Innovation Engine Blog

Making predictions is no easy business. Take this, for example:

“There is no reason anyone would want a computer in their home.”

 — Ken Olson, president, chairman and founder of Digital Equipment Corp. (DEC), maker of mainframe computers, arguing against the PC in 1977.

But, with accurate insights and reflection and analysis of those insights, we can begin to develop a sense of what the future might hold. For 2010, many are predicting change to occur in technology, pop culture and personal life. Here’s what we think is next for products, services, and business models:

The integration of Conscious Capitalism will spur long-term growth.

Conscious capitalism is a way of thinking about "social responsibility," the idea that an organization (government, nonprofit, business) has an obligation to act not only in its own best interests but also in those of all its stakeholders (customers, employees, suppliers, investors, society).

In the developing consumer driven market, companies will no longer be responsible to only their investors—not if they want sustainable profit, anyway. Instead, companies will either adopt Conscious Capitalism or be forced to once they realize that doing good allows businesses to advance beyond previous limitations.

And the proponents of this change? First of all, they will be people like John Mackey, CEO of Whole Foods. Along with John Mackey, many CEOs in parallel industries have already built the essence of Conscious Capitalism into their business models.

Secondly, but more importantly, the consumers will drive this change. With the power to choose products and services created by companies who no longer see business as a machine driven by profit only, consumers will exercise this measure of control to empower corporations and facilitate change for the world.

Vertical learning will be of increasingly high value.

Vertical Learning is the pursuit of knowledge of our own assumptions, ways of interpreting experience and our beliefs. But, it has been long overlooked and placed secondary to Horizontal Learning—knowledge acquired through training, education and work experience—expanding our skill sets, in short.

Horizontal Learning is, of course, absolutely necessary. For instance, those who want to design products must learn the proper techniques and acquire the necessary technological information to do so. But Vertical Learning is seen as a lesser skill—introspection is not currently viewed with equal value.

However, with the two working in tandem, we are less likely to think about products, services, and business models in binary terms. Instead, we are encouraged to “think through” and think around the obvious obstacles to innovation and renovation—therefore building something of far higher worth.

If we take both into account, we can better see developing trends with objectivity in relation to each other and discern the implications of those relationships as opposed to seeing the individual issues and tasks involved in innovation.

Although making predictions can be tricky, there’s nothing outrageous about our predictions and other future trends. After all, businesses and consumers are ready for positive change in the world—the most successful companies of 2010 and beyond will embrace this unmet consumer need.

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The slower our economy seems to get, the faster the opportunities come and go for you “big game” hunters with your big innovation guns.

1) Are you a magnet for “big game?”

2) Are you ready?

3) Are you capitalizing and enjoying the results?

The answers depend on your organization’s perspective/definition of the word “YOU.”

“YOU” might be the collective (your whole unit/team) or “YOU” might be the individual (an army of one). If it’s the latter, you are a one-man band—opt out now, stop reading, you don’t need anybody’s help conquering the world. Insights, ideas, communication and execution are all you. I’ve never met you, but I suspect you’re a mad genius and/or a train wreck.

If it’s the former (collective “you”), and you’re on an innovation quest to achieve great things with wildly talented people—you already appreciate that innovation is a team sport.

So, lets check out the team you have (and the team you deserve.)  Take a look around your organization. In my experience, when you do look around (with eyes wide open), the best-case scenario is:

 •   1/3 of your team is a strong reflection of you and your company’s quest
 •   1/3 of your team could be a reflection of you, but don’t know about your quest
 •   1/3 of your team doesn’t care, because they don’t know how much you care about the quest or why they should

Now the question isn’t about you after all, it’s about the ecosystem you’re creating. As the leader/architect/almighty designer of the organization and the culture that feeds it, you know the optimal design for readiness is a wholehearted culture, NOT one of thirds. Own it. Fix it. Optimize your culture of innovation and stack the odds in your favor. Successful companies driven by innovation are built to create their own innovation “luck” where preparation meets opportunity, where concepts meet needs and where speed, focus and timing are everything. And that’s not luck, that’s a premeditated commitment to the things that matter.

Are you committed to being perpetually ready for today’s opportunity and tomorrow’s battle?

Today’s innovations settle for nothing less, why would you?

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The winner of the Wall Street Journal 2009 Technology Innovation Awards is on pace to change the world. Sure, Tapulous, the maker of the hit, one million dollar per month games is changing the face of mobile gaming technology—but technology innovations that hold the promise of making everyday life better for millions of people across the world are the ones to watch.

Ibis Biosciences' T5000 sensor, which won Gold at this year’s awards, allows for the detection of unknown organisms—a viable solution for the identification of novel infectious diseases. In short, the T5000 is intended to answer the question: "What microorganisms are in my sample?"

