Knowledgeworks

Come and Try Out Your Agile Innovation Leadership Muscles - 16 Feb 2012

2012-01-23T05:16:00.000-08:00

A Flash Innovation Workshop with Victor Newman and Simon Evans, Innovoflow Ltd.

Developing Responsive Fast-Twitch Muscle Training for Rugby!

Date: 16^th February 2012 @ Hamilton House, University of Greenwich Timing: 0900-1700

Overview

Innovation Agility combines flexible thinking about your innovation process, the willingness to exploit the full range of options outside current products, services and business models, plus the ability to learn rapidly.

Agile Innovation Leadership skills are especially valuable in turbulent markets and for developing Open Innovation strategies to work with great ideas from both inside or outside the company, and also for going to market with external partners.

This workshop provides a model (through simulation) to help innovation leaders to develop agile thinking and the necessary decision making ability to operate successfully and meet the needs of the emergent, post-recession world.

Come and give your Agile Innovation Leadership muscles a try-out by clicking on this booking link and selecting the Agile Innovation Leadership workshop option.

Content

· A warm-up task to stimulate innovative thinking.

·         Current challenges and problems with innovation.
·         Use of simulations to accelerate innovation learning.
·         Introducing the concepts of the “Innovation Eco-System” the “Idea lifecycle” and “Agile Innovation leadership”. Discussion.
·         Learning from experience - using simulation components to illustrate examples of failed innovation initiatives and how they could have been rescued. Participants illustrate their experiences using the simulation.
·         Constructing an optimal innovation ecosystem with constrained resources.
·         Reverse Innovation Thinking: Identifying barriers to innovation and harvesting experience to develop antidotes.
·         Who is the custodian of the eco-system? Discussion
·         Summing up, review and take-aways.

Learning Objectives

To understand that innovation is at the core of all businesses
To understand the nature of an idea and how it survives
To take the broad view of innovation and ensure that ideas have the best chance of generating real value – it’s not just about coming up with ideas
To recognise that innovation must be “part of the day job”
To treat the innovation eco-system as something that requires feeding, watering and nurturing in order to be successful
(Most importantly!) recognise that innovation is not a free lunch - you must invest many different types of resource

Who should attend

All SMEs or entrepreneurs who care about developing innovation agility in a turbulent environment, who realise that new ideas sometimes need new ways of thinking and working, to turn them into practical products, services and business models.

Benefits to you and your business

·         Acquire a new and practical way of discussing and thinking openly about the way you innovate in your organisation.
·         Discover how to design and test a comprehensive innovation eco-system to ensure ideas are supported throughout their whole lifecycle to generate maximum value
·         An opportunity to share experiences of successful or failed innovation approaches and how to learn from them
·         Have an enjoyable learning day, much of which can be taken back to your business
·         To start to build a relationship with the Centre for Entrerprise & Innovation which could lead to other opportunities

How do you sell innovation to current business leaders?

2011-11-02T09:21:00.000-07:00

We are in an interesting situation. Businesses that could be investing in innovation are holding onto their cash and waiting to see how the global economy plays out. That’s one explanation. I have another.

There’s an old consulting joke that goes like this:

Question - How many consultants does it take to change a light-bulb?

Answer - The number of consultants is immaterial, the key issue is that the light-bulb has got to want to change!

Let’s unpack the current context: what have we got?

POLITICIANS: Who borrowed irresponsibly to create artificial economic growth & buy elections through unsustainable public service expansion and vanity projects.
BUSINESS LEADERS: Who successfully rode artificial growth-curves but don’t know how to grow businesses in a recession.
ORGANISATIONS: With Products/ Services & Business Models at the wrong end of the S cash-curve, who are betting their pensions and bonuses on product extensions.

And we have even got CONSULTANTS who can see the need to move out of EFFICIENCY strategies and into EFFECTIVENESS strategies but cannot package a new paradigm & don’t know how to sell it to current leaders, but we either innovate or we die and we cannot borrow our way into growth.

We can sell transactional efficiency, product optimisation process consulting BUT we know that having the right people with the right psychology will make a lot of the KPI architecture completely irrelevant. Unfortunately at the top, we have people (probably not really leaders in the true sense) who can play political games in a growth phase, but who may not be the right people to grow the business in the current environment through innovation.

So how can we sell change in order to innovate to people who don’t understand what it means? We could possibly begin with the linguistic trick that launched Lean Thinking. The word “lean” was powerful because of the implication that those who didn’t adopt it were fat (organisations). We need a similar linguistic trick that carries a hidden insult for non-consumers to act as a Trojan Horse to begin a literally vital, viral makeover.

Creativity, Projects, Project Leadership and Project Managers

2011-06-21T09:09:00.000-07:00

Spencer Holmes interviews me on Youtube, discussing creative thinking, project leadership and managers. An introduction to the 30/70 rule as a means of aligning specialists behind a project.

http://www.youtube.com/watch?v=1aigg1rMwZ8&feature=youtube_gdata_player

Toxic Efficiency: How to Kill Your Organization by Making Efficiency Your God

2011-06-06T08:50:00.000-07:00

Back in the 90s, I read an interesting book about fighting power by a retired US Colonel (Trevor N, Dupuy) much of which I disagreed with, where he established that the German Wehrmacht had by April 1945, quadrupled the fighting power of their infantry battalions in comparison with their capability in June 1940, this in spite of virtually halving the manpower on an infantry battalion down from 800 to approximately 400 men. What the author didn’t discuss was the futility of such developments, since the war was already lost and this kind of fighting power was irrelevant.

But the futility of focusing on transactional efficiency is often hidden in organisational cultures which prefer to work on solving problems that they can solve, that reinforce the collaboration of existing power and resourcing structures, instead of focusing on the problem whose resolution will lead to systematic change that will demolish current accumulated reserves of Relational Capital, whose new shape is unpredictable.

A few years later, I found myself facilitating the leadership of an automotive assembly plant on their strategic rationale for achieving the appropriate level of lean-ness as being the means of ensuring that they would be a natural site for the assembly of future models from their Japanese partners. I realized that there was something wrong with this as a viable strategy, but couldn’t put it into words.

Subsequently, I led an exercise in reverse-assembly of a 4WD vehicle in order to discover how to simplify the current assembly process. This was useful in that it led to the simplification of the assembly process by focusing on pre-assembly of modular components (so we could appear to reduce the man-hours involved in assembly), a significant reduction in the variety of fixing devices, and the final realisation that the 4WD vehicle needed to be redesigned and light-weighted (since it was really based on a heavy truck sub-frame and suspension system). We constructed a new prototype vehicle with significant benefits and showed it to our Japanese partner. The outcome was unexpected. I was asked to formally apologize to our Japanese CEO. As he drily put it: we do the innovation, you just assemble the product. At that point, I realized the danger of focusing on efficiency: it can mean that you lose the ability to invent new products, yourself.

In 2000, I was headhunted from Cranfield University to become Pfizer’s Chief Learning Officer, setting up a corporate university, organising governance, metrics and a system of barefoot practitioners. I realised that if I wanted to be successful in my own terms I had to connect closely with the strategy (developing a system of Strategic Learning Plans that answered the question of what do you need to be good at to deliver the strategy?, and what do you need to learn to provide the capability required?). I worked on improving the learning process for drug project teams whose lifecycle can take 8-10 years and involve considerable member rotation meaning that teams can unlearn as fast as they learnt. This lead to the invention of the Baton Passing technique with some significant improvements in time and cost-saving and reduction in attrition or failure.

Then in 2003 I suddenly woke up. I noticed that acquisitions were not delivering and it wasn’t down to the costs of integration. I realised that there was no point in optimising a strategy that would never deliver the shareholder returns required in the long run, at a time when innovation productivity in the pharmaceutical industry had been flat-lining since 1981. We needed a new strategy. So I began leading skunkworks projects to harvest lost Intellectual Property in Pfizer and build awareness of the fractured nature of the current investment strategy and its limitations. But it was too late. Naturally, leadership (like all pharmaceutical businesses) told itself to cut costs and began the dreary ritual of down-sizing and attempting to learn how to operate efficiently, but like the Wehrmacht, they missed the strategic point of inflection, in other words, that all strategies have a lifecycle, but that when you focus primarily upon efficiency without a balanced, ambidextrous approach that includes effectiveness, you are doomed.

Key Learning Point for Leaders: try to balance transactional efficiency strategies with systemic effectiveness strategies!

Rediscovering the Lost Art of Strategic Knowledge Management in Business Administration

2011-03-08T08:56:00.000-08:00

All strategies are knowledge strategies - in the sense that your strategy is the product of a series of conscious or unconscious knowledge choices.

Sometimes it can be helpful to go back to basics. Strategic knowledge management is taught in business administration courses, like the ones profiled on this MBA degree site. However, when professionals enter the fast-paced environment of the real business world, they sometimes leave the fundamental tools and lessons of school behind them."

