Building an Innovation Marketplace
Innovation at scale is hard to pull off. Some of the best thinking happening today in the innovation space is focused on training product teams to develop a mindset using Lean Startup, Customer driven development, fast learning, agile development approaches. I’m a big fan of all of those and spend my days consulting and training large organizations to do just that. But this is a classic case of necessary but not sufficient. Instead of just focusing on the mindset of teams selling their innovation ideas into the portfolio pipeline, we have to bring a concurrent focus to changing the mindset of decision makers who are the targeted buyers; The senior executives writing checks to fund the best ideas that emerge. In other words, for innovation to succeed at scale inside a large enterprise, we need an efficient innovation marketplace.
My introduction to markets began at an early age. My parents sold handbags and luggage at markets across the north west of England. I have strong memories of school holidays “working” with my dad on the market selling great value (read: low priced) luggage and handbags. Widnes market, where my dad had a stall for over 20 years, was emblematic of a mature and efficient, if sadly, not particularly lucrative, marketplace. My dad used evidence of what his customers wanted and how much they would pay from an accumulation of anecdotal data. His buying patterns each season reflected that knowledge and he hoped that he had enough of the right stock purchased at the right prices to react to the latest trends and price pressures, to make it a successful season. Here’s the key quote from a recent article celebrating the market’s 140-year-old history, “Widnes Market represents what the local and regional customers want, good friendly personal service and value for money.” A decidedly non-innovative business had clear success metrics understood and managed by both buyers and sellers. My dad learned the range of his customers taste and spending power, and they rewarded or punished him by buying or rejecting his merchandise or negotiating down his margins.
In their recent HBR Online article “ Why Leadership Training Fails — and What to Do About It” Michael Beer, Magnus Finnström & Derek Schrader discuss some of these issues in the context of training programs funded by the learning and development arms of large companies. Huge quantities of money are poured into well intended and well crafted, but ultimately isolated workshops. Employees take 2–3 days out of their regular routine and are exposed to exciting and powerful ideas about any number of topics including how to transform their ways of working to foster innovation. They leave with what my colleague Matt Lemay calls “Workshop-itis.” Their enthusiasm during the Friday 4pm wrap up is suddenly confronted by the Monday 9am reality of piles of emails and business as usual ways of working back in their cubicles. Beer et al reference research that describes this as a lack of “fertile ground” in which the new mindset can take root. The problem is that the executives who signed off on the transformation initiative aren’t themselves changed enough to offer support to the potential that emerges from the training.
As Barry O’Reilly from Exec Camp says frequently “When executives say ‘we need to change and transform’, what they really mean is ‘you need to change and transform.’” The ‘you’ in this case being the product development resources across the company and decidedly not the strategy, accounting, legal or HR resources. That narrow focus on execution means that in the companies where the aspiration is a more innovative environment, ignoring the role of traditional accounting measures, incentives and investment decision-making processes and structures, means despite great intentions, organizations often create environments where it is virtually impossible for innovation to flourish.
At Spinnaker we are launching a series of workshops to help companies who are in the early stages of driving a Lean Enterprise focused transformation in their business. We’ll be leveraging the learnings from our engagements with large companies to deliver highly practical hands-on experiences targeted at Executives, Innovation leaders, and Product Management. The first 2 workshops, Starting Your Lean Enterprise Transformation and Lean Enterprise Decision Making are being held in New York in late January, with additional dates in the UK and Europe coming soon.
If you are looking for ways to drive growth by building an efficient and powerful Innovation Marketplace, we can help. Hope to see you soon!