How to start an agile innovation engine?

My recent blog post was about how enterprises are too often overlooking the innovation management processes. Perhaps some feel that this area is a bit too famous for expensive and colorful consulting industry. Or perhaps because of the lessons learned from social collaboration software: There is plenty of tools available, but engaging users to participate is the most challenging part.

Many reasons can be found for keeping innovation “as it is” – in meeting notes and brainstorming workshops. Innovation is too often not seen as integral part of the everyday production and therefore it is not under continuous process improvement – or at least ideation part in effective “Innovation Project Machine” is often not properly solved (very interesting article at InnovationManagement.se, I recommend to read).

There is no reason to let it be like this. Let’s take a closer look what simple steps enterprises can do to engage their employees, partners and customers to innovate better together. And with what expense does this happen.

In agile innovation the question is not how to create detailed processes, but how to get people actively sharing ideas and implementing them productively together.  If everyone is already busy on their daily activities, how to motivate people to participate something that might not affect directly to their work?

Innovation solutions have been evolving a lot during recent years. Innovation platforms have become more social and the most advanced solutions already provide concepts such as gamification for better engagement. Studies made for example by Gartner have shown that leading enterprises have a great interest towards these concepts. This accelerates the development.

Organizations that haven’t invested large sums of money into innovation platforms can also benefit of this ongoing revolution. While big innovation platforms get more standardized with features, new tools evolve with easy-to-use mature concepts and proven solutions.

This takes us to the next level of innovation management solutions: Less expensive consulting, more straightforward action and result-driven experimenting. Building an innovation process shouldn’t be about configuring a complex software for your processes – it’s about passion, flow and instant experimental implementation with agile iterations and readymade components.

Here’s some perspective to this thinking: Stage-Gate is a mature framework for managing innovations. It has shown effectivity in enterprises across the world. With new set of tools it gets even better. We can create a simple social and gamified solution with a lean Stage-Gate process to support everyday ideation and innovation. With modern web based and mobile solutions you can start running the whole new platform in cloud with monthly basis without huge upfront investments on consulting or implementation.

Here’s one example how LumoFlow supports Stage-Gate (same ideas can be repeated with other innovation software as well):

How can this be easily implemented and perhaps a bit more agile way? Let’s also remember that in average business, there is not yet sustainable ideation processes for discovery stage.

Lean approach is a good beginning in this: Build, measure and learn. Get started with a small solution, add more over the time. At early stage simple ideation process with similar kind of approach is quite much enough.

This is how you could start an agile innovation engine with LumoFlow:

Start ideation first with your closest colleagues without a process – take ten minutes per day to post one or two ideas that has been bugging you already some time. Ask others to do the same. After a while start creating structure to these ideas. Push them into simple innovation funnel with a small workflow: evaluation, scoping, implementation .. (this workflow should be defined by your business needs).

Take the next step: Between stages create a decision making gate: Once a week read through the highest scored ideas and push most promising ones deeper into funnel. After one or two months you have some implemented ideas and fine tuned innovation funnel to repeat this process. Then it’s time to add more participants (cross-organizational, across enterprises as much as possible) and repeat the build, measure and learn steps. Setup doesn’t have to be more complicated than this:

Agile, and definitely lean – at least if you remember to keep this iterative and connect your key customers to share ideas. Be also ready to push the thumb down and kill the idea or sometimes critically recycle the idea before it goes to the next stage. Also don’t allow people to be afraid of letting ideas grow something that they weren’t meant to be. This is not a sales funnel for closing deals! And above all – change the process if it’s too complex or you figure out how to improve it.

Total cost of this proof-of-concept case is some hours of your work and some other by your colleagues. This cost together with less than a hundred per month software subscription are reasonably spread across the experimenting time without upfront investments.

What to expect as a return for your investment? If not yet looking how your new ideas are affecting to sales, at least now you have an agile innovation engine that is ready to be pimped up and tuned. Expand it to cover more users – build, measure and learn. Process improvement is in any case continuous practice. Or in worst case you have learned something about your innovation culture with very low cost.

