The difference between success and Segways

https://www.cbsnews.com/pictures/famous-people-riding-segways/11/

Innovation has a number of  barriers in the journey to success.

Adam Grant explores some of the myths around this in his latest book Originals. 

He points out that success is less about willingness to risk take, and more about skill in risk mitigation. 

And that more is more when it comes to ideas turning into successful outputs. (You need to kiss a lot of frogs before you find your prince/princess).

But when you are dealing with lots of ideas, being able to successfully judge which to proceed with, as early as possible, is the difference between success - and the Segway.

Grant explains:

"Inventors will necessarily struggle mightily in gauging whether their creations are ultimately frogs or princes. The best way to get better at judging our ideas is to gather feedback. Put a lot of ideas out there and see which ones are praised and adopted by your target audience."

You need to hear how your customers feel about your idea. You need to connect early, and often.

"When building the Segway, (the) team generated a wide number of ideas, but didn’t have enough critical input from customers to make the right choices for the final product. The device went through three or four iterations before a customer ever saw it.
Conviction in our ideas is dangerous not only because it leaves us vulnerable to false positives, but also because it stops us from generating the requisite variety to reach our creative potential"

The lesson is simple. Inventors are poor at evaluating the value of their idea versus customer need or response. Managers are equally poor:

"In the face of uncertainty, our first instinct is often to reject novelty, looking for reasons why unfamiliar concepts might fail. When managers vet novel ideas, they’re in an evaluative mindset. To protect themselves against the risks of a bad bet, they compare the new notion on the table to templates of ideas that have succeeded in the past."

Trusting our customers and - particularly in the ideation and concept stages, giving them the tools to be open to the novel (think of the tools deployed to drive open thinking in the Design Thinking process), is your route to the highest hit rate. and the lowest waste of creative effort, time and money.

Why mice get to eat dinosaurs

Photo by rawpixel on Unsplash

Many of us work for a reason. We have something we want to achieve. We want to make change, fix a problem, get stuff done. In the ideal scenario 100% of our efforts are focused on exactly that.

Funnily enough, that's also the reason for every business ever to start. Every start-up is a solution to a problem that someone stumbled on, woke up screaming about or otherwise identified a 'gap on the market'.

So why does it often feel like your ambition to get things done, to make things better, ends up being constrained by the very organisations that were meant to be configured to share in and scale your ability to make that difference?

It's an old conundrum - labelled variously Dis-economies of Scale, career politics, empire building, silo'd thinking etc. Whatever the name the result is immense waste, both for the businesses themselves and for the customers they aim to serve.

This waste gets formalised in structural inertia that constrains the organisation's ability to adapt.
And unless these are understood, acknowledged and a plan for responding to them is drawn up - well that inertia will keep things as they were, stalling the ability to compete.

Of course you don't need to worry if there are no new entrants to your market arriving without all those constraints. But if there are (there always are) then you must address them or try to compete with roughly half your capability and capacity to respond focused on dealing with internal drag instead of focused on meeting market need.

The start-up mentality comes without the brakes. It's little surprise therefore that in case after case the businesses that have succeeded since digital began (you know the examples off by heart by now) have been start-ups built on a different way of working. I'm not saying every start-up will out-compete every incumbent. I am saying that those that survive long enough to emerge to compete come without the inertia of incumbents and are instantly better positioned to perform better.

The inability or unwillingness to identify and deal with their inertia is also why it is so hard to point to a large scale incumbent business in any sector and claim they have pulled off a genuine transformation driven by digital. Orgs that were not born digital have to deal with a heap of internal inertia such as:

Resistance to:

• Ending old supplier relationships in order to establish new ones. Better the devil you know, right?
• Admitting you may have backed the wrong horse (eg ending investments you built the case for and/or supported in the past). I haven't got to where I am today without sticking to my guns, right?
• Moving monoliths of capability and capacity from old to new requirements. What do we do with all these mouths we always fed with the old, while we scramble towards where the market is actually headed?
• Cannibalising what you do with cheaper alternatives. But that hits my margins! (Sure, wait for someone to eat your business from outside instead then).
• Anything we aren't absolutely clear about, have little experience in, or isn't core to our strengths. We have no expertise in X. Hint - if it's new, nor does anyone else. The thing to be expert in is learning and responding at speed.
• New Data. Seriously - how many times have you heard 'we tried this before and it failed' when the whole landscape in which the plan was meant to operate has shifted? New guys don't have your hang-ups (or as you may prefer to call it in the boardroom, your 'corporate memory')
• Accepting that success in your old model is not what's required to succeed in the new. Proven leaders in the old are just the folk for the new, right?

