it is. A degree, CV, or deep experience wouldn’t make a difference. Please send us an email about why you are interested in joining the company, how you will make a difference, and share your LinkedIn URL. That’s it.

If a job at BlueCallom is not your absolute dream job

More than 50% retire with a bittersweet view when looking back. Sweet because they got used to what they do and are kind of ok. Bitter because they never had a chance to fulfill their dreams. Never had a chance? You have the chance to get your dream job but most likely have never been educated on making it a reality. We had let go of people or never hired them in the first place if we recognized such a situation. And we always helped them to pursue their dreams – as we did.

Our Career Opportunities

 

What can be done to make your organization more innovative?

The COVID-19 pandemic is changing the rules for conducting business. Now more than ever, innovative behavior is one of the essential characteristics that a company needs to develop in order to stay competitive in the changing economic landscape and new trends in consumer behavior. In order to keep your customers happy or attract new customers, the introduction of new business services, products, or processes will be the key to ensuring your organization’s future success. So, how do you foster a working environment that supports innovation within your organization?

In this post, I’ll discuss four proven strategies to enhance the innovative dimension of your company.

1) Embrace a ‘Freedom to Fail’ Culture

Let’s consider 3M, a multi-billion dollar American company, as a shining example of an enormously successful company that is known for fostering an innovative work culture by allowing employees the Freedom to Fail. As pointed out by Art Fry, the inventor of the Post-It Note at 3M, companies that wish to empower the innovative minds within the workplace need to provide freedom to employees: the freedom to fail and freedom to learn from the missteps.

The lesson that freedom can open the door to innovativeness can also be applied to the design of job roles. 

As research shows, flexible job roles can engender more participation in innovation. For example, If you are in the position to hire, instead of creating a bulleted and rigid job description, consider providing room for the next person you hire to mold their responsibilities as they grow into the role. When given the space to think outside-of-the-box of a job description, people will notice opportunities for innovation that they might not have recognized otherwise. The idea is to support everyone in your organization on the quest to identify areas of innovation and provide the space for exploration. 

2) Promote Cross-Functional Communication

When it comes to innovation, cross-functional collaboration in the workplace leads to a greater exchange of thoughts and expertise that can spark the creation of novel ideas. As Gary Hamel said, “too many companies define themselves by what they do rather than by what they know”. Bringing cross-functional teams together to solve company problems is one excellent way to tap the innovative potential of your organization. 

Multi-disciplinary collaboration and coordination are necessary for a new business idea to succeed in concept development and become an innovation. Companies with siloed business departments face an extra challenge in implementing new business concepts since the responsibility to produce innovation is split across different units. If these units experience poor communication, the odds that a new product or service is quickly (or successfully) brought to market are marginal. Both cross-functional and open communication are critical to fostering a culture of innovation in the workplace.

Next, we’ll dive deeper into the importance of differing perspectives when it comes to innovating. 

3) Spark Creativity through Diversity

Creativity includes more than innovation, but innovation inherently includes creativity. At BlueCallom, creativity is treated as the ability to compose ideas by searching the mind for correlations between various lived experiences. Being creative allows us to develop novel concepts. In order to foster an innovative workplace, individual creativity should be celebrated as an organizational resource. It is no secret that when people of different backgrounds and skill-sets are brought together, they can collectively generate great new ideas.

But, what is actually happening through this exchange that enables the creation of potentially breakthrough ideas? Creative abrasion, which is described as a process where different, sometimes clashing, perspectives are integrated (Source: HBR). In a nutshell, this means that in order to cultivate a working environment that leads to innovation, it’s absolutely critical to avoid an innovation monoculture of experts.

At BlueCallom, the Innovation Dream Team is a stage in the Innovation Journey which supports your team to assemble a diverse group of people to support your innovation vision. BlueCallom’s neuro innovation management software will help guide you through this team assembly process with a focus on diversity. 

Regardless of how innovation is handled in your organization, whether it’s a separate unit or a decentralized program, ensuring that people with diverse backgrounds and starkly different approaches are included in the innovation generation process is a productive step towards building a culture of innovation. Unleashing creativity through the diversity of thought is key.

4) Implement an Innovation Management Process

How do you get from a great idea to a tangible innovation?  The answer lies in designing a process that supports innovation within your organization, in other words: innovation management. It’s proven that having a structure and a set of common guidelines in place supports innovation. 

While most existing innovation process models are catered to producing incremental innovations, meaning modest improvements to existing products or services,  BlueCallom has developed a twelve-step innovation methodology with the goal of generating breakthrough innovation. The core of the BlueCallom innovation methodology lies in the ideation process and a technique called Neuro Ideation. Neuro ideation is a brain-stimulating ideation process that unlocks ideas by harnessing collective creativity from individual experiences. To learn more about neuro ideation, you can check out this webinar or this blog post

Are you interested in more actionable insight into managing innovation? We welcome you to explore our Deep Innovation Design online course

Thank you for reading! Is there any strategy that has worked well for your company that was not mentioned here? If so, please add your comment.