The real world is of course much more complicated. Ideation usually requires a “critical mass” of people to participate. Yet before expanding too much there must be slots reserved for measuring and learning as well. The best part is that deeper you dive in innovation, better possibilities you have to measure. How many ideas have been posted? How many decisions have been made? How many comments have been given? How many tasks have been completed? How active people have been? A good innovation platforms gives answers while you focus on learning.

Implementing a productive and cost-effective ideation engine is important, but it also fosters the next questions: How can you get people motivated to participate over and over again and how can this engine be integrated seamlessly to your production or projects? I will return to these questions soon.

Agile innovation management – repeatable and sustainable growth

According to industry studies around 90% of enterprises have not created repeatable innovation processes. Yet delivering new innovations is by far the best opportunity for finding new growth. In established businesses focus is too often fully on production and customer service, while innovation’s front end – a fuzzy phase of ideation, discovery and planning – is managed with the left hand on reports and meetings.

It’s quite surprising how little the enterprises have formally invested on new innovations while seeing how much effort is actually put into new developments overall. Innovation’s fuzzy front end can cover almost 50% of all innovation activities – no matter have you formally invested on it or not. When creating something new people need to share ideas, combine them into new concepts and manage the stages from early inspirations to delivered innovations. Why does most of the enterprises create process for this only at the stages where plans for new innovations are already getting formalized and approved?

The biggest corporations have successfully been solving these issues with a good selection of large innovation platforms, such as Brightidea, Spigit or Hype – or with innovation frameworks such as Stage-Gate. Industry leaders screen all the time new opportunities and formally transform them into new innovations. And they keep on growing even bigger with new delivered products and services. What would happen to Apple if they didn’t launch a new product every now and then?

How can a regular sized enterprise gain repeatable and sustainable innovation processes?

For mid-sized and small enterprises a large innovation platform or strict framework is usually an overkill solution. Complex process-driven innovation is simply too bureaucratic for everyday hands-on development. Fortunately there are many agile idea management platforms, such as Wazoku, covering the basic idea sharing and processing. But what happens after ideas have been shared and planned to be implemented?

With LumoFlow we have taken a step further to provide tools for hands-on innovation. We implemented an agile goal-driven innovation process on top of our existing social collaboration solution. This way we made sure that innovation process is not only serving the information system or reporting. Innovation happens when people with different skills and knowhow collaborate together. The process serves people.

Here’s an example how LumoFlow creates structure to innovation:

An agile innovation process provided by LumoFlow.com

In the heart of our solution is a co-creatively managed innovation portfolio (the innovation funnel). It grows over the time while people are working on new ideas and concepts. Front end of the funnel can have a great variety of ideas and concepts, while outcome is well planned and controlled with decision making and agile stage gates. All information is connected with a seamless structure, while processes are kept as agile as possible.

How does this change the world? Innovation has many forms. That’s why many innovation platforms are such a complex giants. But think for example an iterative lean business development process: Build-Measure-Learn. Even with very thin and agile process it’s already easier to manage development and measure the results. Learning happens when ideas are shared and people across organizational boundaries can instantly comment your blueprints and working demos.

Feedback is not coming only from inside your company, but also partners and other stakeholders can easily join. LumoFlow encourages everyone to participate with gamified and social features. At the same time the whole innovation process is on front of people’s eyes – the goals are defined. Ideas are rolled into implementation with determined steps instead of lost email conversations and scattered communications.

With these and other agile solutions we have already changed the world of our customers. I think that’s a very good beginning.

Check out more from http://www.lumoflow.com

The goals of social collaboration

When an organization decides to study what social business / enterprise 2.0 can mean for them it is often out of curiosity since other companies in their industry are looking at it. Many traditional industries such as manufacturing do not necessarily see immediately what value social collaboration can bring to their organization. Those organizations that move from that curiosity to looking at social business in a rational way will quickly try to form a picture of what the ultimate goal is of social collaboration in their organization.

Answering what the organizational goals of social business are is a two sided question. On the one hand there are the concrete goals, such as reducing internal email communication or improving idea sharing across the organization. Then on the other hand there are the more high level goals such as increasing market share or increasing innovation.