All of these and several others lead to the most debilitating inertia of all - rabbit-in-headlights syndrome. This is the resistance to making a decision in time to jump.

Of course - not only must you be able to make a decision fast enough, you also need to know which way to jump. That's where real strategy plays, where you ditch the 4x4s to find the insight to really understand the landscape, your opponents, the direction of travel of change/market demand, the wisest places to attack and defend, and the challenges yourselves and your rivals face in implementing the tactics that attack or defence will require. And I've shared much on this in recent posts. (eg The Job Of Digital Strategy).

For today, let's focus on how we can remove some of this inertia.

Perhaps its worth taking some lessons from DevOps (and emerging DesOps). It seems odd to me that many incumbent organisations are taking up, or being sold on, the advantages of one or both to make things but rarely getting the hint that perhaps this is how they should be organising themselves to operate for value.

For example, high-level lessons from DevOps:

Measure: Localise accountability.

This requires the redistribution of the power to act - you can't ask for accountability without it. Flattened hierarchies are pretty much inevitable.

Speed: Get to “learn” as quickly as possible.

That demands some Scrum Mastery... driving the notion of server-leaders whose job is to support the makers on their mission, and remove obstacles. If the inertias are your obstacles then, game on. This one organisational focus could save it.

Responsive: Pivot on lessons quickly.

See above. Speed without the power/capacity/capability to respond is just a faster way to crash).

Automate: Use software to do more to help create and manage what can be automated.

See also the idea of Scrum Mastery - as in removing obstacles, accelerating pace, repeating what can be replicated (getting to nuts and bolts you can re-use vs making a new set of nuts and bolts for each piece of work).

Small chunks: Reduce risk through compartmentalisation.

This one large orgs really struggle with. Small teams working at speed, enjoying distributed power with the capacity and capability to act on their own decisions).

There is power in these basic tenets of DevOps, much of it writ-through agile approaches and all of it core to a new way of working.

But let's be clear, this requires a different way of working, different flows of capital, different distributions of power. These come as standard in start-ups. But unless and until you are able to match the freedom to move that a start-up is born with, you will be out-competed, as sure as mammals followed dinosaurs.

Standardising innovation will deliver disruption at scale

I joined in a conversation on Linkedin triggered by one innovator positing a view on what disruption really is - and a dozen more piling in to place their version of the truth on record.

My point of view was/is this:

A technology trend has the potential to be disruptive. 

The response to it is a business model built on the co-evolution of practice which that trend prompts. If that response is a new model creating value in a new way, it will disrupt the existing landscape.

I felt the lack of clarity/consistency/agreement about a pivotal term like disruption revealed how far from being truly disruptive the innovation industry currently is. This comes as small surprise given that it is a core part of digital transformation (being the way-of-working How of digital transformation). And as I have previously pointed out - Digital Transformation faces its own lack of clarity on the supply side, at a time when demand is outstripping the industry's ability to supply it.

The nuts and bolts of innovation remain too often hand-wrought. We can not expect innovation to become the new way of working at a scale and regularity that the speed of digital demands, unless and until we bring a little more standardisation and certainty to it.

This was something I also referred to in: A Shared Language of Innovation recently. In that article I discuss the way in which terms such as MVP, POC, Pilot and Prototype get used in multiple ways. This speaks to the current lack of standardisation and uncertainty (when the client demand is for more standards and more certainty).

But that was just a start. Take a look at the terms I italicised in my initial POV above. We could have a lengthy debate on the meaning of all of them. Which would waste effort, time and intellect which would be better spent on creating the higher order complexity in which value actually resides.

