Don’t Fall Victim to Things That Stifle Innovation

With all the talk about the importance of innovation, you’d think we’d be better at it by now. Not so according to a recent Accenture study of more than 500 executives at British, French and U.S. corporations. Rather than offering “the next big thing,” researchers said that innovations coming to market today are more typically “line extensions.” Instead of the game changing products, services, and business models that were anticipated several years ago, many so-called innovations have become considerably more limited in scope. 

First the good news: Over 70 percent of respondents to the Accenture study ranked innovation among their top 5 priorities--with nearly one in five (18%) putting it at the head of their list. However, study authors found two dominant obstacles standing in the way of driving higher returns from innovation: Conservatism and the “invention trap.”

1.      Conservatism focuses on individual line extension renovation rather than developing a broader portfolio that also includes big, hairy audacious ideas.

2.      The “invention trap” is an overreliance on the invention process itself.

The problem here is that most organizations—large or small--lack systematic, enterprise-wide processes that can commercialize inventions into scalable products or services and bring them to market in a timely manner. 
Here’s what else disturbed us about the Accenture report:

·         Only 34 percent of respondents believe their company has a well-defined innovation strategy.

·         46 percent say they have become more risk averse in considering new ideas.

·         45 percent see their company pursuing a portfolio of smaller, safer opportunities rather than seeking the next breakthrough.

Busting through inertia

We recently interviewed Michelle Mason, managing director of ASQ for the Association Adviser enews. Michelle told us that if your organization has complex problems to solve, “look for employees with high levels of curiosity.” Eric Wulf, head of the International Car Wash Association told us he’s a “resource getter, not a management of people person” and Bob Hasmiller of the National Association of College Auxilliary Services told us he’s a big advocate of “Management by Walking Around (MBWA)” and hiring people who are insatiably curious and lifelong learners.
Here’s another shocker: Nearly all (93%) of the executives surveyed in the Accenture report regard their company’s long-term success to be dependent on its ability to innovate. At the same time, less than one in five (18%) believe their own innovation strategy is delivering a competitive advantage. Fewer than half the present-day respondents believe they have an effective approach to new product development or are seeking innovation effectively.

C’mon people we can do better than that.

Respondents cited specific challenges to innovation (we call ‘em excuses)

• Predicting future trends (30%)
• Achieving cost containment (27%)
• Securing ongoing budget support (26%)
• Leveraging new technology (26%)
• Transforming new ideas into marketable goods and services (24%)

Macro View

Tuesday, the Standard & Poor’s Case-Shiller home price index posted the biggest gains in seven years as housing prices rose in every one of the 20 cities tracked.  Further, consumer confidence reached a five-year high in May according to a Conference Board report also released on Tuesday, with big improvements in Americans’ views about both the current economy and future economic conditions. It hasn’t hurt that employers have added jobs for 31 straight months.

Conclusion

At the end of the day, the only thing really stifling innovation at most organizations is fear or failure and lack of imagination. That’s why we pioneered the Art & Science of Strategic Stumbling™.

You can’t learn if you don’t fail from time to time. And that’s the main difference between visionaries who build great companies and products and executives who simply build careers. Who would you rather work for (or hire)?

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Tags: Accenture study of innovation Standard & Poor’s Case-Shiller home price index, the invention trap, management by walking around, lifelong learning, Strategic Stumbling

You Have to Hit it Full Throttle This Summer

While gathering around the barbecue with a cold beverage in hand this Holiday weekend, take a few moments to enjoy your good fortune. The weather is warm. You can swim outside in most parts of the country and week by week, month by month, the good news is outpacing the bad news.

According to a recent Business Confidence Survey by Insperity, small business owners are showing a willingness to hire more employees amid signs of expanding business activity.

·         More than 40 percent of the nearly 5,000 respondents said they are adding employees, up from 28 percent last October;

·         55 percent are maintaining current staffing levels, versus 63 percent last fall;

·         Only 5 percent are laying off employees, down from 9 percent in October and

·         28 percent think an economic rebound is currently in process versus 20 percent last fall.

