Methods to Create New Business and Product Ideas


Levels of Innovation – Overview

Levels of Innovation

Perceptions of innovation differ. The ones used in this book will be those generally accepted by the Industrial Research Institute (IRI) a professional society headquartered in Washington, DC. The “Levels of Innovation” figure shows word choice that describes various high level types of innovation. We will be using the terms incremental, next-generation, and breakthrough.

In this chapter we focus on the methodology used to create ideas at these different innovation levels. The lowest level of creativity, “incremental”, really has to do with existing and minor improvements to existing products and services. These ideas are usually ones that come fairly quickly to mind for individuals skilled in the technology and knowledgeable about the business area. The next level of creativity deals with creating “next-generation” products. Solving problem here usually requires not only knowledge of the technology and background area, but the ability to look at the world in an unusual or different manner. The highest level of innovation, “breakthrough”, is usually associated with very unusual ideas that most people can appreciate only in hindsight.

Type of Creativity Needed

To be successful in obtaining the creativity needed for business success, it is important before starting to clarify the type of creative thinking you need. This can be done with the help of questionnaires such as the one shown in the “Type of Creativity Needed” figure. This helps by narrowing efforts to be creative about products, processes, marketing or management. Additionally, you can test to see if you really need incremental or revolutionary results, or something in-between. Finally, you can check to see if you need to work within wide or narrow boundaries (such as time or money). It is critical that a management team be aligned on the type of creativity needed, and ready to fund / proceed with the ideas that are generated. Senior managers have been known to ask for breakthrough innovation, and when those ideas and solutions are developed, they then are not ready to fund the new plant, train a new sales team, or proceed with a new advertising campaign. Thus, making sure everyone is aligned on the type of creativity needed is the first step in a creative business-focused process.

Reflecting for a moment on how past authors have looked at creativity, the seminal work by Thomas Kuhn on the Structure of Scientific Revolutions clearly stands out. He outlines how science progresses, and describes processes of puzzle solving. He delves into great detail about the methodology used by individuals, the importance of groups, the influence of society, and the nature of thought.

The Seven Levels of Change / Innovation

A Strategy for Creativity, Innovation, and Continuous Improvement

An excellent and more practical method for thinking about creativity, innovation, and continuous improvement was put forward by Rolf Smith. Rolf divided creative thinking into seven different levels. The “A Strategy for Creativity, Innovation, and Continuous Improvement” figure shows a summary of this methodology. Because of the clarity this approach, this Compendium is also organized according to these levels.

From an organizational standpoint, these seven levels are an effective way to go about designing creative processes and problem solving teams. The first couple of Levels “do things right”, and “do the right things”, are typically undertaken by individuals and small groups with little training. For Levels 3 through 5, “doing things better”, “doing away with things”, and “doing things other people are doing”, usually require facilitated processes. It is most appropriate to have skilled individuals within the organization, and sometimes individuals from outside, design specific meetings and processes that will deliver the desired innovation results. At Level 6 and Level 7, “doing things that haven’t been done”, and “doing things it can’t be done”, it is imperative to use outside facilitators. The Office of Strategic Innovation Inc. is an organization that has experience in such methodology.

Usually challenges and opportunities come our way without active inquiry. It is part of coming to work. But before proceeding with looking at problem-solving and creativity in more detail, it’s important to note that there are times when you’re really out looking for new business ideas. How does a challenge turn into an opportunity? Applying creative thinking systematically requires deliberate, organized, purposeful and focused methodologies. Peter Drucker, in his book Innovation and Entrepreneurship (1985), outlined seven change areas that can be potential starting points in a search for business ideas: First, he suggested that you look for the unexpected: successes, failures in advance. Second, you look for incongruities: discrepancies between the “what is” and “what should be”. Third, you investigate needs and requirements by understanding and finding ways to address deficiencies associated with problems and issues. Fourth, you investigate changes in structure: rapid growth, organizational restructuring, changes in procedures, and convergence or introduction of technologies. Fifth, you investigate demographics: changes in shifts in size, age, composition, diversity, educational status, income and employment of populations. Six, you investigate changes in perceptions: being alert to changes in the way people view things, changes in meaning, and interpretation of facts. Seventh and last you investigate new knowledge: increased information flow, sharing, convergence of different kinds of knowledge, and emergence of new technology. Looking at lists developed from ideation / brainstorm sessions associated with each of these areas are good ways to spark questions to use in developing challenges and opportunities for a new business. Another good model is to search for “messes”. This is the first step in the Model of Creative Problem Solving put forth by the Creative Problem Solving Institute (CPSI)

Level 1 & 2: “Incremental Innovation”

Creative Problem Solving Model

Returning now to problem solving for a new business idea, Incremental Innovation is about becoming more patient and more effective. “Doing things right”, Level 1, is about creatively finding new ways to do things that improve cost and reduce the time. “Doing the right things”, or Level 2, is about creatively setting the right priorities, doing what’s important first. Most individuals who use a CPSI creative problem-solving model easily can solve problems at this level. The CPSI model is shown in the “Creative Problem Solving Model” figure.

Problems at this level are generally considered to be “Tame Problems”. They can be solved by most people by understanding the problem, gathering information, analyzing information, generating solutions (as shown in the CPS model), assessing the solutions, implementing, testing, and modifying.

The first step in the CPS model is about finding what the real mess is and making sure that you’re really working on the right question. Are you really after making things nicer, or are you really after finding things that will be available sooner? It’s about understanding the cost and performance trade-offs in your product or service design. Having defined the problem appropriately, the next step is to understand the mess from many different perspectives. One can look at it as a chemist, as a mechanical engineer, as an architect, as an artist, as a musician, as an astrophysicist, as an anthropologist. Each perspective used will define the problem somewhat differently. Brainstorming from any of these starting-point perspectives will quickly generate ideas to solve the problem. Solutions derived from these ideas and the actions needed for implementation then follow a normal project management methodology.

This problem-solving methodology is very similar to that used by the McKinsey consulting group. The McKinsey approach can be divided into five major activities: 1. Framing the problem. 2. Designing the analysis. 3. Gathering the data. 4. Interpreting the results. 5. Presenting your ideas. A basic tenet of the McKinsey thought processes the concept of MECE, an acronym for Mutually Exclusive Collectively Exhaustive. What this means is separating your problem into distinct, non-overlapping issues while making sure that no issue relevant to your problem has been overlooked. The most common to tool used to break problems apart is a logic tree, starting with the 20,000 foot view and moving progressively downward. For example if the problem is “how can we increase profits”, the decision tree might break that down to “where the company’s profits come from”. If the answer is from just three of the core business units you can then draw the first level of a logic tree for this problem. You can then split profits into the revenues and expenses. You continue drilling down to granular key points in the decision trees. You use the 80-20 rule to make sure that you’re following a branch that has high impact on the ultimate problem.

When coming up with solutions, it’s important to determine whether a proposed solution or hypothesis is valid from a business standpoint. Three questions to test this are: 1. Will the proposed action reduced costs, 2. Can we implement the necessary changes? 3. If we implement this change can we maintain product quality? In answering these questions it’s important to remember that that a few key facts can go a long way to making the right choice. The six key principles McKinsey’s consultants use to analyze data are: 1. Apply the 80/20 rule, 2. Make a chart every day (captured in that chart should be the three most important things learned today), 3. Don’t make facts fit your situation, 4. Always ask the “so what” question, 5. Perform a sanity check, and 6. Recognize that there are limits to analysis (data without intuition is merely raw information, and intuition without data is just guesswork. Putting the two together gives you the basis for sound decision-making).

The Ideaction Process

There are many practitioner guides to innovative thinking. One of the best was put out by L’Academie de la Banque de Montreal. Their ideation processes is similar to the CPS model but importantly their workbooks go into great detail for each tool outlined in “The Ideaction Process” figure. In particular the process stresses the Issue Redefinition step. Creativity should be applied to the task of precisely defining an issue. Concentrate on finding the real issue and you will save valuable time. To do this you must: 1. Break down the issue. 2. Analyze all aspects of the issue, not only those that seem important at first glance. 3. Paint a portrait of the issue from different perspectives. 4. Put yourself in the shoes of those affected by the issue.

Cube Model

Most traditional market research also falls at this incremental level. For example, a typical Boston Consulting Group (BCG) methodology used with their clients is to segment the market by user, place and desired benefit. The approach is to collect a set of consumer data to identify, quantify, and prioritize opportunities. This is a structured approach similar to the CPS model above. The marketing results by such an approach are often presented graphically as a cube, see the “Cube Model” figure. Many authors speak loudly to the requirement that the customer’s needs, both articulated or not, have to be addressed if any innovation is to enjoy commercial success.

Typical Market Research Plan

To gather the data for such market research the plan usually consists of multiple phases, as shown in the “Typical Market Research Plan” figure. In the graphic shown it is a retail product that is envisioned. The first phase involves in-depth understanding of the consumer. The second phase than involves quantitative research to make sure that what we produce will also produce a profitable business. In the first phase, key user groups are usually interviewed to get a good understanding of the breadth of applications for a proposed product or service offering. Following up on the applications that are uncovered, deeper dives are undertaken to really understand what applications are used in each segment. Further research is done to understand the distribution system of a product or service as this can often times influence the business profitability and growth rate. Interviewing throughout the distribution channels additionally provides insight into consumers purchase behavior as often times channel partners are asked questions or hear concerns of consumers as they select one product from another.

