Self Help

Built to Innovate - Ben M. Bensaou

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Matheus Puppe

· 42 min read

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  • The world is changing rapidly and unpredictably, forcing organizations in all sectors to urgently innovate to stay competitive.

  • Organizations need to master two contradictory activities: executing today’s business efficiently while also innovating for the future.

  • Many books focus on innovation concepts but don’t provide practical frameworks to build innovation capabilities.

  • This book provides an end-to-end perspective on how to create an innovation “engine” within organizations, outlining key processes, roles, and governance.

  • It offers a supplier-side view focused on how organizations can build innovation capabilities, rather than just a customer-side view on innovation outcomes.

  • The book details three key innovation processes (creation, integration, reframing), three key roles (frontline innovators, innovation coaches, innovation agenda-setters), and how to establish governance.

  • It aims to make innovation everyone’s business, providing tools to empower creativity across the organization.

  • The goal is to help leaders instill “the innovating habit” and systematically prime the innovation engine in their organizations.

  • Organizations need two engines: an execution engine to carry out day-to-day operations efficiently, and an innovation engine to continuously generate new ideas and improvements. Most focus only on execution.

  • Innovation refers to outputs like new products or processes. Innovating is the continuous process of looking for, developing, and implementing new ideas that create value.

  • Innovating should involve everyone in the organization systematically and continuously. It starts with looking for ideas anywhere.

  • Most books on innovation focus on high-tech companies and don’t provide concrete guidance for building an innovation engine. This book aims to fill that gap.

  • The author has developed and refined an approach to building an innovation engine over 20+ years of research and consulting. It involves three key processes:

  1. Creation - generating new ideas continuously
  2. Integration - channeling ideas to the right people and assets
  3. Reframing - challenging assumptions and mental models
  • The book will explain how employees at all levels can contribute to these processes, assisted by innovation specialists (I-Teams). It provides tools and examples from diverse industries to make innovation a habit.

Here are the key points from the passage:

  • Innovating involves three key processes: creation, integration, and reframing.

  • Creation generates new ideas. Integration connects people and ideas across the organization into an innovation network. Reframing challenges assumptions and shifts mindsets to see possibilities.

  • These processes happen at all levels: frontline innovators, midlevel coaches, and senior leaders. Each has a role to play.

  • The Built to Innovate (BTI) Framework shows how the three processes interact across the three organizational levels.

  • Innovating can start anywhere - with frontline ideas, leadership commitment, or midlevel support. The goal is to build the full framework over time.

  • Core traits of innovative organizations: inspire individual creativity, link distributed expertise into a coordinated process, continuously question assumptions and challenge the status quo.

  • The book provides examples of companies doing this well and advice for implementing the framework. The key is shifting from a supplier view to a customer view.

  • The goal is to embed innovating as an everyday habit involving everyone, not just scattered genius individuals. This creates collective genius.

  • BASF is the world’s largest chemical company, with a long history of innovation and R&D. However, in the mid-2000s, BASF recognized the need to supplement its scientific strengths with a broader, more collaborative approach to innovation.

  • BASF tended to have an insular, “inside-out” culture focused on its own expertise rather than customer needs. It needed to develop more “outside-in” capabilities.

  • BASF launched an initiative called “Help Our Customers Be More Successful” (HCS) to foster interaction with customers, understand their needs better, and avoid imposing one-size-fits-all solutions.

  • HCS evolved into a broader culture change program called Perspectives, aimed at establishing an enterprise-wide focus on understanding and meeting customer needs through innovation.

  • Perspectives involved deep analysis of BASF’s customer relationships, mapping them into six types based on their needs. Different customer interaction models were developed for each type.

  • The goal was to increase innovating capacity across BASF by helping all employees, not just R&D, make innovation an everyday habit through collaboration, openness, and focusing on customer needs.

  • Over a decade, BASF implemented cascading changes at all levels to ingrain this new innovation mindset into its culture and accelerate innovation output.

Here are the key points about how BASF transformed its approach to innovation and customer relationships:

  • BASF recognized the need to shift from an “inside-out” orientation focused on developing products in their labs to an “outside-in” approach focused on understanding and meeting customer needs.

  • They introduced the Perspectives program which involved extensive research to identify 6 key Customer Innovation Models (CIMs) representing distinct customer needs.

  • BASF realized its processes and structures needed to be customized to serve these CIMs rather than relying on a one-size-fits-all approach.

  • They launched the Pathfinder system where cross-functional teams deeply research specific customers to identify the best CIMs to meet their needs.

  • Perspectives was embedded into the culture through extensive training, workshops, and events for employees at all levels.

  • A key pillar of their strategy became “We help our customers be more successful” reflecting the new customer-focused orientation.

  • Scientists now collaborate with marketing, sales and customers from the start to co-create products tailored to customer needs, rather than developing innovations in isolation.

  • This outside-in approach has led to major innovations like Boost foam for Adidas running shoes, co-created through close partnership between BASF and Adidas teams.

Here is a summary of the key points about BASF’s approach to innovation:

  • BASF has shifted to an outside-in, customer-focused approach to innovation, emphasizing cocreation with customers rather than just developing products in the lab.

  • This led to major product innovations like Boost shoe soles developed with Adidas and the stain-removing Basotect foam developed with P&G.

  • Accidental discoveries are now captured and explored for innovation potential rather than dismissed. The stain-removing properties of Basotect foam were discovered by chance.

  • BASF has become a leader in business model innovation, not just product innovation. They analyzed and codified the 30+ business models used across the company.

  • Business model innovation is seen as equally important as product innovation to create value. Models are reevaluated to determine if changes could better serve customers’ needs.

  • declining sales and profitability can spur business model innovation, as can changes in customer needs or the competitive landscape. Flexibility and creativity are required.

In summary, BASF’s outside-in focus and systematic approach to both product and business model innovation has made them an innovation leader able to continually adapt and create value.

  • W.L. Gore & Associates was founded in 1958 by Bill and Vieve Gore to explore innovative uses of polytetrafluoroethylene (PTFE).

  • One of Gore’s longstanding practices is “Dabble Time” - associates are encouraged to spend 10% of their time exploring personal projects. This has led to major innovations for the company.

  • Gore values both innovation (“dabbling”) and execution. Both are seen as engines that power the organization.

