AI Photo Shoot: Innovation Catalyst or Killer?

This remarkable collaboration between Opie, her stylist, and Fran has sparked both excitement and speculation, raising questions about the impact of AI on innovation and talent for the beauty and fashion industries.

Algorithmically Assisted Photoshoot

Opie and her stylist were immediately captivated by the AI-generated image and reached out to Fran through Instagram. Intrigued by the possibility of creating a similar artwork featuring the model, they embarked on an innovative collaboration. Fran requested numerous photos of Opie from various angles to train the generative model, which then produced around 50 unique images within a mere 20-minute timeframe.

The resulting magazine spread represents a fusion of AI-generated and traditional editorial photographs, offering a striking blend and juxtaposition of imagery.

Talent Catalyst or Killer?

Unsurprisingly, the debut of the AI-generated magazine cover has elicited diverse reactions. Some view it as a potential threat to jobs within the beauty and fashion industry, raising concerns about the role of human photographers, stylists, models, and editors who have honed their talent and craft.

Some photographers are concerned over the loss of creative control. Many photographers take pride in their artistic vision and unique style. They worry that AI-generated photos could lack the human touch and creativity that sets their work apart. AI-generated photos might conform to predefined styles or follow popular trends, potentially limiting the photographer’s ability to express their individuality.

However, others see it as an exciting example of the ongoing evolution of art and technology, where AI augments and collaborates with human creativity rather than replacing it entirely. In this view, AI-generated photoshoots represent a fascinating fusion of traditional craftsmanship and cutting-edge technology.

Finally, others see this as simply a new genre. Just as the enjoyment of paintings and vinyl records continue even though digital versions of these artworks are available, algorithmically-assisted photography expands the options available to creatives.

Implications for Innovators and Marketers

The advent of AI-assisted photography signifies a paradigm shift in the beauty and fashion industry. As a product development professional in this field, it raises three questions and opportunities for me:

  • Beauty Standards: AI photoshoots have the potential to both positively and negatively impact beauty standards. On the one hand, AI can foster creative exploration, pushing the boundaries of conventional beauty and inspiring new trends. On the other hand, AI photoshoots may exacerbate the pressure on individuals to conform to certain unrealistic ideals.
  • Product Development: From a product development standpoint, AI-generated imagery has the power to inspire new ideas and drive customization in the beauty industry. Consumers may seek to replicate or personalize the looks generated by AI, prompting product developers to create unique formulations, textures, and colors that cater to emerging trends. This opens opportunities for a more diverse range of beauty products and personalized experiences for consumers. However, it also presents a challenge for product developers and manufacturers to keep pace with a rapidly evolving landscape of AI-generated trends.
  • Authenticity: As AI becomes more prevalent in the fashion and beauty industry, the question of authenticity arises. Will brands that extensively use AI photoshoots be perceived as less authentic or trend laggards? It remains to be seen how consumers will respond to the balance between AI-generated imagery and real-life representations, and whether transparency about the use of AI will be necessary for maintaining trust.

Navigating the Future

Glamour Bulgaria’s AI-assisted cover photo represents a paradigm shift that brings both excitement and challenges. It is crucial for innovators and marketers to embrace the opportunities while considering the implications on talent, innovation, and branding. As the industry evolves, finding the right balance between AI and human creativity will be key to harnessing the full potential of this technology while preserving the unique perspectives and talents that make the beauty and fashion industries thrive.

Design Thinking Faces the Pace of Change

“The biggest takeaway for me from the show,” says Jha, “as someone being an academic, it’s important to really understand your field from the commercial perspective, how people are understanding it, how it’s getting interpreted, and at times misinterpreted. So what helps is, when you really see people talking about design thinking or innovation, from the place that they are coming from, the value that they see, the value that they don’t see.”

Jha adds, “As a person in academics, it helps me on a very personal level. How can I boost the jargons around it, the myths surrounding it? How can you simplify it more for people to get the core of what you’re trying to express? My FEI talk was also around this, how sometimes firms like design thinking, innovation, human centered design, these things are watered down just because of how they are represented. So that’s my biggest take away.”

How much of the application of these phrases such as design thinking, heard at FEI, is a kind of “innovation theater,” another concept that’s come up here as opposed to a true understanding?

“I would say it’s mostly people trying to work out and make do with what’s really true and at the core of it because most of the people that are here are really embedded into their innovation functions, they understand it, for the most part,” observes Jha. “What I would still say is, less than a theater for me, for most of the people, it’s how much capability do they have and how much leadership they can have in their organization—and how they are set up to bring innovation. Even if you have a leadership title, sometimes you don’t have that strength in the organization to really bring that change. And we heard a lot of that around this challenge. The culture isn’t supportive. There isn’t the buy in from the C suite even if you are the VP, but you need that C suite to come in for resources.”

Still, despite these mostly positive directions and the best efforts of many in the innovation community, there can be misunderstandings or misinterpretations as we all learn to speak the same language of innovation.

“One misunderstanding is innovation being misunderstood as invention,” notes Jha. “Whenever you think about innovation, we think about what we have to do is come up with something entirely new. And that is invention. Take computers, for example. Some people do say it as innovation, but the distinction that I make is, multiple rounds of innovation happened after the computer came in, and brought us to a sleek tablet or the smartphones that we have in our pockets. That is innovation.”

Jha adds, “The difference is invention is a creation of a product, process or service for the very first time. While innovation really increases the value of a product, process, or service that might already be out there. Let’s say the technology is out there, but isn’t usable for you as a human, that’s just an invention out there. But when you are able to use it to make your life better, you find value out of it, that’s when real innovation happens.”

The second misunderstanding applies closer to design thinking and human centered design. Jha continues, “Of course, a huge part of any innovation being successful is when we talk to users, talk to the people. If you ask users, what do they want, they won’t know because the innovation is not yet out there. For example, people also talk about if Apple would have wanted to ask, do you want a smartphone with just a screen on it? No buttons. Everyone would have said no. So the myth here or misunderstanding is when we say talk to your users, it doesn’t mean ask them what they want next. Talk to them to really understand what their values are, what their aspirations are in life, and what are the challenges they’re facing.”

Seeing Through the Desirability Lens

While there are examples of transformational innovation, such as the evolution of smartphones, the industry is often being turned to and asked to do business model innovation. Digital transformation from within. This takes a different type of skill set.

“Whenever we talk about innovation, there’s a very popular model which is called the DVF model, which is desirability, viability, and feasibility. And it says that the real innovation or breakthrough happens at the overlap of the three. Desirability is what humans value, viability is how can you come up with a new business model and how the business is structured, whereas feasibility is basically do we have the technology that we can use to get closer to the innovation that we want to create.”

