Leading Innovation

Leading Innovation:
Making Stone Soup at UM B&F

Jeff DeGraff
Ross School of Business, University of Michigan
How Innovation Really
Works
A
Whats Innovation in Your
Book?
You have been asked to
write a cover story article
for a popular magazine
on your selection of the
most innovative
organization
What organization did
you select?
What makes it so
innovative?
Why this organization and
not the others?

3
www.competingvalues.com
What Makes These The Most
Innovative Companies?
1. Apple
2. Google
3. Microsoft
4. IBM
5. Toyota Motor
6. Amazon.com
7. LG Electronics
8. BYD
9. General Electric
10. Sony
11. Samsung Electronics
12. Intel
13. Ford Motor

14. Research In Motion
15. Volkswagen
16. Hewlett-Packard
17. Tata Group
18. BMW
19. Coca-Cola
20. Nintendo
21. Wal-Mart Stores
22. Hyundai Motor
23. Nokia
24. Virgin Group
25. Procter & Gamble

BusinessWeek, April 15, 2010
BCG survey of 2,700 executives in 70 countries
4
2010 1
st
Time Over of Companies Not EU or US
What do Executives want from
Innovation?
0 20 40 60 80 100
New products & services for
existing customers
New proudcts & services to
expand new customers
New to world products
Cost reductions to existing
products & services
Minor changes to existing
products & services
Priorities
Priorities
5
What Stops Them from Having
Innovation?
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25
21
21
18
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0 5 10 15 20 25 30 35
Lengthy Development Times
Lack of Coordination
Risk-Averse Culture
Limited Customer Insight
Poor Idea Selection
Inadequate Measurement Tools
Dearth of Ideas
Marketing or Communication Failure
Barriers to Innovation
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Who was the Most Innovative
Company from 1996 - 2001?
There is NO DATA on the future when breakthrough innovation pays
How Do Organizations Fail?
Study of 400 firms on Fortune
500 and 90 international firms
since 1955
Random sample of 50 firms
87% had experienced a stall
Growth rates increased up to
stall year
Dropped greatly in the
following years
Few regained momentum
Fewer returned to growth rates
within a decade after stall

www.competingvalues.com 8
What Causes the Failure?
The presumption of an
unassailable competitive
position by management
Innovation management
breakdown - Slow product
development, reduced R&D
spending, lack of coordination
Premature diversification from
"core" activities
Shallow bench and leadership
pipeline shortfall
POOR LEADERSHIP

In 2008 Google made 97% of the
Companys revenue on a single
product!!!
9
Thought Experiment

What if the key to
innovation in your
organization doesnt
entail STARTING
something new but
STOPPING
something old?

10
What is Stone Soup?
Parable about the
power of creativity in
communities
Overcoming suspicion
Crossing boundaries
Contributing little bits
Role of diversity
Self- authorizing ring
leaders that integrate
Village feasts

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Principle 1: Give Innovation a
Wider Domain & Connect the Dots
Innovation enhances something
--Think Google
Innovation obsolesces something
--Think Schwab
Innovation retrieves something
--Think Barnes & Noble
Innovation reverses into its
opposite over time (time bound)
--Think e-mail
Innovation is how many things
come together to create value
(solutions)
Growth producing innovation is
just as likely to occur in inbound
logistics or packaging as it is in
marketing or R&D
Innovation is everywhere because
innovation isnt a thing its an
attribute of many things!
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Anton Ego
Remember Criticism is Nothing;
Creativity is Everything
In many ways, the work of a critic is
easy. We risk very little yet enjoy a
position over those who offer up
their work and their selves to our
judgment. We thrive on negative
criticism, which is fun to write and
to read. But the bitter truth we
critics must face is that, in the
grand scheme of things, the
average piece of junk is probably
more meaningful than our criticism
designating it so. But there are
times when a critic truly risks
something, and that is in the
discovery and defense of the new.
The world is often unkind to new
talents, new creations. The new
needs friends.
Ratatouille (2007)
14
Principle 2: Ride What
Movesand Move Your Feet
Ride What Moves
Consumer demands
Competition
Shareholders
Science and technology
Government regulations
Geopolitics
Macroeconomics
Environment
Outrageous fortune