Summary of Research Results by Attractiveness of Individual Market Segment

For applications with the highest expected commercial value, quantitative research is then done in a second phase. The purpose is to understand exactly which opportunities will be pursued, for which market segment users, and for which of their applications. This structured approach to creative problem solving is geared to identifying the right problem to work on. For ease of communication and organization the results are often graphically displayed as shown in the “Summary of Research Results by Attractiveness of Individual Market Segment” figure.

Matrix of Market Segment Results

Each of the individual segment characteristics is summarized in a box and the boxes put in a matrix as shown in the “Matrix of Market Segment Results” figure. Such quantitative results allow an organization to see where to focus. In this example, Government management analysts represent a large segment size, high usage level of the product, and are willing to pay a high price. Using such structured methods of innovation and invention allow individuals and companies to quickly create products and services at the first and second Levels of creative endeavor. Conducting marketing surveys, obtaining marketing reports from outside groups, doing conjoint analysis, quality function deployment (QFD), and Kano analysis are all techniques that are usually used.

When coming up with ideas or solutions to the problems that have been identified at Level 1 and Level 2, using linear techniques for idea generation is a fast and efficient way to do so. These techniques are summarized by William Miller and consist of: matrix analysis, morphological analysis, nature of the business, reframing questions, Force Field analysis, attribute listing, scamper, alternative scenarios, forced or direct association, and design tree. Intuitive techniques for idea generation at these levels include: imagery, brainstorming, analogy, dreams, drawing, and meditation.

Growing Joint Clusters
Declining Joint Clusters

Another technique for mess finding in this level is to use intellectual property databases. Patents in particular are unique because they require the description of a technical invention along with its business or commercial use. When the business community finds an area which they believe they can earn a good return on their investment, those areas grow in patenting activity. Patents are a trailing indicator of how companies and governments have invested money in areas they believe represent future growth and opportunity. Tracking patent growth in different areas thus gives an indication of where near-term opportunity lies. The European patent office by way of IPC tracks such growth and decline. They have over 120 main groups in their IPC. These are gathered together in what they called joint clusters. Over the past several decades computers, telecommunications, biotechnology, audio and video media have all enjoyed rapid growth. On the other hand growing more slowly are polymers, industrial chemistry, handling and processing. The “Growing Joint Clusters” and “Declining Joint Clusters” figures show these trends.

Embedded in these joint clusters are individual technical and use domains. Their growth rates range from everything from -40% to well over 600% over the same time periods. Looking at the individual domains shows that even in some of the overall declining joint clusters there remains individual areas of growth activity. Examples are solid waste and reclamation of contaminated soil, musical instruments, acoustics, headwear, and lighting. Studying areas of growth and decline serves as a supplement to market research as a way to identify new opportunities for businesses to pursue.

Process Improvement Creativity Methodology”

So far we’ve been focused on product and service creativity. There is also the creativity that’s important people who work in operations environments. Factories, distribution centers, customer support, all have their own need for the creative processes. The methodologies are quite similar; however there are some that are unique to process improvement. These are shown schematically in the “Process Improvement Creativity Methodology” figure. Creativity for process improvement usually starts with a gap analysis identifying opportunities. Teams typically consist of engineers or shop floor personnel analyzing the process flow for bottlenecks and constraints. Other methods include benchmarking other organizations having similar responsibility, or Pareto analysis of their own process flows. Once a gap is identified, the next step is to form a team and scope out the project. Important here is to make sure that the customer and the end requirements are understood so that the process improvement stays within the boundaries established by the end-user. Tree diagrams and quality functional deployment (QFD) are useful tools here. Many specific techniques are outlined in books by Edward Demming.

Relationship Between Product and
Process Innovation

Some industries obtain more value from process innovation than others. This is shown in the “Relationship Between Product and Process Innovation” figure. Looking at it from an R&D Games model standpoint, industries which are based on understanding basic engineering principles are the most reliant on new processes. More mature industries of the R&D Game type that do not need scientific or engineering principles to be discovered for implementation, do not benefit much from process innovation (past that needed to focus on cost reduction).

The next step is to understand if the current process is in statistical control or not. Much work was done in the 1950’s, 1960’s and 1970’s around quality improvement programs, all aimed at obtaining controlled processes. Deming is perhaps the most widely known person working in this field. The actual problem solving techniques include brainstorming, why-why diagrams, process redesign, cause and effect diagrams, triggered Trico analysis, nominal group technique, failure mode and effects analysis, (MDMA) decision trees, and process benchmarking.

To assess process creativity results, improvement requires the ability to measure that the changed progress is statistically different, and sustainable over time. This assessment is done with trend charts and process capability charts. Also, unique to process improvement, is that the journey never ends. It’s a constant loop of observing, improving, measuring, acknowledging, and repeating.

Level 3 to 5: “Next Generation Innovation”

Innovation Equation

Innovation at this level is more complex and requires either more individual thought or better yet group efforts. James Higgins argues that creativity can be increased by both increasing the levels of personal and group creativity through learning certain techniques (processes). If these occur within the right organizational culture (possibilities), the result is innovation, as shown in the “Innovation Equation” figure. Increasing personal creativity involves a three-pronged effort: 1. Increasing the individual’s level of intuition, meaning the right side of the brain. 2. Freeing the individual from any socialization that may have limited his or her creativity. 3. Learning creative processes. Increasing group creativity requires the learning of group creativity processes, and also the proper management of group dynamics.

Competitiveness Model

In Levels 3 and 4, four principal types of innovation predominate. These are: 1. Product innovation, a physical product or service, or an enhancement either. 2. A process innovation, process for improving efficiency or effectiveness. 3. A marketing innovation, a new marketing concept or action. 4. A management innovation, a new way of managing. The sweet spot of innovation in these four areas is shown in the “Competitiveness Model” figure. William Hall and Michael Porter found that firms that have a very high degree of differentiation relative to competitors, or low-cost position relative to competitors, operate within competitive power alleys. It is important to know if your company is targeting one or the other of these, as can be found in your mission, vision and value statements. These two power alleys are the target areas for Level 3 and 4 innovation.

When working in groups its best to use structured processes. The most common of these is brainstorming. This method was first introduced by Alex Osborne in his book Applied Imagination in 1949. Although brainstorming is perhaps the most widely known, it is also the most misunderstood and abused. There are four rules that have to be applied religiously. They are to suspend judgment, free will (anything goes), go for quantity, and cross fertilize. Suspending judgment is perhaps the toughest thing to do. Most of the time comments and criticism creep into the discussion even though people are trying to hold them back. The next most difficult thing to do is to go for quantity. It’s interesting to note how groups of abhor silence. Usually what will happen in a brainstorm session is that a whole bunch of ideas will come immediately out of peoples’ heads. After that the number of ideas slows down. Most groups of abhor silence so as the idea flow stops, the meeting usually ends prematurely. As a result most groups give up too early and stop way before non-normal 2-Sigma and 3-sigma thinking occurs.

There are lots of other tools in addition to brainstorming that are useful at this level of creativity. From a cultural standpoint the guidelines are: Don’t judge too soon, handle newborns with care, accentuate the positive, harness the subconscious, if you can’t say something nice…., use Ha Ha to create Aha, don’t worry be happy, and value people. From the personal standpoint the guidelines are: plant seeds for the future, mental exercise, thinking is allowed, an open mind, sometimes do-it-yourself, you are the final judge, enthusiasm spreads, take the plunge, create a crisis, opportunities in deviations, technology push or market pull, share your ideas, take a break, and break your mental chains. Guidelines with respect to group behavior are to: overcome barriers, overcome fear, overcome failure, overcome tradition, and overcome bureaucracy. On the positive side this means groups must take advantage of: variety, diversity, perspective, and individuality. Specific methods of creative problem solving include: creative thinking skills, breaking the rules, affinity diagramming, force field diagrams, mindstorms, paired discussions, throwing the ball, passports, blue slips, Fishbone diagram, random words, thinking hats, try metaphors, try different perspective, try a random walk, reinvent the wheel, new uses for old things, combine concepts, working teams, and observe firsthand.

An excellent resource for innovation on the marketing side is the book “Jumpstart Your Brain” by Doug Hall. In this book he walks through his Eureka stimulus response creativity method and underscores the methodology backing his philosophy of a “brain operating system”. In R&D organizations this approach was further validated and it was found that the “brain operating system” is oftentimes equal to the fun and ease of thinking. The formula looks like:

Number of Eureka Inventions = (Stimulus + Brain Operating System)^Fun

What Doug explored thoroughly was the fact that fun is in the exponent, and not simply a term that is added or multiplied. Work at the Avery Dennison Research Center in the mid-1990s modified the formula for R&D to look like:

Number of Next Generation Inventions = (stimulus + (book knowledge * experiences)^ (Fun Atmosphere + Ease of Obtaining Background Information)

The added elements here are the Brain Operating System, which is book knowledge times your experiences. In the exponent “fun” is replaced by having a fun atmosphere in which to work, coupled with the ease of obtaining background information. What was found was that if background information (that is the ability to run literature searches or two quick experiments in the lab) is difficult, the number of new inventive ideas falls off dramatically. This observation led to significantly increased resourcing of information scientists and competitive intelligence professionals. The leverage such individuals have on an organization’s performance is oftentimes overlooked! The key is that most people think of those individuals and support personnel as having leverage that is either additive or multiple, not exponential as it turns out Doug’s research showed.