A few years ago, I was consulting at a senior level in a business where every year more money was being pumped into product development and yet the number of products getting to market was static. Reviewing the data within a variant on the porter Competitive Advantage matrix (price and product differentiation) was leading us into a 2nd-best trap of minor differentiation because low risk had become the name of the game. Similarly, productivity was being affected by dangerous, institutionalised assumptions that the minute survival ratio of successful products to prototypes and high attrition (failure) ratio required a necessarily large population of prototypes to work from to grow the business.

This low survival rate of successful prototypes was demonstrated to be another example of groups within the organisation exploiting and corrupting measurement systems over time (in other words if you want lots of prototypes that don’t work and will pay for them, we will provide them for you). However, the failing business model and associated strategy required a more indirect approach to open up and articulate the underlying and often tacit knowledge it was based upon which was clearly not working.

I noticed that although we had a lot of data about the situation, we never discussed the emergent strategy or tested the knowledge it was based upon. Although we talked about innovation, people seemed to think they were already doing it. Whenever I asked to see the organisation’s “innovation process”, they kept pointing at the New Product Development process (sometimes called the pipeline). The first problem was that we were committed to a default strategy that we never discussed and it was killing us; and the second problem was that people thought that the NPD or product pipeline WAS the innovation process, and thus it was impossible to question the business model or the potential for creating new value services around the old core products.

No-one was willing to directly question the business model that involved spending so much to deliver less. I decided to take another approach, and lead a disguised strategic conversation exercise through metaphor, based upon the 9-dot problem.

You know the one where you are asked to connect 9 dots in a box arrangement of 3 lines of 3 dots, using only 4 continuous straight lines. Usually what happens is that you try and try to solve this problem and it’s only when someone shows you the “arrowhead” pattern that extends the lines outside of the box that you realise that you sometimes have to step outside the box to understand the problem and see a solution. Working within the current emergent strategy was a bit like trying to solve the problem by staying within the box with similar emotional frustrations - in that it didn’t matter what you did with your resources, you still couldn’t solve the problem with current thinking. Having made the connection with the strategy, the next step was to invite people to connect the 9 dots using just 3 consecutive straight lines. After initial astonishment and disbelief, people would ask whether they could break the rules and in effect began to question their own constraining assumptions. We then transferred this thinking to our emergent strategy to ask ourselves: just what were the constraining assumptions? We then applied “reality checks”. Were these constraining assumptions still true, did they still constrain us? In every session, with a bit of preparation, the same 6 constraining assumptions that made up the organisation’s success formula would appear and we would demolish or modify them in the light of new knowledge and market changes. The outcome was a populated matrix or portfolio of new strategies that defined new freedoms to innovate in the language of the organisation. The scariest moment was presenting this to the head of new product development when he said: “you know, I only ever get to think like this on my own, late at night…”

There is a big difference between being efficient and effective. All strategies are knowledge strategies. Make sure that the knowledge you use to build your strategic choices is still current. Thinking outside of the box involves being a stranger to the familiarity of your own organisation. Knowledge is like fruit, the highest value is only realised when you connect the timing of the fruit ripening to the moment of the customer’s hunger. Don’t keep selling old fruit to people who aren’t hungry. Make sure your strategy is based on fresh knowledge, and that any old knowledge that remains within your emergent strategy is still edible and not past its sell-by date.

Implications:

1. How long has the current strategy got left?
2. How good is the knowledge you are paying attention to?
3. What is the knowledge you are deliberately ignoring, and why?

Innovation is a Political Act - Discuss

2011-02-07T04:15:00.000-08:00

Innovation is about doing new things and learning to do old things in new ways to create new value. We need to understand why organisations become “sticky” under innovation pressure and the forms that this “stickiness” takes when innovators are trying to introduce new approaches to create new value through organisations.

• A culture is a by-product of a technology stabilization process, it is composed of the problem-solving experiences and processes involved in turning an invention into an innovation. All cultures are relatively “sticky” in the sense that they resist pressures to change.

• Strong cultures continually evolve new behaviours to block change, to maintain social stability and power structures based upon existing patterns and accumulated reserves of mutual Relational Capital.

• The greater the mutual Relational Capital in the network, the “stickier” the organisation. The stickier an organisation, the more pronounced its tendency to focus on the problems it can solve, rather than the problem it needs to solve (as a means of avoiding renegotiating existing stocks of Relational Capital).

Relational Capital is the social “capital” you build through establishing positive impressions and trusting relationships with key colleagues, stakeholders and potential internal customers, through trading and being able to bank favours at crucial times in the lifecycle of the business and personal careers. It explains the tendency within major corporations and political parties to appoint that “safe pair of hands” who turns out to be a dangerous idiot (unable to recognise that the context has changed, old customers want new things and new customers have emerged) instead of appointing the innovator who wants to move the strategy in a new direction, to change the rules and create new value. That “safe pair of hands” is usually the manager who is owed the most in Relation Capital transactions, the value of which would disappear if the technology and direction of the business changed and made the existing transactions void.

This explains the tendency to optimise existing products, services and business models instead of moving into the territory of creating genuinely new value by focusing on becoming effective. If you hold a big account of Relational Capital, would you want to give it up? This also explains the 60-70% failure rate of systemic change programmes. When you change organisations, you make all current existing Relational Capital void.

We need to unpack the nature of this Relational Capital, explore and understand the forms it takes, and the conditions under which it be both open and closed, positive and negative. In other words: whether it can be positive and open (when you have an “open” approach to constructing Relational Capital that is inclusive) and whether a closed approach is always negative and defensive, a conscious option or merely a social reflex that we can influence by working with leaders and persuading them of the benefits of consciously managing their approach to Relational Capital.

I will develop these ideas and this topic at Henley KM Forum Conference on 17th February 2011 (1345-1515 in the TK Conference Room).

Green Door and Elephants

2010-10-21T05:13:00.000-07:00

“Green Door" is a 1956 song whose lyrics describe a green door, behind which "a happy crowd" play piano, smoke and "laugh a lot", from which the singer is excluded.

We are probably aware of the social phenomenon in organisations and teams when people refuse to talk about the “Elephant-In-The-Room” or the big issue that needs to be resolved, avoidance of which helps to maintain an artificial social stability as people perform intellectual and linguistic feats of avoidance in order not to begin the dangerous process of facing current reality and questioning the legitimacy of power and existing Relational Capital whose leadership is leading down an obvious path to failure.

I want to propose a technique “ITR – In-The-Room” for innovators who are trying implement successful improvement strategies, based upon recent experiences of working with innovation practitioners to construct generic Practice Maps of what is actually required to be successful in their roles and what really works.

I recently used the Baton Passing technique to facilitate the construction of a Practice Map based on current experience from over 20 organisations and over 30 practitioners, which was revisited and drastically rewritten at a subsequent session. Whilst the structure of the knowledge was interesting and valuable, populating what turned out to be a 5-Step generic process model, each step breaking down into Lesson Themes, each supported by individual Lessons using a robust structured template, I noticed 2 phenomena which exposed emergent Elephants-In-The-Room for innovation practitioners.

1. Once the Practice Map existed, it became possible for practitioners to ask each other very specific questions: in other words, it became possible for them to identify the shape and size of the unknowns (or new Elephants) that they need to convert into personal knowledge for use in order to survive.

2. There was a giant but invisible issue that ran across and through the Practice Map: an issue that I call “ITR”.

It was only once we got to a level of “granularity” that came from being able to see a practical Practice Map, that a major conversational theme emerged (perhaps the biggest Elephant-In-The-Room for people trying to do their kind of job): their political marginality as mere instruments and not participants in delivering new value.

It became clear that their biggest problem was convincing the Board (or the body that inhabits “The Room” where the real decisions get made) that they were delivering enough value or savings to justify their continued existence. But this was difficult if you couldn’t access the meeting or “Room” where the real strategy (not just the metrics or broad goals) was discussed, because your political marginality made it difficult to acquire Relational Capital with the Board members to let you enter this “Room”.
This is similar to the experience of Quality Directors in R&D organisations, where they realise that unless they can get into the high-level strategy meetings, their lives will be dedicated to tidying up wasteful strategies that they could have influenced at birth and focused on delivering value.

At the moment, ITR has 3 key stages:
A. How to Find and Understand The Room (where is it, what’s in it: locating it, finding out who’s in it, what do they care about/ their agenda, and who could be persuaded to introduce you?)
B. How to Fit in The Room (constructing your activity to meet their agenda, using their language to demonstrate that you are a key player in delivering their goals and bonuses, getting yourself invited)
C. How to Enter The Room and Get Invited Back (identifying players who you can help, working with them 1:1 outside The Room; learning about the ongoing agenda and making contact with the agenda-holder to invite you back again).

Lessons for Innovation Practitioners (3): C. Get Close to the Strategy, Help them to Know What they Really Want, and the Linguistic Torpedo

2010-06-29T09:18:00.000-07:00

One of the problems of being a change specialist lies in the temptation of going out and harvesting the Low-Hanging-Fruit. This appears to be a good thing at the time, but when you have harvested the LHFs, and applied local and tactical solutions: you will inevitably get faced with the tough, systemic issues that no-one wants to address because they are about the decay of the core technology that everyone has learnt to stabilise, and its replacement. And those with the most Relationship Capital to maintain and lose in acquiring a new technology and riding it, must fight for efficiency and destroy the arrival of alternative strategies with the potential to deliver new effective value in the market and a new cohort of leaders who will establish their own more recent, and more highly-valued currency of Relationship Capital.

