Juan Carlos Diaz Martin talked to business creativity and innovation expert, Professor Franc Ponti, about current trends in innovation and how they may shape the way that organisations address the need for innovation as a means to fuel growth and foster business improvement
The following inteview will also be published in the June edition of VIEW magazine - For further information on VIEW, please contact the Chief Editor .
Q: What is disruptive innovation and how is it different from the traditional concept of incremental innovation?
Disruptive innovation means radical or breakthrough innovation. Once you create a product or service that is really disruptive, you are also generating a new order of things, a new paradigm. The launch of products like the Nintendo Wii, the iPod or Actimel changed the perspective of their product categories. Now, elderly people are playing videogames, compact discs are out of fashion and people have learned to drink yogurt as a medicine. On the other hand, incremental innovation is about improving things that already exist. Both are very important, but disruptive innovation is more risky, because it requires the breaking of existing rules. When successful, disruptive innovation is hugely profitable.
Q: Does innovation fit conservative organisations that are averse to change, such as the public sector? On the other hand, can it be difficult to innovate in sectors where everything seems to have been invented?
It’s not easy at all to innovate in change-averse sectors, because innovation means changing a lot of things. If you want to innovate in this type of organisation, you have to first convince the owners or the managers, but this is very difficult because they depend on political changes. Second, you must alter the employee mentality. I would say that, while not impossible, making innovation work in public firms is extremely complicated. Anyway, it’s a challenge...
The more it seems that everything has been invented, the more hidden opportunities for radical or disruptive innovation you may have. If you run a company that takes everything for granted, it’s impossible to innovate. You must first change this mentality and understand that, beyond immobility, there’s an opportunity to discover new things. This is the case for the Cirque du Soleil: they had the ability to see that another conception of the circus was possible.
Q: Is a specific innovation function really needed inside the organisations, lead by a group of people who specialise in generating and managing ideas, or could any employee be a potential participant?
My opinion is that both approaches are not contradictory. First, you must develop an innovative culture in which everybody is aligned, in terms of behaviour, with the general concept of innovation of the firm. In parallel, it’s always a good idea to have a department that works 100 per cent of the time on innovative projects. Some firms call it an ‘Innovation Committee’. Doing this, you have a ‘push’ mechanism (lots of people giving lots of ideas) and a ‘pull’ device (innovation experts working with these ideas and developing strategic innovation projects).
Q: What are the various facets or dimensions of innovation?
Innovation has different dimensions. Probably the most well-known is technological innovation. But you can also innovate in terms of product or service, process, internal organisation, new market orientation… the list goes on. In fact, a good innovation policy must consider all of these different dimensions. If you put the accent on technology but you forget about people, sooner or later you will have problems.
Q: To what extent do creativity and innovation go together? Will a team with a large amount of creativity always be a successful innovation team?
Creativity and innovation are not the same. Creativity is the human capacity to develop imaginative and original ideas in a certain field of activity. To be creative, you have to trust yourself, unblock your mind, avoid self-criticism, listen to others and use your right brain (what De Bono called ‘lateral thinking’).
Innovation is a process that consists of transforming an idea into something that adds value for someone (product, artistic work, scientific theory, etc.) and that brings you some kind of success. If innovation is not successful (especially in the business world), why do we need it?
You can be perfectly creative but, moreover, you need the skills to implement the idea. Then you become innovative. Of course organisations must help in the innovation process. Very often they put — consciously or not — lots of barriers in the way of good ideas.
Walt Disney understood this very well: we need dreamers (creatives) but also realistics and critics (innovators).
Q: In brainstorming processes, must all innovative ideas be considered potentially successful and worthwhile or are there methods and techniques to quickly identify the interesting ones?
You never have total certainty whether an idea coming from a brainstorming is good or bad, useful or not. In fact, experts claim that we shouldn’t reject apparently absurd or crazy ideas during a creative session. A good creative team must be able to transform this mad idea into something feasible. A bag with legs can be transformed into a bag with small wheels, for instance. Experts like Michael Michalko propose different techniques for making a selection of the best ideas: PMI (Plus, Minus and Interesting), the Force-Field Analysis (strengths and weaknesses), the Backbone, the Murder Board...
Q: What are the secrets to achieving everlasting innovation?