Another excellent resource on personal creativity is a book “Escape From The Maze: Nine Steps To Personal Creativity” by James Higgins. This book was written primarily for the person just getting started in the field of creativity and wanting to improve their performance. He walks through the process, starting with accepting your innate creativity, then moving onto exercises to improve your use of your own brain, how to understand your own preferences, pursuit of perfection, and judging information during a creative problem solving process. He details ways to use creativity techniques such as brainstorming, mind-mapping, scamper, excursions and intuition. He then closes the book with thoughtful exercises on using both sides are your brain, both left and right.

Yet another excellent resource for group performance on creating next-generation products through collaborative play is a book on “Innovation Games” by Luke Hohmann. This book shows how innovation games can be used as a market research technique. Ideation is especially insightful when customers are involved in the new product innovation processes using this methodology. He gives detailed descriptions of how to use his 12 specific games: Why the game works, what’s needed for preparing to play the game, the rules for playing the game, how to process the results, and how to implement in an organization the outcomes.

Benchmarking Process Steps

As innovation gets harder to do at Level 5 “Doing Things Other People Are Doing”, benchmarking is a tool of great value. A shown in the “Benchmarking Process Steps” figure, this is an orderly process to search for industry best-practices that, once adopted, lead to superior performance. When conducting Step 2, Identify Comparable Companies, business, technology, and intellectual property databases are all useful. Using all three data sources insurers a high probability of finding an organization with a comparable product or process. When undertaking Step 3, Determine Data Collection Method and Collect Data, the techniques outlined in Chapter 23, When And How To Access External Technology, are most useful.

Another powerful technique used in innovation at these levels is to utilize unstructured information mining. IBM lead the way in this regard. By using voice recognition software along with powerful databases, customer interactions can be recorded and mined for hidden information. In addition to “voice of the customers” there can also be the “voice of the employee”, which when mined often shows ideas for new products or services when the information is structured by machines and displayed graphically. Patent information can also be mined for new trends. On a large scale brainstorming can be conducted with design jams and innovation jams. Organizations such as IBM have successfully experimented with such jams in groups up to several thousand people.

On the marketing side, as problems get harder, focus groups, voice of the customer, and observation of customers is also a necessity. This is done (either directly or through the use of two-way mirrors, videotaping of product usage, mapping and usage patterns among a variety of customers, and most recently virtual display of shopping or use environments at the same time subjects are wired and recorded for eye movement, heart rate, and emotional response. Each of these techniques is of course aimed at creating insight into unusual patterns that can be developed by a group into a new product or service concept.

Ideas obtained from customers can be segmented into four concepts with respect to customer service:
1. Anticipatory customer service to serve the unexpressed needs and wishes of the customer. This can be done with anticipatory artificial intelligence relevant to someone who is browsing or looking at a particular item by inquiring with the opening line “I see that you’re interested in… Would you like to explore… “
2. If customer service can be delivered more efficiently via automation or self-service, look for ways to offer that as an option.
3. Focus on fixing the beginnings and endings of customer service interactions and make sure that it is available 24 x 7 with people or bots who introduce themselves in a warm and interested manner based on anything they can know ahead of time or detect.
4. Fix any “broken windows“ in customer service that would leave a bad impression; which means focusing on exceptional product quality and design when innovating new products.

TRIZ methodology, introduced to the Western world and nearly 1990s, after being used in many years in Russia, has also found utility in specific industry segments. The methodology has been reduced to software by companies such as Ideation and Invention Machine, and provided as a service by both Ideation and Innovation-TRIZ companies. The methodologies involve three different classes of problem-solving. The first is usually called inventive problem-solving’s (IPS) which helps individuals solve complex technical problems by organizing their thinking process into five steps. These are documenting the problem, formulating the problem, prioritizing directions for innovation, developing solution concepts, evaluating results and planning implementation. This is supported by software which was based on patterns of innovation uncovered at the Russian patent office. Many users view this methodology as a guided brainstorming activity that generates very high success rates, particularly for mechanical and electrical related problems. In these areas, case studies found that students using TRIZ operators created solutions of the preferred type with an increase of 74% in cognitive accuracy over students not using TRIZ operators. Furthermore, students using the TRIZ operators tended to create fewer of the obvious solutions (an increase in cognitive precision of 27%). That said, the poorest TRIZ results are achieved in chemistry and software areas.

The second overall process is anticipatory failure determination (AFP) which involves analyzing and predicting failures in products and processes. This is similar to a failure modes and effects analysis, typically used and developed in the aerospace industry, but goes much further in that it can look at a problem through software to determine what are likely to be constraints to a good solution of the problem, and provide suggestions where other people have invented around these weak points. Knowing that other people have already found a solution allows the problem-solver to think ahead and anticipate problems in their own product design.

The methodology culminates in Directed Evolution (DE) which provides a means to proactively drive innovation and growth without relying on traditional technical forecasting. The method looks at technology and market evolution, develops a comprehensive set of possible scenarios for future evolution which are based on inventive problems being solved in the past, and from the scenarios creates next-generation products processes and technologies.

As the ten lines of evolution provide excellent thinking tools for DE, they are also useful for simple brainstorming sessions. Details of the ten lines of evolution are:

1. Stages of Evolution.
Based on available information about your system and specific information related to the different stages of evolution, complete the following tasks; identify the stage in which your system resides, identify the main business objectives for the current and next stage, identify typical mistakes or traps that should be avoided, and formulate strategic objectives for the system’s development.

2. Evolution Towards Increased Ideality.
A system’s Ideality can be defined as the ratio of all useful system functions to all harmful system functions associated with the performance of the useful functions. There are five generalized ways to increase a system’s Ideality. 1. Increase the number of useful functions including: absorb the useful functions of other systems nearby the given system, or that of the environment; invention of new useful functions. 2. Improve the quality and other parameters of the useful functions. 3. Reduce the number of harmful functions, including: eliminate or prevent harmful function; divert harmful functions to other systems or parts where the harmful influence is less critical; find useful applications for harmful functions. 4. Reduce the magnitude of harmful parameters. 5. Combine the above actions to ensure a higher ratio.

3. Evolution Towards Increased Involvement of Resources.
Consider the following ways to modify available resources for better utilization: accumulation of resources, concentration of resources, combination of resources, physical and/or chemical transformation of resources.

4. Non-Uniform Development of System Elements.
Formulate contradictions for the given system using the following templates (a) a useful function (state the function) should be performed because (state the reason) and should not be performed because (state the reason). (b) A parameter (state the parameter) should be high because (state the reason) and should be low because (state the reason).
Consider resolving the formulated contradictions by applying the following separation principles: separate opposite requirements in space; separate opposite requirements in time; optimize characteristics in time; separate opposite requirements between a whole object and its parts; separate opposite requirements on the basis of changing conditions; separate an impeding part from an object; separate or remove a required part from an object.

5. Evolution Towards Increasing Dynamism and Controllability.
Consider increasing the system dynamism by improving its ability to change and adjust to multiple conditions and requirements. Use the following recommendations: increase the degree of stability; transition from a stationary to a mobile condition; divide a system into mobile parts; introduce a mobile object; apply different physical and chemical effects.
Improve the systems controllability using the following recommendations: introduce a control field; introduce a controllable additive; introduce a controllable anti-process; provide self-control of system; introduce negative or positive feedback.

6. Evolution Towards Increased Complexity Followed by Simplification.
(a) Increase the system’s complexity by segmenting it into parts and then integrating the parts in a new way. To do these follow these recommendations:
Segmentation by: make an object that is mountable; partition into simple shape parts; pulverize an object; provide for the degradation of links during partitioning.
Integration by: integrate parts into a system; add integrating elements to the system or frame; create a hierarchical structure; add an object that possesses the required properties and functions.
(b) Consider integrating the system into a higher ranking super system. This can be accomplished through transformation into a system (the combination of two identical or different systems) and / or transformation into a poly system (the combination of more than two systems). Use following recommendations:
Build a Bi-System: from homogeneous elements; from compensating elements where one element compensates for the drawbacks of the other; from systems with shifted characteristics; from competing systems; from antagonistic systems that perform opposite functions; by combining competing systems that are in different evolutionary stages; utilizing the binary principle; creating a dynamic bi-system.
Build a Poly-System: from homogeneous elements; from compensating elements where one element compensates for the drawbacks of the other; from systems with shifted characteristics; from bi-systems; by creating a dynamic poly system. Enhance a bi- or poly-system by enhancing system links and/or increasing the differences between the elements.
(c) Consider simplifying the system using the following recommendations: apply disposable objects; apply a model or copy; make an object that is mountable; change the principle of operation; apply specialization; use more highly integrated subsystems; exclude auxiliary connecting, protecting, or housing functions; exclude duplicate elements; utilize self-service; consolidate discrete subsystems.

7. Evolution with Matching or Mismatching Elements.
Consider matching various system parameters for the purpose of improving functionality. Make the parameters equal, proportional, or mutually dependable.
Consider the intentional mismatching of various parameters for the purpose of: eliminating harmful effects by making the related parameters different, independent, opposite, etc.; making the system parameters controllable, that is, changeable depending on condition by matching or mismatching when required. Note the following system parameter should be matched or mismatched; system structure, materials, physical state, chemical properties, temperature, strength, reliability, rhythms of functioning, electric or other resistance, magnetic properties, dimensions, weights, colors.