The difficulty of working with customers is that often they don’t and cannot know what they want until they see it, or they hear themselves saying it out loud. There’s a great story about Professor Martin Elliott and his hole-in-the-heart team at Great Ormond Street Hospital for Children (Greaves, W., “Ferrari Pit Stop Saves Alexander’s Life”. Daily Telegraph, 29 August 2006). It was only after years of attempting to apply lean techniques to their procedures, and benchmarking with the aerospace industry (which was seen as sufficiently high status), and after a “particularly bad day at the office” that Martin Elliott and his colleague Dr. Allen Goldman sat slumped in front of the television, accidentally watching a motor racing grand prix, that the two of them simultaneously became aware of the similarities between the handover disciplines from surgery to intensive care and what was going on in the pit of a formula one racing team.

In effect, lean thinking (in their current frame of mind or context) could only take them so far. They needed a systemic shift that moved them from focusing on efficiency to becoming effective: in other words, they needed to change the mental rules behind the way they expected to do business if they were going to innovate.

So how do you get the CEO to want something they don’t know they need, to want something new and different which would devalue all existing stocks of shared Relationship Capital? The trick involves three items: proximity, questioning and language. In other words, to get close to the strategy, ask the right personal question about ambition and legacy, and to infect the organisation with the language of the future.

Strategic proximity can begin by offering to facilitate tactical chunks of the strategy, or to lead warm-up sessions to widen the scope of thinking about the future – without asking to be involved in the deliberations of the core team. Once they feel comfortable with you, Relationship Capital will be established and you can get closer to facilitating the strategic discussion itself.
Once you have done this, you can begin “Asking the Right Question” which involves extending your facilitation approach into discussions in confidence with the CEO or senior leader to help them craft what they want to achieve in terms of their legacy to the organisation. Hopefully this isn’t a new building or a statue!

Part of the above process, the third leg of the stool is what I call the “Linguistic Torpedo”. Until people in the organisation have the language to describe the problem or to name the solution to the problem that everyone sees, they find it difficult to act. Linguistic Torpedo is where you specify a problem and its solution in non-bullshit characteristic language, naming them and introducing them to at least 5 key meetings with people you want to influence, and saying it at least 3 times in each meeting. You may have to muddy authorship in these meetings, suggesting that you have heard people in the organisation using these terms. This requires patience, but within 6-9 months you may hear your idea coming back to you (like the boom of torpedo hitting the target and coming back to the submarine hunter, magnified by power of water to carry sound). If you do it right, people will not remember you as the source and will honestly believe that they have invented the terms.

Final Warning

Obviously the key to being a great change specialist lies in being ambidextrous: developing the ability to feed today’s ravening numbers “beast” whilst also helping leaders and potential leaders to dream new dreams, able to facilitate thinking and change around both efficiency and effectiveness.

We need to develop both capabilities, but these require consciously managing your behaviour and interactions to grow Relationship Capital, the ability to renegotiate robustly as circumstances shift, and a willingness to serve when it comes to “seeding” and influencing the strategic conversation about the future of the organisation, and the new technologies, products, services and business models required in a world where the S-curve around knowledge lifecycles is becoming increasingly compressed and in need of replacements.

Lessons for Innovation Practitioners (2): The Deal is the Deal: Always Renegotiate

2010-05-23T08:35:00.000-07:00

In Luc Besson’s excellent first “Transporter” movie, the hero (played by Jason Statham) has 3 rules. The first two apply to your situation: 1) The deal is the deal; 2) Never open the package.

However, for the Change Specialist or Innovation Practitioner, these “rules” need a slight modification:

1) Only the latest deal is the deal. Keep the deal fresh and documented.

2) Always open the package. Make sure you know what’s in the deal and what’s changed.

The optimal moment for making yourself effective and managing the power of other peoples’ accumulated Relationship Capital and their need to devalue any that you may develop, is the moment when you are appointed and when you have the opportunity to negotiate “the deal” around those elements that must be managed in order for you to deliver your best to the organisation.

Fundamentally, this involves objectifying the ambition of the organisation out of the context that drove your appointment, by defining the key “chunks” of your programme in terms of time, resources and political backing required in order to deliver. This needs to be documented in some form of Memorandum of Understanding with the CEO, and other functional heads. In reality, we all know that customers change their minds, stuff happens, reality shifts and ambitions shrink and expand. The key thing to remember is that when the Deal you have drawn up with the Organisation can no longer be operationalised: then you must renegotiate the Deal and all the detail involved.

Failure to renegotiate when circumstances change, on the assumption that everyone after all, was in the same meeting and has a shared understanding of the new circumstances that delayed your programme or reprioritised investment, is dangerous and naive. Someone, at board level will exploit that curious collective amnesia and groupthink of top teams and degrade your growing Relationship Capital by pointing out that you have failed, the whisper will grow to become fact. So being right in retrospect, is not a defence.

Giving It Away To Win: From Power Push to Viral Pull

2010-04-24T07:55:00.000-07:00

One of the core contradictions at the heart of change management is the idea that for a new idea to be successful, leaders must sign up to the proposed change. The problem is, how can you be committed to a form of change that you have never experienced and which will devalue your carefully-acquired Relationship Capital?

It’s important to recognise the viral element of successful change management. Sometimes, as with products, it’s a good idea to be a fast-follower who can exploit the pioneer’s market creation. One of the most dangerous things that can happen to an organisation is when a CEO takes a long flight and gets time to think without distractions, or is invited to speak at a conference and gets infected with a new idea for changing or improving a business’s performance. What happens next probably explains the 70% failure rate of first-wave systemic change methodologies, and is a further demonstration of what happens when a change-agent tries to pretend that they can be effective without building Relationship Capital:

Someone has a “vision” for an improved business, and hires a change Practitioner “who’s done it before”. This Practitioner thinks they have a mandate for change, but it’s merely an understanding that will flex when circumstances change.
The Practitioner builds a “Machine” to deliver the change, which turns into a new function (aping current organisational behaviour, in order to survive among the competing functions) and becomes an overhead.
The Machine starts constructing metrics to look good and attacks the Low-Hanging-Fruit (LHF) to justify the investment; the Machine’s purpose mutates into feeding itself, looking for good stories of its work among the functions (which alienates the functions by suggesting that it was all down to the Machine); it becomes disconnected from the business.
The Business gets pestered by Machine consultants who keep arriving to do stuff and distracting its people. The Business functions begin to question having to pay for feeding a Machine that’s increasingly seen as disconnected from the Business, and leaders start blocking any moves away from LHF into systemic change.
The Machine creates its own efficiency numbers to demonstrate activity and apparent benefits. Business functions gang up on the Machine, or a crisis occurs and the Machine is closed down, or quietly dies a death. Things go very quiet.
Then (after an interval of time, with luck) an Internal Business Visionary rooted in the real world of the Business functions starts it up again BUT at a lower level within their own function. This internal visionary has learnt from the failure of the Machine that fed itself to death, that change has to be business-focussed and initiated and should not try to ape the clothing and behaviour of the Business functions.

The change lessons could turn out to be:

Let someone else fail and then follow them, or work with someone who really wants to do it. It’s not about doing it TO the business, but for the Business to do it TO and FOR ITSELF.
If you build a change Machine to compete with the Business functions, they will have to destroy you at some point.
The Practitioner who succeeds in the long term will give away their practice and focus on maintaining a Centre of Excellence and the development of thought-leadership, learning to act as a guide, and not as a Machine builder or driver.

The Pace of Innovation Leadership

2010-03-29T10:12:00.000-07:00

At last a Knowledge and Innovation Management Book in the military context.

I must recommend Mark Urban’s recent book “Task Force Black” (‘The Explosive True Story of The SAS and the Secret War in Iraq’: Little, Brown; 2010). What appears to be another book about the war in Iraq, is actually a book about Strategic Knowledge Management and a leading practitioner.

What is fascinating about Urban’s account of the Special Air Service contribution to the “hidden” war against Al-Qaeda and related insurgent groups are the innovations around knowledge management that Stan McChrystal wove together, which have potential for establishing and maintaining innovation leadership within a volatile global market.

It is the integration of surveillance technologies, elite teams, and information management to change the pace of decision-making that is noteworthy. Major-General Stan McChrystal realised that it would take a military social network to defeat a cultural insurgent network, and consciously accelerated the pace of data-gathering and interpretation, cutting out the traditional siloed, and layered, “Chinese Whispers” migration of intelligence aggregation, analysis and synthesis through creating his own intelligence network, with its own media in the form of intranet spaces to display it in, that could be accessed and interpreted by participants in real time.