Jha continues, “Whenever an organization just focuses on coming up with a new business model or let’s use this technology that’s out there, it doesn’t work. Or if you just focus on human aspiration it doesn’t work. Because you’re missing one part of it. So there can be more focus to one of these factors. You know, there’s new technology out there. You find if there is a human need and then you create a business model around it. It’s always beneficial to think from all these three lenses, and you cannot let the desirability lens go. Because at the end of the day, people have to use it. If you’re creating a business model and how let’s say a subscription model can be a part of it that goes to the customers. Are they open to that? So there’s always that aspect of it a little bit to keep in mind.”

See the video from FEI for more on the inner workings of innovation, the impact of AI, what the future might look like and the rest of Seth Adler’s conversation with Prapti Jha.

Opening the Doors of Innovation Perception

So what would be one innovation secret that Sorice would let out of the box here at FEI? “One of the things I teach at Northwestern is the masters of engineering management program,” says Sorice. “One of the things I like to talk about is how innovation is applied. The books are wrong. You don’t really get it from a book. You have got to do it. To actually understand it, to get it wrong and then to figure it out. It’s not really a process. It’s really about how a company implements.”

Sorice adds, “The first thing that I do with students, we get right down to an unstructured brainstorm. I typically ask people, have you done it before? Not a lot of hands. Then we say, let’s coalesce those ideas into concept cards? How many have done that? Not many. How many people have tested? More. And then we start getting into the more traditional pieces of process. But really all the breakthroughs are where it’s not comfortable. That’s where I want to spend the time, and how does it translate to a problem solved, and then the concepts and testing and all the rigor. That’s where all the mechanics come in later.”

Getting out of that comfort zone is key to developing innovative solutions. Sorice continues, “We’re setting ourselves up with that uncomfortable work at the beginning, that’s really where the true insights for innovation will appear. It’s all about solving problems. Do you find a problem no one’s solved before. You have to go out and find it. Sometimes you have it yourself. But you don’t always have it yourself, and then figuring out how to walk those things forward. That’s the part of being a leader in product development, technology, product management. You have to go through the process of actually understanding where those problems are that really matter that you could solve.”

But what about the typical innovator’s dilemma? Here’s this new technology. It’s completely disruptive and the company is not set up for it. How do you make the choices of what to do with this and how to make it go at the organization?

Sorice feels it’s all about focusing on the consumer. He points out, “The upside down of that is typically you can do so much testing and innovation without even looking at a piece of technology. In fact, I pushed my organization, we work on doors, to not even think about how a door is made, what materials are going into the doors. Think about how people live in their houses. That what really matters, is it the pets and Airbnb and deliveries. And then you get into how do people come and go from a house? And then you get into a door. You have to focus on where you’re trying to end, which is making people feel better about how they live in their homes. And so think about it, not from a door of a house perspective, but a door of perception.”

It is that perception that is key to the process and the implementation. “That’s our big thing is we help people walk through walls, which is actually part of what we think about from a mission standpoint. Helping people achieve what they didn’t think was possible, shareholders, employees, communities, but the other part of that is really focusing on making lives better. That part of it is aspirational. Technologies are meaningless unless they actually solve real human problems,” says Sorice.

See the video from FEI for more on Seth Adler’s conversation with Cory Sorice, as they tackle investment and development strategies, the state of the economy, the speed of innovation and more.

Connecting Reality and Technology Through the Metaverse

There has lately been a change in the way people are talking about the metaverse. Disney and other companies said they are not going to spend any money in this anymore, for example. Yet, there is still much potential for this space. Shannon and her editors seemed to have had the forethought to name the book, Interconnected Realities, and to get ahead of this trend.

“It is a book about the metaverse. It is a book about the purpose of the metaverse,” says Shannon. “And even though the attention headlines have moved on, the metaverse is still a thing, and it is going to affect all of us. But what it actually, ultimately is called, that’s up for grabs. That could turn into something else. We don’t call the Internet, the information superhighway anymore, right?”

Shannon adds, “First, we have to understand what the metaverse is. And at a fundamental level, the metaverse is the union of the digital and the physical. For me, the meaningful part of the metaverse is actually a lot closer to a Snapchat filter than to something that you do in virtual reality. So you’re still in the physical world, but through some sort of a device, and maybe we’ll start off with smartphones. We do that now. But moving eventually to head mounted displays. So augmented reality glasses, being able to have digital information and even overlays in our physical world as we move through the physical world. That is the true nature. And I think the true promise of the metaverse where genuinely we have the three-dimensional Internet and information and entertainment surrounding us in real time in our day to day lives. There’s already money being spent by me on couches that I bought through AR.”

Are we missing the first step in kind of imagining what we’re all going to be wearing, headsets or not wearing headsets? Yes, according to Shannon. There’s this continuum between fully digital and fully physical. There’s the physical world with no digital at all. And then there’s the mix of the two, and then you end up all the way over to fully digital. And that’s the virtual reality world, with the full VR headset, where we don’t see the physical world at all.

So just where along the continuum will the metaverse end up? “There’s also kind of subsets in there of PC-based metaverse experiences that are digital experiences, fully digital worlds where you’re an avatar, and I’m an avatar But we’re in a PC, so not fully immersed with a VR headset. So there’s all these different flavors. And actually, if you look at where the metaverse is being used, anything along that continuum right now,” observes Shannon.

There are many variations on the metaverse. Of course, the name itself connotes Meta, before and after the company changed its name. Those who were working in the metaverse space, just understood the word metaverse to mean augmented reality and virtual reality and all these mixes of digital and physical. Then Meta came in, and because they have the oculus, that kind of made everybody think the metaverse is virtual reality. But the two are not synonymous, and the metaverse extends beyond just the gamer demographic, asserts Shannon.

“I think what’s best for understanding how the metaverse is going to transform our lives is to talk about some of the things that it can do,” she says. “Imagine the combination of digital with the physical world with the power of generative AI, democratizing computing. This is actually where the magic is really going to happen.”

She continues, “Just imagine a world in which you have glasses that kind of do a lot of the functions that your smartphone does. But it’s hooked into generative AI, not just that it can produce text, but that can code Open AI. The company also has a product, not just ChatGPT, such as one called Codex, which lets you use natural language to describe a program that you want, and then it will write that program for you. It’ll select the appropriate computer code. And it’ll write the program. Imagine I come into this [FEI] conference and I go, and I look around, I don’t know anybody’s name here. And I was like ‘glasses, write me a program in which, if I speak to anyone for more than thirty seconds, you take a picture of them and flash a light so they know that that’s happening.’ And then I can get and match up against the FEI, permission granted, of course, a database of who was here, and then give me a list at the end of the day of the people I had major interactions with. And so that just came to me. I just had that idea. I told my glasses to write that program, to create that app. That’s the kind of world that we’re going to be in.”

But despite the anticipation, just when might this happen? The democratization of computing genuinely is speeding things up. For Shannon, she sees none of this coming until about the end of the decade because there’s a lot of technical stuff that needs to come in first. So where are we in terms of the development of the metaverse?