8. Evolution Towards Micro Levels.
Consider utilizing deeper structural levels or combinations of these levels using: system made of elements with specific shapes; poly-system made of elements with simple shapes: poly system of small elements such as powders, microspheres, granules, drops, etc.; effects associated with substance structure such as supramolecular or crystal level; molecular phenomena; atomic phenomenon; field actions instead of substances.
Consider utilizing different aggregate shapes or combinations of states, using: solid-state substances; plastic and elastic material; gels; liquid; liquids as critical supercritical phases; gases; plasma; voids or areas with low density, vacuum, etc.; various combinations of solid, liquid, gas and plasma states such as foams, liquid saturated with gas, suspensions, sprays, dust, ionized gas, etc.; aggregate state transformations such as melting, evaporation, condensation, solidification, etc.

9. Evolution Towards Increased Use of Fields.
(a) Consider utilizing the following fields or combination of fields:
Mechanical fields such as gravity, pressure, shocks, vibration, explosion, or acoustic waves. Special corresponding substances would be explosives.
Thermal fields such as heating and cooling, and aggregate state transformations. Special corresponding substances would be water/ice/vapor, bi-metals, shape memory effect materials.
Chemical fields where special corresponding substances would be catalysts and inhibitors.
Electrical fields such as electrical charges and electrical currents. Special corresponding substances would be dielectric materials and conductive materials.
Magnetic fields such as electrical current and permanent magnetic fields. Special corresponding substances are conductive materials and magnetic materials, magnets, and ferromagnetic particles.
(b) Consider transforming an existing but unusable field into another, more useful one.
(c) Consider changing field parameters from one to another of the following: permanent, one-dimensional field; permanent, multidimensional field; gradient and/or asymmetrical field; alternating field, rotating field, traveling field; alternating reasonance field; non-sine field such as rectangular, trapezoid; pulsed field; combination of fields with different parameters.

10. Evolution Towards Decreased Human Involvement.
Try to replace a human with a machine, device or other equipment using the following recommendations: make the process simple (reduce the level of intelligence required to realize the process); aid humans in easily automated operations that require power, accuracy, speed or some other characteristic prone to human error; substituting humans without changing the principle of operation; change the principle of operation to suited mechanized operation (i.e. pay attention to power, accuracy, speed, rather than intelligence).
Consider the following ways of substituting humans in various kinds of activities:
In Operations use simple mechanical tools instead of hands, teeth, etc.; use mechanical energy transformers and accumulators for human power, such as levers, gears, jacks, boasts, springs, sling, etc.; use nonhuman energy sources such as animals, wind, water, steam, chemical power, electrical power, nuclear power, etc.
In Control use tools to control system functioning, such as rudders, steering wheels, airfoils, guides, etc.; use special devices to transform control commands, such as amplifiers, reducers, filters, rectifiers, stabilizers, modulators, etc.; use devices to produce control commands, such as cams, gyroscopes, software, etc.
In Decision Making use various sensors such as mechanical, thermal, chemical, electrical, magnetic instead of human senses as information tool; use devices for processing information such as analyzing, summarizing, measuring, and verifying; use devices to make decisions based on information analysis.

Level 6 & 7: “Breakthrough or Radical Innovation”

At these levels of innovation many of us get weak in the knees. To do things that have never been done before, or to do things that everyone knows can’t be done clearly takes a different set of skills than the previous levels. There are individuals that have achieved this in the world. To work on such problems the best approach is to get good experienced outside help.

Beyond Consumer Led

It’s also important to note that with rare exceptions such as Einstein, most radical and breakthrough thinking is done in groups. It is true that the gem of an idea may come in an individual but that person has to be supported in an inquisitive and challenging environment. This inquisitive and supporting environment is rarely found within existing organizations. They almost always have to be built from scratch in order to have the correct diversity of individuals with respect to their knowledge and experience. Without such diversity breakthrough thinking is not likely to happen. Accessing individuals who can serve as a good voice of the customer is also difficult. Lead customers are reliably accurate when it comes to assessing the potential of sustaining technologies, but they are reliably inaccurate when it comes to assessing the potential of disruptive technologies. In fact, as the “Beyond Consumer Led” figure shows, many Level 6 and 7 opportunities come from needs that consumers rarely articulate. Opportunities are also available from customers who are not yet served. Tapping these unexploited opportunities is why breakthrough innovation is so powerful.

Reach & Range of the Internet

When thinking about the ability to reach customers, the Internet and Internet Connected Devices have greatly expanded a company’s ability to do so. As shown in the “Reach & Range of the Internet” figure, transactions have moved from only being able to be done internally, to now being able to reach almost anyone anywhere in the world. Likewise the Internet platform has moved from a communication tool of standardized messages to now being able to consummate the most complex cooperative transactions, through both people and autonomous agents. For example, it was boom in the late 1990s that took the lead in redefining business models. Having products and services delivered through small local retail outlets changed dramatically. Superstores came in and dominated the landscape. These were followed immediately by virtual stores. The Internet drove overnight delivery of products direct to consumers’ homes and places of business. From an ideation standpoint the questions in the center of the graphic are useful in selecting various platform capabilities to use when commercializing a new idea.

Summary of Constraints on Consumption

When it comes to identifying opportunities for breakthrough innovation, a good place to start is to spot constraints on consumer consumption. In the “Summary of Constraints on Consumption” figure, four categories are discussed. These are constraints on skills, wealth, access, and time. Being observant to when these constraints occur in everyday life is a good source of ideas. Another place to look for ideas is to think about the concept of “jobs”. This concept holds that consumers don’t really buy products; they hire them to get “jobs” done. To identify opportunities to create new growth, look first for important jobs that people can’t get done satisfactorily with available products. The way to do this from an ideation standpoint is to create a “Jobs Tree” as shown in the figure (for the case of preventing disease and injury).

Jobs Tree

Signals of Change

Another way to find opportunities at Level 6 and 7 are to focus on three marketplace signals. These are: 1. Signals of Change. 2. Competitive Battles. 3. Strategic Choices. The three corresponding figures show the details to look for in each marketplace signal group.

Competitive Battles
Strategic Choices

Some problems at this level are called “Wicked Problems”. Characteristics of such Wicked Problems according to Horst Rittel are that they “cannot be exhaustively formulated, every formulation is a statement of a solution, no stopping rule, no true or false, no exhaustive list of operations, many explanations for the same problem, every problem is a symptom of another problem, no immediate or ultimate test, one-shot solutions, every problem is essentially unique, and the problem solver has no right to be wrong”. To solve such problems one has to shift from “problem design thinking” to “purpose design thinking”.

Design Process

Problem-Based Design Thinking comes from weakness, from need, from fear, from dislike, from hate, from pain, or in reaction to something. In contrast Purpose-Based Design Thinking comes from strength, from creative urge, from hope, from love, from caring, or by intention. From these characteristics it is easy to see why the problem solving methodology for breakthrough innovation differs significantly from that of incremental innovation. According to Harold Nelson the design process goes through nine steps. These are shown in the “Design Process” figure.

In business there are usually two elements to a problem. The first is to see the future environment and how people will relate to products and services in that future. From that picture we can clearly identify gaps and utilize an approach such as brainstorming to fill those gaps with products and services that will build us a profitable business. It is seeing that future clearly that is a Level 6 and 7 activity. There are two methodologies that allow one to envision future technologies and services that have never been seen before or can’t be done. We will also explore a business development approach and methodology that focuses on the same types of activities. These examples should give us the understanding and courage to tackle problems at this level.

Steps to Seeing the Future

To address the first challenge, seeing the future, thoughts from Joe Coates are most helpful. His insight and wisdom shows up throughout his lectures and presentations. Joe’s business practice was based on three assumptions: (1) We have the capability to see the future whether it is five or 50 years ahead, with enough clarity and confidence that it is useful for planning. (2) We have to have the capability to intervene in the evolving future to make the undesirable less likely and the desirable more likely. (3) We have the obligation to use these capabilities to anticipate and influence the future. These are bold statements but by using the methodologies outlined in this section it absolutely is possible to see the future with the clarity needed to develop products and services that will intercept trends.

The first way to see the future is to utilize Pattern Analysis which is based on the premise that the future will replicate past events. Examples of this are the famous Moore’s law which shows a regularity of improvements in transistors over three decade period. Likewise the changes in local area network transmission rates over four decades are also a linear progression on a log plot. Such techniques are normally valid when controlling factors are well-defined and relatively constant. The techniques prove most useful when quantitative projections are required. Clearly the use of such techniques requires relevant and accurate data. Where they breakdown is when the forces driving the change are in flux. The general types of Pattern Analysis are: Analog Analysis, which uses one or more analogous situations to project future trends or events. Precursor Trend Analysis, which projects future developments in a lagging technology by correlating them with previous developments in a related leading technology. Morphological Analysis, which envisions new products or services by first defining the essential functions involved in the current product or service and then postulating alternative ways for accomplishing each of these functions in new ways or by combining them. Feedback Models which refine forecasts by giving special attention to the effects of one development on another related development. For example the increasing adaptation of fax machines increased their perceived value and thus promoted further adoption.

