Turning Crowd Innovation Into Real Products and Revenue

May 28th, 2014

Turning Crowd Innovation Into Real Products and Revenue

AgendaWhat will we discuss today

• Introductions

• Crowd Ideation

• Idea Categorization with examples

• Innovation Execution Methods with examples

• Maturing Innovation Capabilities

Meet the Speaker

John Welder, Director of Strategy and Innovation

John Welder is a Director of Innovation Strategy with Mindjet, with over 20 years of experience working in the high tech sector of Silicon Valley.

Prior to joining Mindjet, John was the Director of Innovation at Ericsson where he founded the global innovation program responsible for internally sourcing, funding, and launching several major innovations. John also received 2 Pioneer awards for products delivered at Cisco.

John has a degree in Computer Engineering and a Masters in Business Administration from San Jose State University and is also an experienced mentor in Design Thinking and Lean Startup innovation

Crowd Innovation

You have engaged your employees to submit and

share ideas…

And your employees and experts have collaborated to

refine them…

And you have selected a few that are strategically aligned

and high potential…

Now what? How do you develop these ideas?

Categorize the IdeaUse an Ansoff Marix modified for Innovation Strategy

Ansoff Matrix modified for Innovation Strategy

• Core: You have all the business capabilities (R&D, Sales, Support, Distribution, etc etc) necessary to successful move the idea into market

• Adjacent: The idea requires a small set of your business capabilities to change

• Transformational: The idea requires a significant set of your business capabilities to change

Core Innovation Example Field Kiosk at DPR Construction

DPR Construction used the SpigitEngage platform to collect ideas on process improvements and cost efficiencies for the field.

• One employee submitted the idea of a field kiosk, bringing blueprint technology out to the field for viewing

• Superintendents and foremen now have 14% of the work week saved, or 7.5 hours a week from a 55 hour work week, from having to walk back and forth between jobsite and the trailer to view drawings.

14%

Adjacent Innovation ExampleFidelity Investments

The philanthropic arm of Fidelity realized it had the financial knowledge, innovation, and passion, but not the channel to reach young people.

• Recently ran a public challenge, “How might Fidelity improve financial literacy among teens in need?”

• 73 proposals, including winner Utah State University Extension 4-H

• Fidelity volunteers now training volunteer teens for a unique peer-to-peer financial education pilot program

Source: http://www.fidelity.com/inside-fidelity/community/grant

Transformational ExampleApple iPhone™ and App Store

Apple iPhone and App Store completely disrupts the whole cell phone eco-system and value chain.

• Value moves from the network carriers (e.g. AT&T) to Applications and App Store

• New standard for simple and easy to use

• Disrupts all other cell phone manufactures and the cellular service market

• Apple created all new R&D, Support, Sales, Distribution Channels, and other business capabilities

• Huge risk and huge reward

I categorized my idea – how do I implement it?Different Innovation Methodologies

Lean, 6-Sigma Corporate VC and M&A Lean Start-Up

Incubation &Eco-System Partnerships

Agile Design Thinking

Lean, 6-SigmaDefining the methodology

Lean and 6-Sigma are innovation models used in manufacturing and development environments. 6-Sigma means successfully improving a process so that it only has 3.4 ‘defects’ per million opportunities.

• This method focuses on statically measuring processes for quality and or efficiency, identifying areas of waste and inefficiency, and then improving these

• Lean, 6-Sigma, and similar quality & productivity methods (TQM, TPM) are great models for internal innovation. They are effective at:

– Internal Process Improvement– Improve Quality– Reduce Costs– Increase Efficiency

Lean, 6-Sigma

Lean, 6-SigmaExample use case

GE is well known for deploying Lean and 6-Sigma methods within the organization for great success.

• The GE Fanuc Automotive manufacturing plant creates high-tech automation products such as industrial lasers and programmable logic units.

• There were 130 active Six Sigma teams worked together on identifying ways to translate customer feedback into higher quality products while reducing costs

Source: LePree, J. (2000, January). Six sigma shines at ge fanuc. Industrial Maintenance & Plant Operation, 20-22.

“GE was a three sigma company and the cost of failure was estimated at 15% of sales. But achieving Six Sigma represents a $4 billion cost-reduction opportunity…” said Sheila O’Donnel-Good, Fanuc’s Six Sigma business leader (LePree, 2000)

AgileDefining the methodology

Agile is an innovation methodology most used in R&D for product & feature development, especially software development.

• The Agile method uses cross functional teams in an iterative model that is focused on delivering against user stories while also designed to reduce wasteful actions. Agile is a great model for delivering new or improved solutions rapidly to identified customers

• Agile is effective at:– Simplifying the development process– Rapid Learning– Internal collaboration– Customer Feedback loops

Agile

AgileExample use case

Spotify is in a highly competitive market with Amazon, Apple, Google and others.

• They needed to be very rapid with software delivery to be competitive

• Spotify engineering is broken into small cross functional “Squads”

• Each Squad is responsible for their own part of the product and can release their software every 3 weeks

Source http://labs.openviewpartners.com/agile-done-right-agile-gone-wrong/

Design ThinkingDefining the methodology

Design Thinking is an innovation methodology which focuses

on understanding and empathizing with a problem area so

that new and improved solutions can be found.

• The Design Thinking model is broken into 3 steps:

1. Inspiration: Look at the problem from new angles

2. Ideation: Generate fresh ideas rapidly

3. Implementation: Rapid Prototyping

• It’s a great model for delivering new or improved solutions

when the customer or user needs/requirements are not

clear. Design Thinking is effective when:– Customer needs or requirements are not clear– New, creative, and/or different solutions are desirable– You are looking for human centeredness

Design Thinking

Design ThinkingExample use case

IDEO, a company that uses Design Thinking to help other companies innovate completed an laser hair removal innovation project for Tria Beauty. They followed the 3 step model:

• Inspiration: IDEO interviewed and observed customers in their homes to understand needs and product requirements around ease of use and safety

• Ideation: The team brain stormed potential solutions around venting, thermal regulation, and manufacturability

• Implementation: Team rapidly prototyped multiple versions of the interface for customer and manufacturing feedback.