“We’re so early in this world. And we just have a lot more media. Is that what it is? People saw how transformative the Internet was. There’s this massive expectation on the metaverse to be as transformative, and it will be. It’s just we have to get some of the details set up first.”

Introducing the Virtual Natives

Shannon also has another book coming out focused on Gen Z. Co-authored with Catherine Henry, the name of the second book, which will come out in September, is called Virtual Natives.

Shannon further notes that we had the digital natives 20 years ago, who were the kids who had grown up with the Internet. Today, what happens when we have the virtual natives—the kids who grew up trying to tap and swipe a magazine page because they were already used to an iPad before they even knew what language was?

“It’s astonishing because these children genuinely are living in these virtual worlds and making money there. And by the time they come to your average employee or your average company, they have their own brand, they have their own followers. They have a much better sense of their identity and value. The corporations of the world are not ready for this. The unique thing about the virtual natives is that they have power like no other generation before.”

“Understanding that Gen Z speaks video, that’s really key,” says Shannon.

See the video for more on the virtual natives, the metaverse and the rest of Seth Adler’s conversation with Leslie Shannon.

People Remain the Critical Link to Innovation

The Front End of Innovation

“The title of my talk is end to end new product innovation,” Ivosevic says. “And when I say end to end, what I mean is anything associated with the front end of innovation from the sketch on the napkin, from the opportunity incubation all the way to the other end, to a successful new product launch and a profitable product. The industry where I’m coming from is the medical device industry, it’s a regulated industry. It affects people’s lives. There are a lot of hoops to jump through until you get to the market. So usually, if you talk about class two devices like catheters or surgical instruments or not to talk even class three implants and so on, we are talking years until you get to the market.”

Ivosevic adds, “There is nothing that happens in less than three years and usually it’s longer than that. The last thing you want is to start something on the front end right off the wall and have someone to develop it and then get stuck in the middle. That’s a big waste. Really, to be successful, to start on the innovation and carry it all the way to the other end and be successful in the market, there are so many critical links.”

During this process, Ivosevic stresses that it’s key to be responsible for research and development, and the entire innovation system, from end to end.

“I’ve been involved with the front end of innovation for a long time and I recognize this challenge that if you don’t holistically look, everything that’s involved in those critical links, it’s just not going to work. I wrote the book to emphasize this holistic approach and those links that will maximize our chance to succeed and get productivity in. The holistic approach. That vantage point is explained in the title,” he says.

So what are some of those critical links that might be missed on the road to innovation? For some, Ivosevic suggests, it might depend on your background.

He says, “It first depends on what kind of bias you come into it with, you might have a certain perspective. Let’s say, you have a capable creative engineer, he or she might fall in love with the technical idea and push it from the technical bias out. Or you get someone commercial and then it’s all business keys, business model, all great things. But actually you need both to come together and there is that entrepreneurial element, which brings together the synergy of the technical and commercial. Probably 80%, 90% of the products that I see not succeeding in the market, you can trace back to not truly understanding the problem, understanding requirements, how do you translate or interpret its needs and requirements from the customers into product requirements and then carry on.”

Innovation Is About People First

Ultimately, it’s about people collaborating for innovation. This is beyond any technology platform that is chosen. It’s the people relating with each other, and not just the process.

“I inherently recognize that process is something that kind of stimulants prescribed thinking,” he adds. “You do A, B, C, D and then you succeed, but it doesn’t always work like that. It’s actually releasing you or liberating you from the process and putting emphasis on the key principles. The key principles that guide this creation, and then the emphasis is on the people, of using those principles and moving forward. For example, we all know we all like to brainstorm ideas to create new things. But what’s the point of doing this if we don’t define first the problem that we’re solving?”

In some ways, knowledge becomes a commodity. We all have access to pretty much the same technologies. Today, we have access to technology and the knowledge differentiator is the people. And it’s that integration, that deciphering it for the organization, and the end consumer. This is an innovation culture. Despite all the talk about AI, we must not overlook human-centricity. And we shouldn’t confuse the process with what we are processing.

“Because by itself, AI is just a tool,” observes Ivosevic. “My company has been using AI now for almost a decade but uses it in a different context, for example, genomic testing where you have a lot of statistical data distribution. But it doesn’t substitute for our mission, which is to help families. And that’s the purpose.”

Like many tools, AI has opportunities and threats associated with it. He adds, “We all see the tremendous benefits and advancements and leaps we can using AI. I’m getting a sense that technology might be kind of getting ahead of us in terms of understanding how to implement it or how to regulate and other things. We have to understand and reinforce the proper place for this. There is no cookie cutter approach in AI.”

See the video from FEI for more on Seth Adler’s conversation with Milan Ivosevic, as they tackle artificial intelligence, and all things innovation.

The Future of Work is Reshaping Trends in Innovation

Talent & Business Trends

Technological, generational and social shifts will impact the world of work over the next decade. This could range anywhere from the types of devices we are using everyday to the ability to work remotely from literally anywhere. Clearly, hybrid and remote work continues to cement its place in the “new normal” of the workplace. This will also be influenced by the competitive talent landscape, the pressure to control costs and the rise of automation, among other trends, according to Gartner’s recent studies.

The workplace culture might be one of the key concerns when it comes to office and work-from-home policies of the future. For innovation leaders and their teams, hybrid strategies have been compelling them to adjust their culture and ecosystems and to be more supportive of their employees.

This new future of work will be impacted by both talent and business trends taking shape. On the talent side, notes Gartner, is the move towards human-centric work design; a reshaping of the culture; managing in a hybrid world; and digital enablement. On the business side, this also includes the rethinking of the workplace and the shifting of talent and skills.

Gartner further looked at “9 Future of Work Trends for 2023.” Developed by Emily Rose McRae and Peter Aykens, the trends offer a least a glimpse into some of the potential workplace shifts moving forward. Just how innovators and company leadership might respond to such trends is significant if they want to build a flexible and agile workforce and a culture for the future. Whether in the office or remote, or a hybrid strategy, this workforce of the future will need to collaborate and innovate to help them succeed in their research and development projects.

Collaboration is Key

There is a great deal of research into the future of work and possible trends that are impacting the workforce today and beyond. But just how can leaders in innovation adapt and succeed now? McKinsey offers some insights in its article, “What is the future of work?” Looking at the hybrid strategies that are becoming more common today, McKinsey offers some key takeaways that innovation leaders and organizations can do now to refine their operating models.

1. Expand executives’ focus on strategic clarity, coaching, and empathy. The leading driver of performance and productivity isn’t compensation or stretch goals but rather the sense of purpose work provides to employees. Be more intentional about interactions, especially those that happen in person.

2. Foster outcome-based management of small, cross-functional teams. This is both more human and more effective as performance management practices shift from being about controlling employees’ work to empowering and enabling teams and people to perform.