Here’s what’s worrisome about this otherwise optimistic report; nearly three in four business owners STILL aren’t convinced that the economy’s on the mend. What else do you want?  A memo from the Commerce Department declaring, “Recession Officially Over—OK to Start Making Decisions”? Don’t hold your breath.

Financial markets are at historical highs, housing prices are at their loftiest level in 3-1/2 years, interest rates are at their lowest levels since most business owners have been alive and domestic business travel is up 5 percent over last year and above the all-time high reached in 2007 (Source: US Travel Association). That’s not enough for you?

Not only has economic rebound been “in process” for at least two years, it may be fading into the rear view mirror. When you think (and really feel) that everything’s fine, it’s usually too late. Your toughest competitors are way ahead of you anyway.

Sure the economy leads the list of short-term concerns for 62 percent of business owners, while government health care reform, and rising health care costs, are tied for second on the list at 51 percent, followed by hiring the right people, at 42 percent. Yet almost the same number (59 percent) expect sales to increase and 85 percent expect to maintain or increase employee compensation.

An Oxford Economics study found that companies that invested the most in business travel during the recession have grown faster than those that cut back on travel. Same goes for those that invested in marketing, product development, business development and hiring. You’ve got to keep your foot on the gas at all times and keep the pipeline full.

Macro View

Despite all the noise and confusion coming out of Washington (and the IRS), home prices rose to the highest level in three and a half years in April—up 11 percent over the same period last year. It was the fifth consecutive month of double-digit gains according to the National Association of Realtors. We were even more encouraged by this stat—the median time on market declined to 46 days from 62 days the previous month--which means properties are selling more quickly and inventory is shrinking.

Conclusion

As Seneca the ancient Roman philosopher once quipped. “Luck is what happens when preparation meets opportunity.” Whether it’s war, business, sports or courtship, nothing’s really changed that much in 2,000 years. Have a great barbecue this weekend and rest up. Summer’s the time to hit it full throttle. Waiting till after Labor Day to make decisions, isn’t going to cut it anymore.

Tags: National Association of Realtors, Insperity, Oxford Economics, US Travel Association

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Time to Take a Break from Tech?

We’re so hyper-connected and tech-addicted these days that even some of the elite technorati are finding a need to unplug. Take Nick Bolton, popular New York Times technology pundit.  He wrote Monday that one of his tech compadres intentionally drives out of cell service range, so he and his wife can spend weekends together engaged with “all things analog.” Another of Bolton’s pals still uses a notepad and pen when he really has to be creative and not spend his “idle minutes” checking e-mail and tweets all day long. When Bolton dines with other technologists, he plays a form of chicken. They all put their smartphones in a pile in the middle of the table and the first one who touches his or her device has to pay the bill.

The meal probably doesn’t last past the appetizer, but at least it’s a step in the right direction.

When used correctly and in moderation, technology gives us tremendous power to connect, create, communicate, collaborate and otherwise GSD (get shit done). But it’s just a tool and you can’t become a slave to it. When’s the last time you saw a carpenter sleep with his or her hammer by the nightstand or pick it up every five minutes to check for new heads, peens, wedges and claws to attach?

Did you get my email?

How long can you go without emailing, or calling someone on the phone to ask, “Did you get my email” if they haven’t responded instantaneously? Some companies, such as employment screening services firm e-Verifile, have email-free Fridays. On the last day of each workweek, employees can use email only for external communications. If they want to contact fellow employees, they have to use the phone or even scarier, meet face to face. We know that’s frightening for some of you in the under-40 crowd, but at least you’ll reduce many of the misunderstandings that come with email as it doesn’t allow for nuance, voice inflection or visual clues.

Our blog has more

Burnout Busters

Reducing our over-reliance on technology should also help alleviate symptoms of burnout. I received a lot of feedback to this article I wrote last year about recognizing and reducing signs of burnout. It was intended for executives of trade associations, but many of the tips and coping mechanisms could be valuable for you.

Here are some other techniques that have helped my colleagues and me:

·        

• Leave the headphones at home next time you go for a run. Just focus on your breathing and take in the scenery. The run won’t take as long as expected and you’ll be brimming with new ideas.