It is also possible to develop products and services never before contemplated. A way to envision the future is to look at it from different levels of abstraction. The work done by Vanston and Vanston, as reported in Research Technology Management, ties one’s view of the future to the levels of creativity that we’ve been discussing. Level 6 and 7 creativity requires a range of futures or ambiguity as described in the “Steps to Seeing the Future” figure.

Five Views of The Future Strategic Analysis Framework

A methodology to get to alternate futures, i.e. a range of futures, with richer ambiguity is shown in the “Five Views of The Future Strategic Analysis Framework” figure. This method uses five thinking styles. It is a group process because as individuals, we each tend to favor and are likely competent in only one. There are those of us that are extrapolated, pattern analyst, goal analysts, counterpuncher’s, and intruders. We each have our own bias.

The diversity of viewpoints comes from utilizing the complexity of individual thinking styles, working together in small protagonist, antagonist, and synergistic team environments. Thus it is important to seek skilled outside help to facilitate such efforts. It’s important to build out a team with each of the different types of views. This is especially important when one is looking at a range of futures that are truly ambiguous. The hardest part for most of us is to take the first step. We’re working in organizations faced with the true need to reinvent itself, and it takes courage to move into the truly unknown.

Sources of Positive Turbulence

To prepare individuals for participation in the following activities Stan Gryskiewicz recommends that “Sources of Positive Turbulence” be tapped as shown in the figure. All of these sources serve to broaden an individual’s perspective and enhance their tactic knowledge.  Such a breadth of experience and perspectives is what makes the below activities rich and capable of producing breakthrough ideas. Note that these sources have to be tapped over time for both individuals and organizations.  Tapping them at the last minute isn’t as fruitful.

To create a range of futures from a truly ambiguous situation Joe Coates outlines how to do a future studies in the “How to do a Futures Study” figure. When broken down in this manner a difficult process becomes manageable.

The first step describing a system to be studied oftentimes requires several iterations. An example of such a picture is shown for Packaging in the “Example System to Be Studied” figure. Capturing ideas using butcher paper with large and different shaped post-it notes for the background and elements is a good way to start.

Example System to Be Studied

Creating a systems diagram in defining the key elements should be done with both internal and external experts. It takes several iterations to identify all the key actors and stakeholders. Such a picture starts with identifying the driving forces, then identifying the trends that are creating those driving forces. The two examples that follow will show how to explore the potential for change. The “Thinking Expedition” is a good method for discovering inventions, and the “Trend Identification and Analysis” thereafter is a good method for looking at how the world is going to potentially change. What evolves are policies, plans, and specific actions to take. It may seem daunting at first, but when done right these methods do deliver results. The key is to keep Doug Hall’s framework of having “fun” in mind.

Four Phases of Strategic Flexibility

When using forecasted futures in the ideation process, it’s important to remember the “Four Phases of Strategic Flexibility” as shown in figure. Scenario building for ideation in each of the scenarios will be required, however it’s useful to define which future is likely to be “core” and which are likely to be “contingent”. Resource intensive ideation methods, as will be discussed below, should be applied the most likely “core” scenarios whereas for the “contingent” scenarios the lighter weight ideation methods of Level 3 to 5 are likely sufficient, that is until it is observed that the world is in fact moving towards one of those contingent scenarios.

A program design for how to go through this breakthrough innovation process in a more or less conventional manner (in line with traditional management practices) is shown in the “Breakthrough Innovation Project Flowchart” figure. This example project provides the rough timing required, activities involved and outcomes of each activity.

Breakthrough Innovation Project Flowchart

When going through these exercises sometimes one discovers that you need to invent a flying saucer. Finding that you need to do things that haven’t been done or doing things that you really believe can’t be done is a daunting task. To do this in the early 1990s Rolf Smith developed a School For Innovators along with Mike Donohue, then director of the Colorado Mountain School. Their idea was to design problem solving activities along the lines of a “Thinking Expedition”, completely integrated with outdoor mountaineering related problem solving.

Thinking Expedition Activities to Get the Team to Level 7 Thought

In a series of a bold experiments in 1993 around real-world challenges facing companies like Exxon, ARCO, British Petroleum, Hoechst Celanese, and Mohawk Carpet, the methodology of the thinking expedition was refined. The objective of the thinking expedition is to take a team of individuals to Level 6 and Level 7 thought required to solve their business problem. To do so a series of activities are undertaken over a period of two to three days. The “Thinking Expedition Activities to Get the Team to Level 7 Thought” figure outlines the activities the team undergoes as it moves through these different levels.

The methodology starts by introducing a team to what a “real world” expedition really is and establishes ground rules for the “thinking” expedition. To do this group activities start at low levels, i.e. thinking about doing things right both within the team room, at work and in one’s personal life.

As the activities progress throughout the day the team moves on to Level 2 thought and starts focusing on doing the right things as a team, and focuses on how to use new thinking tools techniques and processes. The real shift occurs as the meeting moves to focusing on Level 3 thought, i.e. doing things better. Group behavior at this point becomes interesting “mess finding”. This turns out to be hard mental work. Using the subconscious mind is also a key element of this expedition. The expedition takes place over many days in part because it uses sleeping time to let the participants’ minds work on the problems at hand. Level 4 and 5 occupy most of the next day. To build skills, exercises focus on the problem at hand, problems related to the work environment in general, and one’s personal life. Problem solving techniques are introduced and refined to take each person to higher levels of creativity. The “Map of Thinking Expedition Activities To Get To Level 7 Thought” figure is a pictorial view of how expeditions are run.

Map of Thinking Expedition Activities To Get To Level 7 Thought

The last day of the expedition utilizes human emotions, group dynamics and group diversity in a way that uncovers impossible solutions to problems. The expeditions move companies in to explore new products and business development frontiers. Projects saving tens to hundreds of millions of dollars, and new products worth tens to hundreds of billions of dollars, are often achieved. It is hard work but worth the investment in time and outside resources to do the impossible.

A final observation here as we think about Level 6 and Level 7 creativity is that outside service providers are often critical to the success of a project. Finding competent service providers is another matter however. The best are often small boutique service firms where the principals have experience over many years, working in both large and small organizations. These individuals have acquired the wisdom needed to lead others to successful products and services. Often times the tendency is to migrate towards large well-known firms, but organizations that are typically best for the creative needs of a corporation at Level 6 and Level 7 work are almost exclusively small service provider companies.

Organizational Alignment for Innovation

Three Domains of Corporate Innovation

Being able to strategically engage creative thought and implement the results is what generates business value. Innovation in this context is the process of envisioning and successfully implementing new ways of doing things. This involves strategic foresight, plus creativity, plus the ability to implement. A graphic view of the strategic innovation sweet spot for most corporations is shown in the figure “Three Domains of Corporate Innovation”.

Getting to this corporate sweet spot is a matter of aligning all three hierarchical levels of a traditional organization. These are the project managers, middle management, and senior management. They are respectively involved with the tactical decisions, operational results, and strategic direction of the corporation. Studies have shown that the number one reason for failed innovation efforts is usually misaligned agendas between these levels of an organization.

Thus, what prevents companies from creating the future is: an installed base of thinking, unquestioned conventions, a myopic view of opportunities and threats, and the unchallenged precedence that comprises the existing managerial frame. People talk about the need to create a “learning” organization, but that this is only half of the solution. Just as important is creating an “unlearning” organization. In fact, this is actually more than half the battle because learning is much easier than unlearning.

Maslow Hierarchy of Needs

Why innovation and creativity is such a difficult task is probably best explained by looking at the “Maslow hierarchy of Needs” figure. It isn’t until one has completely fulfilled the bottom needs of the hierarchy that one starts to approach cognitive, aesthetic, and self-actualization needs. These are ones associated with truly innovative individuals and organizations. From an organizational standpoint if a corporation is not meeting the physiological, safety, belongingness and esteem needs of employees, it is in trouble. If the company’s leadership is confused, or misalignment between mission, vision and values exists, the innovation part of the organization is going to struggle to produce business success.

Three Intelligences: Access, Strengths, Weaknesses
Interactions of Three Intelligences: Positive and Negative Impacts

The “Three Intelligences” figure describes the characteristics of the three intelligences needed for breakthrough innovation. Leaders need to access all three intelligences and also need the ability to discern which intelligence or combination of intelligences best fits the issues they encounter. However, many organizations do not give sufficient attention to all three intelligences. For most leaders the analytical intelligence is well-developed both because of academic training and continued work experience. In the past decade the concept of emotional intelligence is been widely accepted in many organizations. A significant number now work to develop their leaders’ emotional intelligence through training programs. The capability of many leaders is adequate but not exceptional in this regard. When it comes to innovative intelligence very few organizations have invested in the development of its leaders’ innovative intelligence or their ability to access it. Likewise very few organizations and leaders focus their development on the integration of all three intelligences to develop holistic leadership. Leaders not only need to develop their own capabilities but also need to be able to create a working climate in which all employees and teams can access all three intelligences in order to deliver maximum value to their customers, stakeholders, and employees. As the “Interactions of Three Intelligences” figure shows, individuals and teams with mixed strengths and combinations of the intelligences have both positive and negative impacts. Having leaders and teams become aware of thinking about the way they think and understand how to make choices about which intelligence to apply in any given situation is critical. Thinking about thinking is an integral process to help employees and teams solve problems.

deBono Thinking Hats

There are many systems which separate thinking into different functions and roles. The most popular method was developed by deBono. In his system each thinking role is identified with a colored symbolic “thinking hat” as shown in the “deBono Thinking Hats” figure. By mentally wearing and switching “hats,” individuals can easily focus or redirect thoughts, the conversation, or a meeting. Making sure teams are comprised of individuals who have innately diverse thinking styles is a key component of divergent innovation processes.