3. Increase talent velocity, especially with reskilling. Being able to staff teams across organizational siloes is a hallmark of agile models. Moving in this direction for talent management might entail developing internal talent marketplaces or hubs for talent redeployment that make it easier for people to discover potential projects. It will also involve reskilling and upskilling people more quickly than in the past, leaning on formal training, as well as apprenticeship and mentoring.

4. Find new zero-cost, high-optionality ways to collaborate. It can help to define a model to increase how quickly your organization can discover and adopt better modes of collaboration, both physical and digital. Do workers need an informal, confidential channel for banter or guidelines on making hybrid meetings more effective? Be intentional about designing these interactions and communicating expectations and working norms.

5. Increase the rate of technology adoption. It’s imperative for companies to seek out new tech and use data to drive optimal results and make better decisions.

Growing Innovation Culture

The approach to innovation talent has evolved in this new globalized work world. While common themes have emerged, different organizations have chosen distinct paths. In this  Innovation Talent Roundtable, Seth Adler spoke with the innovation community, which shared several thoughts on the search for innovation talent and fostering a culture of innovation.

Igniting innovation culture and talent is fraught with danger as, if you’re not careful, it can lead to burnout. Finding innovation talent that fits within a given organization is, to put it simply, challenging. Good innovation talent itself is elusive. Add to the equation that a given person not only needs to have the specific skill set being sought, but that same person must fit with corporate and innovation culture already established.

Welcome to the Future of Work

The future of work has a significant impact on innovation. As work environments evolve and adapt to emerging technologies, changing demographics, and evolving expectations, the way innovation is approached and implemented undergoes transformation. We asked ChatGPT to sharpen our focus on several ways in which the future of work influences innovation:

1. Remote and Distributed Work: The rise of remote and distributed work arrangements enables organizations to tap into a broader talent pool and collaborate with individuals from diverse backgrounds and locations. This diversity and access to talent can foster innovation by bringing together varied perspectives, experiences, and expertise. Remote work also encourages the adoption of digital collaboration tools, which facilitate real-time communication and idea sharing, further supporting innovation.

2. Flexible Work Culture: The future of work emphasizes flexibility in terms of work hours, location, and arrangements. Flexibility allows employees to structure their work in a way that suits their productivity and personal preferences. This freedom can stimulate innovation by providing individuals with the autonomy and space to explore new ideas, experiment, and take risks. A flexible work culture also fosters a more inclusive and diverse workforce, which is known to drive innovation.

3. Cross-functional Collaboration: As organizations increasingly embrace interdisciplinary and cross-functional collaboration, innovation benefits from the exchange of ideas and expertise from different fields. By breaking down silos and encouraging collaboration among teams with diverse skill sets and backgrounds, organizations can foster a culture of innovation and harness collective intelligence to solve complex problems.

4. Agile and Iterative Approaches: The future of work promotes agile methodologies and iterative approaches to project management and innovation. Agile methods emphasize continuous learning, experimentation, and adaptation, enabling teams to quickly respond to changing market dynamics and customer needs. This iterative mindset encourages experimentation, failure tolerance, and rapid prototyping, leading to accelerated innovation cycles and the ability to bring new ideas to market faster.

5. Automation and Artificial Intelligence (AI): The integration of automation and AI technologies in the future of work has a profound impact on innovation. Automation frees up employees from repetitive and mundane tasks, allowing them to focus on more creative and strategic endeavors. AI technologies can analyze vast amounts of data, identify patterns, and generate insights, providing valuable inputs for innovation. AI-powered tools can also support ideation, prediction, and decision-making processes, contributing to more informed and effective innovation efforts.

6. Upskilling and Reskilling: The future of work necessitates continuous upskilling and reskilling of employees to keep pace with technological advancements and evolving job requirements. Organizations that invest in developing their employees’ skills create a culture of learning and innovation. By equipping employees with the necessary knowledge and competencies, organizations foster a workforce that is better equipped to generate and implement innovative ideas.

7. Emphasis on Human-Centered Design: The future of work places a greater emphasis on human-centered design principles, which prioritize understanding and addressing the needs, desires, and challenges of end-users. By involving end-users in the innovation process, organizations can develop solutions that truly meet their expectations and deliver meaningful experiences. Human-centered design approaches such as design thinking and user experience research help organizations uncover unmet needs and drive innovation in a customer-centric manner.

The Future of Work Is Now

In some ways, the future of work is already here for those in innovation that embrace collaboration and foster an open and holistic culture. The future of work significantly impacts innovation by enabling remote and distributed work, fostering flexibility, encouraging cross-functional collaboration, promoting agile and iterative approaches, leveraging automation and AI technologies, emphasizing upskilling, and embracing human-centered design. Embracing these shifts in the work environment can unlock new opportunities for innovation, enhance organizational agility, and drive competitive advantage.

Video courtesy of Gartner

Beyond Innovation Theater

In Part 1, we focused on the concept of transformational innovation and covered many angles of the theme, such as people-centricity, technology, and disruption. In Part 2, we asked, how might design thinking play into this scenario? Here in Part 3, we look beyond technology, and ask how might creating the right culture play into the process? Then, at its foundation, how might the process itself make transformational innovation go?

All Things Innovation would like to thank the participants: Leslie Shannon, Head of Trend & Innovation Scouting, Nokia; Milan Ivosevic, VP R&D, CooperSurgical; Prapti Jha, T.H. Chan School of Public Health, Harvard University; Sudha Ranganathan, Director Marketing & Talent Solutions, LinkedIn; Harsh Wardhan, Innovation Program Lead, Google; Nevada Sanchez, Co-Founder & VP, Core Tech. Eng., Butterfly Network, Inc.; Oscar Barranco Liebana, Innovation Director, FIFA World Cup 2022; Angelina Carvajal, Strategy & Innovation Partner, Sr. Dir. (Optum Advisory), UnitedHealth Group; and Cherie Leonard, Director of NA Insights, Colgate-Palmolive.

Transforming the Theater

Sudha Ranganathan notes, “Earlier when we were discussing our pet peeves, this is before the recording started, you spoke about something that really resonated today. It was the term ‘innovation theater.’ And I feel like it touches upon what you’re getting at right now, which is, it’s easy to talk about how to generate great ideas. What’s really hard is embedding that into the DNA of an organization, and then creating commercialization out of it so that at least a few ideas see the light of day. I feel like that ‘innovation theater’ is such a brilliant phrase to encapsulate how hard process is.”

Cherie Leonard says, “What struck me about the innovation theater was the matrix. And they looked at the growth potential and then the– it was business model driven really. And I think even sometimes the most disruptive ideas, we fall back on the business models that we know. And they talked about, I think, how that turns into innovation theater, because you’re going through the process and you have the incubation and everything, but then what’s actually scaled is in line with an existing comfortable business model. So, you kill all the big disruptive ideas. And I feel like that’s such a tremendous risk.”