Innovation - particularly where it relates to digital transformation - must agree and stick to making standard sized nuts and bolts. 

Until it gets close to ubiquity its impact will be limited.

There is little Disruption in making nuts and bolts - but there is next to none without them.

Minimum Learning Vehicles

https://medium.com/@NeotericEU/lean-start-ups-by-example-5aea8091c07b

One of the many problems with making stuff fast in organisations is the varying forms of language used to describe the same thing.
Park for a moment the regular confusion between efficiency and effectiveness, the one that can create mindblocks in rapid iteration is the Minimum Viable Product.
I have heard this used interchangeably for paper sketches in Design Thinking creative sessions, all the way through to the first product being taken to the actual market at production scale.
Mindblocks - well not having a clear view of this makes it very difficult to understand what each rapid iteration cycle is trying to achieve.
I have become used to using MVP as something that may better be called the Minimum Learning Vehicle (MLV). I say it may better be called that because I think it better reflects the learning discipline of the MVP:
1. Identify what it is you want to learn from this iteration.
2. Draw/make/build only that which will give you that learning.
3. Test with the end user.
By its nature, the use of MLVs keeps things lean - avoiding scope creep and maintaining focus on the value proposition (the value to the end user).
It's a critical thing for all parties to agree when they set out to iterate to value at speed.
What do you call your MLV?

Creating new value - or simply keeping up?

Photo by Fancycrave on Unsplash

Demand for digital transformation is at an all time high - according to a survey of 600 leading execs for a DXC report: 2019: The year of digital decisions. It provides timely evidence that supports my mapping of the situation facing industry right now - referred to in detail here.

Referencing that article (The Job Of Digital Strategy Consulting): Companies are testing the water, feeling their way with agile here, lean there, new-tools-but-same-ways -of-working almost everywhere... There is no certain way of doing or being digital yet. Not by some distance. But we must expect that there will be movement in that direction.

What the increased demand/desire tells us is that digital transformation is headed toward ubiquity and with it standarisation and the need for interoperability. There's an increasing realisation that companies must build themselves a new future and this is at such scale that trying to do this with hand wrought nuts and bolts is too bespoke - too slow and too expensive.

What this also reminds us is that digital transformation is not the end product. It is a process of creating the nuts and bolts on which higher-order complexity - the novel stuff that creates greatest value - gets built.

When you have all the nuts and bolts, and power supplies and gears and pulleys and all those things you need to make stuff, it doesn't magically self-assemble. into things of value.

How you are able to use what you have brought together - the pile of 'what's' your grand 'why' of digital transformation may have provided you - that is where the magic happens.

The insight, the imagination, the ideation, the design, the rapid iteration, the testing and scaling - without these your digital investments are simply 'efficiency' spends. They won't even reduce your IT budgett. When we make stuff more efficiently we tend to use more of it (as Simon Wardley points out. Think how many more nuts and bolts got used as a result of standardising them.

What is needed is a way in which you can standardise and make repeatable the insight, the imagination, the ideation, the design, the rapid iteration, the testing and scaling. What is needed is a new way of working.

This is the 'How' of digital transformation and it is where the fight for market mastery gets won and lost.

In 2019 this is the most pressing challenge for creating new value vs simply keeping up.

The strategic importance of managed innovation in digital transformation

A couple of thoughts in visual form on the strategic importance of managed innovation in digital transformation - and the behaviours required of the people involved:

First - the strategic importance:

Second - the behaviours

Getting your ideas to the races

Innovation leader Hans Moller described it as  history in the making. BT liked it so much they want to hitch their own innovation challenge to it next year. CEO Heidi Mottram claimed it as a global first.

A race course in Northumbria may seem an unlikely venue for ground-breaking of this magnitude but there’s no doubting the combination of festival spirit with design thinking AND a data hackathon created an open innovation festival the likes of which experienced participants had never witnessed before, including this writer.

