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Innovation 101 in 5,000 words or less with Braden Kelley

Last week we posted our podcast interview with Braden Kelley, where we talked about his basic guidelines for implementing an innovation strategy. Today we bring you the transcript in case you missed it or would like to have his recommendations in writing.

Braden is the founder of Business Strategy Innovation, where he consults with organizations to help them pump up their innovation efforts.

He has worked with some of the world’s leading B2B and B2C organizations on creating innovation strategies, increasing customer marketing effectiveness, managing organizational change, and improving organizational performance.

During our interview, we picked his brain about his recommendation and insights on developing and managing a successful innovation process. He discussed who should spearhead innovation in a company, pitfalls to watch out for, and much more.

Read on below. If you want more insights from Braden, check out his blog at Blogging Innovation; his Twitter handle at @innovate; and his new book, "Stoking Your Innovation Bonfire."

Janelle: Hi, everyone. Janelle Kozyra here for an Inmagic podcast. Today we are joined by Braden Kelley who is the founder of Business Strategy Innovation where he consults organizations to help them get started on their innovation efforts. He has also spoken at many conferences and events around the country and the world on various innovation topics as well as about building digital relationships, audience, and community.

He is also the blogger of the very popular innovation blog called Blogging Innovation. And he has a new book out called "Stoking Your Innovation Bonfire" which we will get to a little bit later in the interview. But right now I'd like to welcome Braden to our podcast. Good to have you with us.

Braden: Thank you, Janelle. Good to be here.

Janelle: So let's get started by talking about your thoughts on innovation. So a lot of our blog readers on the Inmagic blog are focused on B2B. So can you share your perspectives on what innovation means for B2B?

Braden: Sure. So it's on my mind when it comes to innovation, really what it's all about is trying to create value, new value that didn't exist before. So whether you're in B2B or you're in B2C, it's really going to be the same in your approach because you're starting with a customer and working backwards to try to identify and deliver on some new value for your customer that wasn't there before. So if you're in B2B, your customer might be in another business and if you're in B2C then your customer might be you or I or any of the consumers at home.

So the approach is the same. The approach is still trying to organize your environment so that it's conducive to creating innovation and then coming up with those ideas from insights that are new and different from others that are out there that can deliver some new solutions that weren't there before. And then translate that value or the people that are looking to purchase those solutions in a way that they can understand them and then will take action to actually purchase them.

Janelle: So speaking of innovation in the broadest sense, who do you think should champion innovation strategies in an organization? Should it come from top-line management or middle management or should it be a grassroots things that bubbles up through the top of and throughout the organization?

Braden: Well, really, when it comes to innovation, it's really out getting started. So you have to start somewhere, but generally the most successful and enduring innovation efforts tend to be top-down. So you do really need that support from the CEO and, most importantly, the visibility and the communication from the CEO. And the rallying of the support of the senior executive team to then ideally engage the middle management level and reach all the way through down to the front line staff.

But at the same time, if you haven't built a culture that engages the front-line staff where they potentially have been clamoring for it and are waiting for that senior support, then it's tough to sustain because you really need the passion and the participation of the front-line staff. So the key is to not only have that top-down approach but also to, in your approach to innovation, to foster the bottom-up and to put things in place that allow for the bottom tier of an organization to participate and to collaborate to help bring the innovations to the fore.

Janelle: What sorts of things, then, should a company have in place, then, before they might begin an innovation strategy? Like, for instance, being innovative has a lot to do with being able to manage change well. So let's say would an organization already need to be successful or adept at something like change management, as an example, before it starts moving forward with some kind of formal innovation effort?

Braden: Well, it's definitely important to understand the principles of success, managing change well and to have some experience in doing that and some credibility with employees about implementing successful change. But the most important thing when a company is looking to get started on their innovation efforts or to start to pursue an innovation strategy is first is that innovation vision.

So where are you trying to go with innovation? Why are you pursuing innovation? What are you hoping to achieve with innovation? What does innovation mean to you? And really building a common language and first a definition for innovation and then a common language around innovation for the staff and for your organization what innovation means and the kind of innovation that you're looking for and what would be helpful in terms of participation.