Smart Skills Details

A similar system was developed by SmartSkills. They use a model comprised of three primary types of thinking.
The first thinking type is JUDGE. It’s about what’s right and what should be. It focuses on rationale and opinions. It makes judgments and assessments. It demands to be convinced before deciding. It asserts personal values. It drives to come to closure.
The second thinking type is DESCRIBE. It looks for what’s true. It’s about what is or what was. It’s fact-based and goes into the details. It listens and watches with total awareness. It gathers and organizes data. It communicates clearly with others. This thinking type is neutral when it comes to making a decision.
The final thinking type is about CREATE. It focuses on what’s new, what might be. It looks for ideas and suggestions. It generates many ideas and finds creative ways around problems. It creates what if scenarios. It uses analogies and metaphors. This thinking type is not committed to a singular actionable answer.
The details can be seen in the “Smart Skills Details” figure. Like the DeBono thinking hats this is another way in which individuals can be assessed for their divergent thinking styles. Making sure the teams are diverse in this respect is also helpful.

KAI Differences

Another way to segment individuals for ideation work is to use Myers-Briggs scores. Although the Myers-Briggs types to not correspond well to creative thinking per se, having diverse Myers-Briggs types on innovation teams will ensure that as the team progresses through ideation and onto commercialization processes, Myers-Briggs diversity will be helpful. For thinking creatively, an associated indicator is the Kirton Adaptive Index type. This is a very powerful tool that is often used to segment team members when going on Thinking Expeditions. From a leadership standpoint it’s important to note that the differences in KAI scores and the perceived member competence show up in various team member behaviors, see the “KAI Differences” figure. Leaders have to be cognizant of these factors when putting together innovation teams.

The topic of creativity within an organization cannot be complete without mentioning Innovation Midwives, a role in the organization identified by Lanny Vincent. In large organizations the innovator’s culture is oriented to explore a wide range of new ideas, trends, and technologies and transform those explorations into useful, practical inventions. Creative individuals push the envelope of the business boundaries. In contrast the senior management’s culture is different. These higher level executives may provide support and resources to the innovation subculture but seldom if ever become directly engaged in the work of innovators themselves. Innovation in the sponsor’s culture is understood as financial investments in some process or set of people, or both, from which there is an expectation that a financial return commensurate with the risk will occur. Innovation Midwives translate between these two cultures in the organization. In fact in large organizations a network of Innovation Midwives or Gatekeepers could be seen as a third culture that views innovation in a more Darwinian fashion, as a portfolio of mutations generating a sufficient variety ideas to enable a robust selection and retention of innovations to serve the organization’s sustained growth. Innovation Midwives appreciate the immediate business realities and the need for control while at the same time understand the need for innovation and the challenges and realities innovation management represents. Such Innovation Midwives can be identified by studying network communication diagrams in large organizations. Communication nodes are often the midwives, who although they have no formal role within the organization, are keys to companies sustaining an advantaged competitive position. Smart executives are careful to identify and protect Innovation Midwives.

Organizations also have another form of resource that rests on the ability to blend different types of resources in ways that multiply the value of each. What is critical is not just possessing discrete skills but also an organizaation’s capacity to blend those technologies to create a world-class engine. This requires technology generalists, systems thinking, and optimization of complex technical trade-offs. Absolute leadership in a narrow range of technologies may count little, and the resources expended in that quest may remain substantially under-leveraged, if the firm is not good at the subtle art of blending. When it comes to leveraging resources, the capacity for technological integration and harmonization maybe just as important as a capacity for invention.

A company must also be balanced. Blending and balancing are different, as one involves the creative interweaving of disparate skills and the other involves taking ownership of resources that multiply the value of the firm’s unique competencies. Balance is between three elements: a strong product development capability, the capacity to produce products and deliver services at world-class levels of cost and quality, and a sufficiently wide spread distribution, marketing, and service infrastructure. In short, a capacity to invent, make, and deliver. Without balance, a company can become a research division for another organization. This happened in the 1990s at Eastman Chemical where they invented many unique new polymer products yet it was Shell and Dow that patented around them and commercialized and distributed those products to the marketplace. Needless to say the financial performance of Shell and Dow significantly outperformed that of Eastman Chemical.

To assure successful innovation, a typical program involves four phases:
Phase 1 is planning for successful innovation. It often involves senior management interviews to identify bottlenecks to success in obtaining their buy-in. During this phase the team that is going to do the work is often introduced to the tools and techniques of creative problem solving and spends time determining the outside resources that they wish to engage. This was covered in the sections above.
Phase 2 has two parts. It usually involves the development of a strategic vision and identification of key opportunity areas, followed by specific new business opportunities. These developing opportunities are refined and the appropriate action plans determined. It is wise to use external thought leaders here to act as catalysts and stimulate the strategic vision process. As we saw above with Joe Coates’ work, it’s important to integrate new information and perspectives on emerging trends, dislocations that the industry is likely to experience, as well as world economic trends and changes into the plans. Through a facilitated process consensus is built, the opportunities ranked, and the leading opportunities selected.
Phase 3 involves exploring and maximizing consumer research efforts. This phase probes consumers and users in different geographic markets and watches consumers’ reactions to new concepts. This often involves prototypes.
Phase 4 involves innovation through implementation. The results of the initial market research involving real consumer feedback is presented to senior management for approval to move forward and put together the resources to fund scale up of the business.
Although the process is simple it is wise to use experienced outside resources to ensure project and program success. Remember we’re working at levels where the solution is not known to the world.

Leader’s Role

The Leader’s primary role in such innovation processes is shown in the “Leader’s Role” figure. There are four areas in which all leaders of innovative work need to be effective. 1. They need to leverage the added value of teams. 2. They need to encourage and model the use of innovative thinking. 3. They need to understand when to focus on innovation when to focus on stability. 4. They need to ensure that the leaders at all levels of the Corporation are ready to commercialize the results of innovative efforts.

Sources of Innovation

It is important to remember that innovation can take many different forms. The “Sources of Innovation” figure shows some classes of innovation. We’ve discussed the technology changes but one can also innovate with respect to the organization and the processes it uses, the channels by which it reaches its customers, the way in which markets are combined, redefined, truly unique and different business models, and finally altering and redefining brands and trademarks.

In his book “Fourth Generation R&D”, Bill Miller outlines the role of Chief Innovation Officer as contrasted to Chief Technology Officer so that innovation in each of the six domains occurs. It is this change in the way of innovating new products and services that has made this century’s business significantly different from the work of the last.

The reason behind having someone responsible for innovation is that for each level of innovation there is a corresponding Level of Fear within the organization. Fear is driven by reverse thinking, what could go wrong as opposed to what could go right. The Levels of Fear surface rapidly during a Thinking Expedition as a group moves up through the seven levels of change and their corresponding seven levels of thinking. The corresponding seven levels of fear are: .

LEVEL 1: PARALYSIS. Fear of doing the wrong things. Doing nothing.
LEVEL 2: INEFFICIENCY. Fear of wasting time. Fear of doing the right things wrong.
LEVEL 3: CATASTROPHIZING. Fear of things getting worse. Fear of bad weather. Seeing only the worst case.
LEVEL 4: HOLDING ON. Fear of letting go. Focusing on the 80% that only brings 20% of the value. Fear that stopping “just do something” will be a mistake. Just in case fear “let’s take everything just to be safe”.
LEVEL 5: SELF-DOUBT. Fear of not being physically able. Fear of not copying the right thing. Fear of copying the right things wrong. Fear of being laughed at. Fear of criticism. Fear of self.
LEVEL 6: NORMALCY. Fear of being different. Fear of being noticed. Fear of being laughed at. Fear of rejection. Fear of tradition. Fear of trying different things that might not work. Fear of the unexpected. Fear of getting hurt. Fear of exposure.
LEVEL 7: DISBELIEF. Fear of the unknown. Fear of no basis of comparison. Fear of problem size. Fear of believing. Fear of a weakness in the system below you. Fear of total failure. Fear of the point of no return. Fear of death, not coming back alive. Fear of others dying. The sum of all fears.

Creativity summary

Understanding how the human creative process works has come a long way. No doubt artificial intelligence will move us even further in the future, but for today the tool certainly exist for most corporations to undertake ambitious growth goals. There is no reason to fear the unknown when looking forward to what a person’s business might be. The knowledge of how to move forward and the resources capable of assisting to do so are both available.

Organization Innovation Assessment Questionnaire

To determine an organization’s capability for innovation the following questionnaire is provided. It is a means to look at the different elements that go into an organization’s capability. After answering each question and scoring the four areas, all answers can be added up to get a grand total. Scores higher than 400 points represents a solid innovation capability. Scores of 300 to 400 are good. A score 300 to 350 is acceptable but needs improvement. Score below 300 leave lots of room for improvement and a score below 200 suggests there are not many possibilities for innovation. .