Can incentives play a role in moving beyond innovation theater at an organization? Ranganathan adds, “A lot of it boils down to something brought up earlier around incentives. If an organization is incentivized to reward things and measure them the conventional way using the original standard byline, then it’s really hard to reward any innovative ideas, because they’re not going to fulfill the same P&L requirements that a one-year out incremental idea we’ll deliver.”

Prapti Jha notes, “If I may, because we are talking about new terms and fun theater, so I’ll just add one more into the mix. Patrick Whitney, who’s a professor at Harvard, he has this term called ‘innovation suicide.’ I won’t go into all the 10 ways, but he says, ‘Innovation suicide, 10 ways organizations kill their own ideas.’ And one of the last one that he says, ‘Everyone wants innovation and transformation as long as it doesn’t require change.’ And that’s powerful, because I don’t want to change my process, I don’t want to change my culture mindset, but we want to be innovative.”

For Milan Ivosevic, the path to innovation is key. He says, “I’ll challenge you to find any single company on planet Earth, if you go and ask them, ‘Do you have any sort of innovation?’ ‘Oh yeah.’ Everybody, it’s so sexy and popular, you have to do something with innovation. But when you go from innovation, and if it doesn’t go all the way and it doesn’t become a product, then what’s the point?”

Leslie Shannon adds, “I recently heard a presentation from another company, another large Silicon Valley company, not mine, about their innovation culture. And one of the things they said that was key for success was making it part of the manager’s incentives for genuinely bringing innovative products to market. And they said that was it. Now, because it’s not my company, I don’t know if it’s actually working or not, but that to me actually sounds like a pretty good idea.”

Diving into Process

So can an organization at least strive tooperationalize their transformational innovation? What else can be done honestly at both large and small organizations where we can at least begin the process of operationalizing this true transformation, which we know needs to happen?

Harsh Wardhan says, “When I heard the term innovation theater, I thought you were talking about theatrics that people put around process to make a lot of money, which is a good business. Now let’s think about the process that is deployed in the companies, or organizations, or the lack thereof. Some people talk about white space ideation, brainstorming, ‘Let’s come together, let’s think about the next great idea over coffee and a lot of sugar.’ That’s the lack of process.”

Wardhan continues, “The other one is, ‘I know this process works. This is the design thinking. I’m going to be following it to a T and disrupt the industry.’ That doesn’t work either. The first one doesn’t work, because it’s a lot of white space thinking, a lot of ideas in the sky, the rubber doesn’t meet the road. This one, we get bogged down in analysis paralysis as we call it. We think too much about process, we cut everything down. It’s a mess. That rubber doesn’t meet the road there either. So, what do we need to do to operationalize transformational innovation is to enable our people to work with flexible processes. It is not only one way that you can do it. Yes, you can use this process, but be flexible to change it down the road.”

Flexibility could be a key process of transformational innovation, agrees Ivosevic. “You inspired me to think about the way I see this. We are talking about process. Process is almost kind of prescribed way of doing things. That somehow doesn’t fit with the free nature of free spirit innovations. On the other side, the extreme is having nothing. So, I believe that kind of concepts and frameworks that kind of provide general guide rails are kind of directing you but don’t go too far into process, because now you start prescribing the way to think about it.”

Wardhan adds, “I like to think about process as alphabets. Not all words are the same. We use processes, frameworks or methodologies. You use different alphabets to make words and sentences. That’s how you make process with frameworks and methodologies. I think that’s a good way to think about it.”

One factor about process, it’s important to break the silos as much as possible to enhance the collective intelligence of the venture.

Oscar Barranco Liebana makes his own observation about the process and the intelligence learned collectively: “One important thing that we learned from the interaction of so many different stakeholders is that each organization has their own agenda, their own processes, and their own way of thinking. So, what we learned is that if we can maximize the collective intelligence from different stakeholders, we were improving the intelligence for innovation. And that means that we are breaking the silos, we’re breaking the processes, and the collective intelligence of the ‘super mind,’ what we call different stakeholders from different perspectives. If you are, for example, addressing the different value dimensions, if you are involving the implementers of the solutions, and you have a very strong antagonist that they are creating friction and conflict, we are creating an environment where with this friction and interaction, you are improving and raising the intelligence for innovation. And, I think, this is something very important, because it doesn’t depend on one single organization. You are creating intelligence and distributed through many.”

Transformation, and its variety of processes, the panelists seem to agree, takes a lot of collaboration—and time.

Angelina Caravajal says, “I think we’re using innovation and transformation to mean the same thing, but in fact they’re very different. And so, not for me to define it, but let’s say transformation innovation, now that we are talking about it, let’s say we know what we mean by innovation, product, business model, service, experience, whatever. Once you have that, then you need to transform something. You may need to transform your own organization, your culture, build new revenue streams, create new connections, create new customers, new ways of working. That’s something very deliberate. And that takes time. As much as innovation, filling that innovation pipeline, bringing innovation to market takes time, transforming your organization, transforming the market to adopt your awesome innovation takes a lot of effort. Those are different concepts, right? And they require different skills that require a lot of collaboration, a lot of trust.”

Click here for the full All Things Innovation FEI Roundtable on transformational innovation.

Supporting Data with Design Thinking

In Part 1, we focused on the concept of transformational innovation and covered many angles of the theme, such as people-centricity, technology, and disruption. Here in Part 2, we ask, how might design thinking play into this scenario?

All Things Innovation would like to thank the participants: Leslie Shannon, Head of Trend & Innovation Scouting, Nokia; Milan Ivosevic, VP R&D, CooperSurgical; Prapti Jha, T.H. Chan School of Public Health, Harvard University; Sudha Ranganathan, Director Marketing & Talent Solutions, LinkedIn; Harsh Wardhan, Innovation Program Lead, Google; Nevada Sanchez, Co-Founder & VP, Core Tech. Eng., Butterfly Network, Inc.; Oscar Barranco Liebana, Innovation Director, FIFA World Cup 2022; Angelina Carvajal, Strategy & Innovation Partner, Sr. Dir. (Optum Advisory), UnitedHealth Group; and Cherie Leonard, Director of NA Insights, Colgate-Palmolive.

Design Forward

Prapti Jha observes,“There are two types of data, one is qualitative data and one is quantitative data. As a society, we have been over focused on the quantitative data, because it’s easier for our minds because it is data, it’s tangible, you can see it, these numbers and all those things. It’s not our fault, it’s how our brain works and we find comfort in that. But as a society, as we are moving faster, and we have technologies to support it, we need to equally balance that with qualitative data. And qualitative data is the behavioral insights, what I just said around aspirations. And it’s a new skillset that you have to bring into the equation. Let’s say if it’s a team, it’s like, ‘How do you have qualitative researchers on the team?’”