How will this apply to us? Take a virus like H1N1 as an example—immediate detection and strain identification can help protect the masses and make responding appropriately to unknown diseases faster and easier—which could mean saving lives.

Ibis Biosciences Inc. developed the sensor to fill an unmet need—rapid identification of the unknown. And the T5000, the product that meets that need, is the first in a long line of rapid detection mechanisms that will alter the way we respond to disease.

But what about the communication that connects the two?

As disintermediation begins to fundamentally change industries, consumers will start demanding bioscience and healthcare communication that’s easier to digest. People want a deeper understanding of the bioscience (and tertiary) technologies that have the ability to change their lives.

As Maria Umbach suggests for the insurance industry, the next opportunity to innovate may be in the way we speak to consumers.

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The profit motive, not government or charity, will create the kind of socially responsible world we want our kids and grand-kids to grow up in

By G. Michael Maddock and Raphael Louis Vitón

Maybe if members of the social responsibility movement were to spend less time hectoring companies about climate change, worker exploitation, and the like, and more time pointing out the greater profits these businesses could produce by implementing socially responsible ideas, they would be more effective.

If they recast the issue in terms of "and," as in "You can do X, which will increase earnings and by the way, contribute to the greater good," instead of "or," as in "You can do well or make money, but you can't do both," they would have to beat followers away with a stick. At its heart, social responsibility is an innovation challenge.

These are the thoughts we came back with after attending the recent Catalyzing Conscious Capitalism conference in Austin, Tex. (see highlights here).

Conscious capitalism is a new way of thinking about "social responsibility," the idea that an organization (government, nonprofit, business) has an obligation to act not only in its own best interests but also in those of all its stakeholders (customers, employees, suppliers, investors, society).

Needed: Clarity of Destination

Let us be clear. Our company is a huge believer in the idea of doing well by doing good. We are proud of the clients we represent and the contributions—both financial and in-kind—that we make. To us, this is not only good business but is also totally consistent with the kind of company we want to run. It aligns with our purpose and core values.

On the way back from the conference, we sketched the conscious capitalism framework in a way that borrows from the late psychologist Abraham Maslow and his well-known hierarchy of needs. We think it's an apt parallel. To us, the conscious capitalism movement requires clarity of destination. We want to be known as a company that makes money—the middle layer—but more important, we want our people to know what we believe so that everyone here can work effectively in unison, which in turn will allow us to make more money for our stakeholders and make more contributions to society.

Because of that, we don't cast the issue of social responsibility in terms of "earthmuffins" vs. "plunderers and/or greenwashers" (people who pretend to do good, but in actuality don't). That dichotomy is neither helpful nor accurate.

We prefer to talk about "going green" the way Ray Anderson of Interface or Jeff Immelt of GE do: "It is a way of making more money."

Not an End in Itself, but a Tool

It's much easier to sell a plan to reduce accidents by saying, "if we create a safer work environment, we will save money on insurance and manpower costs," than it is to run around screaming about the exploitation of the workforce.

We don't know who said it at the conference, but he or she got the idea absolutely right: "Conscious capitalism is a devastatingly good weapon." It is not an end in itself but rather, a tool.

Creating a win-win-win business model—with the wins being what benefits the company, its stakeholders, and the environment/society in general—is the only way to optimize value. That means that in addition to measuring your success monetarily, you need to adapt new metrics, in terms of relative intent and relative impact, that will tangibly illustrate the ongoing progress toward the interrelated desired outcomes of the model. At the onset, it could be as simple as charting your recycling efforts or as complex as measuring the return on investment on your employee-safety efforts.

It will be capitalism, not government or charity, that creates the kind of world we want our kids and grandkids to grow up in. Getting that world will require innovative thinking, but it is well worth the trip for many reasons, including money. Nonetheless, if you just see this as a way to make more money—which it is—you are missing part of the point.

As a friend once put it: We may not save the world, but it's important that our kids know we were on the right team and that we were trying.

This article originally published in BusinessWeek

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Orbitz has been doing it for years. And, so has Ebay. In this digitally inclined age of emerging e-commerce in which demand for evolved/innovative business models has risen dramatically, cutting out the middleman (or agent, dealer, distributor, etc…) sounds obvious and easy enough. After all, taking steps out of the picture always leads to lower prices for the end consumer and results in higher margins for the company- therefore it is the best thing to do, right? You might have guessed this was coming:

Wrong.

Disintermediation, the removal of intermediaries from traditional distribution channels, is never such a cut and dried issue. For a company like Amazon.com, disintermediation is a part of their business model—not just a marketing plan ; yes it works, for them. But for other companies that have jumped on the disintermediation trend in an attempt to innovate, stay relevant and generate more revenue; confusion and failure can follow. Just ask PeaPod (who at one point was expected to put grocery retail chains on their heels, but now remains an ancillary service). In every case, there is a delicate strategic balance of dancing with the one that brought ya and “working the room.”

