Duval Suggests Killing More ideas Fosters More Innovation

note: this article was originally compiled and written for the Orange Business Services Live blog

Bluenove’s Martin Duval is not only a successful entrepreneur and an open-minded innovator. He is also a controversial business writer with French flair who can deliver straight to the point conclusions. Whereas most would-be innovators will lay a stress on the production of new ideas – the ideation process – Duval knows, like most hardened innovators, that the truth lays not in that process but in the more delicate art of rejection and … killing innovations. Here are his thoughts on the subject, for the benefit of our readers:

Lately, I had a chance to describe the challenges faced by French start-ups with regard to the financing of the early innovation phase and the managing of partnerships with major corporations, and that piece was published by the French High Tech weekly 01 Informatique. In that article, entitled all players in the innovation chain should play their role!, I was stating that start-ups should only focus and partner with those corporations, which have implemented a structured and proactive business incubation and partnership programme such as NOVA External Venturing, part of the manufacturing industry behemoth Saint-Gobain, or the ‘Veolia Innovation Accelerator’. Amongst the new ‘Open Innovation’ processes which have been designed and implemented by those major corporations, I did point out the ability and the value of killing innovation and potential partnerships. I know that this may sound strange coming from a proponent of innovation but I insist, one has to learn how to say NO if one wants to get to YES.

What I mean by that is that start-ups by nature have limited resources and time to work their way through the complexity of a large organisations and handle their long-winded decision-making cycles. Therefore, when a large organisation is able to implement a process to efficiently filter out potential partners within a reasonable period of time, it is in fact sending out a positive rather than negative message. I would advise a 1 month or a 6 weeks-delay at the most as a fair period for a large organisation to get back to a candidate partner with a positive or negative answer. Delaying the response for any length of time and keeping start-up owners on tenterhooks is simply not on in my eyes. The start-up in question can then decide to keep trying to partner through another part of the organisation at its own risk, or to change what needs to be changed within its project structure or even look for another partner.

Ideally, the more a negative feedback is explained and detailed, the higher the value that is delivered: such explanations can help highlight the weaknesses within the original project, so as to better identify the target market position for the new solution. As a consequence, it is an easy way for corporations to deliver value and improve their reputation within their innovation ecosystem. It is certain though that rejecting an application actually requires a lot of preparation as well as some process and resources in order to produce the analysis and manage the follow-up the within 1 month to 1 ½ month.

As a matter of fact, rejection can take place at each gate within the open innovation stage-gate process with a higher probably and more preparation needed early in the process than ever after: from screening before initial contact, right after the initial contact and/or meeting, after the feasibility study, during the partnership negotiation and after the test. To a certain extent, I even believe that a good quality rejection process delivers more attraction and better corporate image than piecemeal success stories. Besides, that kind of process applies not only to start-ups but also to universities, government-owned or private R&D labs, suppliers and customers involved in crowd-sourcing initiatives etc.

At the end of the day, large organisations can derive a real high-end competitive edge from the management of rejections regarding innovation proposals from start-ups and other innovators. The tougher the process is, the more desirable those selective large organisations therefore become in the eyes of smaller players.

Similarly, when it comes to managing internal innovation processes, too little attention and effort is devoted to killing projects in my eyes. Oftentimes, a standard innovation pipeline is contrived – as part of an innovation process – with a wide ideation spout on the left side and a narrow tube on the right, from which successful projects emerge. Once again, there is so much value in killing projects efficiently at each stage-gate of the innovation process and here are a few examples of the expected benefits:

  • re-allocating resources to other, more promising projects,
  • learning from trial and errors and capitalising on best practices across projects,
  • developing a culture of innovation – learning from errors, aiming at success – in order to foster motivation and encourage new daring ideas,
  • simplifying project portfolio management,
  • reducing overlap if not competition between projects.

Innovation processes are becoming more and more collaborative with the help of enterprise 2.0 platforms supporting ideas and project management. Thus it ensues that sharing thoughts about innovations that should not be accepted and projects that should be stopped is an absolute must-have. Once again, let us emphasise the fact that the proper number of resources should be allocated to the screening of projects and that pruning weak ideas should be an area of focus.

Both the rejection and even the killing of bad ideas/innovations can actually deliver benefits from a competitive edge viewpoint. Are you – and your company – ready to reap those benefits and image improvement from saying NO and for killing more innovations?