  • Innovation and execution depend on engagement and initiative by all associates. Gore has a non-hierarchical “lattice” organizational structure to empower associates.

  • Examples of innovations at Gore include Gore-Tex fabric, Glide dental floss, and Elixir guitar strings, all originally dabble time projects.

  • Gore’s approach shows that systematic innovation paired with effective execution, driven by empowered associates, can produce ongoing success and growth.

  • Key lessons are: foster innovation everywhere, combine innovation with disciplined execution, and engage all employees by giving them autonomy, ownership, and the ability to follow their passions.

  • Organizations need two “engines” running simultaneously: an execution engine focused on efficiently carrying out day-to-day work, and an innovating engine focused on exploring new ideas and possibilities.

  • The execution engine has a skeptical, logical, efficiency-driven mindset. The innovating engine has an open-minded, imaginative, flexible mindset.

  • Both engines are essential, but the innovating engine often doesn’t get enough attention. It takes longer to see the value it creates.

  • Smart leaders understand the need to systematize and protect the innovating engine.

  • At W.L. Gore, policies like “Dabble Time” give employees free time to switch into the innovating mindset.

  • Gore’s core beliefs and guiding principles, like empowering individuals and teams, also nurture the innovating engine.

  • Gore’s lattice organizational structure, lacking hierarchy, encourages small teams, open communication, and leadership through influence rather than formal authority.

  • Getting every employee to participate in both execution and innovating requires instilling both mindsets. Examining Gore’s unusual practices provides insights into how this can be accomplished.

  • W.L. Gore & Associates pioneered a non-hierarchical, egalitarian management style that empowers employees to innovate and manage their own time and projects.

  • This philosophy traces back to founder Bill Gore, who believed that true commitments can’t be imposed, only freely made. He wanted a company of people genuinely committed to their work.

  • Employees at Gore are required to negotiate their roles and responsibilities with peers rather than having a traditional boss. This encourages innovation as well as execution.

  • Gore has developed systems like the “Real, Win, Worth” innovation funnel to help employees focus their energies on high-value projects while retaining freedom to innovate.

  • Gore’s innovation system is more open-ended than typical R&D, with every employee a potential source of innovative ideas that can germinate before being tested for viability.

  • The company’s continued success with innovation has made it a magnet for talented people and earned it a spot on Fortune’s “Best Companies to Work For” list since 1998.

  • The Value Test is a simple framework Gore uses to evaluate innovative ideas, assessing whether they will increase customer willingness to pay or reduce company costs.

  • Asking these questions consistently helps determine if an idea deserves further exploration and development.

  • Samsung has gradually risen to become a world leader in innovation through building a systematic process for generating and implementing new ideas.

  • One key was adopting TRIZ, a methodology for analyzing problems and imagining new solutions. Samsung trained thousands of employees in TRIZ, sending a message that innovation was a priority.

  • Samsung also established a Value Innovation Program (VIP) Center where cross-functional teams live on-site for weeks to focus intently on developing breakthrough innovations.

  • At the VIP Center, ordinary Samsung employees with diverse backgrounds are temporarily assigned to innovation projects, not just R&D specialists.

  • Having a defined process for innovation has been more important than just encouraging employees to be creative individually. The process itself helps drive the innovation engine.

  • Samsung has effectively combined multiple innovation methodologies like TRIZ and Blue Ocean Strategy to stimulate fresh thinking. The company sees value in varying the approach over time.

  • The systematic commitment to training employees in innovation methodology and providing facilities for intense focus on new ideas has been crucial to making Samsung an innovation leader.

  • Organizations need two distinct capabilities: executing current work flawlessly and imagining new products/processes (innovating engine).

  • Don’t isolate innovation to a separate R&D unit. Employees across all departments should work in both execution and innovation, adopting the necessary mindset.

  • Various methodologies can inspire and guide innovation, but the specific approach is less important than making space for innovation and involving all employees.

  • Innovation spaces can be physical (like Samsung’s VIP Center), virtual (like Bayer’s WeSolve platform), or a combination. The key is to make innovation a regular part of all employees’ responsibilities.

  • Innovation shouldn’t be forced or punitive. Encourage participation by conveying that innovation is an important expectation for all, but don’t penalize for perceived lack of innovation.

  • The message for employees should be: doing current work well is important, and so is participating in imagining the organization’s future through innovation. Everyone’s creativity is needed to maximize the innovation engine.

Here are the key points from the passage:

  • The US military struggles to produce a steady stream of small-scale innovations, despite its vast resources. Reasons include its vast bureaucracy and ultra-complex procurement rules.

  • The biggest challenge is the complexity of developing equipment needed by troops in inhospitable places. The huge gap between customer (troops) and supplier (contractors) makes military innovation difficult.

  • To narrow this gap, the military now uses exercises like Tech Warrior Enterprise to let contractors experience battlefield conditions firsthand. This helps them understand the real needs of troops who will use their equipment.

  • Tech Warrior events expose contractors to how warfighters think and help them design innovations that are more useful in the field. The exercises provide invaluable real-world feedback.

  • Switching from a supplier-side to a customer-side view makes innovative thinking easier. Companies must look at potential products and services from the customer’s perspective.

  • They should also consider current noncustomers, who may offer insights into new products or services. Overcoming barriers like insulation from customers and not-invented-here syndrome is key.

  • Paying attention to customer needs is difficult. Success often breeds complacency about the need for innovation. Helping customers articulate unfamiliar needs is an art few businesses have mastered.

  • Many businesses fail to consistently innovate in a customer-centered way because they erect barriers that prevent them from hearing and responding to customer needs. These barriers include only listening to current customers, fearing that new innovations will cannibalize existing products, and taking the path of least resistance rather than truly engaging with customers.

  • Ecocem provides an example of how a company can overcome these barriers through practices like:

  • Listening to the customer message about the need for more sustainable cement products, even when incumbent cement companies were ignoring this.

  • Engaging with industry regulators and standards bodies (an influential noncustomer group) to get approval for their innovative cement substitute.

  • Building an internal innovation team focused on deeply understanding customer needs through close collaboration between scientists and salespeople.

  • Pursuing long-term partnerships with universities to access talented researchers.