So how do you decide whether or not disintermediation is the right path to travel down? What indicators signal the future of your industry lies in disintermediation?

1. Tune in & Evaluate.

Take an intensive, analytical look into not only your company’s channel strategy, that of your direct and indirect competitors and also at your industry as a whole. Is it slow to change? Ripe for change? Time for a challenger to shake it up? Most importantly, do your customers see value in the intermediate? Can you specify and quantify that value? Sometimes the consumer’s need can only be met by the intermediate – in homeowners insurance for example, the complex nature of the buying cycle can best be met by the agent (and only the agent), in other cases the best way to meet the need is to get the intermediate out of the way. Do segments of your customer base work around your middle man and flock to your competitors’ sites in droves to make purchases -(e.g., auto insurance : Geico, Progressive)?

Pay very close attention to your channels. Are they growing around you or with you? What is your channel strategy? Are they appropriately integrated? (From your customer’s perspective – not yours). Do they converge with your web strategy in the right places to add value—or not? By examining the foundation on which your distribution rests, as well as the channels of parallel industries, you’ll find even more insight that will be extremely useful in developing and executing industry & brand-specific strategies. The answers to these among many other questions will allow you to assess whether or not there is a strong unmet need that may be fulfilled by disintermediation.

2. Diverge.

 Compare your market’s trends and challenges with other parallel industries that may be sharing the same issues. By observing and learning from the strategies that thought and business leaders have executed under similar conditions, you’ll have a wider solution set and a helpful frame of reference.

3. Shift your perspective.

Consider looking at your channel as a stakeholder model, in which the elements are interdependent. This perspective demands that all strategies and upper level decisions are created based on their interwoven relationships and on solutions that deliver a win-win-win. And since removing the intermediary will affect the other interdependent components of the channel, you’ll have a leg-up on deciding if disintermediation is the best choice for your business, and your customers.

So should you disintermediate? Or not? The answer is simply relative.

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November – a month of dropping temperatures, turkey consumption and… mustaches? Yes, Maddock Douglas is proudly participating in the internationally awkward yet best-intentioned movement known as Movember.

Simply put, Movember is an annual charity event to raise funds and awareness for men’s health, specifically prostate and testicular cancers. But instead of wearing ribbons or wristbands, participants wear “hairy ribbons,” AKA, mustaches. Since its inception six years ago in Australia, Movember has grown (zzzing!) worldwide and raised more than $47 million in donations.

The Agency of Innovation is doing it’s part with our team, Mustache Douglas. With Raff Viton and Chad Fenoglio leading the charge, 15 employees (click here to see the roster) have joined the cause and our offices are full of mustaches, almostaches and good intentions. Says Viton, "Both Pink October and Movember are very personal causes for us at MD. Like everywhere else, we have close relatives or friends living with cancer. My father has been living with prostate cancer for over a year, and one of our own VP's, Matt McKee, is a cancer survivor as well. We’re committed and passionate about doing not just what we can, but everything we can to make a difference in the fight against cancer."

As the month draws to a close and the giving spirit of the holidays is in full swing, we’re looking to make a final push for some “stache cash.” If you’d like to donate to our team, visit our donation page on the Movember website. All donations go to the Prostate Cancer Foundation and Lance Armstrong Foundation (LiveSTRONG).

Thanks to all those who have supported this warm-hearted and warm-lipped cause. And stay tuned for Decembeard – just kidding.

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Is your company better at having an idea or making an idea happen? Knowing where your organization's strength lies is a vital first step toward innovation success

By G. Michael Maddock and Raphael Louis Vitón

Perhaps no other country celebrates innovation the way America does.

This passion for inventions started early in our history. Did you know that George Washington signed the First U.S. Patent Grant on July 31, 1790, and the patent examiner was none other than Thomas Jefferson? (Thank you, Google!) In America, we're reminded of the life-changing power of inventiveness every day. Some of the greatest inventors of yesterday spawned the greatest brands of today. What do the names Chrysler, Coleman, Goodyear, Campbell, Colt, and Edison mean to you? Cars, tents, tires, soup, guns, and the electric lightbulb, of course.

When you dig a little deeper, you start to notice an incredibly important aspect of inventiveness: For every yin, there must be a yang.

For example, the next time you are marveling at the wonders of Disney, make sure you remember Roy. While Walt was dreaming about his Magic Kingdom and making a mouse talk, his brother Roy was actually making sure that Walt's dreams would come true. Roy was the operational genius; a yin for Walt's yang.