In the final session of Northumbrian Water Group’s five-day Innovation Festival on Friday afternoon innovation outputs were described in video, song and prototype. The range included:

• Flooding Ranger –a digital platform to inform and support people in the community, to help identify risk, act on it, and get real support when the worst happen
• Rain To River – a sweeping commitment to creating blue and green corridors to keep water on the surface and return it to rivers without causing flooding in homes.
• Hot Spots – by hacking open data and NWG’s own data the data scientists identified 20 key areas in Essex (part of NWG’s remit) where action would halt the rise in leakage. Targeting another 50 they found would reduce it to customer-targeted levels. (water leakage currently spirits away 20% of the flows through the network). Data hacking also revealed an unexpected truth – When they work on a repair the likelihood of leaks near where work has been conducted increases six fold.
• Home Leak detector; If your toilet is leaking, you are wasting water. If you tweet about it NWG could listen to pro-actively respond cutting your costs and saving water.
• Lab In A Box – Making use of the 65,000 holes currently dug by NWG every year – when the ground is open, take data on the conditions of soil, pipes and other factors which could help predict where future leakage may occur.
• Breathe Easy; Part of the commitment to the environment all water companies must make, saw one group looking at solutions for greener living. The Judge’s prize in this case was for Moss Trees. Already in use in some parts of the world, these are structures on which moss can grow and be sustainably maintained with rain water. Moss is 275 times better at absorbing carbon dioxide than trees are – and take up considerably less space. Expect to see this one on the side of roads in Newcastle within the year.
• E-Commute; To reduce unnecessary journeys for staff, E-Commute will provide simple text messages warning of delays, alerting to car share possibilities, and suggesting when it may be better to stay home.
• Bradley: Provides hands free comms, advice and direction via voice – useful in conditions where touching anything can be difficult (around caustic chemicals, for example).
• LISA: A personal life assistant to filter all the things you don’t need to know out until a time that better suits, while bringing key information to you at the right time.
• Squirrel: Alexa meets Uber meets VR. An AI powered service which identifies your problems, finds a service provider, makes the booking knowing your movements, and provides the service provider with onsite support via VR to fix almost anything. It only stops short of enabling the user to do the same.
• iThrive; Uses VR to create your preferred working environment while sharing a space with others or connecting you with others when working from home.
• Womble: Combining underground robot data with overground sensor readings from vans and drones to make infrastructure visible and monitor it.
• Community Portal: For communities to share the kind of infrastructure needs they indentify for themselves and direct NWG resource to resolution if and when in relevant areas.
• Infrastructure Corridors: You and I may assume that each utility has access shared and permanent access to each others’ maps of pipework etc. Or even that they share plans for repairs to limit the number of times the roads are dug up. Sorry. True only in very rare circumstances. As a step toward resolutions Infrastructure Corridors will be trialled in a test location of new build where the challenges and regulations of bringing all the pipeworks together in an accessible but secure channel away from the roads will be tested. The data and other collaboration required to pull this off could serve as a template for roll out across the country.
• Light from Dark: Dark Fibre-optic networks can be utilised to measure and monitor movements in the soil, changes in temperature and other dynamics which could identify leaks (as previously stated- a huge water industry problem, particularly in open rural areas where they may go undiscovered by human eye for many months.
• I-Job: Bringing together customer data, past work at same location, skills matching and training for employees on the road. The intent is to also overcome the connectivity problem often experienced in rural areas by making use of updates to the van when passing back into connected spots. The group wants to supplement this with employee-made how-to videos to enable scaling of skills across teams.

And these are just some of the highlights presented in the final sessions by each team – each of which had started with hundreds of ideas. CEO Heidi Mottram intends to tot up how much value all these outputs could bring. Already the 'six months of innovation in one week' estimate made yesterday has been revised up to a year's worth at event's end. Crucially Heidi is committing to taking all of the outcomes forward (at least for further business case development).

And it doesn’t stop there. There were the results of an internal Invest Quest challenge. Five finalists were meant to fight it out over a £250k investment. The ideas proved so strong the business doubled the pot and committed to backing all five.

There were visions of the future from a teenager’s bedroom pov. There were customers who showed up to join in part of a sprint and found themselves so taken by the spirit they stayed all week.