Although it seems obvious, not every organization considers what the goals are and how to achieve those. One reason may be that the concrete goals come from the workers and the high level goals from top management. The challenge, but also the real strength, of social business is to allign the concrete goals with the vision and mission of the company.

A study by The Economist Intelligence Unit at the beginning of 2012 showed that those organizations that reaped the benefits of social business had a CEO and executives that communicated clear goals and drove engagement across the organization. That study also showed that you can measure the outcome of social collaboration if clear goals are set.

As I have stressed in previous articles, the ultimate goal of social collaboration is building a stronger community. This means building a culture of engagement, feeling of common interest and sense of trust.

Measuring the ROI of Enterprise 2.0

How do we calculate the ROI of Enterprise Social Software? Is it actually possible? Should we even care?

Measuring the ROI (Return On Investment) of information technology is not new. It’s been part of an intense discussion around Enterprise 2.0 since Andrew McAffee coined the term back in 2006 to describe the impact of web 2.0 tools on organizations.

As an executive I need to justify my investments. One way is to use qualitative measures such as ”we are able to collaborate more effectively”. The other way is using quantitive measures which give a number to for example the percentage of workers that are more satisfied since a new collaboration tool was introduced. What makes it complicated is that we are measuring mostly the intangible aspects of organizations.

Source:  CloudAve

When looking at the above picture we see that those factors that have an impact on an organization as a whole (e.g. becoming more innovative) are most difficult to measure. On the bottom line it may be easier to calculate how much costs we are saving when implementing an IT solution, because that is a hard measure. But that has less direct impact to the organization than for example the agility to adapt to customer demands.

I do believe that every buyer of an enterprise solution (and user for that matter) should think about ROI. Those that have successfully implemented social software have thought carefully what problems they aim to solve with the solution. While doing this they will look at how they will be able to measure the success of the solution. Social solutions should support organizational processes and therefore align a process with a goal. This presents the user with tons of data about efficiency and in the end also ROI.

Social solutions should be able to provide you with a lot of data. LumoFlow for example can tell you how long it takes from an idea to the implementation. But also comparative user data such as document creations versus task completions. This may tell you whether your workers are using the social software as a content repository or as a place to collaborate on projects. This data can be correlated with KPI’s and from there measure ROI.

In the end I believe, although ROI is important, we should not place too much emphasis on it. The success of a solution should not relate to a specific ROI number, in my opinion. Enterprise 2.0 is a journey that an organization undertakes. It’s a journey to create a more collaborative, more innovative and more customer focused culture. It’s a change process that comes with ups and downs. There will aspects that are more easy to measure than others, but don’t let that stop you. With such low up-front investment, user and running costs even the smallest gain by enterprise social software provide you with a positive ROI.

Social Collaboration – so what!?

I see lots of criticism towards social business solutions. The argument is that it is the same stuff with a different package. ”Let’s put social in front of our product and it will sell”, is probably the viewpoint that many critics have. I agree.

If you are tired of people preaching that ”social media will change the (business) world”, but don’t see any concrete benefits to your own work then I may understand your reaction. That’s not your fault. Blame your employer and the software vendor. To get benefit from social business your organization and you yourself need a different mindset. I will explain why.

There really is a fundamental difference in how people are working now and 20 or even 10 years ago. Work used to be organized around groups of people in stead of networks. We used to think about projects in stead of communities. Organizations have become much more dynamic and organizational boundaries more fuzzy. Eventhough the theories of the network organization have been around for decades, they are only now slowly becoming a reality because the right mindset and tools are available to make it possible.

All this means that there will be a difference how software solutions are designed to support this new way of thinking about how we organize work. There is a difference between a traditional knowledge management system and social knowledge sharing. Same goes for a traditional project management tool and a social collaboration workspace. Definitely there is a difference between an intranet/extranet and social collaboration environment. Some of the key differences include:

Content vs People: intranet is content focused and pretty much one way traffic from the content creator to the users. A social collaboration environment is designed for people to connect, share, interact and collaborate together towards a common vision.

Team vs Community: our work environment is not limited to the people we work with on a daily basis. We are constantly building a larger community of colleagues, partners and customers. This means we can access knowledge from where ever want, when ever we want.

