Fellow readers, this month GE announced that it will be opening up thousands (not thousands not hundreds) of patents from its library of 20,000 patents. First off, this liberation of IP (patents) is a huge forward move. Why? For decades, global companies have viewed their technical prowess, not in terms of new products and innovation introduced to the market on a regular basis, BUT, in terms of the numbers of patents held by the company.
This patent-holding pattern has many obvious problems, but the one I want to discuss is ‘suing’ and harming entrepreneurship. If you are an entrepreneur, you will need to fish through hundreds of thousands of patents to make sure you are not infringing on anyone’s patents which halts innovation because start-ups are reluctant to risk a legal fight with large (and more financially stable) corporations. In the process of this democratization started by GE, 5 key positive events will occur:
I. Start-up entrepreneurs will now have access to IP which they can bring their know-how and skills to innovate and create new products. They can opt to sell it directly and give GE royalties OR, alternatively, come up with a mutually agreeable plan with GE, for GE to market the product.
II. GE will connect with hundreds of start-ups globally, who can bring value to the market with their IP. Hence, they will know the pockets of talent which ordinarily they would not have been aware of. This in turn will spike up innovation at GE, for GE products and bring variety and diversity in the products.
III. This one is major: It is hugely difficult if not impossible to break through large corporations. This creates a communication bridge between GE and such companies, opening more possibilities for both sides, hence spurring innovation both at GE and outside of GE.
IV. At times may allow GE to invest or co-invest and be a part of the productization of the patent.
V. Beyond anything else, this allows our global community to innovate at a much higher rate than we see today.
To start off, GE has decided to use Quirky’s crowdsourcing product development platform. Hey- I am all for the crowdsourcing of innovation. Quirky will play the role of the online platform, connecting folks who can productize the patent into a useable innovative product for GE. Currently, we know a subset of the patents, but soon many more will be identified. I am excited about companies like Quirky which are taking crowdsourcing into another level and allowing such a marketplace.
Having said that, let’s remember, once the patent is openly available and the developers/entrepreneurs identified, we would benefit greatly if we build sustainable prototyping and funding models to move the process forward rapidly and not just celebrate because we have an enabling platform. To make this work, we need to take the innovation to the final stage, which is turning IP (patents) into products which the market wants and where revenue is produced. But this is a key first step.
For decades, we have known that patents are silent silos where we hide our abilities carefully and which we police to make sure no one can touch it. This move by GE is a whole new ball game. Yes, this opens the door to nations such as China and India, who have a wealth of technical talent who can productize IP efficiently, and I salute that. Let the games begin.
What GE has done is a full disruption to the world of IP ownership. Instead of doing what Motorola did with Google (selling the IP portfolio and now Google owning the IP) or what Kodak is desperately doing but not succeeding (trying to make money off of the IP), GE is changing the game. As I talk in ProVoke, innovation and positive change can only come if we are willing to mindfully disrupt. GE is mindfully disrupting a highly protected area and clearly there will be resistance by some companies, but it will, without a doubt, forward us towards success. Without a willingness to change things, nothing changes and nothing improves. Stay tuned as I keep you posted on this front. GE is an absolute member of my Culture of Disruption (CofD).
More and more I am seeing senior executives in large companies inspired and challenged by the task of ‘how to encourage staff’ to make deeper and bolder bets, choices and decisions. Ironically, I am seeing this in companies where top-down command and control would have not allowed us to have had this conversation before. The article in yesterday’s WSJ touches on this point and a good read.
Why and why NOW?
Companies in all sectors have a huge challenge ahead. They need to INNOVATE. The more employees and staff are engaged and involved, and the more risk they take, the higher the chances of success. Yes, that is right in the face of the FEAR of failure from risks. The more isolated staff are from taking risks, the lower the chance of the company to succeed. This directly relates to innovation. To innovate and to allow new possibilities in ANY business, we need to think of new ideas, experiment, take risks, win big or fail fruitfully. Yes, failure is the step before success not the last step.
To do so, folks need to step outside of their comfort zone, break their daily habits and use their creative juices to think through alternatives.
Being a CEO is a lonely game. It is singular. One CEO. Imagine the pressure if all the innovation and new ideas have to come out of one person. Instead what if it came from thousands or tens of thousands of staff in a company?
More and more, I am engaged in inspiring conversations with leadership in companies regarding not only how to help break the risk-averse habit loops, but ALSO how to inspire people to make more bets and take bigger risks. In as such, we need to remove and reduce the fear of failure or any perceived (and often these are obstacles in our mind!) risk.
Get Out of Jail, Free cards are one model and another one which I very much like is Risk REWARDS, which are handed out even if ideas don’t work out, but recognizes the initiative to make bold decisions. Decisions don’t have to be huge one, but can be small ones which are game changing. In almost all companies I am seeing this conversation come up, which is fantastic. The pressure to innovate is growing in all companies and innovation comes from ONE SOURCE: FROM THE TALENT in companies and the talent is YOU!