And Move Your Feet
Beliefs
Skills
Choices
Plans
Actions
Information
Processes
Measures
NOT other people

See the Wave; Dont Be the Wave
Whats Moving in Your World?
West to East Big to Small
Money to Time Alignment to Collaboration
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Whats Not Moving?
The end of an era is typically
marked by increased control,
scale, centralization of
power, and conflict
The beginning of a new era is
usually indicated by
creativity, variation,
distribution of energy, and
conflict
Whats ending in your world?
Whats beginning?
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Principle 3: How You Innovate is
What You Innovate
Incremental Innovation
Relative Delivered Price for Comparable Quality
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Lean (Reduced TOE)
Double Digit Growth
Dont They Create Paradoxes?
1. Should we be focused and programmatic or flexible and
opportunistic? (Reliable incrementalists or risky radicals?)
2. Should we build our own innovation capabilities or acquire them?
(Organic or inorganic growth?)
3. Should innovation be pushed from corporate leaders or pulled from
field leaders? (Closer to shareholders or customers?)
4. Should we set our strategy and then develop the culture and
competency to make innovation happen, or the other way around?
5. Should the financial portfolio set the innovation development path
or respond to it as a variety of innovations emerge?
6. Should innovation be a departmental function in the organization or
a distributed responsibility for all operating units?
7. Should innovation be aligned with the core business or set free to
create the new business?

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What About Services and
Solutions?
Services are seldom scalable
Companies with the most scope
and scale have a predatory
advantage in creating solutions
19
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One Size Doesnt Fit All
Everything in the universe is
both whole and part of a larger
system
Compatibility, fit,
synchronization and timing are
key issues for innovation
Diversity is essential to produce
creative tension, but within the
context of a larger system
Innovation is mostly about
connecting the dots and
crossing boundaries
How Would You Make Innovation
Happen at UM B&F in One Year?
How do they interact with each other?
How do they decide who becomes the leader?
What tools, methods, and processes do they use to
improve the firm?
For what offenses do they fire (sack) people?
Where do we find these people in the firm? Other firms?
What value do they create?
Are they fast or slow?
Are their approaches breakthrough or incremental?
22
Apathy is the Death of Innovation;
Competing Values the lan Vital
The Innovation Genome
What are the Key Approaches to
Innovation?
Collaborate
Social Approaches
Knowledge management
Collaborative communities of practice
Search and reapply
Culture and competency development
Collaborating with customers
Open source
Create
Generative Approaches
Futuring and scenario planning
New market speculation
Diversified radical experiments
Early technology adaptation
Innovation societies and fellows
Corporate venturing and spin-offs
Greenhouse funds
Control
Technological Approaches
Continuous process improvement
Lean manufacturing
Total quality management
Simulations
Platform innovation
End to end IT systems
Supply chain innovation
Compete
Business Approaches
Mergers and acquisitions
Portfolio management
Rapid action problem solving teams
Revenue insight processes
Branding
Market adjacencies
Business solutions
Value Propositions: Breakthrough Innovation & Organic
Growth
Be the first to tackle the treacherous areas to create
blockbusters: Autoimmune disease like multiple sclerosis,
rheumatoid arthritis, lupus and AIDS
Challenge standards, convention and dogma (Rituxan) The
crowd is usually wrong
Establish a culture of the outsiders on the inside track
Spend big on discovery - 50% of sales on R&D, 2x industry
standard (Multiple shots on goal)
Cozy up with top research universities and cherry pick when
necessary (Richard Scheller of Stanford and entire autoimmune
lab from Univ. of Minnesota)
Innovation is not instant perfection, big failure happens
Chase the impossible to develop unimaginable competencies
Look for the unusual resume to increase diversity of thought
From lab to boardroom, challenge authority
Workplace
Stimulating projects
Flexible hours
Free from everyday
constraints
New initiatives
Independent work streams
Diverse workforce
Leaders
Visionary dreamers
Clever
Optimistic
Enthusiastic
Quick on their feet
Expressive
Big-picture thinkers
Innovation Practices
Futuring and scenario
planning
New market speculation
Innovation societies and
fellows
Diversified radical
experiments
Early technology adaptation
Corporate venturing and
spin-offs
Greenhouse funds