Fundamentally, McChrysal consciously took Boyd’s OODA loop philosophy out of its traditional air combat context (Boyd’s fighter-pilot proposition being that in order to win in air combat, the first combatant with a superior pace to their Observe-Orient- Decide- Act cycle, is the winner), connected it with energy and applied it hunting down insurgent cells, to roll up structured networks faster than they could respond, and thus “win” or at least destroy the opposition’s ability to dictate the pace of the war.
Implications

If we simplify innovation thinking to at least 3 basic thinking rules: move, test, and break; then McChrystal and his disciples have added a fourth element to demonstrate that so-called “asymmetric” networked warfare can be defeated, as long as military leadership has the courage and energy to
1.Move: consciously changing perspective –to empathise, to think like an insurgent, understand where and how they are being manufactured, as well as their victims;
2.Test: explore current assumptions around purpose, context and rationale for yourself and the insurgent, remodelling these to work with better assumptions, deliberately discarding obsolete thinking and structures; and finally:
3.Break: consciously game-breaking or changing the rules to create new opportunities, recognising when to flex your rules of engagement, when and at what pace to change the rules of the current game, in order to win.
4.Up the Pace: use 1-3 to change the quality of thinking and decision making whilst accelerating the pace of decision-making, so that the opposition cannot compete with you.

Sticky Organisations and How They Make Smart People Stupid

2010-02-18T10:09:00.000-08:00

The thrill of being headhunted to a senior role in a successful and knowledge-intensive corporate on the basis of expertise is only balanced by the downside of finding yourself trapped in a cycle of ritualised meetings, unable to influence the strategic direction of the organisation that paid the recruiter so well to recruit you. In such a situation, several options become available:

Lie back and enjoy the management cycle of activity (like pedalling a static exercise bike with minimal resistance).
Get upset about the fact you have become a corporate adornment, that you can’t influence the strategy, become cynical and constructively dismiss yourself, or
Try to understand the situation, and do something about it.

Let me explain the relationship between a “sticky” organisation and Relationship Capital.

All cultures are relatively “sticky” in the sense that they resist pressures to change.

A culture is a by-product of a technology stabilization process, it is composed of the problem-solving experiences and processes involved in turning an invention into an innovation.

Strong cultures continually evolve new behaviours to block change, to maintain social stability and power structures based upon existing patterns and accumulated reserves of mutual Relationship Capital.
The greater the mutual Relationship Capital in the network, the “stickier” the organisation.

Relationship Capital is the social “capital” you build through establishing positive impressions and trusting relationships with key colleagues, stakeholders and potential internal customers, through trading and being able to bank favours at crucial times in the lifecycle of the business and personal careers. It explains the tendency within major corporations and political parties to appoint that “safe pair of hands” who turns out to be a dangerous idiot instead of the innovator who wants to move the strategy in a new direction, to change the rules. That “safe pair of hands” is usually the manager who is owed the most in Relation Capital transactions, the value of which would disappear if the technology and direction of the business changed and made the existing transactions void.
This explains the tendency to optimise existing products, services and business models instead of moving into the territory of creating genuinely new value by focusing on becoming effective. If you hold a big account of Relationship Capital, would you want to give it up? This also explains the 60-70% failure rate of systemic change programmes. When you change organisations, you make existing Relationship Capital void.

The message is: If you are a subject-matter expert or even a thought-leader, you cannot put your knowledge to work within a “sticky” organisation unless you can rapidly develop Relationship Capital. Without Relationship Capital, you will not be invited to the “right” meetings where you can make a contribution based upon your hard-won expertise.

The personal strategy that applies, involves enduring a rite of passage in meetings, negotiating deeper stages of trust, where your behaviour must be positive without appearing to threaten existing knowledge power and established Relationship Capital in the room. These will involve working your way through a sequence of meetings, demonstrating your respect for existing Relationship Capital, meetings where provocations to your expertise will be offered but to which you must not react.

Simplified Relationship Capital Building Labyrinth Sequence

Level 1 Meeting: Wrong Problem / Wrong Method
Level 2 Meeting: Right Problem / Wrong Method
Level 3 Meeting: Wrong Problem / Right Method, and finally
Level 4 Meeting: Right Problem / Right Method

The Expert’s Journey to Effectiveness

Ideally, an expert would be allowed into a meeting level 4 meeting from the start. In reality, the expert goes through a rite of passage (1, 2, 3 level meeting types) to socialise them, test their “right stuff” and their willingness to respect the primacy of existing, dominant (but often decaying) knowledge forms and their established Relationship Capital. Once you have developed high Relationship Capital, you will get invited to the real meetings that determine survival. It may take 18 months of self-control and sticking to the rules.
This explains why genuine “out-of-the-box” or even “no-box” thinking needs leadership sanction or a major crisis of survival that wipes out the bankability of existing Relationship Capital.

The Rules

Respect existing Relationship Capital, find out who has the most banked and whose is most at risk.

Don’t preach using your Craft Knowledge to define the problem or appropriate solution or techniques.

Use their language to define the problem they want to work on: don’t be surprised if they want to solve the wrong problem. Help them to do the wrong thing, better.

Don’t explain where an enabling technique comes from, pretend to invent it on the spur of the moment.

Try to use local contextual examples rather than using comparative case studies of external practice.

Be patient and control your body language.

I will be talking about this at the Henley KM Forum Conference on 24th February 2010.

The Art of Innovation Leadership

2009-12-24T10:48:00.000-08:00

Innovation Leadership is an art because it involves understanding and managing 4 behavioural dimensions which have, until recently, remained hidden. Whilst we are probably familiar with Sun Tzu’s and Marcus Aurelius’s maxims on the importance of self-knowledge, the psychology of Innovation Leadership has not been available in a practical form that could help leaders and organisations, until now when we need it.

Blind Drivers of Innovation
Understanding innovation leadership is a bit like driving a car. At present, most organisations manage their psychology of innovation like drivers of cars who happen to be blind. It is possible to become relatively successful at leading an organisation through the medium of traditional performance measures. These are much like the cues that a blind driver uses to stay in the correct lane on the motorway. By listening to the sound cues of irregular bumping of tyres over cat’s eyes on one side of the car, and the screeching noise of the other side of the car grinding along the side of the oncoming traffic or stationary vehicles or building, a crude form of progress can be managed; even if getting onto and off the motorway is problemmatic. Every year, there are stories of blind drivers in remote rural areas (usually with a child or drunk giving instructions from the passenger seat) being chased and halted by astounded traffic police. It clearly can be done, and is being done, more or less: but does it make sense? And is it acceptable?

Not being in control of your own innovation leadership behaviour as a leader, is like leading your team or organization as though it is a car that you choose to drive with your eyes closed. Most people have no idea what their innovation leadership profile is. They are in effect, blind leaders of innovation. We are probably all familiar with the idea that it is not what leaders say, but how leaders actually behave that has the most impact on organisations, and that it is their behaviour that sends the strongest messages and provides the most powerful cues as to what defines successful performance in the organisation.

The key to successful leadership of innovation begins with understanding

• The 4 Innovation Leadership Behaviours (ILB),
• The limitations of where you are now (in terms of your actual ILB profile)
• The nature of the challenge (in terms of your preferred ILB profile), and
• Being hungry enough to want to change, to take control, to do something about it.

For some leaders, the idea of developing an understanding of their own ILB profiles (actual and preferred) can be intimidating, much as primitive tribes were afraid that photography would steal their souls, or that to study and seek to understand the behavioural patterns might destroy the power of a secret formula by exposing it. But as they say at the Royal Air Force’s Parachute Training School: “Knowledge Dispels Fear”. And this knowledge is essential, and if you have it then it becomes possible to ask yourself:

1.What will it take to move out of efficiency strategies into effectiveness strategies?
2. What can I contribute to making this organisation more successful?
3. What kind of innovation leadership should I be working on?
4. How can I develop myself to make a difference, and become more effective?

The 4 Innovation Leadership Behaviours (ILBs)
For innovation to occur in an organization, you need a mix of at least 4 generic types of Innovating Leadership Behaviours – Creators, Translators, Stabilisors and Navigators. When planned for, encouraged and balanced correctly they can promote and deliver continuous innovation.

They are:

Creators - Who provide the source of new, disruptive ideas.
Translators - Who connect new ideas to new opportunities.
Stabilisors - Who build quality delivery systems for products and services.
Navigators - Who anticipate what’s coming, know when to get in, when to get out, and how to manage it.

The 4 Innovating Leadership Behaviours are extreme stereotypes and usually (but not always) I find that leaders’ profiles have proportions of all four in their own characteristic “portfolio” depending on the limitations of their experience, work environment and their natural work preferences.

Conclusion
Understanding the implications of leaders' ILB patterns is a powerful source of information on the limitations of the existing strategy and what is going to be required to move out of efficiency and survival into effectiveness and growth, in difficult times.

Chunking, or The Leader's Rule of 3

2009-12-02T09:38:00.000-08:00

This innovation leadership tool is about rapidly identifying the vital few issues and obstacles that need to be managed or dealt with, and allocating attention and resources to them.

The “Rule of 3” is an idea I engineered from studying leadership, change and innovation. It’s the product of combining Pareto’s Principle, Williams’ close observation of Field Marshall Montgomery’s characteristic approach to getting things done and Max Atkinson’s research on successful speech-making.