Bluenove is a consulting firm specialized in Open & Collaborative Innovation http://www.bluenove.com

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Futurelab’s Thys: in innovation “the wrong questions turn out to be the right questions”

Alain Thys: a relentless innovator and profit-tracker

On March 4th, 2009, I was able to meet and have breakfast with, at last and after a few missed opportunities,  Alain Thys in Paris. Alain is one of the partners of futurelab, a consultancy based in Belgium (of which he originates) together with fellow Stefan kolle. I can’t actually remember when,or how we came across each other, but it is bound to be on the web, and that’s probably how we ended up cooperating on the Futurelab blog by the way.

 

What I know though is that Alain is the author of one of the most important Marketing presentations that I have seen at slideshare.net, which I keep using over and over again, and is entitled marketing accountability (you will find the direct access to the presentation at the end of this article). Alain Thys’s biography is also very interesting.

He describes himself as a “shopkeeper”. He has had extensive experience in European advertising and marketing at companies like Mexx and Reebok. He was in charge of marketing at Reebok Belgium for a while, when it was decided to merge it into the Dutch arm of the company, at the beginning of the 1990s, and that’s when the Internet arrived. It is also when Alain discovered these “funny computers” and the things that we could do with them. A 3-year stint in the Netherlands at the head of the Reebok  marketing unit ended up in a re-org and a sabbatical in Mexico (lucky him!).

At the beginning of the year 2000, he then decided to go into start-up mode and work for a joint-venture in which AOL, and LVMH (Louis Vuitton) were involved. Their new plan was a groundbreaking online idea for the travel industry. This was “way ahead of what was done in those days with regard to online travel”. In fact, it was a bit like à la carte holiday packages, what is commonly described nowadays as dynamic packaging (although very little of it is still to be seen in the field, which means that it’s still ahead of its time).

The usual cash burning story about 2000 bubble start-ups is unfortunately repeated in this venture of Alain’s: a $130 cost per customer was leading unfortunately to a meagre revenue of $16, hardly enough to generate profit. Vision doesn’t always lead to profitability, but there is one thing about visionary people, is that they shall never be deterred. And that’s exactly why Alain decided to move on to the next idea. So he started a new incubator for e-payment in Ireland, related to mobile payment. He admitted to having a lot of fun creating the new start-up, and he did this for a couple of years before joining a media group in Belgium in 2004-5.

This media group, itself a media pioneer in Belgium, led Alain Thys to focus on “creating new things and generating new profits”. He admitted to “not being very knowledgeable about the Internet world” which actually led him to ask “the wrong questions, which turned out to be the right questions”.

Alain was lucky enough to actually see the Internet at its inception, he grew with it (not exactly generation Y though). And he learned as he was going along. As matter of fact, and to be honest with him and yourself, everybody’s learning as we are going along in this market (a case of the blind leading the blind I guess).

He then created futurelab in 2005, and Stefan joined him in this transition period. Futurelab is a consultancy geared towards “generating new profits out of marketing and innovation”. This consultancy is actually working very much based on word-of-mouth, and is expanding across Europe, doing little or no cold-calling or direct marketing. But it is taking WOM to the next level with the help of the Internet.

Their work is mostly based around marketing strategy consulting, and their aim is to “generate profit through innovation and customer centricity”. Future lab’s objective is actually to “deliver on that promise of a value to the customer”. He described innovation as being “doing something differently, and that you haven’t done before.” But he also has profitability in mind.

Alain Thys declares that “in 80% of current projects, we see marketing & innovation fail in that respect”. When asked about the reasons why such an obvious metric is actually not taken into account, which seems zanyish and at the same time is happening on a daily basis, he answers thus:
  1. it is either that people forget about the bottom line altogether. However, there must be some sort of payback on innovation,
  2. the second reason why innovation fails is that most innovators “forget about what it means to the customer.”

So, Alain adds, very often, “what is needed is a different perspective, and this is when consultants become really useful”.

Most of Futurelab’s business is done through word-of-mouth using their Internet website and blog, an incredibly comprehensive digest of the most authoritative Internet and blog writers about innovation, which can be found online. The blog is available at http://blog.futurelab.net and shouldn’t be missed. I would also recommend Alain’s set of slides which are available and downloadable in creative Commons format from sideshare.net.