  • Ecocem’s approach illustrates how companies can adopt the customer-side view by learning from both current customers and noncustomers, overcoming inertia and fear of cannibalization, and putting in place practices that force engagement with outside voices. This enables more consistent customer-centered innovation.

  • Teaming up salespeople with technology experts at Ecocem, a cement company, allowed for greater understanding of customer needs and preferences. This led to new product innovations tailored to customer problems.

  • W.L. Gore’s Innovation Center provides a space for Gore engineers and scientists to collaborate with outside experts like customers, academics, and entrepreneurs. This allows them to develop new ideas and applications for Gore’s products that they may not have conceived alone.

  • At the Innovation Center, Gore uses deep-dive conversations and AI tools to fully understand customer needs and match them to Gore’s product catalog. If no match exists, they may co-develop a new product.

  • AkzoNobel’s Paint the Future initiative invites startups and other companies to address a business challenge defined by AkzoNobel. The most promising concepts are further developed through workshops and collaborations. This builds an ecosystem of innovative partners.

  • The key point is that actively collaborating with and learning from customers, non-customers, and external partners through co-creation can lead to valuable innovations tailored to customer needs. This is especially useful when tackling complex challenges.

  • The innovating engine relies on three key processes: creation, integration, and reframing.

  • Creation involves continuously generating new ideas, not just for products but for all aspects of the business (customer service, logistics, HR, etc.). Frontline employees often play the biggest role in directly creating new ideas since they have the most customer contact.

  • Integration means selecting the most promising ideas, combining them into innovations, and implementing the innovations across the organization. Cross-functional collaboration is key.

  • Reframing involves purposefully shifting mindsets and perspectives to gain new insights. It means pivoting from an internal, supplier-side view to an external, customer-centric view.

  • These three processes allow organizations to serve current customer needs through the execution engine while also preparing for the future through the innovating engine.

  • The execution engine focuses on the present, while the innovating engine focuses on the future. But they should not be separate teams - everyone should contribute to both.

  • Adopting these three processes of innovating - creation, integration, reframing - is key to building a powerful, productive innovating engine.

  • Kordsa faced innovation challenges as a mature business in a slow-growing commodity industry. The end of a joint venture with Dupont meant it lost access to R&D capabilities.

  • Kordsa was squeezed between suppliers and customers with little pricing power or strategic freedom. Its growth strategy had focused on acquiring capacity rather than innovating.

  • The CEO launched an innovation program to fill the R&D void and reframe the business from a commodity provider to an innovation partner.

  • An innovation center was created to improve production processes, cutting costs and boosting Kordsa’s reputation.

  • The head of innovation built relationships with key customers to understand their needs and shift Kordsa’s role from supplier to collaborative innovator.

  • Kordsa reframed itself as a provider of complete tire reinforcement solutions rather than just materials. This opened new growth opportunities.

  • The case shows how investing in R&D, integrating across silos, and reframing the business model enabled innovation and growth despite competitive challenges. Key roles were played by the CEO, head of innovation, and work with key customers.

  • Kordsa was a Turkish company that produced industrial fabrics and composite materials. It was part of the Sabancı group.

  • In the early 2000s, under new leadership, Kordsa transformed itself from a commodity supplier into an innovation partner for customers like Michelin and Goodyear.

  • Kordsa’s leaders encouraged innovation throughout the company. They provided training in innovation tools, recognized innovative employees, hired experts, and required innovation projects.

  • Kordsa built new R&D capabilities like a prototype spinning line to test new fabric ideas. This let them cocreate solutions with tire customers to improve efficiency.

  • Kordsa developed new offerings like a tire cord fabric called Capmax that eliminated costs for customers. This made Kordsa a more valued supplier.

  • Kordsa expanded into new industries beyond tires. Its innovations increased sales by 70% in 5 years in the Sabancı group.

  • Three key innovation processes drove Kordsa’s transformation:

    • Creation: Empowering all employees to innovate

    • Integration: Systems to develop ideas into business opportunities

    • Reframing: Getting close to customers to understand unmet needs

  • Kordsa became a top innovator in Turkey, with constant small innovations from frontline workers. It cemented innovation in its culture.

  • Kordsa’s stage-gate system gave new businesses 5 years to grow without needing to meet the company’s usual profit requirements. This allowed them time to scale up and work out any issues with the profit model.

  • Sabancı integrated innovation across its group of companies by having managers present new innovations at quarterly meetings. This spread ideas between business units, fostered connections between innovators, and rewarded innovation efforts.

  • Sabancı leaders targeted communication to supporters, opponents, and undecideds regarding the innovation initiative in order to move them in the right direction.

  • The CEO led training sessions on innovation methodologies, signaling top leadership’s commitment.

  • The CEO reframed Kordsa’s identity from a materials supplier to a solutions creator that puts innovation at its core. This cultural shift was key.

  • Like for-profits, nonprofits like the YMCA must innovate and reframe themselves to stay relevant. The YMCA has repeatedly innovated its service model to address new social challenges over its history. Most dramatically in the past decade, the YMCA has reframed itself as a holistic community health organization.

  • Fiskars Corporation is one of Europe’s oldest yet most innovative companies, approaching its 400th birthday but more innovative than ever.

  • Innovation at Fiskars involves new products but also new processes, empowering employees at all levels to innovate in every aspect of their work.

  • This enables all three key innovation processes - creation, integration, and reframing - to occur throughout the company.

  • Fiskars started in 1649 as an ironworks operation in Finland. It later added cutlery production and became known for its iconic orange-handled scissors launched in 1967.

  • To foster a culture of innovation, Fiskars gives employees time for their own projects through “Innovation Fridays” and other initiatives. Ideas are shared on innovation boards and social intranets.

  • Frontline employees drive product innovation through deep customer insights. Midlevel managers integrate innovations across the company. Top leaders drive strategic reframing as needed.

  • This inclusive approach to innovation helps Fiskars continually reinvent itself, ensuring longevity through ongoing adaptation. Employee innovation keeps the company’s “innovating engine” running strong.

Here is a summary of the key points about Fiskars:

  • Fiskars was founded in Finland in 1649 and is known for its high-quality scissors, gardening tools, and other household products. Its “Fiskars orange” scissors are prized for durability and ease of use.