·         Turn off the TV monitor when you’re using the stairclimber or treadmill. That’s right. Just stare into the blank screen or admire some of the well-toned “scenery” around you.  Again, you’ll come back to your desk with dozens of new ideas and possibly a new “friend” or two.

·         Mow the lawn or wack the weeds. It’s a great way to burn off some steam and the steady hum of a high revving power tool will surely drown out any noise around you. Thinks of it as free use of outdoor sensory deprivation tank. You can’t possibly hear your smartphone under these circumstances. You’ll come back inside with plenty of clear-headed ideas and a highly appreciative spouse.

Macro View

Stocks rose yesterday, with the Dow and Standard & Poor’s 500-stock index rising to new highs and the Nasdaq reached its highest point since November 2000—that right, 13 years ago.  “The main things driving the market — the Fed, earnings, consumer confidence — are holding up, and people put money in the market on any down day. I still see a lot of value,” he said.

In signs that the rally may strengthen from current levels, the Credit Suisse Fear Barometer, known as the CSFB Index, fell 11.4 points over the last two weeks — the largest decline on record — and was now at a one-year low of 21.73.

And, if you still don’t think the fear/greed pendulum has officially swung over to the avarice side, it seems the IPO market is back—in a big way. U.S. companies are on track to raise the most money through initial public offerings since before the financial crisis, driven by the same thirst for risk among investors that has pushed the stock market to new highs. According to Dealogic, 64 U.S.-listed public offerings have raised $16.8 billion already this year. In the same period in 2012, the biggest year in dollars since the financial crisis, 73 companies raised a total of $13.1 billion. Last week alone brought 11 U.S.-listed IPOs, making it the busiest week for such deals since December 2007.

Conclusion

Technology is not going away. The trick is to stay up to speed on as many tools, apps and devices as you can, without becoming a slave to them or feeling like you’re constantly behind the curve. Don’t do it alone. Ask as many smart people as you can, and make sure you have a few friends, confidants or advisors who are significantly younger and more intrepid than you. Regardless of your age, there’s always a smart person in your circle who’s a little younger, more plugged in, and who has more free time for experimentation than you. As Tino Mantella, head of the Technology Association of Georgia (TAG) told me the other day, “You don’t have to be first on the wave, you just have to be ready to catch it when it comes.”

Tags: CSFB fear index, Dealogic, e-Verifile, no email Fridays, Tino Mantella, TAG


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Is video advertising worth it?

Nearly 10 Billion Video Ads Viewed in February
But, web users increasingly fed up with lousy ads

If you think advertising is starting to intrude on your favorite video sites like springtime dandelions on your lawn, you’re not alone. According to comScore, 178 million Americans watched 33 billion online content videos in February, while the number of video ad views reached 9.9 billion and time spent watching video ads totaled 3.8 billion minutes. Video ads reached more than 50 percent of the total U.S. population an average of 63 times during the month and video ads accounted for 23 percent of all videos viewed.

But, before you put all your marketing eggs into the video basket, please make sure you can deliver high quality, relevant video messages to your target market or be prepared for backlash—fast and furious backlash and negative brand equity. Hint to do-it-yourselfers: don’t forget about the importance of good lighting and high quality sound. Invest a few bucks in a tabletop or lavaliere microphone.

According to InsightsOne, with Harris Interactive, the vast majority of American adults 18 and over (87%) are putting their foot down on the number of irrelevant ads they are willing to tolerate before they ignore a company completely. One in four Americans (23%) say they will do so after seeing just one spam email or online ad, and 43 percent say they will ignore a company completely after seeing as many as two.
Annoying ads are pervasive, says the report, with 91 percent of Americans reporting they see them. While email spam and junk mail tend to get the most attention, many Americans are annoyed by website ad spam, email spam/sidebar ads, postal junk mail, television ads and ads on social media.

If you advertise or promote your firm on the web take note: 36 percent of web users who’ve been flooded with online ad spam say they will leave a website because of too many irrelevant ads, and many more feel that the company doing the advertising doesn’t respect their time. In terms of email, 60 percent will unsubscribe from future messages, but 45 percent will simply ignore future communications.