Jha continues, “And again, it’s around resourcing, it’s how an organization is set up, what it might look like when you’re talking about how do we get those insights because we don’t have a technology there to grab those things. Basically, we have a concept of extreme users, you all might already be aware of that, and maybe just talking to 10 people, but on a deeper level for an hour or so. And you come up with so many insights because they’re extreme users. And then you marry that with the quantitative data to come up with the insight. So it’s not 100%, just 10 people, what people said, because you get questions around that too. But, that’s how design thinking or leading with research might help.”

Technology certainly plays a key role in the process of transformation. As Harsh Wardhan notes, “Another thing that you mentioned around technology, not being bound by technology to think where innovation can take us, that is where desirability led innovation helps everything that Prapti said. Because, if you think about innovation, you’re already aware of the diagram of desirability, viability, feasibility, the standard product management tool that is being used in the industry. The center of that is the pinnacle of innovation, or the center of that where the innovation miracle happens. But, it is time that we lead with desirability. It is time that we lead with humans. And I’m going to go a step forward and I’m going to say humanity now.”

Creating the Right Culture

But in addition to technology, having an innovative culture might also be a key component to the entire project.

Cherie Leonard says, “I wanted to build on something you said, because I think the idea of all the different types of data and things is critical. It’s empowering the full team to take that time to do it. So, it doesn’t live with insights, or marketing, or design, it lives with everybody. And I think having that type of culture, going back to the people, is really critical. And giving people the time and the space to not only have those conversations with regular people, with consumers, but also then to take the time to digest it.

Leonard adds, “Because, it’s fascinating the things you pick up, especially in-home interviews and things, that they don’t say, right? But, you’re seeing it over their shoulder observing something, the coat on the chair. I think another way that I think is really interesting and fun to tap into that is to go to things. We do this for foresight all the time. What are the life hacks? Go to Indiegogo, what’s out there right now, what are people trying to solve that they’re not telling us, but they’re finding workarounds? And I feel like there’s so much richness and so much inspiration we can get and do so through a manner now of empowering the full team to get there.”

Taking that inspiration to a grass roots level will help improve design thinking as well as striving to look how new products may solve a problem in consumers’ lives.

As Leslie Shannon puts it, “I’ve been a technology innovation and trends scout for almost a decade now. There’s a million excellent ideas out there. It sounds reductive to say it, but great ideas are actually a dime a dozen. The ones that turn into something, that become a new product, that become a new technology, are the ones that genuinely solve a problem without costing too much. It’s that simple. And the cost doesn’t have to be money, it can be time, it can be hassle, it can be, ‘I’m used to my stethoscope.’ But, that’s it. And it sounds like kind of simple and straightforward, but that’s still really hard to do.”

Putting design thinking and the necessary research into context in today’s environment, Milan Ivosevic says, “I just want to point out one element of when we talk about data and this limitation, how far we can go with what’s available, and then we could talk about transformational innovations. Data that exists today out there are establishing a reference point that’s based on a non-existing thing. So, now if you want transformational innovation, let’s not start from the reference point that existence embedded. But there are different ways to carve the pumpkin. Let’s go around, let’s be creative in approach rather than like, ‘No, we have to force AI to go out there and dig that out for what’s sitting there.’”

Click here for the full All Things Innovation FEI Roundtable on transformational innovation.

Achieving Transformational Innovation

All Things Innovation would like to thank the participants: Leslie Shannon, Head of Trend & Innovation Scouting, Nokia; Milan Ivosevic, VP R&D, CooperSurgical; Prapti Jha, T.H. Chan School of Public Health, Harvard University; Sudha Ranganathan, Director Marketing & Talent Solutions, LinkedIn; Harsh Wardhan, Innovation Program Lead, Google; Nevada Sanchez, Co-Founder & VP, Core Tech. Eng., Butterfly Network, Inc.; Oscar Barranco Liebana, Innovation Director, FIFA World Cup 2022; Angelina Carvajal, Strategy & Innovation Partner, Sr. Dir. (Optum Advisory), UnitedHealth Group; and Cherie Leonard, Director of NA Insights, Colgate-Palmolive.

The concept of transformational innovation makes sense. The idea is one of business model innovation, making sure that the future that we’re creating at our organizations is different than the current picture. And, of course, that it’s customer-centric and everything is in place. And then when we open the transformational innovation playbook and try to start doing that, that’s where the issues ensue. So what is actually achievable?

Leslie Shannon: From my own company’s history, there’s been two kinds. One has been taking advantage of a new technology that has arisen, and somebody gutsy enough and bold enough to see a way that there’s a link between the current technology and the next technology, and just recognizing that this is the natural evolution. And not being afraid of cannibalizing your preexisting product and so on, but actually moving naturally in that area. But, there’s also the total tragedy way, back against the wall, everything has gone to hell. And we’ve had a couple of those too, where you have to innovate if you’re going to survive at all. And that one’s a little bit less desirable, I’ll just say.

Seth Adler: Fair enough. Oscar, I want to go to you next, because we just ran the FIFA World Cup and congratulations. You were responsible for innovation within. Discuss transformational innovation from your perspective.

Oscar Barrance Liebana: I think from the FIFA World Cup, knowing that, for example, we have engaged with 67% of the global population, is a big challenge concerning the reliability of the technology and the solutions that we are implementing. However, I would say we highlighted that the vision and the strength to commit to deliver innovation and to deliver amazing, that was our slogan, was something really incredible for the whole country. From all the different organizations and the strength of the whole ecosystem supporting the idea to deliver ‘amazing’ to the world. It was something unique and the momentum and the snowball effect that was created at the end of the day, it really created an amazing delivery.

Adler: Sudha, you’re at a large tech company, which is often cited as a leader in terms of innovation, and you’re helping us all transform. What are your thoughts on transformational innovation?

Sudha Ranganathan: A lot of transformational innovation from my perspective is through the lens of talent and how talent is set up to innovate. There’s a couple of big questions that come to mind. At the level of the individual contributor, are they being given a charter to take intelligent risks? Because risks are important if innovation is to be produced. And at the level of leadership, are they creating enough safety in the system that failure is seen as a chance for growth rather than as banishment or the potential loss of a job, for example? There’s this very transparent set of expectations and communication on if we want innovation to happen, there’s also a risk to be taken, and are we comfortable with that risk, equipping our ICs to know that that risk is OK, but then equipping our managers and incentivizing our managers to reward talent when risks pay out, but to not punish them when those risks don’t go as planned, and instead to learn from them and then contribute to the next risk that we can take.

Seth Adler: Harsh, you are also at a sizeable technology company. As far as transformational innovation from your unique perspective, you being in charge of innovation for a part of the organization, where are you coming from?

Harsh Wardhan: When I think about transformational innovation, I’ll first give my personal thoughts on it, then I’ll come from my company perspective, not representing Google, but still what we are doing. When we think about transformational innovation, I think about two types. One is for survival, because you need to continuously sustain in the game. That’s your sustainable innovation. The other one is disruptive innovation or radical innovation. Those two are a little bit different, but intent is the same. That’s how I think about it. But then, because I come from Google, let’s talk about digital transformation a little bit. We confuse digitization with digital transformation.