Unstructured vs Structured: a lot of collaboration is adhoc and unstructured. Social collaboration tools allow you to build networks, define targets and manage the whole process. Eventhough you may feel that your work is getting more complex because you are part of a larger network, it becomes easier to manage if you have the right processes and tools in place.

Unmeasurable vs Measurable: because a lot of work was difficult to structure, for example co-creation and innovation with people you do not work with regularly, results were difficult to control and measure. Social collaboration allows you to define targets and measure your effectiveness and end-results.

Ultimately we want to turn loose collaboration in to goal oriented collaboration that delivers measurable value for the organization. That is the difference and true value of social business.

Innovating the government

Earlier this month I visited the event Ambtenaar 2.0 (roughly translated Government Worker 2.0) in The Hague. At this event the aim was to share experiences about how to collaborate more effectively and increase innovation using social collaboration/media tools. The event was attended by more than 400 government workers in The Netherlands.

When you think of government workers you probably don’t think about innovation. This can be explained by the fact that the work of most government workers is highly structured, consists of many rules and legislations, and is highly influenced by a traditional work culture that simply does not support innovation.

However at the event, there was a incredible buzz and positive energy to learn how to become more lean, more customer focused and innovative. Several trends form the foundation for that. Firstly, like in any other organization also at the government the average age is decreasing. Younger workers bring different attitudes and new energy. Secondly, social media and social collaboration tools have entered the government. New tools support new ways of working and tear down organizational boundaries.

But to truly innovate a government organization, a cultural change has to take place. What probably sets a government organization apart from commercial companies is a strong fear of change. Of course we witness this also at our private sector customers, but this fear is more deeply rooted in government workers. To become innovative and allow new ways of working in to the workplace it is necessary to step out your comfort zone. The work culture at the government does not support this.

Maybe the government can learn from traditional organizations in the private sector. From our experience we see that the success of a social collaboration solution starts with asking yourself what specific challenge you are trying to solve for the worker. We use a very pragmatic approach and try not to address big picture challenges but look at measureable improvements.

In practice this means that small teams may experiment in real projects supported by their managers, however not involving IT departments or top management. It has proven to be more successful to show top management concrete results before introducing a new way of working or tool. On the other hand top managers are the most networked and benefit the most from social collaboration. Our solution has been specifically designed for networked collaboration thus introducing a tool for collaborating with external partners and across different layers of the organization can prove the benefits even more clearly.

To implement cultural change throughout the organization it is obvious that top management needs to support this, offer direction and a clear vision. There is no grand strategy or proven path of success to make this happen. Both bottom up and top down influences are necessary to increase innovation in an organization.

Six Best Practices of Enterprise Collaboration

How can an organization benefit from social collaboration solutions? More importantly, what specific problems do these solutions address and how do they create value for the users?

Lumo Research, the company behind award winning social collaboration solution LumoFlow, has gathered six best practices of improving group work across boundaries. Discover the latest trends and learn in practical terms how companies and networked organizations worldwide are benefiting from social collaboration.

• Sense of community
• Engaging employees
• Becoming co-creative
• Improving productivity
• Commitment to business
• Next level with gaming

Download the FREE paper here: http://www.lumoflow.com/bestpractices

Benefiting from shadow IT

Shadow IT is the use of IT tools in an organization which are not controlled by that organization. Usually this means that the IT department does not know that a tool is used and/or it has not given any formal approval to use that tool. Although critized by most IT departments, shadow IT also is an important supporting element to innovation.

Shadow IT is often the result of existing IT solutions not being able to deliver the right solution for a specific group of users. These users come from various parts of the organization but in most cases consist of users that are in one way or another improving or creating something new. The right IT tools offer people to become more effecient, share knowledge easier and deliver results faster. Users who are looking for these kind of tools are mostly executives and business managers involved in development work (organizational or product/service). These users have become much more demanding and knowledgeable about what IT solutions they need.

The use of shadow IT has certainly increased with the arrival of cloud computing. Without having to install a software or make big financial investments, it is now possible to quickly evaluate and implement a solution that fits your needs. Finding and purchasing software is now also much easier since product information, use cases and references can be found on the internet and does not require talking in IT language to a software vendor.