  • In recent decades, Fiskars has expanded into other businesses through acquisitions, including tableware (Iittala in 2007), porcelain (Royal Copenhagen in 2013), and glassware (WWRD group including Waterford, Wedgwood, and Royal Doulton in 2015). Today Fiskars has 3 business units: Vita, Terra, and Crea.

  • Fiskars takes a methodical, research-based approach to innovation. It studies professional users and non-customers to understand needs and opportunities. For example, feedback from professional gardeners shaped improvements to tools aimed at consumers.

  • The development of the successful Waterwheel garden hose system demonstrates Fiskars’ innovation process. Extensive research uncovered customer needs, and the final design delivered an easy-to-use, versatile product. It won design awards including the prestigious Red Dot prize.

  • Fiskars also innovates in services and processes, not just products. For example, Oliver Zehme transformed their in-store merchandising through studying consumer behavior and implementing customized displays for each market.

  • Innovation in all areas has helped Fiskars grow into a global company with $1.4 billion in annual revenue in 2020. Its systematic approach to innovation continues to drive new products, services, and processes.

  • Fiskars innovates not just in product design but in business processes like merchandising and marketing. For example, Ivar Zehme rethought their approach to in-store displays, developing the “Ambassador system” which organized tools by tasks rather than categories. This boosted sales significantly when tested in Germany.

  • Fiskars uses a framework called “Built to Innovate” (BTI) where innovation happens at all levels: frontline employees generate ideas, midlevel coaches facilitate and integrate ideas, and senior leaders reframe strategy.

  • Frontline employees get insights from direct customer interaction that spark new ideas. Engineers and designers also get new ideas from hands-on work.

  • Midlevel managers encourage and provide resources for frontline innovation.

  • Senior leaders organize activities like “Idea Days” to spur innovation across the company. They also reframe strategy based on insights from lower levels.

  • The three processes of creating, integrating, and reframing ideas happen continuously at all levels. This creates an “innovating engine” running at full efficiency.

  • Fiskars’ leadership encourages innovation at all levels of the company through processes like the Five-Year Innovation Master Plan. Senior leaders set the vision and standards, while frontline employees generate ideas.

  • Middle managers play a key role integrating innovative ideas into business operations. They organize the development process and incorporate promising concepts into existing business units.

  • The CEO and other senior leaders focus on reframing Fiskars’ business model and strategy to stay competitive in the future. They consider how changes in customers, technology, and distribution will impact the company.

  • Fiskars aims to pioneer the circular economy, eliminating waste by reusing and recycling materials. The Vintage Service initiative allows customers to resell used products back to Fiskars for resale or recycling.

  • The culture values tradition but also empowers employees to think creatively without being limited by the past. Leaders strive for a balance between focus and “freedom to go crazy” with ideas.

  • Fiskars’ relatively flat structure and small size help sustain an innovative, democratic culture where all employees feel empowered to contribute.

  • Frontline innovators play a crucial role in the process of creating new ideas and innovations. They have the most direct contact with customers and daily work processes, giving them unique insights into unmet needs and opportunities for improvement.

  • However, frontline workers often don’t get much respect or opportunities to innovate. Many frontline jobs are entry-level with little prestige. When frontline workers do stand out for their creativity, they often get promoted away from the frontlines.

  • This creates a paradox - as employees move up the hierarchy, they gain more power to innovate but lose touch with the frontlines that generate insights.

  • Organizations need to recognize the importance of frontline innovators. They should incentivize frontline workers to share ideas, create systems to surface the best ideas, and empower frontline innovators to test and implement their ideas.

  • The Starwood hotel example shows how frontline managers, when given the time, permission, and simple tools, can generate a flood of valuable new ideas.

  • To leverage frontline innovation, organizations need to shift mindsets when frontline workers enter the “innovating engine” and empower them to look for new value-creating ideas.

  • Marriott International acquired Starwood Hotels, bringing together 30 hotel brands and over 6,700 hotels globally. This created opportunities but also challenges in balancing operational execution with innovation.

  • Empowering and listening to frontline employees has been crucial for Marriott to stay closely in touch with customer needs and preferences.

  • Starwood pioneered using social media as a source of innovative ideas, empowering customer service reps to monitor comments and surprise customers. They also held meetings for frontline staff to suggest innovations.

  • The Ambassador program trained select staff as single contacts for individual travelers, learning their needs intimately. This led to innovations like YOUR24, letting guests choose their own check-in time.

  • Since acquiring Starwood, Marriott has continued frontline-driven innovations like the Bonvoy app and virtual concierge Alexa.

  • Key points: Innovations at Marriott often originate from frontline staff insights into unmet customer needs. This helps bring staff and customers into closer connection, increasing loyalty and intimacy. Empowering frontline innovators creates a virtuous cycle benefiting Marriott and its guests.

Here is a summary of the key points about Gore, Menlo Associates, GitHub, Valve Corporation, and lessons for running a great innovating engine:

  • Gore provides frontline employees with significant freedom to explore customer needs and develop innovative projects, resulting in business success despite an unusual low-hierarchy model.

  • Software firms like Menlo Associates and GitHub have also utilized non-hierarchical structures that encourage creativity and innovation. However, GitHub ended up adding middle management after growth created organizational challenges.

  • Valve Corporation became hugely successful in video game development by having virtually no formal management or hierarchy. This gave employees freedom to form teams and ship creative products.

  • However, Valve’s non-hierarchical structure seems to have contributed to a stall in creativity as their Steam platform came to dominate their business. Many top developers left.

  • While difficult to maintain long-term, non-hierarchical structures can provide tremendous short-term benefits by empowering frontline innovation.

  • Successful innovating engines minimize bureaucratic hierarchies and rules that limit creativity, while execution engines may need more structure. Companies should strive for as much frontline freedom and flexibility as possible.

  • Netflix has succeeded in maintaining a relatively rules- and hierarchy-light culture that empowers innovation, providing an example for others. The key is finding the right balance between structure and creativity.

Here are the key takeaways from Chapter 6:

  • Frontline employees play a special role in the innovation creation process because they frequently interact with customers and experience company operations firsthand. They should be encouraged and empowered to identify customer needs, desires, and problems as opportunities for innovation.

  • For most companies, the execution engine needs traditional organizational tools like hierarchy, rules, and approval processes to function efficiently.