But then also building some very key infrastructure points and some very key resource flexibility to allow for people as ideas come up for them to be funded, for there to be funding available, to fund really great ideas, for there to be the opportunity for resources to move partially or fully on to the innovation project that you're wanting to pursue. And without those things, your innovation efforts are likely to struggle because every new project requires resources, both financial and human resources. And without the structure in place to provide those, where are your ideas going to go?

Janelle: So you would say that an innovation strategy is not a one-size-fits-all approach?

Braden: No. No, because the kinds of innovation that organizations may choose to pursue may be different for every organization. And in many cases you want your innovation strategies to dovetail into your corporate strategy or your organizational strategy. And every organization has their own and so it's definitely on a case-by-case basis and something that ideally the senior leadership team has to work together to decide and craft and come together on a common agreement on what innovation is going to mean for their organization and how they are going to pursue it.

Janelle: So can you maybe share with us an example of an organization, not necessarily mentioning any names or anything, but just a story about an organization who you think has been able to implement an innovation strategy successfully following some of these recommendations that you've just outlined?

Braden: Well, I'm interviewing several organizations right now for the next book project or application project. And one of the organizations that I've been talking to is Intuit because they're doing a lot of interesting things in the space of innovation and how they go about creating it. And so in a lot of the organizations that are successful and other organizations would include Whirlpool.

There's evolving to be a very common approach for the organizations that are able to sustain it over a longer period of time. And that's number one. You need a small core organization that sits at corporate or somewhere close to the senior leadership team, potentially the leader of the innovation group may be a chief innovation officer or part of the leadership team, that is not responsible for creating all of the innovation, but is responsible for managing innovation within the organization.

And then from that, that core team, there's often a distributed team spread all through the organization at all different levels. Some people call them innovation champion. At Intuit they call them innovation catalysts and these people may be trained in innovation, in creative strategy, or capabilities. They may be trained in design thinking, they may be trained in a variety of things.

But, ultimately, they sit all throughout the organization and serve as lightning rods for innovation. And people that can really help others in the organization, structure their ideas, pitch their project, help work through their project, and provide resources all the way throughout the organization rather than trying to completely centralize everything.

At the same time, organizations are really experimenting with time to allocate toward innovation, so Google's 20 percent time is very famous, 3M has, I believe, its 15 percent time, and Intuit has time as well, but they do something slightly different with theirs and that's that they allow people to accumulate it and group it together. So rather than spending 10 percent of their time a week, they can sort of bank it up and then take a block of time to work on something.

And oftentimes people are doing that and doing it in a collaborative way with other team members and pulling teams together to work on interesting ideas. So those are a couple interesting things and approaches that organizations are taking that are becoming more and more common and the implementation might be slightly different.

But organizations are having success with doing those kinds of things, those being two examples, time and the way that they provide resource flexibility and then also structure and the way that people infuse innovation throughout the organizations walls, though having it close to the senior leadership team.

Janelle: So do you find those things, time, carving out specific time slots when you work on innovation, having the resources to support it and giving employees some flexibility to work on innovation in their own way, do you find that those things are some of the most important elements in being successful at innovation in your organization?

Braden: They are definitely two of the most important, but probably the most important is building trust. And the reason that that's so important is because that when it comes to innovation, if you're really trying to make innovation a deep capability of your organization, then it's not a one-time thing. It's not a project. It's not a fire drill, but if it's something that you want to have infused in your DNA, then you have to really show that you're committed.

And you really have to show that when you ask people for ideas and you throw out challenges, that there's an outcome from that. And that there's change that occurs as a result of that and that there's projects to be kicked off and there's products or services that end up in the marketplace as a result and things that people can be proud of and things that drives people to participate further in the future.

And so it's really all about showing that commitment, demonstrating that commitment, earning that trust continually, and, from that, then you really start to unlock the power of people and ideas. And you start to hopefully also get people who are collaborating more and not just to come up with ideas but to evolve ideas and develop ideas and evaluate ideas and implement ideas. And I think that that's probably the most important thing.