Downside for an organization might be the loss of control. IT departments aim to control the information flows. Security of the solution, information stored in different places and who has access to what are some concerns that IT has. Tackling these concerns are usually not due to the technical aspects of the IT solution but the user. In security the user is always the weakest link.

So how can both IT and business benefit? In our case we see firstly that the people that we talk to at our customer organizations are very knowledgeable. These are executives who know exactly what is missing, what value the new solution should deliver and what obstacles there are to implement a new solution. Secondly, in most cases the IT department is involved in the decision-making. This means that the business manager has to have a strong case why existing solutions are not delivering the right value and how IT can maintain a form of control.

IT benefits from users who can do their work more effectively (both within and outside the organizational boundaries) while maintaining  a minimum level of control over the information flows. It is therefore important that IT moves away from a ”one solution fits all” attitude and lets the users decide how they want to tackle their work challenges and how to support their work processes. Business on the other hand benefits from clearly understanding what specific problem they are trying to address with a new solution and being able to make this case to IT, if necessary. To support this notion: the majority of IT driven solution implementations fail. And more will fail in the future (source: Gartner).

Going from idea to implemenation

We all innovate and more often than we realize. Whether we are improving a work process, making changes to a product or thinking of better ways to promote a service.

Innovation always starts with a need. Than there’s an idea. Sometimes it’s clear but often we need to gather knowledge and opinions to formulate the idea. Once we have formulated the idea we go towards implementing it. The challenge of innovation lies in effectively linking the need, idea and implementation. There needs to be a process in place, whether formal or informal.

That is why we have spent a lot of time thinking about how we can provide a solution that is flexible enough to serve the needs of a large customer base but still effectively support each organization’s unique processes. We found that both our software’s usability and helping the customer align our solution with their process are in many cases equally important.

When thinking of usability it is important that ideas can be easily shared, voted and ranked. Then it should be possible to close the idea and move towards implementation. Choosing collaborators, assigning roles and tasks, and working on tasks with a clear overview. Supporting a process through our solution we do by helping our customer identify their processes, organizational specific needs and type of users. Organizing workshops for key users has proven a great way to not only discover best practices but also find new ways of collaborating thereby enhancing an innovation culture.

We see that many solutions either focus on the idea management part or on the implementation (project management). Some research suggests that innovation often fails because organizations tend to invest more on the ideation part then the actual implementation. Our view is that to be productive in a networked environment, where people often do not see each other or innovation happens ad hoc, it is crucial to link the need, idea and the implementation.

Highly networked organizations gain market share faster

Now that kind of sentence should grab your attention! It did at least for me when I read a report at the end of last year saying that there is a correlation between increased market share and the socially networked organization.

The McKinsey report ”The use of web 2.0 in business” from December 2010 analyzes a survey conducted by the same consultancy that shows that companies who use the web intensively gain greater market share and higher margins. What does this exactly mean?

I think that most executives do not need to be convinced anymore that organizations who use social networking and collaboration tools inside the organization will benefit from this. For example, people have quicker access to information, collaborating on projects is easier and the companies may even save money by replacing outdated and expensive legacy systems.

The real benefit however is in connecting with the outside world. McKinsey found that the companies who gain the biggest increases in market share and profit margins are those that have solutions in place that enable workers to collaborate with customers and partners more effectively.

For example the ability to make decisions lower in the organizational hierarchy and a willingness to form teams that comprise both in-house and external workers allow organizations to become more agile. Now I know what you are thinking: but we are doing this already to some extend! I sure hope so, but managing these relationships with the appropriate tool for a specific need seems to be done by an elite crop of organizations. Only 3% out of more than 3000 interviewed executives across different industries and regions are using both internal and external web 2.0 tools to create a truly networked organization.

In our customer conversations the number one question is: “Can I safely manage collaboration and its related sensitive information with colleagues and partners in one workspace?” It seems that companies have come to realize that the only way to implement innovation is by actively engaging customers/partners and sharing information openly. Access to the right people and knowledge at the right time is therefore crucial and those companies that really understand the business value of collaborating and innovating are the ones that are the most competitive.

And of course the answer is: “Yes you can!”