1. Overcoming the barriers to innovation
Changing your behavior and processes to increase performance
Andrew Maxwell Ph. D.
Chief Innovation Officer
Canadian Innovation Centre

2. Agenda Why is being innovative challenging?
What stops us from innovating?
How can we become more innovative?

3. Introductions Asst. Professor, Temple University
Chief Innovation Officer, CIC
Professional engineer (Imperial College, London
MBA, London Bus. School, Ph.D. U of Waterloo)
15 years with technology multinationals
Cofounded four technology businesses
Managed U of T’s technology transfer office and established technology incubator
Developing online courses in entrepreneurship and innovation

4. Why is innovation important?
Improve top line, bottom line or market share
Strengthen balance sheet
Strengthen brand/reputation
Increase workforce retention (incent stakeholders)
Enhance community engagement
Improve environmental performance
Attract investors/acquirers

5. Innovation is important….. but why is it difficult?
Successful innovation involves:
Changing current procedures
Adapting leadership role
Developing new organizational structures
Abandoning existing customers (and finding new ones)
Modifying incentives, compensation and recruitment
Change company culture (and attitude to risk)
The real question is…. are you ready for this
Improve top line, bottom line or market share
Strengthen balance sheet
Strengthen brand/reputation
Increase workforce retention (incent stakeholders)
Enhance community engagement
Improve environmental performance
Attract investors/acquirers
© Andrew Maxwell, CIC, 2012

6. Confusion over what innovation is
Joseph Schumpter (1936)
Introduction of a new good, or a new quality of good
Introduction of a new method of production - need not include new technologies)
The opening of a new market
The securing of a new source of supply
The creation of a new organization
Innovator’s Alliance (2012)
Innovation involves exploring and adopting new methods of creating value
Generating new ideas
Conducting R&D to develop new products
Continuous improvement in all functional areas
Finding new ways to deliver products and services

7. What is innovation?
Innovation is the creation of better or more effective products, processes, services, technologies, or ideas that are accepted by markets, governments, and society (Wikipedia)
Confused with:
Invention refers more directly to the creation of the idea or method
Innovation includes:
Product Innovation
Process Innovation
Service Innovation
Business model Innovation
Innovation is the creation of better or more effective products, processes, services, technologies, or ideas that are accepted by markets, governments, and society. Innovation differs from invention in that innovation refers to the use of a new idea or method,
© Andrew Maxwell, CIC, 2012

8. What is disruptive innovation
Distinctions between incremental and disruptive innovations are based on the impact on the market, not on the sophistication of the technology advance
Incremental innovations make changes to existing products or services that tend to reinforce existing market positions
Disruptive innovations change nature of competition in marketplace, can lead to creation of new ventures an/or enable smaller companies to take on incumbents

9. What is business model innovation?
Business model innovation identifies new ways to make money to increase competitiveness and drive adoption
New ways of doing business can also increase competitiveness and productivity by:
Creating enhanced utility for the customer
Enabling a different pricing strategy
Providing alternate purchasing options
Sometimes a technology innovation requires a business model innovation to achieve commercial success

10. The innovation imperative
On the road to the future, you are either:
The driver
The passenger…..or
Roadkill
Gary Hamel

11. But innovation is a science not an art
Traditionally we talk about innovation based on experience, not evidence
We don’t look at diagnostic factors that differentiate between success and failure
We provide insights, not predictions
But as we advance the study of innovation, we can use our improved understanding to predict outcomes
Adopting a process approach to innovation will improve innovation outcomes

12. Innovation management is a process
Innovation is a management process the requires specific tools, techniques and discipline
Innovation involves the development of organizational processes and procedures for generating, considering and acting on innovative ideas
Innovation research focussed on technology; but real challenge is to understand innovation process and the cognitions and behaviours of people in that process
Innovation involves an understanding of the social sciences, rather than the physical sciences

13. Implementing an innovation process
Outputs
Outputs
Product innovation
Service innovation
Process innovation
Business model innovation
Inputs
Decision
making
Monitoring
Employees
Suppliers & Partners
Customers
Competitors
Ideation
Evaluation
Realization
Resource
allocation
Project
management

14. The innovation context
Strategy
Product Leadership
Customer Intimacy
Oper. Excellence
Disruptive Offerings
Resources
Financial
Technology
People
External
Leadership
Incentives
Communications
Risk Tolerance
Culture
Business Information
Quality Management
Project Management
Decision Support
Processes

15. The innovation context
Outputs
Strategy
Resources
Product innovation
Service innovation
Process innovation
Business model innovation
Inputs
Employees
Suppliers & Partners
Customers
Competitors
Ideation
Evaluation
Realization
Culture
Processes

16. Innovative ideas only generated if…
Clear understanding of why innovation is important for company
The innovation strategy is clear and well communicated
Simple method for collecting and evaluating ideas
There is the requisite support for innovation
Leadership support
Alignment of incentives
Allocation of necessary resources
Decision system for deciding priorities open and
Commitment to make decisions and implement in a timely manner
“Organizations, by their very nature are designed to promote order and routine. They are inhospitable environments for innovation” Ted Levitt

17. Changing the rate of innovation requires company transformation
Change through Leadership
Create a Shared Need
Shape a Vision
Mobilize Commitment
Make Change Last
Monitor Progress
Change Systems and Structures
Change Culture from Control to Trust
Communicate
Incentivize

18. Changing the culture
Create an innovation-friendly organization, that embraces a culture of “risk” and “rewards failure” (and success)
Develop a “ project and portfolio management” approach to innovation around decision-making and implementation
Develop a cross functional “matrix organization” to embrace innovation across organization
Focus on “communications” and “engagement”
Design “incentives” to support innovation

19. Innovation is about taking higher levels of risk
which means accepting higher levels of failure
“If the people running Amazon.com don’t make some significant mistakes, then we won’t be doing a good job for our shareholders because we won’t be swinging for the fences.” Jeff Bezos
“I don’t mind failure. I’ve always thought that schoolchildren should be marked by the number of failures they’ve had.”
James Dyson
“The biggest risk is not taking any risk…In a world that changing really quickly, the only strategy that is guaranteed to fail is not taking risks.”
Mark Zuckerberg

20. Common causes of innovation failure
Organizational Causes
Process Causes
Poor leadership
Poor organization
Poor communication
Lack of empowerment of stakeholders
Poor knowledge management
Resource limitations
Poor goal definition
Poor alignments of goals and actions
Poor team effort
Poor monitoring of results
Poor communication and access to information
Inappropriate decision making

21. Innovate….or die trying….
Thank you
© Andrew Maxwell, CIC, 2012