And then the research for the book, when I threw out a question about what the most important barrier to innovation was or what the biggest barrier to innovation, organizational psychology was number one. And so the organizations that can master that and can unlock the creativity of their people and earn that trust are the ones that are over the long haul going to have the greatest success.

Janelle: Yeah, I want to get into that a little bit more. I want to take you back, though, to the idea of building trust, specifically. What are some ways that you think organizations can help build trust among employees?

Braden: Well, I think the first thing is being very careful and thoughtful in their communications and the way that they finally communicate out. But as we mentioned earlier, put the structure in place to allow for the resource flexibility and funding that's necessary to make ideas actually happen. And to really keep communicating with people to let them know what the outcomes have been and maybe even what some of the progress has been.

And I think that too often when we looked at innovation or a lot of efforts, we might put out an initial communication and then we leave it there and there's a website up or whatever, but then we don't go any farther in a lot of cases and to our detriment.

And I think that the organizations that keep the lines of communication open and that really give people a view into what's happening and why the innovation effort is important and how it's not just a project-based thing, but this is the new way that the organization is pursuing success in the marketplace, the further you're going to be able to do to really earn that trust and maintain that trust. It's all about results and showing results and continuing to show commitment.

Janelle: So, then, go into your book, "Stoking Your Innovation Bonfire." You talk about some of the barriers to innovation and you just mentioned one a little bit earlier is the organizational psychology. So can you explain what you mean by that when you say organizational psychology?

Braden: In a lot of cases what that comes down to is fear, risk, and elements like that. How is risk dealt with in the organization? What is the risk profile for the organization or tolerance for risk? How is failure dealt with in the organization? How are idea submissions generally treated in the organization? Is there tolerance for disrupting the status quo? Is there tolerance for risk? What happens when people fail?

These are the elements that can cause organizations to struggle with innovation when it comes to organizational psychology is that to be successful you really have to have a positive way of dealing with failure. You really have to have a portfolio approach or other means of enabling risk taking. And you have to have an organization that encourages collaboration and also isn't overly political and allows people to put their ideas forward without being criticized before they're fully formed. And so these are some of the things that come together to either promote or destroy innovation potential.

Janelle: You mentioned collaboration there and also another piece of your book where you're talking about how to sort of get back the organization's innovation spirit. You talk about how to leverage the collective wisdom of employees. So why do you find that their collective wisdom and their knowledge is important in innovation success?

Braden: Well, I think that the bigger innovation that you're trying to create or the farther that you're reaching or the more disruptive that you're trying to be, the more change that's involved. And the change reaching in to more and more parts of the organization and externally into more and more different organizations requiring greater and greater collaboration.

And the reason why it's important to have it so that you're engaging a broad cross-section of both your organization and also of your ecosystem is because most really difficult problems, nobody is going to have all the knowledge. And most great ideas begin as partially-formed or partial ideas. So one of the roles of a central innovation organization or of the people leading innovation is often collecting and connecting the dots and really trying to identify what the most interesting partial ideas are and where the duplicates are and then trying to connect people that can fill in the gap.

So gathering ideas that are similar and connected and putting those together to create a more fully based idea or potential solution and knowing which people in the organization might be able to help overcome some of the key hurdles. Because we don't all fill the same roles in innovation. Different people have different skills in the overall innovation process and different things to offer.

So you might have one person that's really great with coming up with ideas but there might be another person that's really good at evolving them or identifying where the key barriers may exist. And you might have another person that's really good at solving tough problems and really enjoys that.

And can take a look at an idea that's struggling where somebody is hitting the wall on trying to transform an idea into a solution and really tackle that key challenge and help people find a way through. And then there's other people that are really good at connecting people or identifying the key ways of communicating the value of the innovation that you're creating.

But it really takes a team effort to make innovation happen and there's really kind of three different pillars to creating innovation. No. 1 is value creation. No. 2 is value translation. And then the third one that kind of sits in the middle is friction reduction, which is really trying to remove a lot of the friction in getting things done or making the ideas happen, either inside the organization or outside the organization. So it really takes a team and there are really lots of different roles that need to be played in an overall innovation effort and that's why collaboration is so important.

