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How Do You Bring Innovation into the Core Business?

Screen Shot 2015-02-02 at 12.58.39 PMBrad Power, management consultant, blogger for Harvard Business Review, and partner at FCB Partners in Boston started a LinkedIn dialog with the question, How Do You Bring Innovation into the Core Business? a few weeks ago.  I was too late to join in, but I thought there were several worthwhile responses and I wanted to add two of my own, namely daily management and continuous improvement, and incentive technological prizes.

Brad wanted to distinguish among (1) incremental improvements which Lean Six Sigma could handle, (2)breakthroughs which could be done with disruptive innovation in separate units that are incubated,  and the one he was asking about (3) innovating at the 10X level within core work.

Here are a few of the responses from the LinkedIn discussion:

  • “Breaking down barriers where different disciplines do not openly engage and getting them to share ideas and issues and work them out together.”
  • “Using innovative supervisor/lower level management problem solving as a model for more effective open collaboration.”
  • “Creating an environment that encourages innovation, accepts failure as a part of that process, and fails quickly.”
  • “Building an environment from the accumulation of knowledge/ understanding from very different topical areas.”
  • “Providing credit and commitment to individuals or groups where credit is due.”

I have two additional methods I want to add to the list and they both have produced successful results at the 10X level for core work:  (1) daily management and continuous improvement (2) incentive technological prizes.

Daily management is a general term but I will use it in the sense that Lean uses it.  According to Advanced Lean in Healthcare by Albanese, Aaby, and Platchek, Daily Management (the management system and people development portion of Lean) is one of three pillars in an advanced learn operating system along with Quality First and No Waiting.  Daily Management articulates what each level of employee, manager, and executive does on a daily, weekly and monthly basis to support core work.  The book also identifies five levels of Lean maturity from Foundation at the first level to optimization at the highest level.  And it shows how the first two levels are evolutionary change but necessary before starting the next three levels of revolutionary change.

I love how the authors call the first two levels “Better Hockey” and the top three levels “Ballet”;  the first two levels are getting alignment right, education started, first  projects started, learning from the workplace, and creating operational stability.  The top three levels are about matching capacity to demand, a takt environment, and optimizing (innovation to improve patient access, cost, and empathy, innovation to improve quality and safety, refining leadership and workforce PDCA skills, and refining strategy deployment. The daily work is about going out to the gemba, monitoring data, resolving problems, finding root causes, designating larger projects and leading them.  It includes daily resolution, cross functional improvements, and strategy focus and deployment.  It is putting innovation into the core work.

George Koenigsaeker talks about studying each value stream and work process 5 times in Leading the Lean Enterprise Transformation.  The first process improvements will get dramatic results, but once implemented employees and managers see more waste that they did not see before, and it is time to study the improve the process a second time, and so on.  Koenigsaeker says when processes have been studied and improved 5 times, 90% of the waste that you started with is gone, errors are reduced by by 90%, labor needed is reduced by  by 80%, and accident rates are reduced by 90%.  Here is continuous improvement at the core by repeatedly looking at the core processes and refining them even further for greater and greater results.

I have seen companies go from initial process improvement projects, to several cross functional projects, and enterprise governance, but only a few have moved to  daily operational improvement with data and leader involvement on their core work. If a company really wants to make a process transformation with innovation, core work needs to be at the heart of their emphasis.

Another method I just read about was mentioned in the book Abundance: the Future is Better Than you Think by Peter Diamandis and Steven Kitler. The book  offers an contrarian perspective on the current pressing problems of dwindling resources, global warming, and population explosion and gives specific technological breakthroughs that are already showing optimistic solutions to these problems.  The authors suggest three forces (1) the rise of the bottom billion (how the poorest people are getting involved in the economy), (2) the rising group of techphilanthropists that are making huge contributions not locally but globally and (3)  a the phenomenon of DIY (do it yourself) innovation. 

It is within this last group that the authors talk about incentive technological prizes. These prizes are large prizes that are offered for the creation of specific outcomes (products, software, etc.).  They can be within a company, open to anyone who wants to apply globally, or could be a combination of internal and networked contestants.  Usually they go to small groups who work on the project with specific product specifications, certain constraints, and by a determined time frame.  The prize money may totally cover the cost of the work, or come near it.  Obviously winning the prize provides good credibility and visibility for the winners and the opportunity of bigger financial returns in the immediate future.  The book listed several examples of prizes that have been successful at the 10X or more level. 

I think both of these examples provide methods of reaching the 10X results that Brad refers to in his discussion question.  Do others have other suggestions they have seen work?  

 

 

 

 

 

 

 

 

 

 

 

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