The answer is in a single word: passion. The same way that you need it to develop projects in your personal life, passion is also the fundamental ingredient to achieve professional success. Technical aspects are obviously important, but what is the emotional link that people have with the project? Are they really interested in it or is it just an obligation? Are they only incentivised by a specific quantity of money? In some companies, innovation projects fail because there’s a lack of motivation. I recommend that they put the emphasis on the emotional factors that facilitate creative and innovative attitudes.
The existence of a champion is also important. This person has the role of maintaining the interest and motivation of the team, and must fight hard with the bureaucracy structures to overcome problems. Tom Kelley, the IDEO expert in innovation, calls this role ‘the Hurdler’.
Q: Can the monitoring and control of the innovation process be carried out by means of measurable and quantifiable indicators?
I think that it’s very important to control and supervise the process of innovation. Firstly, because you have to justify the whole process in economic terms: it makes no sense to invest a lot of money in innovation if you don’t have a pay-back. But secondly, because, by controlling and monitoring the process, you learn how to do it better. If you don’t have quantitative information, it’s very difficult to understand what is really happening. Do we sell more innovative products than classic ones? What is the percentage of time that each employee dedicates to innovation? How much time do we need to launch a new product or service? Do we have access to new market segments through our innovations?
Q: The term ‘open innovation’ is being considered by experts as the next big thing in innovation-management practices. What are the key aspects of this new approach?
The term refers to the capacity of organisations to look outside and listen to the different stakeholders. This dialogue with external agents is supposed to generate innovation because it allows the company to go beyond blindness. For instance, I have been working with Catalan Television. We organised a meeting with people who almost never watch this TV (immigrants who don’t understand Catalan), plus demographers and anthropologists. All of them helped us to look at the problems from very different and complementary perspectives.
‘Open innovation’ is related to the concept of collective intelligence. This means that you always find more talent outside your firm than inside. So why not profit from this intelligence? New technologies can help us a lot, especially the Internet. Phenomena like Innocentive, Linux or Second Life are good examples of how network collaboration is generating lots and lots of innovations. Procter & Gamble uses the Innocentive network (http://www.innocentive.com/) as a way of improving their R&D department, using the intelligence of more than 100,000 scientists around the world.
Q: Is there, generally speaking, any difference in the innovation management strategies applied to service companies with regard to those that put products or consumer goods on the market?
In my opinion, there’s no difference between innovation in products or services. What is important is to create transforming or memorable experiences for the consumer. Why is Starbucks Coffee such a success? Probably because they had the brilliant idea to put together four or five things that work: comfortable chairs, good music, newspapers to read, nice waiters and acceptable coffee. More and more companies must shift focus to how they connect with their people rather than the product or service they offer. Look at IKEA, another excellent example. Why do thousands and thousands of people go to IKEA every day? Because they just sell furniture at a good price? No! It’s much more than this: the ambiance, the freedom they give the customer, the restaurant, the self-service…
Q: As a professor, do you think innovation should be a subject in schools and universities?
I think it’s very important that young people have the opportunity to develop their creative skills at school. We can all be very creative if we trust ourselves. Innovation should be taught, of course. The entrepreneurs, managers, scientists and artists of the future — they all need to understand how innovation is implemented and developed inside organisations, but they specifically have to learn how to overcome barriers and difficulties. I think that optimism is a key factor in being innovative.
Q: Nowadays, which companies are a worldwide landmark in terms of excellence in innovation management?
Just to mention some of them: 3M, Cirque du Soleil, BMW, ING Direct, the restaurant “El Bulli”, Southwest Airlines, Google, Apple, Starbucks Coffee, Inditex (Zara), Mango, Nintendo, Nestlé, Jones Soda…
Q: How will present and future macro-market trends (strategic differentiation, offshoring, offer customisation, etc.) affect the ways of innovating in companies?
First of all, companies have to understand that, if they don’t put the emphasis on differentiation, they’re going to be ‘one among many’. So, differentiation is not only a marketing strategy, it’s a vital question.
Second, it’s true that the world is changing very fast. China, India and other countries are prepared to compete with the EU and the United States. That’s why we have to become more innovative. We have to create ‘blue oceans’, new market spaces where competition becomes irrelevant. If we continue doing the same, others will just copy what we do more easily.
Finally, there are lots of new trends (offshoring, etc.) that are, little by little, generating a new concept of what a company is. More and more firms are losing their traditional national or local base and benefiting from the new, global economic structure. This implies serious changes in the conception of how power is exerted and also in the way we structure and manage our organisations.
End of Interview