Janelle: Let's talk about those three pillars a little bit more. Value creation -- what's that?

Braden: So when it comes to innovation, and any great innovation is bringing new value to the marketplace. And the way that I like to define innovation is that innovation transforms the useful seeds of invention into solution, valued above every existing alternative and then widely adopted.

So if you think about something like Quicken. Quicken wasn't coming in and competing against personal finance software packages or accounting packages or things like that. It was really competing against the pencil because people are at home and they're using a pencil or a pen to do their personal finances. They've got their checkbook and they've got their own personal way of dealing with their finances. And Quicken has to, not only be better than all the other personal finance software programs, but they also have to be better than the pencil.

They had to deliver enough value that people would be willing to abandon their old way of doing things. Because there's always a solution in the marketplace, even if it's the do-nothing solution. So when somebody says that, oh, this doesn't exist, nobody is doing it, we're solving a problem that nobody has solved before, I cringe because that's not true. There's always a solution, even if it's a do-nothing solution.

So when it comes to value creation, it's all about identifying how you can bring more value to the customer than they currently have the ability to get through the existing solutions, or the do-nothing solutions. So that's value creation. Value translation is all about, okay, now that you've created all this value, invented it, or brought it together to bring it into a solution through invention and through maybe an interesting business model or some great services and other aspects that layer around it, how do you either explain it to people or educate people on the value that you have created?

Because the more disruptive that you try to be in terms of your innovation, the more you start to move from merely explaining the value or merely explaining the idea to really having to educate people. And that can take a lengthy period of time or a great deal of effort and sometimes people's potential innovations really fall down because they underestimate the amount of education that needs to be done to translate the value that they have already created.

And then the third one, friction reduction, is really about making it as easy as possible for people to extract the value that you've created. So how easy is it for people to do business with you? How easy is it for you to work within your organization to make and produce that innovation or deliver that innovation if it's a service? So it's really about trying to help yourself get out of your own way or to get out of the way of the customer so that the value you've created is easy as possible to get. So those are the three elements that come together -- value creation, value translation, and friction reduction.

Janelle: So many of our blog readers on Inmagic's blog, they're at the earliest stages of thinking about innovation and what idea management and ideation means to them and their organization. So what are maybe some top three things that you would leave with them to consider or think about as they start framing their innovation strategies? I mean, does it start with by looking at their culture, by looking at their technologies? What would you recommend that they start with?

Braden: So the number one thing that I would say is that you have to ask yourself the follow question which is why are we planning to pursue innovation? What is this that we're hoping to achieve? And use that to start the conversations necessary to define innovation for your organization, to create a common language around innovation that you can communicate throughout the organization. And the people inside it or the people that potentially you may look to involve outside the organization so that everybody knows what it means and how they can participate.

The second thing is to make sure that you have the resource flexibility and the funding available necessary. So that as soon as you start asking people for ideas that you can actually put people on the project to develop the ones that you select and fund the project to start pursuing those ideas and turning them into real potentially shipping products and services. Ideally, of course, that will start with small investments, but prove some of the key hurdles can be overcome, and then progress forward, but that's kind of the second point.

And then the third point is don't jump from A to J. Don't jump in and start drawing out a challenge to people before you put these foundational elements in place. And some other additional foundational elements I would put in place, as well, is making sure that you have a vision strategy and goals around innovation.

That you've really thought it through and that you know exactly what you're pursuing before you start throwing out challenges to people or soliciting ideas. Too often people jump right to give me all your ideas and then realize that once they've done that and how many they get, that they're not ready or not equipped to do anything with those ideas. And then they destroy a lot of trust and don't get any innovation as a result.

Janelle: So in all cases, innovation must be tied to the business objective.

Braden: Not necessarily all cases, but most organizations are going to want to pursue it in that manner. Very few organizations have the flexibility and the leadership necessary to go into areas that aren't tied to their business. I mean, you look at what some people are doing and like Google, and you wonder how many organizations can really do the kinds of things that they're doing in terms of the way that they go into alternative energy and other things that are really, really far from their core business.