  • However, the innovation engine can benefit from minimal hierarchy and rules, giving frontline innovators more creative freedom.

  • While all employees participate in innovating, leaders at different levels play special roles: frontline staff drive creation, mid-level managers coach/enable, and top executives inspire/align innovation efforts with strategy.

  • Companies like Valve and Netflix have very flat structures and few rules to encourage maximum creativity in their innovation engines. This works because innovation is their central focus.

  • For companies in other industries, it may be best to maintain a traditional structure for the execution engine while empowering more creativity in the separate innovation engine.

  • The key is to minimize hierarchy and rules in the innovation engine so frontline staff feel able, capable, and motivated to innovate. But companies should be cautious about eliminating management entirely.

  • Allianz experienced a flood of employee innovation submissions after training programs, but then the rate plummeted. Rather than giving up, they appointed local innovation coordinators to provide feedback within 15 days. This quickly resumed the flow of ideas.

  • Generating ideas is just the first step - you also need a system to develop ideas into realities. Midlevel managers are crucial for creating and sustaining these innovation systems.

  • Allianz created a worldwide innovation system called Ideas to Success (i2s) with 72 local managers coaching employees on innovating and implementing ideas.

  • They made innovation a competitive team sport by tracking and publicizing innovation statistics. Other innovations included an annual Global Innovation Award and appointing “lead champions” and “innovation champions” to advocate for and mentor on innovation.

  • Over time, the culture of innovation became deeply embedded across Allianz through the work of these midlevel coaches. The i2s program is no longer needed, though Allianz Consulting still provides support. Innovation is now driven from within business units.

  • Companies like Apple, Google, Facebook, etc. get a lot of attention for innovation, but some more traditional companies like IBM are also highly innovative.

  • IBM has led in patents for 28 straight years, demonstrating consistent innovation over time. IBM has reinvented itself through successive technology eras.

  • IBM’s innovation is driven in large part by its midlevel managers, who organize activities like hackathons and contests to foster an innovation culture. Programs like Emerging Business Opportunities also empower midlevel managers to identify new opportunities.

  • Japanese company Recruit Holdings has also become highly innovative through a culture of “opportunistic innovation” and empowering all employees to be innovators. Employees are motivated by connecting their work to personal values and passions.

  • Both IBM and Recruit Holdings show that innovation can thrive in companies of any age or industry by empowering midlevel managers to drive an innovation culture. Long-lasting innovation comes from practices and programs that get all employees actively thinking about innovations, not just relying on “celebrity” founders or CEOs.

Here are the key points about how senior leaders can focus an entire organization on innovating:

  • Sports teams like the San Jose Sharks face tough competition for fans’ attention and dollars. To succeed, they need innovation across all aspects of their business.

  • The Sharks’ president, Jonathan Becher, made innovation a top priority through his words and actions. He communicated continually about the importance of innovation, modeled innovative thinking, and gave employees freedom to try new things.

  • Becher created cross-functional “SWAT teams” to tackle important innovation projects quickly. He also began holding open office hours to get input from employees at all levels.

  • Senior leaders play a crucial role in making innovation a priority. They must clearly and consistently communicate about it, role model it themselves, give employees latitude to experiment, and put in place processes to rapidly advance the best ideas.

  • When senior leaders use their position to focus the entire company on innovation, it becomes embedded in the organization’s culture and activities. But leaders can’t just talk about innovation - they must back up their words with concrete actions and participation.

  • Under President Jonathan Becher, formerly of SAP, the San Jose Sharks have become the most innovative NHL team by applying Becher’s talent for digital innovation.

  • Becher overcame the tradition-bound, innovation-averse culture of pro sports by inviting resisters to participate in creating change, running small experiments rather than big bets, and framing innovation as enhancing the fan experience.

  • Becher focused on customer journeys and experiences, not just revenue. He encouraged building relationships with fans even if it didn’t immediately boost sales.

  • This innovation focus became crucial when COVID-19 halted live games. The Sharks creatively kept fans engaged, like airing simulated video game competitions.

  • Overall, the sustainable fan base Becher built calls for constant innovation beyond the sports industry norm. His experience shows innovation can strengthen traditions rather than threaten them.

  • Jonathan Becher, CEO of the San Jose Sharks, demonstrated how a top leader can stimulate innovation throughout an organization. He did this by focusing on three key levers: organizational structure, processes, and culture.

  • Becher advocated changes like appointing innovation executives, creating innovation teams, and establishing systems to facilitate innovation across the organization.

  • He promoted processes that dedicated resources to innovation, and hired/evaluated/promoted in ways that rewarded innovation.

  • Most importantly, he influenced the organizational culture by giving “permission to innovate”, rewarding innovators, allowing reasonable failure, and modeling open-mindedness and experimentation.

  • Removing obstacles to innovation can unleash creativity among eager employees. Innovation brings richness and engagement to work.

  • A similar transformation happened at Ecocem under CEO Donal O’Riain. He overcame an ingrained cement industry culture resistant to innovation.

  • O’Riain built an innovative culture starting from the top - reshaping the board of directors to prioritize innovation, creativity, and customer focus.

  • He drove innovation into processes like hiring and rewards, and modeled openness and listening himself. This cascaded through the organization.

  • The result was a powerful innovation engine that has fueled Ecocem’s growth through intimate customer knowledge and continual innovations in products and services.

Here are the key points from Chapter 9:

  • To successfully manage innovation across an organization, senior leaders need to put in place effective governance and coordination mechanisms. This includes establishing clear roles and responsibilities, appropriate processes, and metrics to track progress.

  • Many companies have created a Chief Innovation Officer (CIO) role to provide leadership and oversight of innovation efforts. The CIO serves as an advocate for innovation and helps align activities across business units.

  • Other common governance approaches include creating an innovation steering committee with cross-functional leaders to help guide strategy and budget decisions. Dedicated innovation teams in each business unit can also help drive innovation locally.

  • Companies should aim for “coordinated autonomy” - providing some central guidance but empowering business units to innovate in a way tailored to their specific needs and customers.

  • Key processes that enable effective innovation governance include stage-gate systems to manage projects from ideation to launch, innovation portfolio management to allocate resources, and tools to capture ideas from across the organization.

