The community of innovators and design thinkers have set the bar (high!) as they generously share their robust innovation tools and road maps free of charge, shunning the notion “you get what you pay for”.  Some of the most exhaustive materials on design thinking I refer to time and time again are:

IDEO’s Human Centred Design Toolkit

• Geared for nonprofits and social enterprises, this user centric and empathic approach to innovation is just as relevant for today’s businesses and its customers

Stanford Design School’s Bootcamp Bootleg Toolkit

• Illustrating the key steps of design thinking with plenty of practical tips to successfully execute each step

Frog Design’s Aging by Design Innovation Action Map

• Focusing on the needs and lifestyles of those 50 years and better, a compilation of insights and activities are provided for other organizations to use to uncover opportunities for helping the aging

Check out these resources and let me know which ones worked best for you and why!

This is a creative commons image courtesy of Jesslee Cuzlon

Innovation is often associated with creativity, big ideas and risk taking.  When times are tough and companies are in a slump, the go-to answer is innovation to spur on growth.  However, for many companies, real innovative growth and transformation remains elusive.

Leadership and innovation guru, Gary Hamel once said in an interview with McKinsey:

“For almost 20 years I’ve tried to help large companies innovate.  And despite a lot of successes along the way, I’ve often felt as if I were trying to teach a dog to walk on his hind legs. Sure, if you get the right people in the room, create the right incentives, and eliminate the distractions, you can spur a lot of innovation.  But the moment you turn your back, the dog is on all fours again…   So over the years, it’s become increasingly clear to me that organizations do not have innovation DNA… This realization inevitably led me back to a fundamental question:  what problem was management invented to solve, anyway?”

 

What Hamel realized was the importance of understanding the original purpose of an organization.  Why was it created in the first place?  What value did the organization set out to provide to its customers and employees?  How meaningful is that value?  It’s that same value and meaning that should drive the direction and purpose of innovation.

Consider Google for example.  Google is renowned for launching a search engine that focuses on pulling together as many results without bombarding its users with useless ads or sensationalized news stories.  Its approach is directly aligned to its mission “to organize the world’s information and make it universally accessible and useful”.   Its subsequent innovations such as the Nexus smartphone and tablet along with Google Glass continue to focus on organizing information and making it accessible and useful.  While the Nexus products have delivered tangible value and meaning for its users, reactions to Google Glass have ranged from cool to creepy.  Inherently, Google Glass is about organizing information and making it accessible visually.  How useful that information is and the lengths taken to access that information is still being debated.   Despite the mixed reactions to its recent innovations, Google is clear about its purpose and how innovation is a means to deliver on that purpose.

How well has your organization done in aligning innovation to its purpose?  What did your organization originally set out to do?  Is it still relevant to your customers, employees and stakeholders today?  What needs to be done to shift innovation efforts to deliver on your organization’s purpose?

This is a creative commons image courtesy of Seth Sawyers

Innovation and culture goes hand-in-hand like PBJ.  If an organization’s culture is not open to curious thinking, celebrating successes and failures, and dealing with the unknown, innovation will forever exist in abrupt starts and spurts and end just as abruptly.

Fast Company came up with a handy list of six cultural ingredients each company should have to create a sustainable climate of innovation:

1. Be intentional with your innovation intent

Innovation should follow a clearly written organizational purpose (read more about the connection between purpose and innovation)

2. Create a structure for unstructured time

Whether its 10% of an employee’s time or dedicated “free days” for future forward thinking, encourage time to explore new opportunities without the constraints of short term goals and deliverables

3. Step in, then step back

This entails a general structure for innovation, some guideposts that employees can follow to foster creativity and innovation, without too many red tape processes for them to get tangled up in

4. Measure what’s meaningful

Identify indicators that will foster long lasting innovation such as the percentage of employees trained for innovation, or the ratio of innovations launched that are sustaining vs. transformational innovations

5. Give “worthless” rewards

To complement the more formal forms of rewards and recognitions, introduce opportunities for colleagues to informally “high five” one another for their innovation efforts

6. Get symbolic

Curate symbols such as specific words or phrases, physical artefacts, stories and folklore that have unique meaning for illustrating an organization’s innovation journey

So, how does your organization stack up?  Which of these traits does it embody well?  Which one(s) do you want to immediately introduce?