Turns out, the best companies are a lot like Roy and Walt Disney. They are naturally good at creating new ideas and executing them brilliantly. All too often, we here at Maddock Douglas (and maybe at your firm, too) stop at the first part, and pat ourselves on the back for being innovative, even though we aren't exactly sure what to do with a great idea.

At our firm, ideas come easy. In fact, we believe big, beautiful, million-dollar ideas are a dime a dozen. Want to see? Picture yourself sitting on a plane. Hmmm. Let's see. Airline ideas. Why don't airlines create a loyalty card? You'd pay for travel at the beginning of the year in exchange for some sort of special treatment or perks—say, no fees for checking luggage; free food and drinks (including alcohol), and access to their "president's club" lounges so you would have some place—other than the gate—to wait for your plane. Sure, you can pay à la carte for all these things, but it would be more convenient for you if the airline bundled it all together, and better for the airlines since they would get the money up front. Starbucks has created plenty of cash flow with this idea. Why not the airlines?

Here's another idea: Airlines should sell luggage engineered to fit perfectly into their planes. The airlines get new revenue and quicker boarding because bags are all fitting nicely into place. You get the picture.

For all of us who say ideas are easy, there are others who say executing is easy. These are the operational experts—the Roy Disneys if you will—who know how to drive the best ideas forward. The corporate equivalent of them would be the director of R&D and the COO. You don't think of them as product innovators, but once they have an idea they execute it—hopefully to perfection.

We find that companies, like people, are usually good at either creating ideas or executing ideas. The trick is to know which describes your company. If you or your company are about operational excellence, but desperate for big ideas, consider importing this kind of thinking via a business partner.

Want proof that we are on the right track? Venture capital companies are full of Roy Disneys, and they know it, so they don't waste time trying to think up new ideas. They know what they are good at and go do it. And here's a bold statement: We also believe that right now venture capitalists have a golden opportunity to revive the spirit of innovation in America. But we'll save that for the next article.

For now, ask yourself this. Is your company a Walt or a Roy? Figure it out and go find a yin for your yang.

This article originally published in BusinessWeek

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Welcome to the new Maddock Douglas corporate site. We exist to bring industry changing ideas from mind to market, and our new website reflects some of the innovative work we have done for 25% of the Fortune 100. Browse our articles and watch videos from our Global Expert Network and innovation thought leaders within Maddock Douglas. We hope you return often to share insights, review fresh content, and explore the evermore conscious world of Maddock Douglas, The Agency of Innovation.

Raff Viton

President, Maddock Douglas

http://www.maddockdouglas.com

http://twitter.com/maddockdouglas

We understand why you, big business, might be wary of diving into the social media ocean. Your organization is seen as a corporation, and corporations, in the eyes of most people, are evil. Large companies — with a 13% approval rating — rank just above Congress and law firms when people are asked to list the most admired institutions in America, according to Harris Interactive.

In fact, if people were to anthropomorphize your organization, your firm would be seen as highly antisocial at best and psychopathic at worst.

But you can change that. The 21st century, with wikis, blogs, and the millions of niche online communities, etc., allows us to create a more level playing field when it comes to customer relationships. It's now possible for us to share with consumers what we as companies are really all about and what we believe, face-to-face, so to speak.

What are the fundamentals you need to master in this new world? There are three.

Phase 1: Architect a Proper Presence

First, you need to identify where your target is and which communities are important to them. You want to be where your customers, and potential customers, hang out.

Phase 2: Gain Credibility Based on Your Target's World View

Help them, don’t sell them. Your message and content need to be all about your customer and what you can do to make their lives better

Phase 3: Co-Create Dialogue Where Your Company Reaps the Benefit of Exchange

Once you have defined and built the right presence, along with crafting the appropriate, engaging content, you can begin fostering true exchange of ideas and emotions.

Read more about the fundamentals here.

Managers of innovation:

Leadership implies movement. Leadership implies a destination.

So, leaders of innovation, here’s question No. 1... “Why should I follow you?” Your team wants to know why they should follow your lead. They need to see and understand how you are going to take them where they need to go. Don't tell them; show them — by focusing on the essential, not the merely important, by staying above the drama, by leaning in to adversity and by finding opportunities.

1) Focus on the essential, not the merely important. Here’s an “essential vs. important” cheat sheet: The important is rational; essentials are emotional. The important you put on a to-do list; essentials go on a to-die-for list.

2) Stay above the drama. Recessions/transitions/restructurings are by definition temporary. Understanding that is key to your ability to focus on the desired outcome and the kind of organization you want to build.

3) Lean into adversity and find opportunities. Believe in yourself, and if you need inspiration to stay the course, borrow from the best. Warren Buffett made his fortune by following an adage he came up with a long time ago: "Be fearful when others are greedy — be greedy when others are fearful."

Read the full post at BusinessWeek.com