Pareto’s Principle suggests that 80% of the effects observed in a situation are caused by a mere 20% of the population. His original 1906 observation was that 80% of the wealth in Switzerland was held by only 20% of the population. This has become a quality method for identifying the most powerful variables in a situation which need to be controlled to manage failure.

Field-Marshall Montgomery: Brigadier Williams serving as Montgomery’s Intelligence Chief [i] noticed his preference for 3-part lists as a means of simplifying complex issues and concentrating resources. In Hamilton's biography of Montgomery[ii] , he notes that in the last year of WW2 Monty was constantly trying to stop the Americans attacking across a broad front to incur 100,000 casualties instead of concentrating at a few points, feinting at one and then making the main effort at another. As Monty said in a letter after the command performance scandal of the Battle of Bulge: "We have failed to date by trying to do too many things and not giving enough resources to any of them to ensure success..."

Max Atkinson[iii] points out the power of leaders simplifying big issues through 3-part focused lists in his analysis of powerful political speeches, particularly their “air of unity or completeness”. It is as though we are programmed to listen more deeply to a 3-part list when we know it is coming, and that audience interruptions tend to occur after 3 points have been stated within a longer list.

Chunking as a Technique (or Identifying and Working on the Vital Few)
This technique is designed to gain a rapid understanding of the vital few issues that need to be managed to be successful. It requires use of the Creative Silence technique to brainstorm all the problems and obstacles involved in delivering the goal.

The goal or the aim must be clearly stated. The team must have had time to immerse themselves in the data involved in the situation.

In preparation a flipchart sheet needs to be prepared with the word “Start” at the top and “Finish” at the bottom, everyone must have pink post-its (for brainstorming issues or obstacles to delivering the goal) and black medium pens to write with. You invite the group to silently brainstorm the issues or obstacles that need to be managed to deliver success. They share these, 3 at a time. You apply CGSM (Common, Ground, Special, Missing) and concentrate the groupings to simplify the themes down to at least 3, with a hidden willingness if necessary to reduce to 2 or expand to 4 or 5, depending on the nature of the challenge. These pink issues or obstacles post-its are then put in an approximate sequence to the left of the vertical arrow connecting “Start” and “Finish”.

Having broken down the issues or obstacles to the vital few (possibly the top 3), then break your team into 3 parts, and allocate 10 minutes for the 3 sub-teams to work concurrently on developing solutions for overcoming the top 3 issues, writing their solutions onto blue post-its and positioning these to the right of the vertical arrow, parallel to issue or obstacle they deal with.

Invite the sub-teams to share these and for the others to add value to their prototype solutions. Identify or vote on the optimal solutions. Use the 3-part list of obstacles and matched solutions in your communication strategy.

[i] Howarth, T.E.B (1985) Monty At Close Quarters, Leo Cooper/ Secker & Warburg: London/ New York, p22.
[ii] Hamilton, N. (1987) Monty: The Field-Marshall, Vol.3; Hodder & Stoughton, p254.
[iii] Atkinson, M. (1984) Our Masters’ Voices: The Language and Body Language of Politics, pp57-72.

Innovation, Passion, Sex, Leadership and Rock'n Roll

2009-11-09T05:40:00.000-08:00

Peter Cook's recent book: "Sex, Leadership and Rock'n Roll" is a commentary on the importance of combining two key elements of leading innovation (of leading people to do new things and leading them to learn to do old things in a new way), of learning to connect with the stuff of passion (ie. sex and rock and roll) in order to innovate. Obviously business isn't rock'n roll, but there are compatible elements that usefully explain successful, innovating organisations.

Rock'n roll, like business is old and yet it is eternally new whenever a new practitioner comes along with some passion (and a willingness to mine the gold of sexual imagery, or at least romance) who can successfully manipulate a few variables and change the context. David Bowie managed it by taking William Burrough's consciously random cut'n paste manipulation of printed text and visual fashion imagery, with a willingness to adopt an ambiguous sexual persona. And the rest is history, and millions made.

Peter makes some key observations that leaders need to take on board, that discipline and creativity need each other, but that if you don't have ingredient "X" you won't get invited back to the next gig, that if you don't have the passion that lifts others and the ability to "play" in the moment, the passion that helps others to be great in turn, you cannot lead: you can only preside.

As Ken Olsen said: "Leaders do the right thing, managers do things right". And it takes passion to do the right thing because you are probably going to be seen as behaving unreasonably by people who have no sense of the importance of doing something different, now: before it is too late.

Q&A with Peter Cook: Sex, Leadership and Rock'n Roll: http://dontcompromise.askeurope.com/2009/09/03/humdynger/

Innovation Processes are Useful, but Innovative People are Essential

2009-11-01T03:01:00.000-08:00

There is an assumption in many organisations that focusing on innovation processes is a kind of industrialisation of innovation, that with the right processes, then you don’t need to worry about employing genuinely innovative people, anyone can and will be successful within a great process.

And it’s true, up to a point: especially when the focus is upon optimising existing products and services. But when the environment changes radically, then the issue of having the right people to innovate becomes important.

I have noticed that innovation consultancies tend to focus upon time-intensive innovation process consultation with a few useful techniques thrown in. This is because whilst they help to focus attention on developing a shared understanding of an agreed approach to turning an invention into an innovation, and on the need to understand customers’ needs, such consulting enables at least 5 additional benefits:

• Consultancies can sell high-priced consulting time, acquire practice and gain another case study to use with new clients,
• The illusion of purposeful activity without having to question the customer’s existing strategic assumptions, political hierarchies, and investment rationales,
• Gives confidence to an employing customer with academic mindset that measures good intentions by the size of investment,
• Enables leadership to sponsor the solution to a problem that appears to be solveable, rather than forcing leadership to work on the real problem that they prefer not to discuss,
• Reinforces the myth of leadership knowing what it is doing.

Whilst I disagree with the attractive book-selling post-rationalist approach of Jim Collins in “Good To Great” (2001) and Tom Peters & Rob Waterman in “In Search of Excellence” in retrofitting plausible success models onto case studies which subsequently decayed a few months or years later in public, both hint at the importance of getting the right people involved in changing an organisation. As Collins puts it, leaders must understand: “the importance of getting the right people on the bus (and the wrong people off the bus, and (only) then (figuring) out where to drive it.” More revealingly, on the same page, Collins observes that “a company should limit its growth based on its ability to attract enough of the right people”.

But what and who are the right people, how do I recognise them; and what do I do about myself?

It's People Who Innovate

2009-10-12T08:55:00.000-07:00

We either innovate or we die. We broadly accept this dictum. But what do we choose to do about it? And on reflection, do our choices make real sense?

First Story

A few years ago, I was working with the consulting arm of a national healthcare system on the issue of the low rate of adoption of innovations developed at centres for excellence into local practice. I have always been intrigued by the joined issues of the psychology of incompetence and the form that resistance to change can take, often known as Not-Invented-Here (NIH) culture.

I ran an exercise involving both local practitioners and government consultants, and we came up with some powerful and interesting lessons for accelerating adoption of innovations. Being a big fan of the rule of 3 (the idea that if you can identify the top 3 issues and resolve these, then the remainder will probably take care of themselves), I facilitated the exercise to identify the 3 most powerful influencers of local adoption of innovations:

1. Use the language of the people who are going to implement the innovation, don’t use MBA language. Consultant language has a tendency to alienate user audiences and trigger powerful NIH behaviours. If you can, employ a typical “user” of the solution who has strong links with the audience that you want to influence, and who expresses themselves authentically.

2. Demonstrate the real results gained to show it’s worth doing: ideally, try to show benefits not only to the customer, but also to the user who makes the innovation happen.

3. Recruit people who think innovating is part of everyday work. Try to employ people who want to innovate, or at the very least make it clear that work is going to involve a continual interest in improving and changing performance.

On reflection, the lessons can be reduced to 3 words: language, benefits and perhaps they are all about the psychology of innovation.

Second Story

At the beginning of 2008, I was working with the Heads of Innovation of 2 businesses which had recently been acquired. I was facilitating a series of discussions about the future shape and direction of innovation strategy in the newly-merged organisation. On the surface, these Heads of Innovation were complying, but in reality they were stressed, and naturally jockeying for dominance and succession or for golden exits. The official outcome was going to be their agreed strategy for doubling turnover through innovation within 3 years. After 2 sessions together, I found that they were playing the old scientist game of questioning me in detail about the legitimacy of the facilitation techniques I was employing, instead of focusing on the issue. Once I had resolved this, I found that we moved onto a technical discussion of stage gate innovation processes (where you segment your invention to innovation process into defined stages, and apply rules that determine progression beyond each stage). The game they wanted to play here, was to pretend that having an integrated, and shared approach to stage-gate definition and decision-making would solve the problem of innovation to drive an aggressive growth target. When I began to pressure them on the issue of innovation talent, and demolished the assumption that scientific ambition was the same thing, it became clear that creative individuals were largely marginalised and isolated within a scientific bureaucracy that was under-performing.