  • Tracking metrics like number of ideas generated, % of revenue from new products, time-to-market, and ROI on innovation spending helps gauge progress and make improvements.

  • Getting the right balance of governance and coordination is key to igniting the innovation engine across a multifaceted organization. Leaders must be actively involved but also enable autonomy and experimentation.

  • Bayer is best known for developing aspirin, but the company’s success depends on continuously innovating in areas like agriculture, pharmaceuticals, and healthcare.

  • Bayer recognizes that innovation must be driven internally, even if it involves external partners. Ideas are just the beginning - translating them into real solutions is key.

  • To foster innovation, Bayer created “WeSolve”, an online platform where employees post challenges and other employees propose solutions. This crowdsourcing tool lets Bayer people worldwide collaborate.

  • WeSolve quickly became popular, with over 40,000 participating. Other specialized innovation forums were also created.

  • Posting specific challenges works better than posting general ideas, because challenges have built-in constituencies to work on solutions.

  • Managers play a key role by identifying concrete, solvable challenges based on customer needs. Frontline employees are best positioned to understand these needs.

  • Bayer’s approach shows how large companies can develop dual systems - hierarchical for execution and horizontal networks for innovation. This “innovation engine” complements the traditional structure.

  • Bayer created an online crowdsourcing platform called WeSolve where employees can post problems and solicit solutions from others across the company. It has been very successful, with over 200 challenges posted per year and high engagement (50,000 employees participate despite only 50,000 speaking English). About 50% of problems get solved and another 30% generate useful insights.

  • To further spread their culture of innovation, Bayer formed an “innovating team” (I-Team) made up of I-Coaches, I-Coordinators, and an I-Committee. These play key roles in encouraging and supporting innovation throughout the company.

  • I-Coaches are trained in creative problem-solving methods and tools. They lead workshops, sessions, and meetings to help teams innovate. This facilitates cross-functional collaboration and integration.

  • An I-Committee of senior execs provides strategy and oversight. I-Coordinators (“innovation ambassadors”) spread the innovation message throughout the company globally.

  • WeSolve and the I-Team help create an innovation culture at Bayer where all employees feel empowered to contribute ideas and solutions. This taps into the company’s full creative potential.

Here are the key points about Bayer’s approach to innovation:

  • Bayer has built an extensive innovation team (I-Team) to foster a culture of innovation throughout the company. The I-Team includes I-Coaches who train employees in innovation methods and facilitate idea generation, as well as I-Coordinators who review and select promising ideas.

  • I-Coaches lead activities like innovation workshops and online idea forums to surface innovative ideas. They teach methodologies like Design Thinking and Lean Startup that emphasize prototyping and experimentation.

  • When big ideas emerge, they can be funded and developed further through Bayer’s Catalyst Fund. Cross-functional teams rigorously test and refine the ideas, with the most promising ones pitched to senior executives for further funding and launch.

  • The Catalyst Fund acts as a bridge between Bayer’s “horizontal” innovation engine and its “vertical” execution engine, ensuring only viable concepts make it through. Several new businesses have already been launched from the Fund.

  • Bayer’s approach shows the power of building a networked innovation team to spread the “contagion” of innovation across a large organization. Activities are tailored to identify promising ideas anywhere in the company and equip internal entrepreneurs to develop them successfully.

Here are the key takeaways from Chapter 9:

  • Innovating needs to occur throughout an organization, not just in isolated pockets. A formal I-Team governance and coordination structure can help legitimize, advocate for, and sponsor innovating across the company.

  • I-Teams are structured in different ways but often include a central unit of I-Trainers who train I-Coaches and local teams in innovation skills.

  • I-Teams also typically include I-Coaches embedded across the organization who guide local teams and individuals in innovating.

  • I-Coaches help identify promising ideas, run experiments, and coach teams on innovation processes. They act as innovation catalysts within business units.

  • An I-Committee made up of top executives can provide high-level support and oversight for innovation efforts.

  • Managers play a key role in empowering employees to devote time to innovating. Recognition from leaders helps drive engagement.

  • Companies need both an efficient execution engine and a vibrant innovation engine. Leaders must nurture both types of activities.

  • Marvel Comics fell on hard times in the 1990s due to corporate raiders and debt. By the late 1990s, it was struggling to survive on declining comic book sales.

  • David Maisel proposed an innovative strategy of Marvel producing its own films based on its popular characters, creating a “Marvel cinematic universe.” This allowed crossover films with multiple Marvel heroes.

  • Kevin Feige was hired to oversee Marvel Studios’ film production given his intimate knowledge of the characters.

  • Marvel Studios adopted a lean production style, avoiding lavish budgets and hiring affordable actors and directors without prior superhero experience.

  • A Creative Committee including comic book editors oversaw the films to preserve the integrity of the characters.

  • This strategy yielded huge blockbuster films starting with Iron Man in 2008. Marvel films now dominate the superhero genre and box office charts.

  • Coming up with highly successful innovative ideas like Marvel’s strategy is rarely straightforward or obvious in advance.

  • A good innovation process methodology provides a structure for sparking and focusing creative thinking to generate breakthrough ideas consistently.

  • The author then introduces a Seven-Step Innovating Process integrating the most powerful elements of Blue Ocean Strategy and additional exploration tools. This process aims to help innovators restructure their thinking to come up with great new ideas.

  • The author recommends using Blue Ocean Strategy tools to help pivot from a supplier-side view to a customer-side view and move from execution to innovation. However, he is open to other innovation methodologies as well.

  • The Built to Innovate (BTI) Seven-Step Innovating Process is a simple, flexible process the author designed to foster innovation. The 7 steps are:

  1. Choosing a subject for innovating

  2. Organizing a diverse project team

  3. Codifying the current supplier-side view

  4. Understanding the customer experience

  5. Exploring noncustomer space

  6. Selecting and fast-prototyping the best ideas

  7. Presenting and selling the best idea

  • Key points in organizing the team include ensuring diversity and including some implementers. The team should agree on goals, values, rules, roles, and processes.

  • Codifying the supplier-side view involves articulating current assumptions about the customer, value creation, and drivers of willingness to pay.

  • The process aims to shift perspective from supplier-side to customer-side in order to uncover innovative opportunities.