For more details on each of these innovation ingredients, read the Fast Company article in its entirety.

This creative commons image is courtesy of Betsy Weber

Throughout my career, I’ve had the great pleasure of working with many clients across various industries.  While the businesses may have been different, what’s often been the same is the customer.  That person who lined up for his double shot latte without foam in the morning, is the same person who picks up groceries at the supermarket in the afternoon, and is still the same person who wraps up his day going online to pay his bills and browse Amazon for a great deal.  Understanding who that customer is – just is – will be as important as tracking their series of purchases.  So, how can we give more thought to the customer?

Data Chatter

Each day that customer is making countless decisions that are captured by big businesses.  When you start adding up those decisions they made, a momentum builds and what results are millions and millions of data points appropriately dubbed big data by those big businesses.  In the past ten years, companies in FMCGs, telecoms and banking have ramped up their efforts to create sophisticated systems and pull together the most talented of analysts and statisticians to mine the data of what customers did in hopes of predicting what customers will do in the future.   These predictions are then used to create compelling promotional offers or design appealing new products and services.

So, what are the customers saying in all those data points?  In a nutshell, the data tells us customers made the decision to purchase something and carried through on that decision.   The data confirms a purchase has been made but does not shed light on why customers decided to make that purchase.  If businesses do not understand why their customers made that purchase, how can they be equipped to successfully design future products and services?  In other words, have businesses placed enough thought on their customers?

Meaning behind the Chatter

If companies want to launch that breakthrough product, they better understand the underlying motivations and wants of the customers. This goal to understand the why is a mainstay in market research.  However, in the January 2014 article “Finding a Place for Market Research in a Big Data, Tech-enabled World” published by the Wharton School of Business, there is frank talk about whether market research is past its prime:

“It is a sad state of affairs. Market researchers were the ones holding up the light so we could see an otherwise dark world,” says Wharton marketing professor Peter Fader. “They used to be leading the way, from the 1950s, 1960s and 1970s on, at giving us a window into customer preference. For resulting managerial decisions, it really was a vital function for so many companies. Today it is in the back seat, if companies are doing it at all.”

 

Companies may be scrutinizing the benefits of market research for many reasons.  Are the practices out of touch with today’s needs and realities?  What are the limitations of certain methodologies?  Just as there is an impatience mentality among consumers, are businesses driven by instant gratification to hear from their customers and therefore dismiss market research because it takes too long?

Trial By Fire

In addition to the stigma towards market research, other practices are surfacing that some companies consider are comparable to market research.  The approach of testing and learning by launching prototypes into the market place has resulted in a potentially false understanding of whether or not customers would purchase those products ongoing:

“People say, ‘Let’s just try stuff and see what works. ’ It’s a widely held belief that it has become much easier to test things in market [i.e., by saying,] ‘Let’s put out our concepts and see what gets clicked on the most.’  That can help you determine a winner, but it doesn’t help you design what would have been the best. By doing careful research and determining the underlying drivers that cause people to click, we can develop better products and services.”

 

When companies launch prototypes without having done the research to understand the customers, it is more different to determine what attributes to the success or failure of the prototype.  For instance, was a failure due to a distribution issue or an inherent flaw in the product design?

Incorporating careful research encompasses a rigorous planning process to articulate the objectives, identify the most suitable methodology and create a technically sound execution of the research to deliver valid, thought driven results.   The Wharton article continues to state:

“Some experts suggest that earlier comprehensive market research could have saved the industry some blunders, and moved it more quickly toward developing a new technology customers wanted, or at least liked. But do customers know what they want? Fader says that ironically, an anecdote from one of the most stunning successes in consumer electronics history has sent exactly the wrong message about the importance of market research. ‘Too often we are counting on a visionary, a Steve Jobs, who really set the market research industry back years because he was so disdainful of it,” Fader notes. “[Jobs] said, ‘I am going to tell people what they want.’ And unfortunately, he was right, or maybe he was just lucky. In that one specific test study, it might have been a fair point, but for most companies most of the time, emulating Steve Jobs — having that kind of brilliance, or arrogance — isn’t going to work. It is going to take more thoughtful data-driven approaches.”