And when people are talking about digital transformation, they’re focusing too much on digital, not the word transformation itself. It has to deal with change, it has to deal with culture like Sudha pointed out. It’s not about deploying a few tools that help you do everything on a computer screen rather than paper. It’s about you change the way we work. And, I think, that’s the underlying thing about transformational innovation, whether it is digital transformation, whether it is about sustainability in innovation, that’s the thing that we have to address, that we have to be comfortable with the change. And one of the definitions of innovation is change.

Shannon: Actually Harsh, I’ve got a great example of what you just talked about. We use email, we all use email. Email is effectively exactly the same as typing out a memo and putting it into your office envelope. It’s been around for 25 years, 30 years. And all of us who are older, we still use that as our main thing. Today, people who are younger use Slack or Discord, because that’s a way to have a record. That’s a message that’s sent out to everyone, and it goes into the permanent history of the project. And isn’t that better? Yes, it is. So, that’s the difference between digitizing and digitally transforming.

Wardhan: It is more and more important to think about that change of the way we work now, because we are talking about the elephant in the room, which is AI.

Our roundtable panelists so far have looked at transformational innovation from the lens of technology to engagement and delivery. Talent is also a key point that many panelists mentioned, as is fostering a culture of innovation. People, and the mindset of the organization, are key, whether it’s sustainable or disruptive innovation, or short-term or long-term planning. Finally, a distinction has been made between true digital transformation and merely digitization of assets.

Transformational Innovation Is About the People

Adler: You did bring it back to AI, but what I noticed from Sudha and then also from Harsh, the two big technology folks that have the most experience in big technology, is that they talked about people and change management. Cherie, you work for a vaunted CPG organization. I want to hear what your thoughts are on transformational innovation, but isn’t it interesting that the tech people are talking about people?

Cherie Leonard: I think it’s fascinating we’re people first, right? I think the idea that, in my mind, it’s behavior change, fundamentally, behavior change that we’re expecting consumers to do in many cases. You have a new format, there are sustainable benefits, whatever it is, but there’s fundamentally, especially with some of the day-to-day routines that people have, you’re really making them think and you’re disrupting their everyday, even if it’s a small thing, such as brushing their teeth. Behavior change is a crucial part externally when you think about who we’re innovating for and actually solving a problem that they have, not just trying to find a technology and find a problem to solve.

But, I also think, internally behavior change and some of the conversations this morning touched on it. It’s more like, “What are those metrics we’re using and how do we balance this urgency for transformation with the need to iterate your way through it?” And I don’t know that there’s a right answer in every situation, but that’s where I’ve seen a big tug of war in terms of like, “Let’s just get something out the door. We have to do something. We have to be leading.” Versus, “Let’s wait and see and iterate and almost in some ways wait for consumers to catch up.” And I think perhaps depending upon the brand, depending upon the industry, that could look very different.

Adler: Angelina, what are your thoughts on that very issue of waiting for the consumer, iteratively innovating along the way and having a nice gliding path as Cherie is suggesting?

Angelina Caravajal: I think it really depends what it is that you’re innovating. It depends on the industry that you’re in. Sometimes the consumer leads. For example, now in the world of digitization with the Amazons, with the Googles, with the consumer behavior has changed completely, very quickly. If you don’t pay attention to what the consumer is doing and thinking, you can very easily fall behind, and you have to adapt yourself. That’s one way of transforming.

Another way is you may have a great product that doesn’t exist in the market today that you want to bring it to the market. When you think about, “How do I transform to have that product be successful?” You have to consider the entire ecosystem, not just your customer, but your customer’s customer. Understand the bottleneck, understand the economic equations. You want to create something that’s sticky, that’s sustainable in the long run. All of this, of course, takes people, and culture, and technology, and tremendous investment and persistence.

The roundtable participants continued the discussion revolving around people. This encompasses both the changing behavior of consumers along with the behavioral insights derived from looking internally at the role talent plays in the organization. Lastly, for transformation to be successful, one must consider the entire ecosystem, from internal teams to the evolving consumer to your customer’s customer.

Focusing on Technology and Data Disruption

Adler: Persistence, of course, being key. We’ve got really big organizations that are represented here. We also, Nevada, I will refer to your organization lovingly as a startup. What perspective are you bringing to the table as far as transformational innovation from a startup perspective?

Nevada Sanchez: I think for us it comes down to just an incredible scope and scale of the problem that you have to solve to truly affect a transformational innovation and bring it to fruition. When we talk about innovation six years ago before we launched the product, the innovation was in the technology. We put imaging on a chip. That’s cool, no one’s done that before. It’s brought the whole industry to a whole new digital era. And now that you have that, what do you do with it? It’s pretty obvious to say, “Throw away the stethoscope, bring in the imaging device at the point of care. This is going to be the future.” And then you see that to someone, they believe you, it sounds great. In practice, “How do you actually do that, when I’ve done it this way for 20 years, I’m not going to pick up this fancy new toy and do something different. This is the way I do it, go away.”

There’s that behavioral aspect to it. There’s also just solving the whole problem. So you go to the hospital systems and you can talk to them about all the advantages in patient care, and readmissions, and capturing revenue from scans. And they say, “That’s great, but I need all of this infrastructure.” OK, we go off and build that now. And then we talk about bringing AI into the mix to solve the problem of suppose I find someone that does want to embrace this, say, “Great, I do want to replace my stethoscope and throw it out.” And then I put this thing down, “I don’t know what I’m looking at. What’s going on here? What is that fuzzy thing over there? I’ve never seen that before, except maybe in a cartoon, in a textbook.” So, we work on building tools to help bring that extra layer of understanding to it. But, now we have to convince the regulators that this is safe and effective. And so, the problem just keeps growing. You have to have the wherewithal to actually solve all of it to really affect transformational change.

Adler: Milan, while we’re in healthcare, what might you add?

Milan Ivosevic: I think one perspective from our side would be that if he would need to be or if he would be disrupted, the best way to be is internally by yourself. And with that approach, it just takes conscious decisions from the management, especially in the companies that already have existing portfolios. You will always want to have incremental, you need to have incremental innovations. But, then it takes conscious decision to purposely invest, and separate, and look into disrupting yourself, because your current operations are designed to actually resist disruption for continuity, for cashflow. And if you engage the same people, they are conflicted, and it doesn’t work that way. It takes that conscious decision of investing into disrupting yourself and separating even physically that group from your main operation.