Here are the key points from the summary:

  • Step 3 of the Seven-Step Innovating Process involves capturing your current “supplier-side” perspective on the subject by examining all relevant data and writing down your conclusions. This defines the contours of your current mental model.

  • In Step 4, you pivot to understanding the customer experience. The team goes into the field to observe and interview real customers, seeking to understand their full experience and Job-To-Be-Done.

  • The team records customer comments in the customer’s own words, organized into a Customer Utility Table (CUT) with stages of the experience as columns and types of utility as rows. This maps the entire customer experience space.

  • Comments are captured on sticky notes color-coded as likes (blue), dislikes (red), and wishes (green). The evolving CUT helps identify areas needing more investigation.

  • Comments can spark innovating ideas - likes suggest enhancing value, dislikes suggest fixing problems, wishes suggest satisfying desires. Deep customer understanding is key to generating useful innovations.

  • Observing customers in their natural environments can provide valuable insights into their reactions and needs that may not be captured through traditional market research. Kordsa discovered a problem customers were having by observing them at a tire plant.

  • The Six Paths Analysis provides six directions for exploring “noncustomer” space to generate innovative ideas:

  1. Across alternative industries or solutions
  2. Across customer segments
  3. Across actors in the business ecosystem
  4. Beyond the scope of activities in the customer experience
  5. Across sources of appeal (functional or emotional)
  6. Across time and trends
  • After generating many ideas, the team clusters and selects the most promising ones based on value created, strategic impact, and ease of implementation.

  • Fast prototyping of the best ideas helps validate and refine them before presentation.

  • At a Visual Fair, each team presents its best ideas briefly to a panel. The panel then selects the top ideas to move forward for implementation.

  • The Seven-Step Process is designed to be easily replicated across units and over time to build an organization’s innovation capabilities.

  • The Seven-Step Innovating Process is a systematic approach to fostering innovation within organizations. It involves steps like choosing innovation topics, taking a customer perspective, exploring non-customer spaces, generating ideas, selecting ideas, testing concepts, and defining competitive strategy.

  • Using this process regularly (e.g. once or twice a year) helps strengthen employees’ “innovation muscles” so that generating and implementing new ideas becomes second nature. It embeds a culture of innovation into the organization.

  • The process can be used for major innovation efforts at the executive level or for more modest innovations at the departmental level. It is flexible and can be tailored as needed.

  • Key associated tools like the Six Paths Analysis help teams analyze opportunities and make decisions to create superior value for customers.

  • The rejuvenation of Marvel Studios demonstrates how principles like focusing on the customer experience, reducing costs, and exploring new market spaces aligned with the Seven-Step process, even without explicitly using it. This ultimately led to great success.

  • Sustaining innovation over the long-term remains challenging. Methodical approaches like the Seven-Step process can provide guidance when innovation begins to lag.

  • Domino’s Pizza was struggling in 2010 with a poor reputation and falling market share. To turn things around, they launched an innovative multi-year campaign to reinvent themselves.

  • Rather than betting everything on a single “moonshot” innovation, Domino’s focused on making innovation a habit throughout the company. They generated dozens of small but valuable improvements in products, services, and operations.

  • Domino’s was aggressive in adopting digital technologies to improve customer experience. Innovations included pizza ordering apps, voice assistants, social media ordering, GPS tracking, and driverless delivery vehicles.

  • Cross-department collaboration was critical. For example, tight partnership between marketing and IT avoided tech innovations that didn’t truly benefit customers.

  • Ideas came from all levels, including frontline workers and franchisees. But leadership from the top emphasized innovation’s importance.

  • While tech was crucial, Domino’s still respected basics like food quality. Balancing digital with traditional competencies was key.

  • Through persistent company-wide innovating, Domino’s transformed its reputation and reversed falling fortunes. It shows how innovating can become an organizational habit.

  • Domino’s Pizza has pioneered numerous innovations over the past decade that have transformed how customers order and receive pizza. These include online ordering, order tracking, pizza profiles, autonomous delivery vehicles, and more.

  • The company spreads awareness of its innovations through mainstream and industry media. This generates buzz and reminds employees that Domino’s is an innovative company.

  • Domino’s innovations generate real value for customers by making the process of ordering pizza easier, faster, and more convenient. They are not just gimmicks.

  • By continually innovating with small, impactful changes, Domino’s has dramatically grown its market share and become the world’s largest pizza company.

  • Innovating should become a habit - something employees do regularly, not just in times of crisis. This creates a “muscle memory” for innovation.

  • Domino’s commitment to continuous innovation helped it respond effectively to challenges during the COVID-19 pandemic, while competitors struggled. Its established innovations like online ordering and its quick pivots like contactless delivery met changing customer needs.

  • The pandemic highlighted how Domino’s past innovations like its own delivery network kept it in control of valuable customer data that competitors handed over to third parties.

  • Continuous innovation has become a source of competitive advantage and growth for Domino’s, even during challenging times.

  • Successful companies often undervalue the need for innovation until a crisis hits. Instead, make innovation a habit to stay ahead of competition.

  • Big, disruptive innovations are rare. But many small, incremental innovations can have a huge cumulative impact.

  • By committing to spend time on innovating regularly, your chances of becoming one of the most innovative and successful companies in your industry will increase dramatically.

The summary covers key points from Chapter 11 of the book Built to Innovate by Ben Bensaou. It emphasizes that innovation should become an ingrained habit across all levels of an organization, not just an occasional act. While major innovations are infrequent, a stream of small innovations can be very impactful. By making innovation a habit, companies can stay ahead of competition and be industry leaders.

Here are the key points from the chapters:

Chapter 1:

  • Companies like BASF and 3M have successfully institutionalized innovation by making it an ingrained habit and continuous process. This allows them to consistently develop new products, services, and business models.

Chapter 2:

  • Successful execution and innovation go hand in hand. Companies like W.L. Gore, Samsung, and Disney have integrated execution and innovation through their organizational values, structures, and processes.

Chapter 3:

  • Taking an innovative perspective involves reframing problems, looking for unexpected solutions, and having empathy for diverse users and ecosystems. Companies like AkzoNobel and Ecocem do this through creative programs and experiences.

Chapter 4:

  • The three key processes of innovating are discovery, incubation, and acceleration. Companies like Kordsa use these processes to systematically generate, develop, and launch innovations.