 

Before you easily disregard the merits of market research and the thoughtful nature of putting the customers first, read more about Vizio’s experience of launching its at home 3D TV in the article “Finding a Place for Market Research in a Big Data, Tech-abled World”.

So remember, the next time you have an opportunity to launch a new product, practice a thought driven design by engaging and listening to your customers.

This is a creative commons image is courtesy of featureset1

This week TED 2014 is celebrating its 30^th anniversary in ponderpickle’s home town of Vancouver!  I’m reminded of the many TED talks I’ve enjoyed and learned from over the past several years.  One that has always stuck with me is Tim Brown’s talk about the evolution of human design.  Tim is the CEO and President of IDEO.  In his talk, Tim takes us on a journey from mammoth design feats to small consumable designs we are all so familiar with today.  Kick back and enjoy this journey.

Tim Brown Urges Designers to Think Big

This is a creative commons image is courtesy of Enrick Hoh

Since the mid 20^th century, consumerism has grown into a powerful force driving economic growth all around the world.   Consumer spending was generally seen as positive but in the 1980s when over consumption and greed started to become more socially prevalent, people began to question whether things were getting out of hand.   Soon, people were more aware of the dangers of conspicuous consumption (such as getting into more and more debt) and worried that the pool of resources were not infinite.

While people were starting to become more aware of their overspending, there was not the urgency to curb spending until the economy began showing cracks in the new millennium.  By the 2008 recession, consumers were looking for ways to share the burden of ownership and businesses were started to address that need.

From Shared Cars to Shared Spaces

Rachel Botsman and Roo Rogers, authors of the 2010 book, “What’s Mine Is Yours: The Rise of Collaborative Consumption” identified three systems that illustrates collaborative consumption in today’s economy:

1. Product Service Systems

This is the way to avoid collecting too much stuff.  Instead goods can be shared or rented across a group of people.  Each person gets the benefit of enjoying the product or service without the (higher) cost or upkeep of full ownership.  An early example of this approach would be time share properties and in many cities today, car and bike share programs.

2. Redistribution Markets

Add another “r” to the list.  Like recycling or reusing, people are now taking their used or pre-owned products and giving it away for free, selling it, or swapping it for something else.  eBay or craigslist are examples of redistribution platforms

3. Collaborative Lifestyles

In this system, people with similar needs or interests come together to share and exchange time, space, skills, or money.  Shared workspaces, like Toronto’s Centre for Social Innovation have become popular alternatives for entrepreneurs.  Peer-to-peer systems such as the UK based Zopa lending group provides an alternative to banks; and travel stay options offered by Airbnb allows travelers to bypass hotels.

According to an in-depth report published by Vision Critical and Crowd Companies called “Sharing is the New Buying” (March 2014) 24% of the population (in North American and the UK) have engaged in some aspect of collaborative consumption and almost half of these consumers are Millennials.  This is not a fad.  With the many ways in which collaborative consumption is influencing the economy, traditional companies need to step back and assess what they are doing to address the consumers’ desire to own less and share more.

Implications and Opportunities: A Glance at Consumer Banking

Some industries have been affected by collaborative consumption more so than others.  With automotives and travel, new players have forced the traditional players to reassess their growth opportunities and revenue models.   With peer-to-peer lending, consumers can bypass the financial intermediary and access the much desired funds with less hassle.

If peer-to-peer lending groups grow to become a more viable alternative to banks and credit unions, would the traditional players’ hands be tied?  I think not, rather, they should look at their value proposition and ensure it’s aligned to the needs of customers.  Credit unions are in a particularly advantageous position to reap the upside of collaborative consumption.  There is already a cohesive glue – the membership – that unites credit union customers with each other, making it a platform primed for collaborative sharing.  Furthermore, with the co-operative model of credit unions, working together should be seamless, and it creates another system for sharing of resources at the organizational level.   Just as individuals are looking for more inventive ways to stretch what they own or gain access to things they don’t own, credit unions can and should do the same.

This is a creative commons image courtesy of Paolo Bellesia