They wanted to avoid the fact that when it came down to people, they didn’t have the right people to deliver the kind of innovation to drive growth that the new organisation required. And that they didn’t think that it was important. Life would go on (they hoped) much as before.

Conclusion

Both these consulting exercises (first and second stories) had a profound effect on my thinking. I have always been a “process” man. I have developed and facilitated the co-creation of innovation processes, applied lean thinking both within and outside the automotive industry, implemented business process redesign, and even taught process leadership as a technique for making processes work within organisations. But I couldn’t avoid the obvious conclusion over time, that

1. Whilst processes are useful as a means of focusing attention and reducing the need to relearn the obvious, they cannot be a substitute for understanding the psychology of innovation.

2. Whilst history has shown us examples where innovative people with deficient processes have found a way to succeed, there are few examples of mediocre people succeeding because they had great processes.

Process Leadership: The First Discipline

2009-09-25T07:17:00.000-07:00

Processes are useful mechanisms for focusing attention on important and complex situations involving chains of activity:

They help leaders and teams manage attention by offering a deliberate sequence of key steps in an appropriate order to reduce failure.
They embody key lessons from the past in an accessible format.
They reduce the need to reinvent the obvious with new groups and new situations.

While we probably believe that we understand what processes do for us, do we understand the necessary psychology of leadership required to make this happen?

"Process leadership" is the ability that great leaders have to manage the day-to-day tactics of getting things done while putting those tactics and tasks within larger, strategic processes that ensure that the right stuff gets done in the right way, at the right time, through adherence to an overarching, logical approach.

Process leadership is about learning how to manage the adrenaline rush that can pull you into taking over other people's jobs and destroying their confidence and capabilities by interventions that diminish them. We've all worked with bosses who were fundamentally happiest on the line taking over their subordinate managers' and leaders' work, but who were unable to step back to mentor and model the kind of behaviors that build leadership and integrity in others.

Process leadership is a form of conscious confidence developed by growing three abilities:

The ability to ask great questions at the right time, in the right order;
The ability to move into a "helicopter" perspective at the drop of a hat, consciously locating activities and priorities within a larger, process context; and
The ability to realize when the current approach is delivering diminishing returns or doesn't match the emerging situation, combined with the courage and confidence to say "stop" and ask for a different approach.

It is a truism that, when organizations find that they can't solve the real problem that determines their future survival, they will find a problem that they can solve without having to smash existing social relationships and change technologies, and they will work on it instead. This is a symptom of what I call "sticky" organizations--organizations with highly evolved "consent and evade" approaches to change (where top leaders agree to change and then return to their business units to block it), organizations with a history of shooting the messenger and announcing victory before the implementation can be measured.

It is not easy to overcome this entrenched behaviour of sticky organisations. We may be fortunate that in General Petraeus in Iraq, we have a recent example of a leader who, at a strategic level, is capable of managing a conscious thinking process on a complex situation; who can apply the three process leadership abilities to balance his attention around a discrete problem-solving process; and who can work this process to arrive at alternative strategies, instead of enforcing fixed solutions to an emerging context like Warner Brothers' Wile E. Coyote in his perpetual and futile pursuit of the Road Runner.

Resilient Leaders and Emergent Knowledge

2009-09-22T04:52:00.000-07:00

Emergent Knowledge is the knowledge we discover when we ask the right question, in the right way about the right issue at the right time, and we discover something new and potentially powerful at that particular moment in time.

Emergent Knowledge is timely knowledge about the changing nature of reality at one moment in time, where we either act upon it and create a new opportunity, or we ignore it in the name of social stability and pay the price in terms of organisational decay, wasted resources and weakness.

There are two old jokes about consultants and change management.

The first joke asks: how many consultants does it take to change a light-bulb? The answer is: that the number of consultants is immaterial, the light-bulb has got to want to change.

The second joke observes that consultants are people who take your watch and then charge to tell you the time. Whilst there is an element of truth in this observation, it needs to be articulated in a slightly deeper way. What is core to this observation is that when consultants deliver their work in the form of a structured report, it has elements that are very familiar: the story that it tells and its conclusions are recognisable. It is this recognition of report content that that makes the executive summary familiar.

Introducing consultants into the organisation, permitting them to ask questions in terms of purpose, process, position and outcomes makes it possible for them to articulate the potential, emergent knowledge within a shared context, at a particular time, and in asking their questions, they trigger their audience’s thinking along their line of research and prepare their audience to recognise the answers subsequently presented.

This is why testing the Emergent Knowledge underpinning a strategy in participants’ heads is so important, needs to be done quickly (in order to fit the context, and reduce decay) and why having an inflexible model can be a killer with an agile competitors, and increasingly changeable customers.

We live in a changing and dynamic environment. The traditional dichotomy of tacit/ explicit knowledge is insufficient to cope with the need to renew and redefine purpose and strategy. Resilient leaders need to include Emergent Knowledge techniques in their thinking in order to survive as well as grow organisation’s willingness to want to change. Successful, resilient leadership depends on the ability to elicit and articulate the emergent choices organisations face, daily.

Cut out the Middleman

2009-09-21T08:23:00.000-07:00

The CBI Higher Education task force, chaired by Sam Laidlaw, Chief Executive of Centrica, said today that “businesses must do more to support the UK’s higher education system with individual funding and increased internships and work placements. Businesses would then have the opportunity to work with universities to develop course syllabi”; also that “Universities and government cannot deliver a world-class service alone. Effective collaboration between the higher education sector, business and government will be critical to the UK’s economic recovery and sustainable international competitiveness”.

At one level, these statements look like an extension of July’s useful HEFCE/CBI report “Stepping Higher: Workforce development through employer-higher education partnerships”.

At another level, this begs several questions at a time that the LibDems are proposing raising the bar on middle-class tuition fees:

Firstly, is it the case that the only way a degree can be useful nowadays is if it is kite-marked as useful by a successful business?

Secondly, does this by inference mean that traditional degree curricula are no longer connected with the real world? (At this point, one remembers the story of the English Literature student at the back of the Oxford University lecture hall being asked why he wasn’t taking notes; and replying that he didn’t need to: he had his father’s).

Thirdly, if both one and two are largely correct, then what about using a classic business strategy to sort this out: disintermediation - cutting out the middleman? One way to integrate collaboration between HE and business would be to remove the Government from the equation, and allow businesses to pay their taxes in lieu directly to fund particular universities and as paymasters, to call the tune and set the necessary standards. We could even scrap tuition fees.

Time Management Means Something Is Wrong

2009-09-15T09:16:00.000-07:00

I was once asked to design a time management course for a global engineering organisation. After interviewing staff for two days I came to the conclusion that I couldn’t continue the exercise because I realised that time management was itself literally a waste of time. I learnt that time-management was no substitute for a clear business focus or strategy within which people could manage themselves.

The next variant of inadvertent leader incompetence is where in effect a leader says to their followers: “I can’t solve this problem alone, I need your help”; and followers in the meantime say: “I can’t get focused until you tell me what the plan is”. And so it goes, round and round. In the meantime the internal stock of confidence in leader and leadership decays with every day that the real problems of the organisation remain untreated. It is as though the fundamental problem that the organisation needs to get to grips with, the linked problems of innovation and power, is like a greasy pig which the leadership of the organisation wants to cook and eat, but is unwilling to allow itself to get dirty and bloody wrestling with in the dirt, when so far all that they have had to deal with is small rodents who like getting trapped.

Leaders must be able to frame the problems around innovating, and lead the process that unpacks the necessary dependencies that must be managed to deliver successful innovating, even if they don't understand the future.

The real problem of innovating is the absence of leaders willing to create a situation where the everyday allocation of power and resources has to be actively considered as though last year or the previous decade never happened, and to consciously share power with those who can innovate for the greater good of the organisation, even if they don't look like us.

IMPLICATIONS

1 If you are worried about time-management, then your strategy is weak.
2 If you want to eat the bacon, you’d better plan on getting dirty and,
3 You just might need to involve some other folks, and share the bacon with them.

When Social Becomes Business

2009-07-06T01:57:00.000-07:00

I chaired a powerful practitioner showcase event launching the University of Greenwich Business School’s new Centre for Business Network Analysis on Friday 3rd July.

What was exciting about this event was the timing: it’s clearly the case that the techniques of Social Network Analysis are about to manage a shift into offering potential new value. I found this interesting in terms of my own definition of knowledge – as really existing when you take an information pattern and put it into a new context (business) to create new potential value (and not just about being known or existential).

Headlines (as far as I was concerned) included the following:

· “Social knowledge architecture is more important than physical location” – David Ewbank, VP Lifesciences, CRA international.

· “Social network maps are a powerful message about existing communication and collaboration behaviours” – Bonnie Cheuk, Global Head of Knowledge & Information, Environmental Resources Management.

· “Network analysis is the key to (understanding) power in organisations (but can be ambiguous)” and “Power accrues to those who understand the amplifier within the network” – David Krackhardt, Professor of Organisations, Carnegie-Mellon University.