Value Propositions: Efficiency & Quality
Refocused after ACC in 1990s (Digital Media, Semiconductor,
Telecommunication Network, and LCD Digital Appliance)
Integrated architecture platforms to minimize cost and maximize
minor variation (Dominate components in a few key industries)
Clearly defined and consistent process for most routine
functions (E-mail, meetings)
Standards maintained by departments (Voluminous checklists)
Derive simple rules from all failures and build replicable
processes (After action review)
Scientific processes: Total quality management, continuous
improvement, just in time inventory, lean manufacturing and
flexible platform design
Chief Design Engineer intensive mentorship of high potentials in
the esprit de corps of the Samsung Way
End to end technological capability from product design to
manufacturability

Samsung
Workplace
Clear roles and
responsibilities
Stable project management
Logical objectives
Methodical processes
Standards and regulations
Ordered and structured work
Leaders
Pragmatic
Organized and methodical
Scientific or technical
By the book
Problem solver
Objective
Persistent
Continuous process
improvement
Reverse engineering
Benchmarking
Lean manufacturing
Simulations
Platform innovation
End to end IT systems
Supply chain innovation
27
Ask Yourself What Works; What
Doesnt When and Where?
Where does Genetechs approach to innovation work at
UM B&F? Samsung's? Why?

Where doesnt Genetechs approach to innovation work
at UM B&F, but should? Samsung's? Why?

What are the leadership traits required to manage these
competing values in UM B&F?

Value Propositions: Speed & Profits
100 year old business went from 12 to 62B in 4 years (High
quality revenue targets)
Lean conglomerate with large scale businesses in software,
cars, steel, phone services, solar panels, biotech, hotels, wrist
watches and tea (60% of profits to charitable trusts)
Capitalize on undervalued cast-offs (Jaguar and Landrover)
Move quickly on acquisition opportunities (Corus)
Focus the portfolio but allow most businesses to operate as self-
directed units with own P&L
Many businesses and products but only one global brand,
brand, brand
Mid-term revenue focus on opportunity with an eye on
sustainability
Hire the clear thinking, intelligent, and vital; not critics
Free and responsible leadership; accountability to all
stakeholders
Workplace
Competitive
High pressure and impact
Fast moving and high energy
Image enhancing deal making
Quantifiable results
Winners and losers
Leaders
Goal and action oriented
Impatient
Assertive
Driven
Decisive
Challenging
Competitive
Rapid action problem solving
teams
Revenue insight processes
Branding
Market adjacencies
Business solutions

Value Propositions: Community & Knowledge
Freedom to encourage, help, and allow other associates to grow in
knowledge, skill, and scope of responsibility
No central innovation function - everyone in the firm is responsible for
making innovation happen
No business unit of more than 50 people
Great ideas emerge over time, as do great innovation teams
Culture is king, create an atmosphere where patient learning is
encouraged
Competencies are developed through coaching and new opportunities
Spend 15% of your time and budget on new ideas, projects and
ventures
Make a little, sell a little, review what works and doesnt, and revise
The ability to make one's own commitments and keep them
Consultation with other associates before undertaking actions that
could impact the reputation of the company
WL Gore
Workplace
Family atmosphere
Collaborative workplace
Shared values and vision
Integrates personal goals
Informal
Teaching and coaching
Leaders
Sees potential
Builds commitment and trust
Sensitive and caring
Patient listeners
Encourage participation
Respects differences
Empowers people
Mentoring and coaching
Team building
Collaborative communities of
practice
Search and reapply
Culture and competency
development
Collaborating with customers
Open source

Ask Yourself What Works; What
Doesnt When and Where?
Where does Tatas approach to innovation work at UM
B&F? Gores? Why?