The outputs inspired commitments from vendors, partners and other water and utility companies – all of which everyone involved will be watching with interest with plans for a grand reporting back next year – when it all happens again.

What has it taken to get to this. CIO Nigel Watson had the vision. But, as he points out, it has taken a brave boss (in Heidi) to create something of this scale.

As Nigel commented: “Someone told me when Glastonbury started it was smaller than this.”

They have 88 acres still to fill at Gosforth Park. But imagine a festival of innovation on that scale – what problems we might solve… in a week!

See also yesterday's post.

Six months of innovation in one week

Under starters orders for blue sky thinking

My first day (and a night) at Northumbrian Water Group's Innovation Festival has been both inspiring and informative. Critically, it is turning creative inspiration into tangible plans.

On arrival last night I was treated to traditional northern hospitality. Pie & Peas no less. And a series of bands, primarily made up of NWG employees, showcasing creativity of their own.

In the light of day today the range and scope of activity became apparent. From a full-on hackathon ,where available data is being interrogated to try to solve the problem of water leakage, to VR demonstrations, through the teenagers' bedroom of the future, everywhere there is a spirit of collaboration and creative building.

Where stickies go ideas must follow

This is the first NWG Innovation Festival. It's been sponsored to the tune of £250,000. NWG's commitment has been in bringing the event and the people together and committing as many as 180 of their own people to the full five days of the event (400 plus partners, academics, schools and customers are attending in total each day).

CIO and Innovation lead Nigel Watson is sure it's worth it and is already commited to delivering NWG Innovation Festival II next year.
Design Thinking is being applied to six sprints:

1. How do we reduce flooding?
2. How do we know about leakage from water pipes and how can we fix it?
3. How do we upgrade our infrastructure effectively and affordably?
4. What will living and working look like in 2030?
5. What can businesses do to improve the environment of the North East of England
6. How do we optimise a mobile workforce for a complex network business

Defining solutions

Design Thinking is far from brand new at NWG. It has been in practice for 18 months. Each month a new sprint is embarked on - always off site and always with a suitable and or eccentric mix of people and skills engaged. In one sprint on billing a baker and a gamer were involved, Nigel says.

NWG uses the Double Diamond approach, taking their inspiration for the initial problem from business KPIs - which in their case are focused on delivering improved customer service.

Where they see evidence they are under-performing, that's where they focus the Design Thinking approach, to deliver a step change. This means innovation always delivers against business need.

The first job is to unpack the initial problem and really work to understand what are the true causes of the problem. Using these, they define the area to focus on and reach what Alastair Tawn (who leads Design Thinking at NWG) calls the 'Critical Problem'.

With the critical problem defined, the team can then work up a range of solutions before focusing back in on the solutions that will work.

For Nigel, the Festival delivers six months of innovation in a week.
Each of the problems the sprints are tackling are ones the water industry as whole need solving. Which explains Nigel's other ambitions for the event

1. To improve the industry 
2. To give small businesses in the NE exposure
3. To enhance NWG's own reputation

"And if just one idea come that makes a significant difference to our business we’ll judge this a success," he said.

With programs for dark fibre to monitor for leakage, movement in pipes and changes in temperature;  universal mobile sensors moving above and below ground and new approaches to getting utilities to share both infrastructure and data among those in development on Day 4 of the event, Nigel should be confident.

We'll get a clearer idea tomorrow when the final ideas are presented.

I'm also planning to share a bit more about the culture of innovation at NWG.

Watch this space, as we used to say when space was limited...

Transformation without innovation isn't enough

When we think about the great business tasks of our time Digital Transformation is the must-do. It is often heralded as some kind of future-proofing excercise. But without innovation as both its beating heart and foundational principal, it can be little more than a retro fit.

Digital Transformation is the widescale response to Digital Disruption - ie a disruption that has happened. That disruption is often to the way people behave: People, machines and information now connect in such a way that a human behaviour has changed - ie how people consume content has been disrupted by new connections between people, machines and information. That has created new needs. To meet them is to transform to meet the needs of digital disruption.