Men less tolerant than women

According to InsightsOne research, Men were statistically more likely than women to take certain actions, including:

• Stop using the product (17% vs. 11%)
• Boycott the company doing the advertising (16% vs. 10%)
• Respond angrily (7% vs. 3%)
• Hit their computer or mobile device in frustration (5% vs. 3%)
• Feel the company doesn’t respect their time (30% vs. 22%)

Macro View

With interest rates low and corporate earnings surprisingly solid, the equity markets continue to flirt with record highs. Weekly applications for jobless benefits fell to a five year low. U.S. employers maintained steady hiring in April, alleviating widespread concerns about the economy heading into a spring slowdown. Economists say the job gains don't reflect a rapidly growing economy, but they provided enough relief to markets Friday to boost stocks into record territory.

Conclusion

The web is one of the most powerful, cost-effective tools ever invented for reaching your target market. But, if you don’t respect your target market’s time or really understand what your clients/prospects are interested in—at their current stage in the purchase consideration cycle—then it can be devastating to your firm’s brand name and reputation.

Tags: InsightOne, Harris interactive, video advertising, intrusive advertising

A great time to be self-motivated. Are you up for it?

If you think you’ve been making more and more important decisions on your own these days, you’re not alone. From your 401(k), to your healthcare, to the clients your retain, to where and how you live, work and worship, we live in an increasingly self-directed world.

As Thomas Friedman (The World Is Flat), noted in an op-ed piece today, “something really big happened in the world’s wiring in the last decade, but it was obscured by the financial crisis and post-9/11.” Thanks to social media, 4G, iProducts, broadband, wireless, the cloud,  Big Data, Skype and apps, we’re now more connected than ever, Friedman observes, so there are more ways for people to “start stuff, collaborate on stuff, learn stuff, make stuff (and destroy stuff) with more people than ever before.”

Friedman and others have noted that if you’re self-motivated, it’s a great time to be alive. Many of the barriers that used to slow you down are gone, but a lot more responsibility rests on you. A big, company, firm, union, or government isn’t there to hold your hand as much anymore.

Warning shot to those ‘mailing it in’

“But, if you’re not self-motivated, this world will be a challenge, because the walls, ceilings and floors that protected people are also disappearing,” observed Friedman.

Now most of you on this distribution list are among the most highly motivated, highly creative, highly caffeinated people we know. If not, you would have opted-out a long time ago and that’s why we love you.

Our blog and the conclusion to this post has more.

Macro View

Whether or not you think the market’s run into record territory is sustainable, we’re starting to see signs of real support (not because there’s nowhere else for investors to put their money). Average single family home prices rose 9.3 percent in February, their fastest rate in almost seven years according to the S&P/Case Shiller index yesterday. Meanwhile, the Commerce Department said Monday that consumer spending rose another 0.2 percent in March, following a 1 percent increase in the January to February period. Personal income and after-tax income also rose in March. Experts say higher incomes are helping to offset the end of the two-year (2%) Social Security tax holiday on workers’ paychecks. What’s more, this week’s stock market rise has been fueled by tech companies, which had been laggards earlier in the year due to investor concern over weak business spending and concerns over sluggish overseas sales.

Conclusion

While many businesses, economists and market watchers are waiting for a rebound from this slow growth economy, we see today’s environment as the new normal. There are still big opportunities in a slow-growth economy, and the winners will be those firms who can increase their margins, not necessarily their topline revenue or billings. While others see threats, danger, disintermediation and loss of turf in this self-directed world, you see opportunity. No single firm, company or product really owns the marketplace anymore--and if they do, they don’t get to own it for long. Celebrate your agility, not your lack of resources.

It’s on you now. Don’t ever take your foot off the accelerator. Just stay focused and keep your eyes on the road at all times.

Tags: Thomas Friedman, The World Is Flat, S&P/Case Shiller index, 4G, iProducts, broadband, wireless, the cloud,  Big Data, Skype and apps

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