Where doesnt Tatas approach to innovation work at
UM B&F, but should? Gores? Why?

What are the leadership traits required to manage these
competing values in UM B&F?

Are You Saying That A Firm Has One
Conscious Approach to Innovation?

No
But it does play to its
strong hand by
Industry
Department function
Location
34
Is the Reunion of Opposites
Really Possible?
U.S. looks to hackers to
protect cyber networks
By Lolita C. Baldor, Associated Press (4/20/09)
WASHINGTON Wanted:
Computer hackers.
Buffeted by millions of digital
scans and attacks each day,
federal authorities are looking
for hackers not to prosecute
them, but to pay them to
secure the nation's networks.

Well Not All the Time
35
Collaborate
Social Approaches

Long term relationships
Community decides
Sustainability
Inclusive
Evolutionary
Create
Generative Approaches

First adaptor customers and markets
Customized offering
Segment specific
Diversify
Channel pull
Core customers and markets
Generic offering
Widest possible market
Align
Corporate push

Control
Technical Approaches
Limited window of market opportunity
Markets decide
Time to market
Exclusive
Ballistic

Compete
Business Approaches
How Do We Manage these
Positive Tensions?
Customers
Suppliers
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Services
Products
Expertise
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And Affected by the
Development of Organizations
Compete
Collaborate
Control
Create
Where is Your Organization on the growth curve? www.competingvalues.com
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Principle 4: Forget the 80/20 Rule
and Follow the 20/80 Rule
Crisis
Seeks to survive
Risk of change low
Reward of change high
20/80 rule
Outstanding
Seeks to grow
Risk of change low
Reward of change high
20/80 rule
Normal
Seeks to maintain equilibrium
Risk of change high
Reward of change low
80/20 rule
Its Easier to Change 20% of the Firm 80% Than 80% of the Firm 20%
The more radical the innovation, the more it needs to start on the fringes
Principle 5: Show, Dont Tell
Innovation is about what
doesnt exist yet
Most of our brain is used
to visualize
Seeing is believing
You need to help people
see
Put them in the movie
A day in their life
Proof the concept

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Principle 6: The Cavalry Isnt
Coming
Wait, Fight or DeviatePositively
Growth requires personal ownership www.competingvalues.com 40
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Principle 7: Remember The
DeGraff Hypothesis

The amount of innovation a
company produces is
inversely related to the
number of PowerPoint
slides or elaborate
process diagrams it
makes about innovation.
Only Known Photo of the Hypocrite
Jumpstarting
Innovation
B
Basic Steps to Making
Innovation Happen at UM B&F?
1. High quality
targets
2. Deep and diverse
domain expertise
3. Multiple shots on
goal
4. Learn from
experience &
experiments

Identify High Quality Targets
Can we
win?
Is it worth
doing?
Is it
real?
Collaborate
Values
Social
Create
Vision
Generative
Control
Processes
Technical
Compete
Goals
Business
44 www.competingvalues.com
Enlist Deep and Diverse Domain
Experts
Teachers
Communicators
Counselors
Listeners
Conflict mediators
Community builders
Dreamers and visionaries
Fashion trend setters
Creative actors
Big picture thinkers
Experimenters
Energizers
Planners
Organizers
Analysts
Technicians and scientists
Methodical problem solvers
Professionals

Competitors
Decision makers
Goal oriented achievers
Sprinters
Political game masters
Deal makers
Collaborate Create
Control Compete