Each strategic goal in digital transformation is therefore a response to a need created by a digital disruption.

But if you take an innovation-first approach to digital transformation, you create the space to become the disruptor.

Consider the impact of the technologies we know of today. Prepare for them to impact faster and more broadly than the web ever did. Imagine and expect the improbable.

The opportunity, for those who will understand the potential of AI and who can imagine its possibilities, is not to be digital - but to be the disruptor.

Why robots are essential to kick-start our next age of innovation

Yamaha's Robot rider could one day end the  chore
of riding fast motorbikes... er, ok it's not all good.

There is an argument - and a well made one at that - that our era is not an age of great technological change - but actually one that is quite stagnant.

Robert J Gordon made the case in his book 'The Rise and Fall of American Growth'. He points out that the Great Inventions that caused real change arrived between 1870 and 1970.

The internal combustion engine changed the way we travel (removing the growing threat of horse manure - which experts predicted would reach 9 feet deep on London's roads by 1950 if allowed to go unchecked). It changed the way we travel much more than any subsequent improvement in performance or styling.

Urban sanitation similarly had a greater impact on our health than medical inventions of more recent years. The invention of the telegraph versus the written message carried by ship, horse and hand which preceded it is a far bigger shift than fax to email or phone to mobile.

The impact was that we got to live (US childhood mortality tumbled from 1/3 in 1860 to 1/200 today), we got to live longer, and we got more time to do with as we pleased (being liberated from household tasks such as washing clothes and preparing meals which had taken 58 hours in 1900 - and 18 in 1970).

Jesse Frederick argues in his assessment of Gordon's ideas that our blindness to the comparative stagnation of the modern era can at least be partially attributed to the fact that the technology of the past mainly created time, whereas today’s technology fills it.

Gordon, published in 2016 - sees this stagnation as permanent. Mostly because the big wins for technology have already been won. But part of the problem is for all our technology we feel as though we have less time. And time is essential for the ideas that make real change.

Enter Robots. the AI revolution and the robotics it is driving are about to answer Jesse's criticism of today's inventions. They are certainly not a technology that fills time, they will create at least 18 hours for us (finishing up the last bits of housework our inventors have failed to resolve so far - ironing, dusting, food prep and cooking, physically moving the devices about etc). The internet of things completes the picture in shopping.

Ok, an 18 hour saving isn't as great as the 40 hour leap that got us here - but this one will come in 5-10 years. The last took 70.

And we haven't even considered the saving in time AI will bring to our working (and commuting) lives. Finally, the time technology promised to free for us will actually arrive.

And yet, even for the slam-dunk win our robot friends will provide, there's an even bigger opportunity for genuine life change: How we organise is changing.

How we organise is society and society is how we live.

As I have long argued; the web enables adhoc self-forming groups to get things done. That's a fundamentally different form of organisation than preferred by 1870-1970. That era was also an era of centralisation and mass production. The next 10 years is about decentralisation and personalisation; whether it be through micro factories in every home (3D printing), the move away from public transport (driverless cars, drones) medical technologies that self diagnose and repair (nanobots) or how we learn, get justice, make contracts and exchange value (blockchain).

We will have the opportunity to live entirely unique, separated lives. But all the evidence of the world since the web is that we will use it to become closer and better connected - without the need for central organisation.

A future without centralised or top-down direction is being enabled through the technologies of this decade and the next. 

Very soon we will have the collective time to carefully consider what our future should look like and imagining how we can reach it - kick-starting the next age of innovation.

And that, when we pause to reflect on the shift from 2010 to 2030, will, I believe, provide us with a case to say we really do live in a time of not just fast, but radical change.

To lead is to listen

Seth Godin interviews Richard Branson about the value of listening for innovation and leadership. You can spare 1min 15 for that, can't you?

Listen - and listen aggressively!

As Branson says, your customers have got more and often bigger brains than you have. And they'll tell you what they want - for free. (Image courtesy)

Watch it here.

BTW American Express, while you're listening... we prefer portable video (ie a code snippet which makes it playable here a la Youtube) not a fixed location we must point at. Just so's you know.