Innovation Breakfast SeriesDavid Kent, CEO

Friday, 11 March 2016

OVERVIEW OF THE RIGHT GROUP

• Established in 1995, a management consulting firm focussed on building trusted partnerships with our clients.

• Specialist in:-

1. Brand Strategy

2. People & Culture Solutions

3. Innovation Strategy

4. Market & Employee Insights

5. Digital Solutions

• Client base spanning the UK, USA, Asia, India, Australia and New Zealand.

OUR CLIENTS

McAleese Resources

Minara Resources

Mineral Resources

MMG Limited

Neptune

Officeworks

Peet

Richard Noble

Skilled

Stockland

St John of God Health Care

Victa

Wesfarmers

WorleyParsons

YMCA

Adelaide Brighton

AHG

AusGroup

Auto Masters

AJ Lucas

Alinta

ATCO Gas

Atlas Iron

BGC

BHP Billiton

Blackwoods

Brikmakers

Bunnings Warehouse

Cardno

Centurion

Global Energy Group

Greencross Limited

Gull Petroleum

Hanson

Hawaiian

HY-TEC

Imdex Limited

John Hughes Group

Kleenheat Gas

Kiewit Australia

Leighton Contractors

Lion

MACA Mining

Matrix Composites &

Engineering

Cement Australia

Cliffs Natural Resources

Clough

Coles

CSBP

CSG

Decmil Australia

Dexion

DuluxGroup

Elders

Ertech

FAST JV

Fortescue Metals Group

Freehills

Fremantle Football Club

OUR PROMISES

• Intelligent - each new client project receives the freshest thinking from our experienced,

leading-edge team of consultants.

• Innovative - no two organisations are identical, so we tailor solutions to work within your

unique environment, delivering the best outcome for you.

• Results - above all, our focus is to deliver sustainable, tangible improvements in

organisational effectiveness and performance.

MEASURING WORKPLACE INNOVATION

• Delivers an Innovation Index for your organisation.

• Identifies key levers to pull to foster workplace innovation.

INNOVATION PATHWAY

• Hackathon’s.

• Incubator Programs.

• Enterprise-wide ideation.

TODAY’S FORMAT

• Overview of The Right Group and LAUNCH™

• Forum Discussion:-

1. What’s fuelling the hype around innovation?

2. What is innovation?

3. What are the approaches to innovation?

4. Who’s doing what in innovation around the table?

– Best practice examples

5. Practical tools to innovation

6. Critical success factors to sustainable innovation

WHAT’S FUELLING THE HYPE AROUND INNOVATION?

• The drive for productivity gains and competitive advantage to stay ahead of the pack and remain sustainable as a business .

• “Second oldest profession” - Innovation has always been around, there is now more focus as it is being backed by the PM.

• Digital technology has disrupted the traditional business model. Those who were ‘buried’ in a supply chain model to meet demand are now able to reach out to their end customers.

• Challenging business climate means that businesses have to rethink their approach to doing business. It’s “Survival of the fittest” in current times and “if you don’t think outside the box, you die as a business”.

• Example of Resources Industry: in good times it was getting production on line and building assets, “ there wasn’t the same platform for cost innovation”. Now in a downturn, focus has changed to operations, return on assets, and how innovation can deliver greater shareholder returns.

WHAT’S FUELLING THE HYPE AROUND INNOVATION?

• Generational change – driven by young people entering the employment market who want to work for companies who are innovative as “that is what their generation is about”.

• Not just an internal focus on your business, but also what is driving innovation in your external partners’ business.

• Market demand- customers demand it and are expecting “us to deliver something better”.

• Changing regulation across sectors such as Not for Profit and Wealth Management is driving organisations to be innovative in order to have the competitive advantage and remain sustainable.

• Australia needs to be more innovative to compete internationally. As a country, Australia’s main challenge is lack of conversion of innovation to ROI. Global Innovation Index shows, ranked 12th on innovation investment but 81st for actual return on the investment. Strong correlation between countries that have rich resources focus on those assets whilst other countries who are not resource rich will focus more on conversion of innovation to return on investment.

WHAT IS INNOVATION?

• A lot of misunderstanding of what is innovation versus continuous improvement.

• Innovation can be simple, something changing within your business, it is not only technology.

• Continuous improvement is small steps and incremental changes whereas innovation is a significant change or a “game changer”.

• Related to core business, innovation can range from small changes or step changes and also disruptive change.

• Introduction of something new; if it is new to a person, group or organisation. Even though it may not be new to someone else - it is still an innovation to that person/organisation.

• Value creation – distinguishes innovation from invention.

• Different ways of doing things – and thinking that leads to a better outcome.

WHAT ARE THE APPROACHES TO INNOVATION?

• Needs to be driven top down from the leadership and be seen as an encouraged behaviour of the work culture and communicated within the organisation.

• Establish a working group within the organisation to drive innovation.

• Must be across the organisation - involve everyone and also create something that everyone wants to be a part of.

• Build a culture that not only encourages idea generation but is not fearful of failure.

• Devote the time to generate and share ideas.

• Manage the intangibles - the innovative capability of the company is an intangible asset that is not on the balance sheet but affects profitability. It often distinguishes why one company is more successful than another company in the same sector.

WHAT ARE THE APPROACHES TO INNOVATION?

• Innovation can be random but it is important to be able to capture ideas and turn them into an opportunity.