So, let your management know what Get of Jail, Free cards would inspire you to be bold, take risks and make the impossible be possible. Trust me, your management is listening and waiting!!!
- This CEO Is Giving His Employees ‘Get Out Of Jail Free’ Cards (businessinsider.com)
- ‘Get out of jail free,’ courtesy of Extended Stay CEO (bizjournals.com)
Folks, as you know, I work with large enterprises in the area of global innovation. Often my clients are over 200,000 employees, and the layout is very complex. And our focus is enabling ‘global innovation’, focusing and enabling thousands of employees to innovate more actively and developing a vibrant Culture of Disruption (CofD) and Culture of Innovation (CofI).
However, global sometimes is super local! Yes, it is challenging to effectively communicate with, collaborate and co-innovate with colleagues in other countries and continents, but hey, is it that much simpler to collaborate with (co-disrupt with) someone sitting next to your office or cubicle?
To innovate, we need to have a culture of innovation, groups thinking similarly about the necessity of innovation and keeping their company cutting edge and vibrant. Hence, it assumes close dialogues, working groups and active collaboration. We find that at times, individuals sitting next to each other (several inches away) during the course of a day, not only are unaware of the other person’s activities but actually don’t collaborate together. They are in one another’s physical line-of-sight, but not in the necessary-collaboration/innovation- line of sight. Often when we bring teams from the same building together, individuals who have been at the company for over a decade have to be first acquainted before we can break the barriers together, disrupt mindfully in order to innovate meaningfully.
So ‘distance’ is not the main factor here. It is essential that we go beyond our immediate group and function to expand our reach and collaborate. Cross functional teams are critical, and yes of course, global teams are imperative. But the problem is not always the global factor, rather our mindset and how far beyond our desk, cube or office we choose to extend from to collaborate with cross functional teams!
So, local is just as key a factor as is global….As always looking forward to your thoughts!
Kudos to Chris DeRose and Noel Tichy for their article discussing why companies stop innovation. This is a very well written article, I invite everyone to read it.
It has always been curious to me why and for what rational reason would companies not encourage more innovation by all their staff. Here is the thought: We aggressively hire very talented people. We fight to get them to join us. A short while later, instead of saluting their brilliance and ideas, we stifle innovation and immediately put command & controls around their creativity. We so fear a decline in delivery and so overvalue focus on minor tasks that we slow-down, stifle, intimidate and at times kill innovation. These are the same drivers and frustrations that encouraged me to write ProVoke. I am pleased that today via articles like this by Chris and Noel, and by people like me going deep into companies as disruptors, we talking about the consequences of killing the spirit of innovation.
In addition, I hugely echo with the writers regrading the fact that more than often, innovation and the strategy is determined by one or two people in the company, instead of a company effort. I am baffled: We rejoice in the fact that we hire extremely talented people and for the brain power of our company. But, when it comes time to determine new markets, products and services, we often do so in a pure top-down (non-inclusive manner). I firmly believe and hopefully you feel this as well when you read ProVoke that, the potential for innovation is massive, if we involve more people. I am furious to see engineers not participate in client meetings, product managers excluded from ‘product’ discussions and 99% of the company ‘uninvolved’ in the direction of the company. What a missed opportunity! Surely if you are reading this article, it means this topic is of interest to you. There are many flaws with the uni-strategy development, but in the interest of time I will focus on just a few major drawbacks:
1. Huge level of knowledge and wisdom is missed when we don’t include larger groups in the innovation strategy discussion. Why not benefit from this experience and wisdom?
2. Huge level of collaborative progress is missed when people are uninvolved. So, why not include your talented assets in making critical future decisions?
3. Exclusive Top-Down approaches (non-collaborative) tend to be highly demoralizing. So, why intentionally demoralize the staff? Why not inspire instead?
4. Game of risk: why not mediate risk by having more ideas at the table, vs 1-2 people’s sole opinion about what the company strategy needs to be?
5. How do we capture the brilliant ideas which we will loose when we don’t listen?
6. Effect on the corporate culture?
7. Impact on hiring new talent?
So, the real question is: Why don’t we inspire our employees to be part of the innovation process, rather than constantly push them to the edges and a make them feel like non-game players and non-essential? Some confuse the need to make major decisions in a vacuum with ‘focus’! Yes, we need focus to deliver and be exquisite in what we do, but, not at the expense of excluding the majority in the innovation journey. Many of the reasons for such behavior is due to the insecurities which create resistances. When we work through the 5 stages of resistance do we get to a much higher place and truly innovate, and inspire everyone. In the ProVoke Methodology (released 2012) we systematically focus on the necessary top-down, bottom-up and cohesive methodologies to progress in innovation.