Think Around the Challenge and
Integrate the Solution
Differentiate
Consider the challenge by
thinking around the four
perspectives
Use breakout groups to
divide and conquer
Integrate
Integrate the perspectives
and develop hybrid
solutions
Integrate the breakout
groups if appropriate to
sync it the solutions
Compete Control
Create Collaborate
Practice Kaleidoscopic Thinking
Are you ready to travel
some new neural-nets
today?
Change your point of view
Listen to your intuition
Draw it
Run thought experiments
Magnify and minify
Reverse your ideas
Go on an expedition
Inhibitors of Creative Thinking
Personal Block Problem Solving
Blocks
Contextual Blocks
Lack of self-confidence
A tendency to conform
A need for the
familiar/habit-bound
thinking
Emotional numbness
Saturation
Excessive enthusiasm
Lack of imaginative
control
Solution fixedness
Premature judgment
Habit transfer
Use of poor
approaches
Lack of disciplined
effort
Poor language skills
Rigidity

Scientific reasoning
provides a panacea
Resistance to new
ideas
Isolation
Negative attitude
toward creative thinking
Autocratic decision
making
Experts
An over-emphasis on
competition or
cooperation
The Creative Edge. William Miller www.competingvalues.com 48
Your Challenge [Here]
What exactly are we doing and
why?
Whos the boss?
Whos on the team?
How much time do we have?
How much money do we
have?
What is out of bounds?
What are the deliverables?
How do we keep score?
What happens if we succeed?
Fail?
49 www.competingvalues.com
Whats Working and Whats Not?
What's Working

What's NOT Working

Potential Improvement Points
What's Working

What's NOT Working


What's Working

What's NOT Working

What's Working

What's NOT Working

Take Multiple Shots of Goals
Diverging
Defer judgment
Look for lots of ideas
Accept all ideas
Make yourself stretch
Take time to simmer
Seek combination - be a
hitchhiker
Converging
Be deliberate
Be explicit
Avoid premature closure
Take the risk to look at difficult
issues or sneaky spots
Develop a sense of affirmative
judgment
Keep your eyes on your
objectives

www.competingvalues.com 51 Creative Problem Solving. Treffinger, Isaksen, and Dorval
Take a Collaborate Point of View
and Think About
Practices - Culture, competency, and
processes of the organization Mission
and vision statements
Learning organization
Collaborative communities of practice
Culture development and
transformation
Customer relationship management
Competency development
Team building
Mentoring and coaching
Training
People: Individuals in the organization,
at all levels
Sees potential
Builds commitment and trust
Sensitive and caring
Patient listeners
Encourage participation
Respects differences
Empowers people

Preferred Environments
Family atmosphere
Collaborative workplace
Shared values and vision
Integrates personal goals
Informal
Teaching and coaching
Preferred Communication
Talk about personal experiences
Tell stories
Express emotions
Put the person at ease
Acknowledge the role of intuition
Recognize important spiritual symbols
Organizational Types
WL Gore
Genentech
McKinsey and Co
Harley Davidson
S.C. Johnson
eBay
The Body Shop
Universities
Take a Create Point of View and
Think About
Creativity methods
Strategic forecasting and scenario
planning
Corporate venturing
Spin-offs
Entrepreneuring
Growth and market disruption
strategies
Change and innovation programs
New product development
Radical experiments
Borderless and virtual organizations
at all levels
Visionary dreamers
Clever
Optimistic
Enthusiastic
Quick on their feet
Big-picture thinkers

Stimulating projects
Flexible hours
Free from everyday constraints
New initiatives
Independent work streams
Diverse workforce
Be enthusiastic and energetic
Look at the big picture
Draw concepts
Use metaphors
Look at the future
Explore how the pieces fit together
Google
Apple
Pixar
Virgin
Nokia
Versace
Bio techs
Start ups