Chapter 5:

  • Democratizing innovation means enabling anyone in an organization to innovate anytime and anywhere. Fiskars does this by empowering its employees and engaging its customers.

Chapter 6:

  • Hands-on creativity techniques like rapid prototyping, simulation, and co-creation allow for faster, more user-centric innovation. Companies like Starwood and Valve use these methods.

Here are the key points and summary for the book chapters:

Chapter 1: The Innovation Imperative

  • Innovation is vital for companies to stay competitive in today’s rapidly changing business environment. However, most innovation efforts fail due to poor strategy, lack of leadership, rigid processes and culture.

  • Successful innovation requires putting the customer first, empowering employees, taking risks, learning from failure, and fostering collaboration. Leaders must set the agenda, provide resources, and cultivate the right culture.

Chapter 2: Why Innovation Fails

  • Common reasons innovation fails include lack of clear strategic focus, limited sponsorship from senior leaders, risk-averse culture, functional silos, and inadequate metrics and incentives.

  • Leaders often declare innovation is a priority but don’t provide the strategic alignment, resources, and air cover needed. The work tends to happen in silos and employees fear risk-taking.

Chapter 3: Building the Foundation

  • Successful innovation requires laying the proper foundation - having a clear purpose and strategy, leadership commitment, embracing risk-taking, and creating cross-functional collaboration.

  • Leaders must communicate the importance of innovation, provide strategic guidance, allocate resources, and establish metrics and incentives to encourage innovation.

Chapter 4: Setting the Tone

  • The mindset and behaviors demonstrated by senior leaders shape the culture and set the tone for innovation. Leaders must role model the values of customer focus, collaboration, learning and risk-taking.

  • Leaders can foster innovation by being accessible, showing interest in new ideas, encouraging experimentation, allowing autonomy and supporting failures. This gives employees confidence to innovate.

Chapter 5: Embedding Innovation

  • To embed innovation, leaders must cultivate creative thinking at all levels, break down silos, provide training and tools, and integrate innovation into processes and strategies.

  • Innovation can be democratized through idea management systems, design thinking, open innovation, and forming teams across functions. The focus should be on execution.

Chapter 6: Empowering Innovation

  • Empowering employees to innovate requires distributing authority, embracing autonomy, promoting psychological safety, and allowing productive failure.

  • Google, Netflix, Valve and other innovative companies give employees freedom to take risks and learn from failures without repercussion. This spurs innovation.

Chapter 7: Coaching Innovation

  • Leaders play a critical coaching role in innovation, providing vision, securing resources, overcoming barriers, mentoring teams, and fostering connections.

  • Examples like Allianz, IBM and Recruit show how leaders’ hands-on engagement with innovation teams drives successful new products and processes.

Chapter 8: Setting the Agenda

  • Senior leaders must set the agenda for innovation by making it a strategic priority, allocating resources, establishing goals and metrics, and communicating its importance.

  • Case studies on SAP, Ecocem Materials and San Jose Sharks illustrate how leaders drive innovation by setting the vision and giving employees space.

Chapter 9: Igniting the Engine

  • Leaders ignite innovation by actively sponsoring promising ideas, clearing obstacles, and involving a broad ecosystem of partners. Bayer’s Grants4Apps program demonstrates this.

  • Innovation is sparked when leaders demonstrate interest, connect people across silos, provide resources and air cover for experiments, and recognize success.

Chapter 10: Priming the Pump

  • Leaders can prime the innovation pump by laying the groundwork, assembling the team, creating focus, and providing cover for risk-taking before launching initiatives.

  • Marvel Studios excelled at this, using design thinking to formulate a clear strategy, culture and creative process before innovating wildly successful films.

Chapter 11: Keeping the Engine Humming

  • Sustaining innovation over time requires dedicated leadership to reinforce priorities, celebrate wins, support failures, and continually evolve systems and processes as the business changes.

  • Domino’s Pizza illustrates this with leaders who engage at all levels to continually enhance technology and services and embed innovation across the company.

Here is a summary of the key points about the companies and people mentioned:

  • BASF is a large chemical company known for its innovation and focus on customer needs. It has pioneered new products and business models in its industry.

  • Bayer is a pharmaceutical and life sciences company with a dual structure that allows for both execution and innovation. It uses tools like I-Coaches and fast prototyping to drive innovation.

  • Fiskars is a consumer products company focused on tools, garden products, and crafts. It uses frameworks like the Waterwheel and BTI to embed innovation throughout the organization.

  • Frontline innovators are employees closest to customers who are given freedom to create new solutions. Companies like W.L Gore, Valve, and Menlo Associates empower these individuals.

  • Ecocem is a cement company that took a customer-side view to develop a greener cement product line.

  • Marvel Studios pioneered an innovative movie development process that allows for lots of idea generation combined with disciplined selection.

  • Domino’s Pizza overcame business challenges by embracing digital technologies and a culture of innovation focused on the customer experience.

The book highlights how these companies have implemented processes, governance structures, and cultures that encourage innovation at all levels of the organization. The central message is that innovation can happen systematically when the right elements are in place.

Here is a summary of the key points about innovation initiatives and processes at various companies and organizations:

  • IBM has over 4,000 U.S. patents per year and uses midlevel coaches to help employees innovate by reframing problems and focusing on the future.

  • Bayer instituted a multi-level innovating system with coordinators, coaches, and teams to foster a culture of innovation at all levels. They utilize techniques like Lean Startup and fast prototyping.

  • Samsung became more innovative by understanding customers, embracing open innovation, and using innovative marketing like experiential stores.

  • The Pentagon looked at innovation from the supplier-side to improve medical services and engaged with non-customers through initiatives like Operation Tech Warrior.

  • Domino’s Pizza instituted a 7-step innovation process focused on understanding customers and rapidly testing ideas that transformed their business.

  • Fiskars innovates through deep customer insight, integrating global and local views, and constant rethinking of products and brands.

  • Ecocem developed partnerships to apply technology in new cement markets and reframed the cement business to engage non-customers.

  • AkzoNobel, BASF, charity:water, W.L Gore, Kordsa, YMCA, Marvel Studios, and others also developed processes to foster systematic innovation.

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About Matheus Puppe