To fill out the below questionnaire, for each question rank your organization’s capability for innovation on a scale between 1 and 10:

lb. Have a stated and working strategy of process innovation (includes process redesign/reengineering)
2b. Develop structural mechanisms for process redesign/reengineering initiatives
3b. Reward process creativity and innovation
4b. Create a vision/strategic intent for process innovation
5b. Treat employees as a vital resource for building competitive advantage in processes
6b. Hold creative process employees and their contributions in high esteem
7b Proactively create new opportunities, and respond to change relative to new processes
8b Possess a market orientation for creating processes (it is close to its customers)
9b. Require cross-functional and customer/supplier process redesign/engineering teams
10b. Celebrate new process successes
11b. Allow employees to make mistakes when innovating processes
12b. Have process idea people
136. Encourage new ideas and risk taking with processes
14b. Continuously create new processes for manufacturing
15b. Requite relevant managers to have objectives for process innovation and evaluate their erformance relative to these objectives
16a. Have new product/research centers
17a. Have management information systems for product innovation to scan the environment, monitor and benchmark competitors determine best practices, keep abreast of new technologies, monitor market conditions, and exchange information internally
18a. Suspend judgment on new product ideas
19a. Have product idea/innovation champions
20a. Value and practice openness with respect to products
21a. Successfully practice continuous as well as “big bang” product innovation
22a. Put each and every product on trial for its life every 18 months to two years
23a. Have open communication between product innovation centers/teams and the rest of the organization
24a Have formal product idea assessment systems
25a. Empower subordinates: delegate sufficient authority for employees to innovate new products
26a. Train employees to be creative for product development
27a Possess a shared value that this is an innovative organization insofar as products are concerned
28a. Engage in knowledge management for product development—identifying knowledge assets, sharing information tapping innate knowledge of individuals
29a. Make commercialization of new ideas a priority
30a. Structure for flexibility to adapt and seize the opportunity for new products
31a. Have a system for getting the products from the lab to the marketplace
32a. Use a problem-solving management style for developing new products
33a. Use many of the 100 or more creativity processes such as brainstorming, verbal checklists, mind mapping, storyboarding, lotus blossom and so on for product development
34a. Manage organizational culture to make it more innovative for product development
35a. Practice organizational learning—learn from experience and share knowledge about products
36a. Use speed strategies for new-product development
37a. Use alliances to obtain product innovation
38a. Use both formal and informal product innovation information exchanges within the company
39a. Use transformational leadership for product development
40a. Provide time for/encourage reflection about products
41a. Place a high value on change and make it part of the organization’s culture with respect to product development
42a. Leverage resources to achieve seemingly unobtainable product objectives
43a. Know when and how to lead the customer to new or enhanced products or services
44a. Have an effective and efficient structure for creating new products
45a. Have effective suggestion programs for products
46.. Use special approaches in managing innovative product development employees
47a. Provide physical facilities conducive to idea exchange and creative thinking about products
48a. Require relevant non-managerial employees to have objectives for product innovation and evaluate their performance in relation to those objectives


lb. Have a stated and working strategy of process innovation (includes process redesign/reengineering)
2b. Develop structural mechanisms for process redesign/reengineering initiatives
3b. Reward process creativity and innovation
4b. Create a vision/strategic intent for process innovation
5b. Treat employees as a vital resource for building competitive advantage in processes
6b. Hold creative process employees and their contributions in high esteem
7b Proactively create new opportunities, and respond to change relative to new processes
8b Possess a market orientation for creating processes (it is close to its customers)
9b. Require cross-functional and customer/supplier process redesign/engineering teams
10b. Celebrate new process successes
11b. Allow employees to make mistakes when innovating processes
12b. Have process idea people
136. Encourage new ideas and risk taking with processes
14b. Continuously create new processes for manufacturing products or delivering services
15b. Requite relevant managers to have objectives for process innovation and evaluate their performance relative to these objectives
16b. Have process redesign reengineering programs/centers
17b. Have management information systems for process innovation to scan the environment, monitor and benchmark competitors, determine best practices, keep abreast of new technologies, monitor market conditions, and exchange information internally
18b. Suspend judgment on new process ideas
19b. Have process idea/innovation champions
20b. Salve and practice openness with respect to processes
21b. Successfully practice continuous process innovation and reengineering
22b. Put each and every process on trial for its life every 18 months to two years
23b:f Have open communication between process innovation teams and the rest of the organization 24b. Have formal process idea assessment systems that separate creation from evaluation and look beyond simple financial analysis
25b. Empower subordinates: delegate sufficient authority for employees to innovate new processes
26b. Train employees to be creative for process development
27b. Possess a shared value that this is an innovative organization insofar as processes are concerned
28b. Engage in knowledge management for process innovation—identifying knowledge assets, sharing information, tapping innate knowledge of individuals
29b. Make process effectiveness and efficiency a priority 30b. Structure for flexibility to adapt mod seize the opportunity for new processes
31b. Have a system for implementing process innovations
32b. Use a problem-solving management style for developing New processes
33b. Use many of the 100 or more creativity processes such as brainstorming, verbal checklists, mind mapping, storyboarding, lotus blossom and to on for process development
34b. Manage organizational culture to make It more innovative for process redesign
35b. Practice organizational learning—learn from experience and share knowledge about processes
36b. Use deadlines and/or objectives that stretch performers’ capabilities to speed process innovation
37b. Use alliances to obtain process innovation
38b. Use both formal and informal process innovation information exchanges within the company
39b. Use transformational leadership for process development
40b. Provide time for/encourage reflection about process.
41b. Place a high value on change and make it pan of the organization culture with respect to process redesign
42b. Leverage resources to achieve seemingly unobtainable process objectives
43b. Know when and how to lead the customer to lower costs and /or higher quality mulling from improved processes
44b. Have an effective and efficient structure for creating process improvement innovation
45b. Have effective suggestion programs for processes
46b. Use special approaches in managing innovative process-redesign employees
47b. Provide physical facilities conducive to idea exchange and creative thinking about processes
48b. Require non-managerial employees to have objectives for process innovation and evaluate their performance in relation to those objectives
49b. Invest heavily and appropriately in process R&D


1c. Have a stated and working strategy of marketing innovation
2c.Develop structural mechanisms for marketing innovation
3c.Reward marketing creativity and innovation
4c.Create a marketing vision/strategic intent
5c.Treat employees as a vital resource for building competitive advantage in marketing
6c.Hold creative marketing employees and their contributions in high esteem
7c.Proactively create new marketing opportunities and respond to flange relative to marketing innovations
8c.Possess a market orientation (it is close to its customers)
9c. Require cross-functional marketing innovation teams
10c. Celebrate creative/innovative marketing successes
11c.Also marketing employees to make mistakes when innovating
12c.Have marketing idea people
13c.Encourage new marketing ideas and risk taking
14c.Market products or services innovatively
15c.Require relevant managers to have objectives for marketing innovation and evaluate their performance relative to these objectives
16c.Have marketing innovation programs/centers
17c. Have management information systems for marketing innovation to scan the environment for new opportunities, monitor and benchmark competitors determine best practices, keep abreast of new technologies, monitor market conditions, and exchange information internally
18c. Suspend judgment on new marketing ideas
19c. Have marketing idea /innovation champions
20c. Value and practice openness with respect to marketing
21c. Successfully practice continuous as well as “big bang” marketing innovation
22c. Put each and every marketing practice on trial for its life every 18 months to two years
23c. Have open communication between marketing innovation centers/teams and the rest of the organization
24c. Have total marketing idea assessment systems that separate creation from evaluation and look beyond simple financial analysis
25c. Empower subordinates: delegate sufficient authority for marketing employees to be innovative
26c. Train marketing employees to be creative
27c. Possess a shared value that this is an innovative marketing organization
28c. Engage in knowledge management in marketing—identifyingknowledge assets, sharing information tapping inmate knowledge of individuals
29c. Make marketing innovation a priority
30c. Structure for flexibility to adapt and seize marketing opportunities
31c. Have a system for implementing marketing innovation
32c. Use a problem-solving management style for solving marketing problems
33c. Use many of the 100 or more creativity processes such as brainstorming, verbal checklists, mind mapping, storyboarding, lotus blossom and so on for marketing innovation
34c. Manage organizational culture to make marketing more Innovative
35c. Practice organizational learning—learn from experience and share knowledge about marketing
36c. Use deadlines and/or objectives that stretch performers’ capabilities to speed marketing innovations
37c. Use alliances to obtain marketing innovation
38c. Use both formal and informal marketing innovation information exchanges within the company
39c. Use transformational leadership in marketing innovation
40c. Provide time for/ encourage reflection on marketing
41c. Place a high value on change and make it part of the marketing organization’s culture
42c. Leverage resources to achieve seemingly unobtainable marketing innovation objectives
43c. Know when and how to lead the customer to new or enhanced product or service opportunities through innovative marketing
44c. Have an effective and efficient structure for creating marketing innovation
45c. Have effective marketing improvement suggestion programs
46c. Use special approaches in managing innovative marketing employees
47c. Provide physical facilities conducive to idea exchange and creative thinking in marketing
48c. Require relevant non-managerial employees to have objectives for marketing innovation and evaluate their performance in relation to those objectives
49c. Invest heavily and appropriately in marketing R&D