Putting it all together, it is clear that constructing social networks or maps is one thing, but interpreting the opportunity emergent within the structure requires a deep and ongoing interest in the context in which the pattern is found.

It was clear that interpretation to deliver emergent value depends on integrating at least 4 levels of information (which makes it an art!):

1. The social context (where is the group in terms of its social development, have they just gone through a defining crisis, or have they avoided one?)
2. The nature of the question posed about the relationship to be explored (academics linguistic naivity can mean dangerous results for participants’ honesty).
3. The position of the outlier: just because someone is not included in the social net, this may not mean that they are ineffective, just that they haven’t built the relationship capital required or been able to participate in crisis and show their “right stuff”; or they have decided that the core business is doomed.
4. The form that power takes in the shape and interaction of the network: is it reward, inclusion/ exclusion, resources or the reinforcement of groupthink?

To some extent, it feels as though all social network analyses share aspects of the Rohrshach inkblot test, Milgram’s infamous “learning” and Zimbardo’s “prison” experiments in being a means of surfacing hidden social scripts about corrent behaviour, in unpacking what people believe really work (but may not know consciously).

And it’s at this point that we realise that we are at the cusp of a new form of knowledge, as it shifts from being academic and interesting and becomes new practice. It is the awareness of the proximity of new practice that has led to the Centre for Business Network at the Greenwich Business School, deciding to focus on developing a cohort of collaborating partner organisations to learn to harden the interpretation of what were social, but will be, business networks for unpacking the hidden value in organisations by uncovering the social networks that critically affect your business performance and could make the difference in a recession:

• Streamlining operations by sharing inputs and reconfiguring the way people work together
• Tapping into previously isolated pockets of creativity to improve products & services
• Identifying influential customers and new markets, and
• Constructing business networks for competitive advantage

One of our next steps is going to be about building practitioner capability in terms of techniques, approaches to interpretation and lesson capture through case studies and the development of validated metrics.

If you are interested in joining or learning more, email: S.Kandola@greenwich.ac.uk

Public Service Innovation: A Contradiction in Terms?

2009-06-30T12:52:00.000-07:00

A few months ago I was facilitating the closure session on a leadership program for experienced public service managers and something weird happened during a serious conversation about public service innovation within the context of the recession.

This cohort of experienced managers were beginning to see themselves as leaders and not managers, and the facilitated conversation upon powerful lessons that could be drawn into future programmes and from their time together as a cohort, led to some unusual candour within the context of likely cuts in public service expenditure.
They concluded:

1. We need a new paradigm for leadership within the context of the recession. We don’t have enough leaders, but we have lots of managers and backwoodsmen strumming old banjos and busily riding rocking-chairs.

2. Public service investments have tended to institutionalise social problems , when the real issue is about having the courage to face and address the social behaviours within families (or lack of them) that are root causes of problems.

3. If we really want innovation in public services, then we need big cuts to destroy the old models embedded in “modernised” services. Nothing innovative will happen unless we face targets of at least 30% cuts.

It's the People, Stupid!

2009-06-30T11:57:00.000-07:00

A few years ago I was working for a national organisation dedicated to innovation in healthcare delivery. The issue they wanted me to work on was to explore the reasons for failure in their customer organisations’ adoption of innovations and putting them to work. I was given a group of their experienced senior consultants in change management to work on this, using a creative approach involving the use of metaphor.

The top 3 solutions were frighteningly simple (which demonstrates the power of the technique):

1. Use the language of the user: try to introduce the innovation using the kind of language that the potential user understands, instead of consultant-speak which tends to alienate and trigger natural Not-Invented-Here behaviours.

2. Identify great benefits don't just apply to the customer of the service, but which also include benefits for the people applying the innovation.

3. Recruit individuals into your healthcare service who want to innovate, and make it clear that their role will involve continual improvement: the way we work will continually evolve.

This brings out an important issue, that if you recruit individuals who do not want to innovate, and who see innovation as someone else’s job, then you cannot be surprised at what you get. So maybe it isn’t about optimal processes, it’s about people. Having the right people with the right psychology.

Don't Share -Build

2008-07-12T10:25:00.000-07:00

The earliest stage of Knowledge Management was bedevilled by the curse of the idea that whoever knew the most, and could manage the most "knowledge" would run off with the glittering prize of the Global Knowledge Economy. In time the futility of this exercise was glimpsed but the promise of better search-engines, individual disciplines and meta-data tagging suggested that this was still attractive, and so the knowledge-farmers and their friends the knowledge-miners continued the trend. Did they dare to consider the possibility that the knowledge revolution was not going to be a computerized improvement on stamp-collecting or librarianship? No.

The literature of change and religious cults is littered with the accidental rubbish of ambiguous, key quotes and sayings that were crafted to mean one thing, and ended up being interpreted quite differently. When TQM (Total Quality Management) ruled the world, a key aspirational saying was: “right first-time”: this originally meant if you plan it right, it will work when you want it to. What it ended up meaning was: don’t build and test prototypes. This became a source of much amusement in Japanese companies.

The injunction of Knowledge Gurus to share knowledge has had similar unintended effects that need to be understood and resolved in order to develop sensible knowledge strategies.

Problem 1: Implicit Economic Paradigm

The economics of supply and demand apply to knowledge. Knowledge in the public domain assumes a low value, and begins to look like a commodity whilst that which is exclusive and personalised gains value. This probably explains the traditional confusion of knowledge with power and why many books about Knowledge Management contain very little actual knowledge.
The currency of the Knowledge Economy is ideas and their exploitation. What is largely missing in the emergent debate on how to configure organisations to compete in the Knowledge Economy, is the application of economics to ideas and knowledge.

One of the key lessons of the Soviet Experiment in nationalised economics was that in its heyday, 3 percent of privately-farmed land produced 84 percent of the edible food. Those things which were shared were run incompetently and were seen to have low value. The irony is that commentators are unwittingly suggesting the equivalent of state-economics to the exploitation of knowledge. If everything is shared, it will be perceived to have low or insignificant value. This has been obvious to anyone brought up in institutional housing, or who worked within a nationalised industry and watched it die. The economics of supply and demand apply to knowledge. The knowledge which is in the public domain assumes a low value, begins to look like a commodity whereas personal knowledge is exclusive, current and protected has the potential to maintain high value.

Imagine a 2x2 hi-lo knowledge transactions matrix for an organisation where the vertical dimension represents value, and the horizontal dimension represents transaction volumes. There are 3 areas A, B, C represented in this matrix mapping the relative positions of the knowledge within an organisation in terms of the relative value of individual knowledge transactions and their volume. Box A represents a healthy collection of high-value but low-volume knowledge transactions. These are delivered by creative individuals and are in transition between idea and prototype model. They are sold at a high daily rate, and have not been packaged. The individuals creating these transactions are at the leading edge of thinking in terms of emergent practice in an evolving context.

Box B is at the hi-lo dimension intersections, representing medium value knowledge transactions at medium volume of delivery, delivered by trained consultants where access to their semi-formalised methodology is controlled by agreement, and used within a relatively predictable environment, to the extent that these transactions have a branded name with relatively predictable and shared expectations in terms of outcomes. Box B is about selling a service. It is only a matter of time before the knowledge in box B slides into the area of Box C.

Box C contains low-value transactions that have been commoditised and delivered at a high volume, probably via a secure portal with low levels of interaction, or through franchised consulting or third party trainers (like NLP, emotional intelligence, Effective Habits of Leaders, etc.). The contents of Box C are designed for immediate customer use.

The 2x2 hi-lo matrix is an ideal. Ideally an organisation would be in command of the timing of the declining value of its knowledge. At no point would it deliberately choose to position all its knowledge onto the market (Box C) or continue to supply knowledge transactions where it was no longer economic.

What’s implicit in the model is the reality of personal knowledge power being connected to a small volume of high-value transactions, and at the other extreme: corporate knowledge power tending to be connected to a high-volume of low-value transactions. This contradiction partly explains the difficulty of attempting to translate personal knowledge power into a form of knowledge that is accessible to everyone where corporate knowledge attempts to capture all knowledge without defining the knowledge framework that is usefully shared across the organisation.

Problem 2: Purpose and Context

So I share this "knowledge" of mine with you. How can you tell whether it's any good? How can you tell whether it is really knowledge, or information or even just structured data? How can you tell it's mine? And how can I share something with you, if I do not know what has value in your eyes and if we do not share the same purpose?

One of the commonplace experiences of Knowledge Work consulting is the request to advise an organisation on how to establish a Knowledge-Sharing Culture. This can go many ways at this point. You can either begin trying to shift the culture by inventing or documenting stories that carry the knowledge-sharing-is-good message. It may be possible to cut to the chase, and point out that until the organisation has a Market Value Strategy that explicitly identifies the kinds of knowledge that need to be created, and plans their market value lifecycles, they will be largely wasting their time.