Take a Compete Point of View
and Think About
Economic value added management
Real options analysis
Time to market reduction
Performance management scorecards
Profit insight processes
Pay-for-performance plans
Branding
Sales channel management
at all levels
Goal and action oriented
Impatient
Assertive
Driven
Decisive
Challenging
Competitive

Competitive
High pressure and impact
Fast moving and high energy
Image enhancing deal making
Quantifiable results
Winners and losers
Get to the point and summarize
Be logical and analytical
Critically confront the downside
Show personal ownership
Demonstrate a biased towards action
Unilever
Microsoft
IBM
Bloomberg
PepsiCo
Goldman Sachs
New York Yankees (alt. Chelsea)
Blue chips

Take a Control Point of View and
Think About
Business process improvement
Activity based costing
Benchmarking
Lean manufacturing
Simulations
Contingency planning
Pervasive information systems
Reorganization
Supply chain management
at all levels
Pragmatic
Organized and methodical
Scientific or technical
By the book
Problem solver
Objective
Persistent

Clear roles and responsibilities
Stable project management
Logical objectives
Methodical processes
Standards and regulations
Ordered and structured work
Provide details
Follow the rules
Conform to accepted esprit de corps
Provide detailed data
Demonstrate how it works
Toyota
GE
Shell oil
Airbus
Wal-Mart
Siemens
LG
Medical centers

Add WOW to Promising Ideas
Substitute
Who else instead? What else instead? Other ingredient? Other material? Other process?
Other power? Other place? Other approach? Other tone of voice?
Combine
How about a blend, an alloy, assortment, an ensemble? Combine units? Combine
purposes? Combine appeals? Combine ideas?
Adapt
What else is like this? What other idea does this suggest? Does past offer parallel? What
could I copy? Whom could I emulate?
Modify or Magnify
New twist? Change meaning, color, motion, sound, odor, form, shape? Other Changes?
What to add? More time? Greater frequency? Stronger? Higher? Longer? Thicker? Extra
value? Plus ingredient? Duplicate? Multiply? Exaggerate?
Put to Other Uses
New ways to use as is? Other uses if modified?
Eliminate or Minify
What to subtract? Smaller? Condensed? Miniature? Lower? Shorter? Lighter? Omit?
Streamline? Split up? Understate?
Reverse or Rearrange
Transpose positive and negative? How about opposites? Turn it backward? Turn it upside
down? Reverse role? Change shoes? Turn tables? Turn the other cheek? Interchange
components? Other pattern? Other layout? Other sequence? Transpose cause and effect?
Change pace? Change schedule?
101 Creative Problem Solving Techniques. Higgins
Select 3 Winning Ideas and
Improve Them
Criteria for a winning
idea is
It provides a solution
to the challenge
Its possible
(Feasibility, power,
capability, etc.)
Its WOW!
Create a Hybrid Solution

Take the two ideas and
create one hybrid idea
(no bolt-on ideas or
marriages of
convenience)
Integrate Compete
with Collaborate
Integrate Control
with Create
Integrate Create
with Control

Integrate
Collaborate with
Compete
Get Some Quick Wins
Small Wins Time-Wasters
Big Wins Special Cases
B
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Easy to Implement

Tough to Implement

Proof of Concept
Who, What, Where, Why and How (5Ws + H)

5Ws + H will you work together on these action items?
What Are Some Examples of
Analogies for Solutions?
ASAP
Think Match.com
Im Special
Think NIKEiD
Premium Proletariat
Think Mercedes C-class
Fix-It-For-Me
Think Cisco routers
Hot Coach Potatoes
Think Nintendo Wii
Tell Me a Story
OPI nail polish (Mauve-lous
Memories)

Cult Communities
Think E-Bay
Old is New
Think Whole Foods
Smashup
Think Yum brands
Hidden Tattoos
Think Harley
Aggregate the Aggregators
Think Kayak
Almost as Good
Think University of Phoenix
Reverse Innovation
Think GE Medical