1d. Have a stated and working strategy of management innovation
2d. Develop structural mechanisms for management innovation
3d. Reward management creativity and innovation
4d. Create a management vision/strategic intent
5d. Treat employees as a vital resource for building competitive advantage in management
6d. Hold creative managers and their contributions in high esteem
7d. Proactively create new management opportunities and respond to change relative to management innovations
8d. Possess a market-based management orientation (it is close to its customers)
9d. Require cross-functional management innovation teams
10d. Celebrate creative/innovative management successes
11d. Allow managers to make mistakes when innovating management
12d. Have management idea people
13d. Encourage new management ideas and risk taking
14d. Practice innovative management
154. Require managers to have objectives for management innovation and evaluate their performance relative to these objectives
16d. Have management innovation programs/centers
17d. Have management information systems for management innovation M scan the environment for new opportunities, monitor and benchmark competitors, determine best practices, keep abreast of new technologies, monitor market conditions, and exchange information internally
18d. Suspend Judgment on new management ideas
19d. Have management idea/innovation champions
20d. Value and practice openness with respect to management
21d. Successfully practice continuous as well as ‘big bang” (reengineering-based) management innovation
22d. Put each and every management practice on trial for its life every18 months to two years
23d. Have open communication between management in centers/teams and the rest of the organization
24d. Have formal management idea assessment systems that separate on from evaluation and look beyond simple financial analysis
25d. Empower subordinates: delegate sufficient authority for manager: to be innovative
26d. Train management employees to be creative
27d. Possess a shared value that this an innovatively managed organization
28d. Engage in knowledge management of the management process itself—identifying knowledge assets, sharing information, tapping innate knowledge of individuals
29d.Make management innovations priority
30d.Structure for flexibility to adapt and seize management opportunities
31d.Have a system for implementing management innovation
32d. Use a problem-solving management style for solving management problems
33d. Use many of the 100 or more creativity processes such as brainstorming, verbal checklists, mind mapping, storyboarding, lotus blossom and so on for management innovation
34d. Manage organizational culture to make management more innovative
35d. Practice organizational learning—learn from experience and share knowledge about management
36d. Use deadlines and/or objectives that stretch performers’ capabilities to speed management innovations
37d. Use alliances to obtain management innovation
38d. Use both formal and informal management innovation information exchanges within the company
39d. Use transformational leadership in management innovation
40d. Provide lime for/encourage reflection on management
41d. Place a high value on change and make it pan of the organization’s management admire
424. Leverage resources to achieve seemingly unobtainable management innovation objectives
43d. Know when and how to lead the customer to lower costs and/or higher quality resulting horn innovative management
44d. Have an effective and efficient structure for creating management innovation
45d. Have effective management improvement suggestion programs
46d. Use special approaches in managing innovative management employees
47d. Provide physical facilities conducive to idea exchange and creative thinking in management
48d. Require relevant non managerial employees to have objectives for management innovation and evaluate their performance in relation to those objectives
49d. Invest heavily and appropriately in management R&D

Looking at the scores from the questionnaire according to the below “Scoring Key” figure allows for more detailed information into your organization strengths and weaknesses. For companies delving this deep into the process it is strongly suggested to use James Higgins work as a resource.

Sources, References and Selected Bibliographic Information

1. “Directed Evolution – Philosophy, Theory and Practice”, by Boris Ziotin and Alla Zusman, white paper, Ideation International, 2001.
2. “The Structure of Scientific Revolutions”, third edition, by Thomas Kuhn, the University of Chicago press, Chicago, 1962.
3. “A Strategy for Creativity, Innovation, and Continuous Improvement”, by Rolf Smith, The Office of Strategic Innovation, Inc.
4. “The 7 Levels of Change: Different Thinking for Different Results”, by Rolf Smith, Tapestry Press, 2007
5. “Model of creative problem solving”, by the Creative Problem Solving Institute (CPSI) an activity of the Creative Education Foundation.
6. “Creative Problem Solving Model”, adapted from CPSI models, courtesy of The Office of Strategic Innovation, Inc.
7. “A Cube Model – used to depict the segmented market by “User”, “Place”, and “Desired Market”, by Boston Consulting Group
8. “Typical Market Research Plan”, by Boston Consulting Group
9. “Summary of Research Results by Attractiveness of Individual Market Segment”, by Boston Consulting Group
10. “Matrix of Market Segment Results”, by Boston Consulting
11. “Growing Joint Clusters”, source EPO Seminar on Search and Documentation Working Methods, 2005.
12. “Declining Joint Clusters”, source EPO Seminar on Search and Documentation Working Methods, 2005.
13. “Process Improvement Creativity Methodology”, source unknown
14. “Applied Imagination”, by Alex Osborne , 1949.
15. “Jumpstart Your Brain”, by Doug Hall, Warner books, New York, 1995.
16. “Escape from the maze: nine steps to personal creativity”, James Higgins, the new management publishing company, New York 1997.
17. “Innovation games, creating breakthrough products through collaborative play”, by Luke Hohmann, Addison-Wesley, New York, 2007.
18. Over 300 articles and editorials, by Joe Coates, Technology Analysis & Strategic Management
19. “Testing the Tea Leaves, Evaluating the Validity of Forecasts” by Vanston, J. H. and Vanston, L., Research Technology Management, Vol. 47, No. 5, September October, 2004, pp. 33 to 39.
20. “Coming to Grips with the Future,” by Joe Coates, Research Technology Management, Vol. 47, No. 5, September October, 2004, pp. 23 to 32
21. For Thinking Expedition details see
22. “Three Domains of Corporate Innovation”, white paper by Creative Realities,
23. “Sources of Innovation”, white paper by New Edge,
24. “4th Generation R&D”, by William L. Miller and Langdon Morris, Wiley, August 1999.
25. “Strategic New Business Opportunity Identification”, white paper by IdeasScope Associates, 1993.
26. “Positive Turbulence: Developing Climates for Creativity, Innovation, and Renewal”, by Stan Gryskiewicz, Wiley, 1999.
27. “Operators Improve Innovative Capability – A Case Study”, by Ron Fulbright, White Paper from University of South Carolina Upstate,2018.
28. “Clarify the type of creative thinking you want to achieve”, Workshop by Ideaction, circa 1995.
29. “Design and action systems thinking”, by Harold Nelson, Presentation at Association for Managers of Innovation meeting, Mar 1997.
30. “The seven levels of fear”, by Rolf Smith, Presentation at Association for Managers of Innovation meeting, April 2006.
31. “The McKinsey Mind”, by Ethan Rasiel and Paul Friga, Audio-Tech Business Book Summaries, Nov. 2001.
32. “The Creative Edge”, by William Miller, Addison Wesley, 1987.
33. “The Development Factory”, by Gary Pisano, Harvard Business School Press, 1997.
34. “Planned Innovation”, by Frank Bacon and Thomas Butler, University of Michigan Press, 1981.
35. “Everyday Heros”, by Perry Gluckman and Diana Reynolds Roome, Process Plus Press, 1989.
36. “Innovate or Evaporate”, by James Higgins, The New Management Publishing Co., 1995.
37. “Survival Strategies in a Hostile Environment”, by William Hall, Harvard Business Review, Oct 1990.
38. “Seeing What’s Next”, by Clayton Christensen, Scott Anthony, Erik Roth, Harvard Business School Press, 2004.
39. “The Creativity Handbook”, Handbook by Office of Innovation, Hoechst Celanese Corp., 1994.
40. “Are We Creative Yet”, Handbook by DuPont Corp., 1990.
41. “Conceptual Blockbusting”, by James Adams, George McLeod Ltd., 1979.
42. “Mining the Talk”, by Scott Spangler and Jeffrey Kreulen, IBM Press, 2008.
43. “Pattern Analysis”, by unknown, Research Technology Management, Feb 2003.
44. “The Innovator’s Guide to Growth”, by Scott Anthony, Mark Johnson, Joseph Sinfield, and Elizabeth Altman, Harvard Business School Press, 2008.
45. “Seeing Differently”, by John Seely Brown, Harvard Business Review Book, 1988.
46. “Radical Innovation”, by Richard Leifer, Christopher McDermott, Gina O’Connor, Lois Peters, Mark Rice, and Robert Veryzer, Harvard Business School Press, 2000.
47. “Creativity in Business”, by Michael Ray and Rochelle Myers, Doubleday, 1986.
48. “Where Good Ideas Come From”, by Steven Johnson, Riverhead Books, 2010.
49. “The Best of Innovating Perspectives”, by Lanny Vincent, Pamphlet by Vincent and Associates, 2000.
50. “More on Soft Systems for Hard Cores”, by Lanny Vincent, Pamphlet by Vincent and Associates, 2003.
51. “Shaping the Future”, by Peter Keen, Harvard Business School Press, 1991.
52. “Six Thinking Hats”, by Edward deBono,, 2019.
53. “Smart Thinking”, by Bob Wiele, Workbook from the Center for High Performance, 1995.
54. “Blueprints for Innovation”, by Charles Prather and Lisa Gundry, American Management Association Publications Division, 1995.
55. “The Care and Feeding of Ideas”, by James Adams, The Portable Stanford, 1986.
56. “Innovative Intelligence”, by David Wess and Claude Legrand, Wiley, 2011.