Leading To Creativity & Innovation

Innovation : Facts• Innovation is something new, something original out of

the existing resources. It may span over : product, process, services, business model, delivery model or thought process or organisational structure.

• Innovation is the specific instrument of entrepreneurship…The act that endows resources with new capacity to create wealth…..Peter Drucker. In fact both must go together for success.

• Innovation entails risk taking, pro-activeness & autonomy. Innovation needs domain knowledge. It is systematic, organized and a rational work requiring passion.

• Innovation needs out-of-the-box-thinking & is aimed at meeting challenges.

• Creativity is bedrock of Innovation

Ingredients : Individual Creativity…….• Creativity requires both sides of the brain,

passion, patience and optimismDoing• Questioning• Observing• Experimenting• Networking

Thinking• Associating

Example : Adhesive Tapes by 3M

Innovation : Various Aspects

Types•Incremental : Automobiles : Emission Standards

•Disruptive : PC•Architectural: iPhone, Auto

Impact•Technological: Automation

•Economic:Mobile Banking

•Social : Education, Healthcare, Communications : Scalability at Lower cost

Segment •Generic : PC, Phone•Customised:Blackberry, Mercedes Benz

•MLM(More at Less for More) : Mobile Phone

Innovation Concepts

Paradigms• Closed / Strategic :

Military, R&D• Open : All from Open

Sources• Reverse : ECG MAC 400 • Crowd-sourcing / Web-

sourcing : Open Feed- back, Competition

• Co-Creation : Engagement with all Stakeholders

Innovation Concepts

Approaches• Top-Down : Directed by the leadership : Attitudes, expectations, policies, strategies : Apple, Google

• Bottom-Up : Emanating from the individual employees : Ideas, Experimentation from Employees : Toyota, Amazon

Reverse Innovation…….• Innovation in to exploit cheap

brainpower and costs• Innovation in emerging economies • Global marketing of product• Scale and price advantageExample : GE Healthcare : Mac400

ECG Scanner, MRI Scanner

Innovation : Culture and Teams

Building & Sustaining Innovation Culture• Empower employees and their creativity • Inculcate habit of risk-taking • Review constantly, eliminate what is not required / not relevant• Set stretched targets and give autonomy• Learn into the future• Build social forums• Have system of rewards & recognition• Celebrate success as well as failure• Build an ambience of free exchange of ideas, transparency & learning

Building a Lean & High Performance Innovation Team.......

• Build the right team• Articulate a Clear Vision• Build a Culture of Innovation• Set Inner Rebels Free• Trust me – You Need Trust• Stay Lean• Innovate at Speed• Stick to Values

Competitive Advantage Through Innovation• New Market / Customer • Cost Reduction resulting in Better Pricing • Improvement in Productivity & RoI

– Improved Quality– Improved/ Additional Features– Shorter Turn-around Time

• Improvement in Culture• Improvement in Technology Threshold • Creating Barriers

• Which paradigm to you think was adopted? How did it gain the competitive edge?(Till 2000, R&D oriented, after that thrust on open innovation through Connect & Develop, Lower cost, Best Global Practices, Co-creation & Co-design) • Which do you think are the most important constituents of creative culture in P&G? (Free & open thinking for problems ,Networking & Associating, stretched targets)

• Does P&G follow top-down innovation? (Yes)• • Is bottom-up innovation followed in P&G? (Yes)

• What should be the approach of P&G to overcome the current threat? (Thrust on customer focused innovation, Great New Product Vitality Index, More thrust on open innovation)

Innovation Concepts & Culture : P&G

Barriers to Innovation

Lack o

f Funds

Not Sure

if the I

dea W

ill Clic

k

Involve

s Far

Too Much

of Risk

Happy B

eing in

a Jo

b

Have N

o Inter

est in

Turning an

Entrepren

eur

Gestat

ion Period Too Long

Time T

aken

to B

reak-e

ven

Lack o

f Exp

erien

ce

Not So Viab

le in a

Shaky E

conomic

Environmen

t

No Men

tor

No Inco

me Bac

k-up

0

5

10

15

20

25

30

35

40

45 42 42

29 2925

23 23 22 21 20 20

Start up Barriers

Eco-System To Foster Innovation

Govt•Policies•Regulations•Tax / Incentives•Laws(Bankruptcy)• IPR

Govt•Regulations•Tax / Incentives•Laws(Bankruptcy)

Demand•Economy•Big Companies•Other Companies

Linkages •Universities •Corporate R&D Labs•Open Innovation•Crowd/Web-Sourcing• Financial Institutions

Funding•Debt, Seed Fund •Equity•Full Range of Options• R&D Funds

Culture (People)• Empowerment• Risk Taking, Pro- activeness, Autonomy• Career advance vs Risk • Shared Passion• Reward Mechanism• Sharing / Discussion• Mentoring /Handholding• Diversity

Entreprenuership Development•Labour pool•Education•Networking

Infrastructure•Physical (Social, Technical)•Services•Forum for Ideas

Innovation Eco-System

Prime Differentiator

Innovation Process

Set Innovation Objective

Formulate Strategy

Define Execution & Monitoring Mechanism

Implementation Process Periodic Review

Allocate Resources & Define Organisational Structure

Boardroom Activities

Execution ProcessExecution Process

Execution

Environmental Scan

Create Real Values Create an

Enabling Environment

Empower & Ensure Support

Mechanism

Identify Good Ideas

Paint a Clear Picture : Set

Real Goals

Establish Ownership

Ensure Teamwork

Game Plan of the Organisations

Innovation Governance

0

1

2

3

4

5

6

7

8

9

10

Successful ProjectUnsuccessful Project

Innovation & Corporate Entrepreneurship : Risk - Internal……….