To put it another way. If you get ever get confused about knowledge. Firmly grasp the arms or underside of your chair. Take a deep breath, close your eyes and repeat the phrase: "Competitive Advantage" to yourself until you feel better. Unless you can link your business strategy to the maintenance of existing knowledge and development of new knowledge, you can only waste time sharing things that need to be constantly interpreted and which may have only slight value. Remember some facilitators use the phrase "thank you for sharing that", when what they really want you to do is to shut up.

Problem 3: Understanding The Psychology of Knowledge Transactions

While the phenomenon of sharing experience has been researched, its psychology has tended to be taken as a given. There is consistent evidence that knowledge is shared among functional specialists in disparate organisations, and that it involves explicit trading in attributable ideas. The ability of individuals in specialist fields to retain complex relationships of knowledge attribution is known, but tends to be ignored. And yet the clues are there in successful communities of practice whose existence is determined by a shared, overarching sense of purpose. People will only share with those whom they respect and from whom they can expect a return or who share the same problem of preserving or reinventing identity. No-one will share knowledge (something that has high potential value) with an idiot or a fool. The sad reality is that these high-value knowledge trades tend to occur across separate organisations and not internally.

The explicit psychology of these transactions involves

Recognition (they are asking me this question),
Respect ( they think I know something they don't),
Attribution (you can use it as long as you say where you got it from),
Reciprocal Credit (I will answer on the implicit understanding that you will give me an equivalent transaction in the future) and
Shared perception of value (we both know this knowledge has real potential value if exploited).

Problem 4: Knowledge Work, Democracy and 30/70 Technique

Is everyone going to be in a position to share knowledge? It's largely an intellectual and creative activity carried out by the same elite constituting the Human Capital within organisations that Scandia's original Intellectual Capital was designed to measure.

Let's approach the language problem, bit by bit. What is meant by knowledge? The failure to be explicit about terms like knowledge means you're going to get a lot rubbish and expensive rework activity. A key question is: knowledge about what, to do what? After all, one person's knowledge might well be another person's structured data, or information. If we work backwards there may be some clues as to how to progress. If we tried to embed data-sharing into everyday work we would do it by identifying outcomes and success criteria and work back to the necessary processes and activities that need to be managed, then define the performance data necessary to make a decision. If we extend the question to embedding information-sharing, nominated individuals would arrange the data into structures and review it within a time-frame to capture the emergent pattern or information.

Now we can attempt to answer the key questions: are we in control of our process, is it about to do something unusual, do we need to make a decision to either stop, start something new, or continue? If we step up the hierarchy: what would embedding knowledge-sharing into everyday work involve? It would involve bringing a number of information-patterns together to create new cause and effect relationships within existing and new markets that offer the potential to either differentiate existing commodity products by wrapping them in the new knowledge or to offer completely new market values by applying existing information patterns to new contexts. In other words: combining different items of knowledge to change the rules of the game.

The truth is that Knowledge Work is not democratic, we are not all going to be Knowledge Workers. Not everyone is going to be either predisposed or equipped to create, far less share any real knowledge in a world which still confuses data with information. The solution lies in creatively reframing the problem from knowledge-sharing into knowledge-building and engaging what we know about the psychology of engagement.

I was brought in to deal with the problem of establishing best practice in a global scientific organisation, and also to help that organisation start to apply new ideas much faster than its competitors. Fortunately or unfortunately, I was working with a lot of global technical experts, and because of the accent upon fast decision-making and action, I would come to meetings with 100% solutions, and one of the things I began to learn quite quickly was that it just wasn’t working.

I assumed that as long as I dotted the i’s, crossed the t’s, fully specced the solution and presented it to them, there would be a minor ripple of applause and then we’d get onto any other business. I was of course being extremely naïve.

What I didn’t realise is that these specialists were at war with each other, and that, in effect, presenting them something that didn’t come from them, would lead to massive resistance. So, I had a great mentor and she said to me one day, she said, Victor, you’ve got to stop this 100% stuff, just give them a 30% solution and just specify the shape of that missing 70%, and then invite them to participate and fill that 70% with their own ideas and their own content. So I began to realise that if I was a bit more intelligent about how I framed the problem, and if I defined the problem for them and then defined the spaces where they could participate, I was much more likely to get a result. And it worked. The trick was to construct a 100% solution in outline, construct a 30% framework that indicated the missing 70% of knowledge in terms of the specialists’ areas of knowledge, and watch them fill the vacuum. The by-product of this kind of approach was that when they filled the solution with their content, they became ambassadors for ensuring that their specialist functions became engaged.

If we ask people to build pyramids out of their own knowledge, this is going to be difficult because we must to convince them to construct something that they are unlikely to be able to inhabit themselves. In fact, we all know that it’s only mummies who get to stay inside pyramids. But, if we ask people to construct houses that they can all live in, we are likely to build worthwhile homes. If we work on defining the type of knowledge we want to build, we can then focus attention and resource to make it happen and start working on the problem of how to engage the right constituents in building it and making it happen.

IMPLICATIONS

1 Reduce the number of idiots in the organisation to the bare minimum necessary. No-one will share anything with an idiot.
2 Employ the tactic of using language with real meaning. Deliberately stop talking about Knowledge Sharing: it only confuses people with its altruism and its implicit democratic message. Start defining aspirational knowledge frameworks within which new knowledge can be built that meets the need of delivering competitive advantage.
3 Create crises to focus knowledge contribution from those who can, and remove investment from the aimless sharing of everything.
4 Use 30/70 until they notice, then do something else.

The Innovator's Got To Do It!

2008-06-20T08:25:00.000-07:00

Years ago, in the early 90s, I remember watching a video of a Tom Peters’ sweat and rant guru session, where he wandered about a floor of anxious senior managers clustered around circular tables (anxious because be might ask them a question that might expose their unfitness to manage their organisations, and senior because only a senior manager could justify the cost of the ticket). Tom Peters’ style was to ask rhetorical questions in a quiet voice, answer them himself in a loud, scornful voice, and then cascade his audience with information about successful companies and entrepreneurs scavenged by his army of researchers, who happened to fit his latest theme.

Tom Peters’ guru topic this time was innovation and he said something profound (for a change) and unexpected, to the effect that the real innovators in the business world were not in the room, this day. That the real innovators are out there innovating, because they have to do it. They cannot choose to do it, they have to do it. It’s in their nature.

The connected topics of innovation and leadership, are a bit like pornography in the sense that those who consume it the most, are just not constitutionally equipped to perform the acts described in the literature. But they love reading about the stuff they can’t and won’t do. Which is the point that Peters was making.

Innovators don’t take lessons, they may not even read books, they just do it, and do it again, until the timing of their idea coincides with the timing of the market and their customers, and they make some money, or they fail. And there is a lot of luck involved, but it is a luck that is backed by persistence and perhaps a kind of autism.

It is this kind “autism” that is so valuable. A recent Royal Society of Arts publication suggested that there is a link (if only by analogy) between successful entrepreneurs and ADHD (Attention Deficiency and Hyperactivity Disorder). Governments around the world are attempting to develop entrepreneurs through their education systems, yet so many successful entrepreneurs have underachieved when it comes to education, and maybe that’s the point. At the same time, people with ADHD display many of the behavioural characteristics traditionally associated with the entrepreneur. This is not to say that successful entrepreneurs are autistic, but it is likely that their attention is not drawn to repetitive, traditional thinking that is reinforced within a conventional education that punishes or excludes heresies. So it could be the case that real entrepreneurs will innovate whether you like it, or not. And maybe the best thing to do is to either get out of their way, make it easier for them to get on with their job, or have a different kind of education that fits the psychology of those with the potential to become entrepreneurs as opposed to those who are good at education.

The problem with educating for innovation is that it creates the illusion that anyone can do it, that there is a formula that anyone can consume and succeed. The provision of this innovation education for entrepreneurs creates an illusion of success, a kind of cargo-cult of innovation reinforced by government box-ticking initiatives.

The cargo-cult was a phenomenon that grew out the indigenous people of New Guinea and Micronesia who observed the Allies’ ability to resupply their troops fighting the Japanese by air. They noted the construction of drop-zones and coloured markers and coloured smoke to indicate wind-drift and concluded that the goods (boots, water, ammunition, food and clothing) were triggered by these visual cues, and decided to copy them, and they haven’t stopped since.

What is ironic is this human tendency to construct associations between symbolic behaviour and the provision of goodness in many forms. It’s a bit like thinking that the more the government spends the better life will get. These associations between goodness and symbolic behaviour can be painful but remain hard to challenge without triggering extreme emotions amongst highly-educated people. The cargo-cult of innovation education also reinforces the idea that the highly-educated are innovative, when the reverse is more likely to be true. This explains the war against common-sense, and helps to explain why it is often so difficult to get highly-educated scientists to innovate strategically, because their thinking tends to be trapped within small academic boxes and why those scientists who are able to break out of traditional box-thinking and innovate, tend to be unpopular and driven out of the organisation. The innovation culture that is driven by academic models tends towards incremental innovation, and a fear of risk-taking which dares not challenge the prevailing formula for success that is in decay. That is why the real innovator is likely to have taught themselves in the school of hard knocks and explains why the best thing you can do with an innovator is to help them do what they are going to do anyway but help them to do it better.