And I'm not sure that a lot of organizations can do that and I'm not even sure that they can do that very well, that they can do it with excellence. And so it's in most cases it is going to be the right strategy to try to tie your innovation strategy to your corporate strategy and use it to help reach beyond, use it to help reach for the future. But if you're in the baking industry, you're probably not going to have an innovation strategy that focused on alternative energy or biotech or something like that.

How can we within our current business, what makes sense for us to reach for and where can we excel with the capabilities that we have as an organization that maybe others can't? So it's definitely something that in most cases is closely tied.

Janelle: So we've talked a lot about how companies can go about being successful with innovation and one of the elements that you were talking about is having the right -- the funding and the human resources in place to support it. And a lot of organizations are still feeling the effects of the recession. Do you think that organizations are treating innovation as sort of a lower-tier objective? Is it taking a back burner to some of the more basic needs of business like cost and expense savings and near-term sales?

Braden: I would say that the answer is it depends. So it depends on the financial state of the organization, it depends on the vision of the senior leadership. But in general, you don't want to stop and start your innovation efforts if at all you can avoid it because if you stop your innovation efforts, well, it takes time to innovate.

So if you stop them and then start them later, then your innovations are that much delayed. So if you stop for a year, then as a you're going to have new innovations is going to be delayed by a year or potentially longer because you may lose people during that year from the organization that might have been responsible for some of the great innovations that you might have introduced because they are frustrated and disenfranchised from the efforts being stopped.

So I would say that as much as possible you want to try and keep your innovation effort constant and moving forward. If you have to scale them back a little bit, that's better than stopping them completely. But I have seen some organizations stop them, some organizations continue them, and I think what we'll see is the organizations that did not stop during the beginning of the downturn will be the organizations that start to pull ahead of the competition that may have.

And if you look at across the market, if you just take the mobile phone industry as an example, you can look and see how Motorola has gotten in trouble in terms of they were really innovative. And then they seemed to stop bringing out a lot of major new innovations to the market and then they really found themselves behind the eight ball and they had to struggle really hard to kind of get back in the game.

And now we're seeing the same thing with Nokia where Nokia is really in a lot of trouble right now and it will be interesting to see whether they survive. But when you stop innovating, when you take your foot off the gas pedal, then what that does is it allows your competition to keep their foot on the gas pedal and potentially surge ahead of you or, for new startups, surge into the new marketplace.

But you might have otherwise been able to keep out because they just couldn't keep up with the relentless pace that you might have been setting. So that's my tip is you might be okay to slow down if you really have to, but try not to take your foot off the gas completely.

Janelle: Great. Now where are you going to be speaking at in the coming months?

Braden: Well, next week I'll be in Belgium speaking at a free event at the Microsoft Innovation Center in Mons near Brussels. And then in August I'll be hosting the Open Innovation Summit in Chicago and October I'll be at the Business Innovation Conference, again, near Chicago. And I'm sure there's other places, but if people are interested in finding out more, they can go to BradenKelley.com and click on the speaking tab and it'll show where I'll be.

Janelle: And if readers are interested in checking out your new book, where is the best place to get it?

Braden: There's a lot of great places to get it. It's available digitally and also in hard cover. If you go to
InnovationBonfire.com and go to the where to buy option, it'll show you a whole list of electronic retailers that you can get it at. You can also possibly get it in your local library as well or request that your local library order it. Several have. And, yeah, so there's a lot of great ways to get it. Also on InnovationBonfire.com you can find a sample chapter of the book and, yeah, and of course Amazon has it.

Janelle: Great. Thank you, Braden. I appreciate you coming on our blog with us today.

Braden: Well, thank you very much, Janelle. I appreciate the time and I hope the audience finds it interesting and hopefully valuable and, if they have any questions, they can feel free to follow up with me and I'll be happy to help.

Janelle: Everyone, that is Braden Kelley, founder of Business Strategy Innovation, blogger of Blogging
Innovation, and you can also find him on Twitter @innovate. So thank you, Braden.

Braden: Thank you, Janelle.

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