Source: http://www.ideo.com/work/lasering-away-unwanted-hair/

Lean Start-Up

Lean Start-UpDefining the methodology

Lean Start-Up is an innovation methodology which focuses on low cost, fast iterations with customers to rapidly discover an effective solution or new product with minimal investment.

• This method uses Minimal Viable Products (MVP) to Build Measure Learn with customers. Pivots are used if the base assumptions in a business plan prove incorrect

• It’s a great model for delivering new or improved products or services quickly especially when the market requirements are unclear. Lean Start-Up is effective when:– Testing and verifying New Products or Services – Rapid iterations and customer feedback– Minimizing investment costs– Pivoting to a successful solution

Lean Start-UpExample use case

A good example of leveraging the lean start-up method was done in the 2012 Barak Obama Campaign.

• Kyle Rush and the online donation team leveraged Build Measure Learn with 500 A/B tests of specific campaign web site pages over 20 months

• With the directly testing, they yielded a donation conversion increase of 49% and increase to sign-up conversions by 161%

Sources: http://www.bethkanter.org/lean-impact-nov4/

http://www.clickz.com/clickz/news/2040788/obamas-2012-web-campaign-aims-energize-retarget

Incubation & Eco-System PartnershipsDefining the methodology

Incubation & Eco-System Partnerships is an innovation methodology which focuses on developing new products or services in an environment separated from your main organization to allow freedom to experiment in different ways.

• Partnerships allow eco system partners to co-develop without constraints as well.

• It’s a great model for delivering new or improved products/services which are different enough from the core products or services that developing in-house would be very slow and tedious. Incubation is effective when:– Internal ways of working discourage change– Partnerships enable exploring new opportunities,

especially eco-system solutions

Incubation &Eco-System Partnerships

Incubation & Eco-System PartnershipsExample use case

The AT&T Foundry™ innovation centers are fast-paced and collaborative environments.

• AT&T and technology providers like Ericsson or Cisco team-up to deliver the latest applications and services into the hands of customers very quickly

• An example of one project that the AT&T Foundry™ incubated is a product architecture which allows you to use your cell phone as a wireless hotel key

Source: http://www.att.com/gen/press-room?pid=2949

Corporate VC and M&ADefining the methodology

Corporate VC and M&A is an innovation methodology

which focuses on using venture capital techniques to

invest, without using a third party investment firm, in an

external start-up that it does not own.

• It’s a great model for exploring new markets and

opportunities which are divergent from the current

capabilities of your organization and for identifying new

technologies. This method is effective when:– The ecosystem is rapidly changing (Tornado

Markets) and your organization wants to use venture as a method learn how the market is changing

– Your organization has a strategy around seeding innovation opportunities with the potential to harvest them as they mature

Corporate VC and M&A

Corporate VC and M&AExample use case

Cisco regularly uses Corporate VC and Mergers and Acquisitions as part of their innovation strategy.

• For example Cisco Investments invested into Insieme Networks in 2010 because it perceived a significant market change in Software Defined Networking. It staffed this start-up with 3 of it’s best engineering leaders to help enable the start-up

• Insieme developed the SDN product line and then Cisco used it’s M&A capabilities to spin-in Insieme in 2013

• It is believed that Insieme was able to develop this market changing product much more quickly then if it was developed in- house

Sources: http://newsroom.cisco.com/release/1412019

http://www.networkworld.com/news/2013/110613-insieme-faq-275585.html

Innovation Methods and CapabilitiesDifferent Methods for Different Innovations

Innovation Methods:• Here are the methods

mapped together on the strategy matrix

• Note that these methods do not have to be exclusive, they can be combined and used together in your methodology

Innovation Methods and CapabilitiesDifferent Methods for Different Innovations

Innovation Methods:• Here are the methods

mapped together on the strategy matrix

• Note that these methods do not have to be exclusive, they can be combined and used together in your methodology

Innovation Methods and CapabilitiesDifferent Methods for Different Innovations

Innovation Methods:• Here are the methods

mapped together on the strategy matrix

• Note that these methods do not have to be exclusive, they can be combined and used together in your methodology

Innovation Methods and CapabilitiesDifferent Methods for Different Innovations

Innovation Methods:• Here are the methods

mapped together on the strategy matrix

• Note that these methods do not have to be exclusive, they can be combined and used together in your methodology

Innovation Methods and CapabilitiesDifferent Methods for Different Innovations

Innovation Methods:• Here are the methods

mapped together on the strategy matrix

• Note that these methods do not have to be exclusive, they can be combined and used together in your methodology

Innovation Methods and CapabilitiesDifferent Methods for Different Innovations

Innovation Methods:• Here are the methods

mapped together on the strategy matrix

• Note that these methods do not have to be exclusive, they can be combined and used together in your methodology

Innovation Capability MaturityHow do I grow my capability to deliver innovations?

Core Transformational

• Start at the core, build the capability to cultivate ideas from your employees around process & product innovations

• Achieve rapid internal success and ROI

• Leverage success to build methods which allow you to take on more risky ideas. Rapidly build adjacent products and services

• Create a special expert team and leverage job rotation teach the organization the necessary skills

• Goal is to mature organization over 3-5 years

How can Mindjet help?

• The SpigitEngage Platforrm

• Experienced Team of

Innovation Experts

• The Mindjet Maturity

Assessment Service

Q & A