Yes, this is all disruptive. Without disruption change will not happen. I would love to share the tagline for ProVoke with you: ProVoke: Why the global Culture of Disruption is the only hope for innovation. You are members of the culture of disruption , CofD. Here are the immediate 1st steps you can take the change the dialog:
1. We can innovate at a much higher level if we are more involved in the conversations, let’s start talking!
2. Would love to talk to you about some ideas I have and want to hear yours… let’s start talking about innovation!
3. Start each meeting with the word: What-if!?
As technologists we are born to think about ‘what-if’s and experimentation. Yes, there needs to be a vision in a company and one which hopefully will inspire everyone. But to make the vision meaningful individuals in the company need to feel inspired, involved and energized. That is the journey of innovation. I don’t think Jobs and Bezos wrote the code for ALL their products! Behind their vision are thousands of brilliant minds, who were hugely involved in defining what is possible, in innovation and in enabling these guys to march on the podium and dazzle us.
Bottomline: You cannot dazzle or meaningfully innovate by one person setting the pace and strategy of innovation in the company. Innovation is a collective cultural effort. So, let’s change the game, one person at a time, shall we?
Fellow readers, I have discussed the following with a number of you already, but wanted to open the dialog to a larger group and get your perspective. I am fascinated with what is going on with Samsung right now, and more importantly WHY I don’t see this happening at other larger companies. With ProVoke, I am involved with many companies globally and concerned that we are not actively and deliberately innovating. Why not?
Three threads are bringing me to the Samsung discussion: Firstly, recently I am seeing tons more Samsung laptops around, so Samsung is making great inroads in an area which was not necessarily their core strength. In parallel I am seeing far less ‘slick’ looking Dell laptops. Why is Dell not doing the same? Secondly, Samsung Galaxy S III totally rocks. How did Samsung become so competitive in the same arena where Apple paralyzed Nokia, Ericsson, Blackberry and others? And thirdly, the fact that Samsung’s success is not accompanied by Apple or Microsoft-like massive media events, conferences, displays of execs walking on stage in a Steve Jobs-like manner, taunting the next product coming up! How did Samsung achieve their success in innovation and market penetration in areas with huge competitors, and do so quietly!?
So, it comes as no surprise that today Samsung announced that their 3rd quarter profit jumped 90%. The company’s telecom unit produced profit margin of 18.8% in the three months through September 2012 (WSJ October 26, 2012). These numbers are very impressive and more so given that it is competing against the likes of Apple with 2 major iPhone upgrades in the last 12 months. The question is: If Samsung can innovate and compete in this fierce market (not sure there is a market more dynamic and competitive than phones right now), why are we not seeing tons more products/ideas succeed in other companies and markets? What is stopping companies from innovating and being competitively differentiated in the marketplace? Why are we not seeing innovation much more frequently?
A few years ago, Samsung did not play in the phone arena. Galaxy S III is a bold move in exceeding customer expectation, bringing new features/technologies AND a very strong, clear and focused
global marketing effort. The market has noticed, understood and rewarded Samsung’s approach and hence the company is successful. What is stopping Dell and HP as an example and many others to do the same?
Some factors to consider include: 1) Fear of introduction of new products, 2) Inability to penetrate new markets, 3) Lack of ability to develop new products, 4) (and this I see a lot of): Fear of digressing from historic cash-cow product lines and 5) a weak competitive positioning and differentiation capability. So, what you hear more of is : ‘ Well, that is not our playing arena, so we are sticking to our core products and abilities.’ Which means, we are not going to innovate, as it is too risky and we may fail!
Newsflash: The market today has very high expectation of innovation by all vendors, AND, cash-cows eventually die out! If we don’t start way early to innovate, we will not have meaningful products in the market. We all know that Galaxy S III was not developed, marketed and sold in 2012! It means for several years Samsung invested in innovation and preparing to enter the market. In other words, Samsung heavily prepared for a transition from Innovation–>Growth–>High Growth for this product (and others products as well). This takes time and thoughtful investment, but as Samsung and others have shown, without the investment EARLY, results will not happen.
So we need to continue the discussion around innovation. We cannot innovate in a state of panic, or always acquire to become competitive. We need to develop a Culture of Disruption and an active Culture of Innovation to succeed! Never before in the history of technology has there been a more important time to have this discussion. As always welcome your thoughts and views on this…
- Samsung Sold Twice as Many Smartphones as Apple Last Quarter (mashable.com)
- Samsung earns record $7.4 billion profit in Q3 2012 on strong Galaxy sales (mobilesyrup.com)
- Samsung’s Profits Soar, Up 91% Thanks To Smartphone Sales (businessinsider.com)