• “Fall in love with the problem not the solution” – it important to identify the problem first. This directs the focus of innovation.

• Share problems within an organisation as it diminishes the fear of failure and allows people to be more creative.

• Red tape can limit innovation and organisations need to be aware of processes and bureaucracy and how this may prohibit the process.

• It is important to measure the ROI of innovation but also recognise that not every idea will can be measured. A leap of faith is often needed.

WHO’S DOING WHAT IN INNOVATION AROUND THE TABLE?

• Atlas - inter-conditional approach where everyone was part of the solution to achieve a new lower cost base while also agreeing to share the potential upside (profit) amongst the group involved.

Key ingredients to success were that everyone shared an appetite for risk, trust and sense of urgency to get it done or ‘have a go’.

• Crown Resorts - innovation program open to all employees. Crown support this at a financial level, with time, recognition and a communication program. Success stories have already been communicated throughout the organisation.

• Shadforth - recognise that whilst the organisation is performing well, keeping a future lens is what will ensure it remains relevant in the future. This includes the creation of a sense of urgency and recognition that change is required.

WHO’S DOING WHAT IN INNOVATION AROUND THE TABLE?

• Orbital - organic approach to innovation: reuse, recycle and repurpose. Also the technology profile/portfolio: find a problem, understand, develop, grow the seed and find value. Nurturing innovation is key and being ready to take the discussion outside the organisation.

• MACA - drive innovation/ continuous improvement from an internal committee. Focuses on productivity improvement with input from various parts of the organisation.

• McAleese Resources - internally working on how to be proactive instead of reactive if a challenge for the business arises. On a quarterly review basis each portfolio manager identifies specific areas within their department to focus on.

• St John’s Ambulance - introduced a FedEx Day giving people time out of normal workload to come up with ideas about a proposed area of work. The organisation has a structured decision making framework that is centred around their purpose for continuous improvement and innovation. There is also an online platform that allows employees to contribute ideas.

CONT’D

WHO’S DOING WHAT IN INNOVATION AROUND THE TABLE?

• GE Oil & Gas - has innovation in its DNA as well as in its heritage. GE introduced the Fastworks program, a fast track development process to get a product on to the market by avoiding lengthy research and development times. Currently it has Global Research Centres. Most recent innovation is working on creating a platform for an industrial internet eco-system.

• Woodside - developed the Biggest Loser Program in 2014 as an approach to continuous improvement; they had 900 ideas come from 330 employees. In 2015, it conducted the Le tour d’outstanding; with 5700 ideas from 3100 employees and contractors. In 2015 employees were broken into teams and competed against each other for a prize at end of year. Also have a team focus on disruptive technology.

• Toxfree: currently have two approaches; first is bottom up with ideas from the floor on continuous improvement with incremental improvements. Second, top down, it has a GM of Innovation and a team focused on technology and building revenues through new products e.g. working with Volvo on driverless trucks.

CONT’D

PRACTICAL TOOLS TO INNOVATION

• Encourage ideation - empower people to identify problems and develop solutions.

• Hackathons - having a day where groups of people come together to develop solutions to a problem within the business. They may have access to data, data analytics and other tools. At the end of the day they present back their potential solutions to a group of experts in that particular field.

• Partnerships - working with other organisations and industries; learning from best practice and/or how they have solved a similar challenge.

• Technology/online tool to capture ideas.

• Suggestion scheme - reward employees with $XX to any employee to who develops a business solution.

• Innovation champions - appointing people within the organisation to encourage innovation, picking up ideas and running with them.

CRITICAL SUCCESS FACTORS TO SUSTAINABLE INNOVATION

• Governance process - especially around new product development.

• Leadership - buy-in, ownership and driving innovation from the top down.

• Partnership - working collaboratively with other organisations across industries.

• Provide the space, time and money for creativity and ideation.

• Be authentic and have a clear sense of purpose to innovation and what is the desired result.

• Measure the return on investment for your culture and the customer.

• Identify the problem, solve it and stretch it to the next level (go above and beyond).

• Celebrate successes.

• Have a clear strategy on how to deal with the unsuccessful ideas and avoid stifling confidence for idea generation and future innovation.

• Maintain a future lens – always be on the look out for the next curve.

ART OF INNOVATION - GUY KAWASAKI

• Ten golden rules:

1. Make meaning

2. Make a mantra

3. Jump to the next curve

4. Roll the dice

5. Don’t worry be crappy!

6. Let 100 flowers blossom

7. Polarise people

8. Churn baby churn!

9. Strive for great value and uniqueness

10. Perfect your pitch

LIST OF ATTENDEES

Contact Name Organisation Position

Martin Cebis CCI WA Business Advisor

Steve Mackenzie Crown Resorts General Manager

Shekar Venkataraman Crown Resorts Supplier Manager - Beverage

Nick Coplin Orbital General Manager

Andrew Simpson McAleese Resources Chief Operating Officer

Terry Dillon Shadforth CEO

David Flanagan Atlas Iron Limited Managing Director

Toby Edmunds Toxfree General Manager

Mike Utsler Woodside Energy Chief Operating Officer

Tracie Ironside St. John Ambulance Learning and Development Manager

Chris Tuckwell MACA Limited Managing Director

Brian van Bueren GE Oil & Gas Sales Manager

Timothy Lo Brightwater Care Group Operations Support Manager

Thank you

David Kent, CEO