Demand Risk

Innovation Cost

Risk

Market R

isk

Informati

on Risk

Finan

ce Risk

Competition Risk

Brand Nam

e Risk

Trademark

Risk

Extrao

rdinary Risk

Foreign

Regu

lation Risk

National

Regulati

on Risk0

1

2

3

4

5

6

7

Weighted Mean

Innovation & Corporate Entrepreneurship : Risk - External……….

Innovation Governance Tools• Strategy Review

• Financial Involvement

• Review of Board Agenda • System of Rewards & Recognition

• Organisational Cultural Audit

• Engagement with the Stakeholders

• Integrating War Games into Innovation activities

Organisational Cultural Audit

Compe

titive

ness

Socia

l Resp

onsib

ility

Cilent /

Stakeh

older

Orientat

ion

Change

Orie

ntatio

n

Teamwor

kFun

Resonsi

bility

& Acco

untabil

ityTru

st

Learn

ing Envir

onmen

t

Result O

rienta

tion

Respect

for t

he In

dividu

al

Entrep

reneu

rship &

Moti

vatio

n0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

ValuePractice

• How effective is the Innovation Governance? • How is the Innovation Pipeline maintained?

• How has the Eco-system has been created?

• What are the competitive advantages of Apple?

• What do you think are the most looming threats for Apple? How should it resolve them?

• What should be the role of BoD?

Innovation Eco-system & Governance : Apple

Case Study : 3M India: Innovation Driven Company

Vision : 3M ……

• 3M Technology Advancing Every Company• 3M Products Enhancing Every Home• 3M Innovation Improving Every Life

Company Values…. Act with uncompromising honesty and integrity in

everything we do. Satisfy our customers with innovative technology and

superior quality, value and service. Provide our investors an attractive return through

sustainable, global growth. Respect our social and physical environment around the

world. Value and develop our employees’ diverse talents,

initiative and leadership. Earn the admiration of all those associated with 3M

worldwide.

Company Values………

Consumer & Office Business

Business Verticals……

Display and Graphic Business

Industrial & Transportation

Business

Safety, Security & Protection Services

Business

Electro & Communication

Health Case Business

1

2

3

4

5

6

8 Pillars of Innovation

Quantify Efforts

63

4

Innovation is Not Possible Without

Broad Base of Technology

1

From the CEO on Down, the

Company must be committed to

Innovation

Set Individual Expectations &

Reward Employees for Outstanding

Work

52

Talk, Talk, Talk

7

Research Must be Tied to Customer

Corporate Culture Must be

Actively Maintained

8

Invest in People

1940s

Cellophane Tape

Overhead Transpa-

rency Film

Overhead Projector

Time

Roadmap : Products &

Technology: 3M

Pocket Projector

Overhead Video

1940s

1960s

1980s

2000s

Freedom to Experiment & Make Mistakes. Mistakes (Challenges) also

rewarded

Product Vitality Index (35-40% : New Products

Index)

2

3

6

Culture & Systems

1

15 / 85 Rule

Dual Ladder Career Track

73

65

Encourage to Do Things Differently

& Efficiently

Successful Idea Owner Becomes

Entrepreneur

8

Systematic Analysis of

Opportunities

4

New Products / Technology

Forum

Support for IP Registration

Complete Office Resources

15/85 Rule in the Lab (Respecting Initiative of an

Individual)

2

45

Allocation of Resources

1

Funds & Grants (Alpha Grant, Genesis Grant,

Incubator Fund)

6Forum for

Discussion of Innovation

Projects

3

Physical & Technical

Infrastructure

Lean Six Sigma

Total Customer Focus

Prototyping : A few Weeks only

2

45

Execution

1

6

High Impact Program (Marketing of Selected

Products I a Short Time-Frame)

Pollution Precaution Pays

Close Monitoring

3

7

Problem Solving Missions

Awards (Path Finder )

Lunch with CEO / MD

Factored in Career Progression

1

3

4

Recognition & Awards

5

Opportunity to be the Project

Director

Golden Step Award for those

successful in new venture

26

Technology Sharing Awards

Necessary Counsel /

Allocation of Resources

Review Product Vitality Targets

Review Successes /

Mistakes at All Stages

Discuss Successes / Failures in Forum

1

2

3

4

Periodic Review

Company Values…. The company is in the top 10 Innovators. Almost 35-40 % and more of the turnover

accounted for products innovated in the last 4-5 years.

15/85 Rule has resulted in killer products such as Post-it-Notes, Scotch-Brite, Road Dividers,etc.

Company has top retention ratio Company always amongst the top admired

companies.

Results………

Takeaways

Company Values…. Competitive advantage and sustainable growth requires

continuous innovation Innovation should be central to vision & must stick to

values without any compromise Pro-active approach with autonomy pays Set audacious targets and give op freedom Set sound governance standards Innovation begins with ideas & creativity. Bolster

creativity in the enterprise Have a sound eco-system in place for a sustainable and

scalable innovation It is people, people, people & culture

Lessons………

Thank You