This week, we are in in Cannes for the annual WIC. It is a gathering of colorful, creative characters, corporate executives and passionate innovation heroes. There’s a wide mix of companies and institutions represented here, with Dell, Lego, HP, GE, Intel, P&G and Nokia leading the way. Right of today’s opening, the Chairman invited the audience to “ask brain-tickling, sparkling and mind-numbing” questions. This, we figured, would be an exceptional conference.
This first day has had a few key themes, with Open Innovation 2.0, Culture for innovation and Innovation processes and – what we call – innovation psychology as the central ones.
A strong theme running through this first day has been disruptive innovation. “If we don’t disrupt it, ‘they’ will”, was a slogan quoted repeatedly. Any company in any industry is subject to radical changes due to sudden, disruptive innovations. Dell is seeing steeply declining sales figures for their PC’s; Hello iPad. Nokia, despite selling some 450 million mobile phones last year is simply unable to find profits in their existing business model. Squeezed between the iPhone’s premium price point, Asian low cost, white labels and finally Android, there seems to be no place for the Finnish company. The general feeling, both from presenters and in the audience; “if you don’t innovate yourself obsolete, you will find yourself out of business in no time”.
Of course, Clayton M. Christensen, believes it is almost impossible for an existing firm to establish the innovation culture to actually do that; but that’s just the kind of challenges being discussed down here.
“There are tons of things we could have done years ago; if we only could have imagined it.”, stated Richard. He argued – with passion – that we have the technology, but “we don’t see things how they are. We see things how we are”. Our internal mental models are steering our predominant view of, well, everything. In turn limiting what we are able to perceive to be possible. Shortly said, we can’t even imagine it. That’s just what happened to Kodak – who had the technology for the digital camera in 1973, and Nokia who tried to launch an app store well before Apple, but was nixed by senior management. They both had the technology, but the decision makers could not imagine it……
One current example Richard drew up was DNA-based cosmetics. These are cosmetics that change the way you look at a genetic level, not just a superficial layer. The first DNA-based cosmetics are expected to go on sale in a matter of weeks. What will that do to the cosmetics industry?
Or, like we discussed, “what massive disruptions are coming to your industry?”.
Richard was also one of the original Apple Masters. We’re now bringing that methodology back for one of our clients in Norway.
Bridging ideas and execution
The WIC2011 has a strong focus on idea management software. Innovation Factory and Hype are two of the case studies shown here. Idea management software, we believe, is a good start. This fuzzy front end of innovation is a key starting point for companies starting out their innovation journey. But the challenge for many firms here is bridging the ideas with the execution phase. Some apply a project management process. Some apply Stage-gate. Others are experimenting with new ways of executing innovation.
Open innovation 2.0.
Open innovation has been on everybody’s lips the last six – seven years. Today we went through several cases of Open innovation 2.0. Intel, Nokia and a Finnish city are partnering up for a massive IT/lifestyle open innovation project.
Phil McKinney, VP and CTO for HP’s $40 bn. PC-division, gave a great talk on moving beyond the obvious. Phil’s business unit runs a core innovation team. Running on its seventh year now, the team is tasked with launching two worldwide new programs every year. With three to four years lead time, this requires the team to dream big and think creatively; but more importantly to facilitate a world class innovation process. 2700 ideas are received annually, with 35 % coming from outside the organization. These are clients, partners, suppliers, academics who believe they have an idea for HP’s future.
Now, what happens at HP is interesting. It is internal crowdsourcing in practice. Moving from these 2700 to the next 250 ideas is a totally transparent process. Anyone can log on, study, comment, adapt and vote on these ideas. Using the 20 % rule, anyone can contribute to self-organizing teams around these ideas.
While some organizations (and some software systems) would let “management decide”, HP believes engaging the organization and tapping the intellectual and creative potential will lead to far better results.
HP is also aggressively innovating how HP innovates. Annually, the innovation team reinvents HP’s innovation processes. Comparing to our Norwegian case studies, this is impressive to say the least. While few Norwegian companies even have innovation strategies and innovation processes, HP reinvents its process every 365 days.
Dell’s management innovation challenge
Dell, much like HP, is finding itself in a constant need for fresh ideas and innovation. Long used as a prime example of world-class business model and supply chain innovation; Dell has now sputtered. Facing serious changes in its competitive landscape and consumers moving over to tablets in the millions, Dell is being disrupted.
Dell’s Chief Innovation Officer, Jim Stikekleather is here in Cannes. Today he highlighted Dell’s management innovation experiments. Trying to move from a command-and-control and management teams-type of organization to a truly modern, creative and innovative organization is one of the key themes Dell’s innovation teams are working on. “We are in the very early stages. It’s a struggle”, Jim stated.
Struggle it might be, but Dell is doing some very interesting things to speed up its management innovation projects. Our favorite was reversed mentoring. Senior executive are given a mentor. But not an older mentor like the literature typically describe. At Dell the senior executives were given a 23 year old. Someone who lives in social medias. Someone who not only are different, but who thinks and acts differently. Would your company name 23 year olds to mentor the senior executive team?
Innovation; it’s all in your head
An issue several speakers touched on today was the power of existing mental models. Negative power of existing mental traps, if you will. The single biggest issue in innovation, according to many, was the challenge of the status quo. Our existing mental models, often shaped by years of industry experience, is seen as the biggest barrier to innovation.
This, of course, is change management. Break an individual, a team or an organization out of the existing mental models is what change is all about. This connection was not made specifically down here. So, over lunch and dinner we try to investigate the links between change management and innovation. It’ll be a focus issue for us the next two days.
Note: Kindle Fire
If you have not heard of Kindle Fire; you will. Announced today, the Kindle Fire is Amazon’s entry into the Tablet PC market. Suddenly facing off Apple’s dominance in the table/mobile/apps space, Amazon is launching the Kindle Fire to guide its customer base into the digital media consumption age. And their business model looks roughed. Amazon has all the content, including ebooks, emagazines, enewspapers, movies, TV-series, music, cloud storage, just to name a few. The unit is rumored to sell for $199 vs. The iPad’s $399 and up. If it does it is likely to fly of the shelves and sell out entirely during the first week alone. Watch this race, as two of the world’s most innovative companies are gearing up for a fight.
On this first day alone, we have met two interesting Nokians. Our ‘Chairman’ is doing consulting work for senior Nokia executives during their current strategic transformation. The second, Dr. Claudio Marinelli is running global open innovation projects for Nokia, in effect trying to shape Nokia’s entire business model from outside sources. An exciting proposition, to say the least.
Tomorrow will see a range of keynote speakers, including this case on Nokia’s open innovation strategy. We’re looking forward to day two here at WIC2011 in Cannes.
If you are curious to learn more about how you can make innovation happen in your own organization, please check out our upcoming innovation program.