Idea generation is seldom the problem

So, you've decided that its time to get out from under that black cloud your business has been in for the last  two years and start thinking about growth again.  If you're a senior leader or CEO, what do you do next?  If you're like many, you'll gather together a group of important people in your organization and start brainstorming about new growth opportunities for your company, hoping that the great ideas coming out of the session will catapult your organization to a new growth trajectory. 

 

Hmmm.  Not so fast.  For starters, most companies don't lack for good ideas - just ask a randomly selected group of employees and you'll be flooded with suggestions for how the business could be improved.  The dilemma is that many of these are not going to be breakthrough concepts.  To get those, you really need some kind of framework, like the lenses approach we take in MarketBusters or some other structured way to stimulate your thinking.  Blank sheets of paper are terrifying!  Secondly, most senior leaders (with all due apologies) are quite removed from the customer experiences and therefore can come up with stuff that looks good on paper but may not work at all in real life.  Have a look at any series of senior-level decisions to do new things (often with acquisitions) and you'll see what I mean (Bebo, anyone?). 

What senior leaders can do instead is to foster the development of an innovation and growth system in the organization that can take the ideas that are floating around, scale the best of them and commit a convincing set of resources to them so that they actually have a chance to succeed in the marketplace.  The problems senior folks need to address are often legion:  silos, poor resource allocation processes, risk-aversion, negative handling of failures and disappointments, sclerotic budgeting systems, slow decision-making...if you're going to get them focused on growth, those are the things that need to be addressed. 

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• Posted Rita McGrath on July 24, 2010

Paying attention to unconventional “links” in a customers’ consumption chain

I've often encouraged executives to pay attention to the customers' complete consumption chain rather than focusing just on what they do, sell or make.  One of my colleagues forwarded me a fascinating article from the New York Times describing how retailers are doing this by helping customers get loans, provide financing or otherwise solve the problem that many of their customers just don't have the money to do business.  Good food for thought - to think through what barriers to doing business are, and how they might be addressed. 

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• Posted Rita McGrath on July 12, 2010

Six Sigma is Deadly for Innovation - But then I’ve said that before!

Every so often, doubtless in a doomed bid to make the whole process of growth and innovation more predictable, some bright spark comes up with the idea of trying to apply six-sigma quality controls to the innovation process. They seem to think that if only innovation could be made more orderly, a more predictable result would ensue. I've said it before, and will say again, six sigma is not the appropriate tool to try to find new things. It's very helpful for optimizing things that already exist, but the parameters that allow it to work properly are totally different in an uncertain and unpredictable world. I was first made aware of the difficulties of using six sigma in this way back when I was doing a fair amount of senior-level executive development at 3M. A new CEO was trying to bring some order into what had become a rather chaotic corporate process, and six sigma was one tool that was being used - as it later turned out - inappropriately, for innovation. I had said it wasn't a good idea at the time. And I guess the company has now caught up. In a recent Wall Street Journal article, CEO George Buckley was quoted as saying: ...it isn't a process. The quality improvement process Six Sigma's worked wonderfully in our factories, but we tried it in our labs and it doesn't work. It's obvious why. The creative process is a discontinuous process. You can't say if I put more money in it I am going to get more out." Well, Bravo for that! Ready to take on stage/gate anyone?

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• Posted Rita McGrath on March 29, 2010

Jigsaw - creating a market for contact information

Anne Ferguson, my assistant, drew this one to my attention.  The company in question, Jigsaw, is trying to create a market for contact information, using a variant of the ‘free labor’ theme I’ve written about before.  Here’s the idea:  Each member adds contact information (the more detailed, the better) into the Jigsaw database.  For doing this, members get points added to their accounts.  Members can then search for all the contacts in the database and access them for a charge of points.  When you enter a new contact, or significantly update a contact, you “own” the contract.  Whenever anybody “buys” the contact, you get a percent of the proceeds in terms of points.  For points (or payment, I presume) the company will also help create customized lists for marketing purposes. 

It’s an interesting idea—you swap your rolodex for the chance to have a peek at the information in someone else’s.  Contacts, by the way, have no choice about being entered.  I checked on my own information and found that someone had put me into the database, and I hadn’t even known it.  I’m intrigued by the combination of incentives to share private information and the benefits promised if others leverage your private information.  The “sell” on Jigsaw’s overview page says:

How Jigsaw Helps
Bypass gatekeepers. Go straight to decision makers and influencers. If you’re a salesperson, recruiter, marketer or business owner, Jigsaw will save you precious time.

Interesting that the company’s main selling point is to help people bypass gatekeepers whose job it is to protect the target contact from unsolicited communications.  One wonders how long before those who would prefer their information to remain private initiate action to get Jigsaw to remove those private contact details.

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• Posted Rita McGrath on April 21, 2008

Enraged customers will create opportunities in the wireless space

Business Week recently described the sad state of the art of wireless phone services in the United States.  Wireless companies, it seems, generate more customer complaints than any other industry.  Even more than airlines.  Wireless companies, in fact, according to the Better Business Bureau, generate the most complaints out of all 3,900 industries it tracks!  Customers are so enraged at some wireless companies’ practices—signing them up for two year contracts for minor changes in service, charging them for supposedly ‘free’ downloads like ring tones, and of course (my favorite) providing poor coverage in general - that regulation has started to look pretty good to lawmakers.  But which lawmakers?  Ah, there’s an interesting dilemma.  States are starting to get into the act, threatening the industry with the kind of nightmarish regulation that industries such as insurance are dealing with right now - state by state requirements with slight differences among them.  A so-called ‘wireless bill of rights’ looks like a nice juicy political win for the state lawmakers.

The carriers, of course, don’t like this idea at all, and are investing in federal regulation of cell phone services.  I guess better one regulator than many, is their thinking.  Meanwhile, they are investing loads of cash in fighting the state regulatory initiatives in places like Minnesota. 

So how is this likely to proceed?  One lesson, I think, comes from the experiences of manufacturers such as the US auto industry - during the period when they were relatively protected from foreign competition, quality was terrible, pricing high, and innovation basically incremental.  It wasn’t until a real competitive threat appeared in the 1970’s that automakers started to upgrade their service and performance, by which time they had alienated so many customers that many won’t even consider buying a US-made car.  Similarly, the wireless carriers have used their oligopoly positions to offer pretty poor service including many ‘enrager’ features for the average customer.  This is bound to create an enormous opportunity at some point for players who can offer a better experience.  Why is the iPhone so popular?  It addresses some of the device based enragers, although it still can’t overcome the limitations of the AT&T network that it runs on.  But, that is highly likely to change.  And customers sure will be motivated to flock to an alternative, should one present itself. 

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• Posted Rita McGrath on March 28, 2008

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