How to Create Winning Analogy
For Your Solution?
1. Revisit your short list of whats moving in the world of your organization at
the greatest speed and magnitude
2. Think of some organizations that are rapidly growing through various forms
of innovation (Not necessarily in your domain)
3. Describe what they are doing (Attributes, actions, markets, money,
technology, partnerships, etc.)
4. Now work up some analogies that fit these descriptions (See examples)
5. Once you find some that really describe what these organizations are
doing, work backward and apply it to your organization
6. For example: Match.com applied to real estate might be like creating an
intake of key psychological factors for better speed dating
7. The key is to get into flow with some volume. Look for analogies that you
can begin to visualize as both viable, and more importantly, unique
Learn from Experiences and
Experiments
Start/Do More

Stop/Do Less

Stay/Do Nothing
Start/Do More

Stop/Do Less

Stay/Do Nothing

Start/Do More

Stop/Do Less

Stay/Do Nothing
Start/Do More

Stop/Do Less

Stay/Do Nothing
Example of Portfolio
Management Bias
Highest risk
Highest reward
High risk
Low reward
Relative reward
Relative risk
Reduce risk Eliminate
Increase reward Invest
Low risk
High reward
Lowest risk
Lowest reward
Example: The bias of
portfolio gravity
Momentum is Crucial to Success
Keep Moving Forward
The Strange But True
Tale of Best Practices
C
Best Practice 1: Creativize It

Creativize
To add value through
creativity to ordinary
business practices
across disciplines, places
and levels
Creativizers
Those who transform the
ordinary into the
extraordinary through
their sense of ownership
and prismatic thinking
Reminds you of Norman Rockwell
Best Practice 2: Create More
Ugly Pots
Art course in pottery
Two sets of grading criteria
Based on aesthetic appeal
Based on the total weight of
the pottery
Well-respected curators
judged
Which criteria produced
more high quality art?
Fail often, early and out
of sight to succeed sooner
Best Practice 3: Hide Inside
Trojan Horse Projects
Projects: Create projects that
will provide opportunities for
these innovation practitioners
to learn what practices work
and dont
People: Create a community
of highly practiced innovators
Place: Create a place for
these innovation practitioners
to work together
Practices: Create new
practices and forums to share
them
Best Practice 4: Diversify When
You Dont Know Your Destination
Innovation is Terra Incognito
Innovation is about arriving at
a place we have never been
before by doing something we
have never done before
Whats going to happen with
the [Your issue here] next
year?
Collecting data about the
future is often an act of
resistance because it stops us
from acting
Launch a diverse array of
ships, send them on different
routes, see what you discover
build processes last
Best Practice 5: See One, Do
One, Teach One
From the trades to
medical school
Its easy to see what is
wrong with someone
elses ideas, its hard to
do better
From speaking a
language, learning to
play an instrument
learning is doing
Apprentice yourself and
coach others
Best Practice 6: Enlist Your
Customers to Grow Your Business
Identify and watch your leading customers
Observe what customers are doing and
theyre using your products to get things
done. This will be a renewable source of
great ideas.
Provide your customers with tools to use
Become an integral part of your customers
own creative processes. Provide them with
the tools they need to be innovative and
creative.
Build and nurture customer communities
Hang out with your customers. Listen to what
theyre saying and suggesting. They will keep
you pointing in the right direction.
Empower customers to show their stuff
Create forums where smart contributors can
earn the accolades of their peers. People
love to show how creative they can be.
Let customers engage in peer production
Dont insist on doing everything yourself.
Instead, let your customers create what you
sell in the future. This is a great business
dynamic.
Outside Innovation by Patricia Seybold
Best Practice 7: Leave Room for
the Stuff You Dont Know Now
Sometimes what you discover along the way
is more interesting than what you set out to find

Leading Innovation

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Leading Innovation:

Making Stone Soup at UM B&F

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