Ranganathan: Yes. Something that you said earlier really sparked a thought for me on there’s innovation, which is really stretching the edges and pushing them as far as possible. But, then there’s a grounding in, “Where is the customer today?” And not losing sight of what’s the current workflow, what are they used to, what do they recognize? And the Jobs to be Done framework is a really popular one. I know it is in tech, but I think it’s in other industries gaining popularity as well. It feels like a really interesting and thoughtful way of anchoring in the customer first, and then exploring the category through their lens, and then expanding your definition of the category a little more, to see what jobs to be done are either unserved or under served, because that’s where real innovation comes from. And I just want to call out a quick pet peeve.

Often when we talk about customer centricity and innovation, I get people reciting to me the Henry Ford quote or the one that’s been attributed to him anyway. If I asked people what they wanted, they would say they wanted a faster horse. I’m sorry, but I call that out. Really good customer centricity is organic research that taps into core motivations, core psychology, and what customers are really trying to solve for. It doesn’t mean to go ask them what the solution looks like. It is to mine the depth of what the real problem is so you can go design the solution using design thinking approaches and so on. And I wonder if this is the right time to pass it to Prapti.

Prapti Jha: Absolutely. So, I’ll first touch on the Henry Ford quote, and it always comes so much about if you ask people, they would say a faster horse. But then again, putting it very bluntly, maybe the researcher needs to go in depth, is like, “Okay, what do you want?” “Faster horse.” “Why do you want a faster horse?” Maybe asking that question leads to, “Yes, maybe I want to go to the grocery shop in less than five minutes.” Why? “Because I need to take care of my kids, I have to do other stuff.”

Basically what they they’re trying to do is save time. They need speed by which they can reach from point A to point B. That’s the motivation and value, and the person’s or users aspiration that you have to get to. And that’s where design thinking that Sudha mentioned, and other ways of getting to those core values and aspirations help. And also just basing your innovation on that, sometimes we call it desirability led innovation. And that desirability can be your user’s desirability, but sometimes it can also be your other stakeholder’s desirability and are we taking care of all those desirability? And so, I love to think about an ecosystem of stakeholders that you’re working with, not necessarily just the users.

Liebana: There is one important challenge that we face also that during the FIFA World Cup is just when we were applying the Jobs to be Done analysis, and integrating the customer journey. We realized there is a technology trap. We understand that when we are in the functional area, we know that we can save cost, increase efficiency, the operational speed, performance and so on. But, when we are talking about the social and emotional aspects, we don’t have data, and the technology is lost.

Basically, when we wanted to go deeper and understand exactly what is the new value proposition that we are touching, the social and emotional aspect, we are lost. We don’t have the technology to understand this. We don’t have the data. We cannot go through the personal privacy, the privacy of the data, personal data and so on. So, we were finding that we have a technology trap where you are thinking, “OK, we are innovating where the technology allows me to innovate.” And sometimes it’s very difficult to go to those places that the technology and the data doesn’t exist. You cannot follow an evidence-based approach and you are lost.

From large organizations to smaller startups, bringing disruptive innovation to the market is not enough. Scalability, as well as problem solving, is also key to the ecosystem, while avoiding technology traps. It’s also important to recognize that the company has to be committed to consciously investing in disrupting itself to bring the product, service or system to the market. Design thinking, the Jobs to be Done framework, and staying focused on the customer all play a role in transformational innovation.

Building Innovation Among Your Team: Final Takeaways

Adler: Some of this is a vernacular issue that we really don’t agree on even the word “process,” the definition of it. That’s an issue that we’ve got to overcome. In overcoming that issue, I want to start to land the plane with the fact that we are all in this together. We are trying to not just get to tomorrow. We’re really trying to get to the next decade and on. And so, with that in mind, when you walk away from this table, what is one thing that you would like to implement at the end of this week when you’re back in the office with your colleagues?

Sanchez: I would like to figure out how to implement the right process for where we are today, not at the scale of Google, but also not at the scale of a tiny startup. And some of the things that I’m thinking about is we talked a lot about process from a negative perspective because there are processes that are often defensive. How do I make sure nobody screws up? And there are places where this is appropriate. A safety critical flight system, please make sure nobody screws up.

But, that’s not the right framework to encourage innovation. So, when you think about it, it is really about if I throw a bunch of 300 people in a room, it’s going to be chaos. So, how can I make this group work effectively? Will you find ways to encourage communication that maybe wouldn’t happen naturally? Encourage the acquisition of customer data and customer information, make sure it comes into the process at some point, wherever it might be. But it’s not to restrict people. And also it’s important, it’s not that you can’t use it as a scapegoat for accountability either. “I followed the process, so I don’t know why it failed.” So, it’s just learning about our needs, how do we solve this problem of making a group of 300 people, it’s going to be larger soon, work effectively, and do so in a way that allows us to turn this innovation and transformation.

Ranganathan: I sit on the other end of the spectrum. I’m also personally inclined to be much more of a pragmatist. Often I’m limited by my own imagination and my own business pragmatism of, “We shouldn’t do this because it’s not going to generate a return in the next couple of years.” So, you need to keep talking about your vision. Because, the goal is not to sell someone on it immediately, the goal is to put it in their consideration, because the right time, the right place will come when suddenly your vision is the right answer to a question that they’re asking.

And when they’re asking that question, your vision had better be top of mind for them, because that’s how they’ll connect the dots and it’ll finally become a reality. So, my visions aren’t big and grand, but whatever they are, I have limited myself from socializing them in the past, because I think it’s not practical enough. But, I’m just walking away with a very different way of approaching this, which is, “Maybe I should be socializing the vision and not be attached to it happening right now.” And then I just wait for the right time and the right place and it will happen.

Shannon: One of the most powerful things that I’ve heard today was the flip side of what you’re talking about, because I’m all about vision. I’m just visioning all over the place. And getting people to take that seriously, and particularly people who are skeptical or who are detractors, don’t be so worried about having your ideas be your ideas. Be open to letting the other person think it’s their idea, and then give them credit for it. And then, the other one is also listen to your detractors, because maybe they’re right. And be willing to pivot and incorporate their thinking.

Caravajal: I’ve always been a big believer in cross-industry learnings and collaborating with people who are really far from what it is that you’re doing in hopes of understanding how they think about the problems that they’re facing, maybe not the problem that I’m dealing with, but something completely different. If you do that, your tool kit expands whether or not you use it. You just become so much more versatile in what you do to solve problems that are near to you. So, this has reinforced this idea that I’ve had, because at the end, it’ll make us more efficient in what we do and successful in what it is we want to achieve.

Leonard: Fall in love with the problem. That’s not a new idea, we’ve all heard it a million times. But, I think, you see it come to life, like you mentioned, across all the different industries. It goes back to having humility. And you’re influencing, “Sure, your idea.” You fell in love with the problem just like I did. So, I think, it’s seeding that level of influence and also then building the culture of psychological safety where you can have those conversations and where maybe that bit of internal friction is good too, to get you to a better place down the line.

Ivosevic: Needless to say, the underlying tone of this conference is AI. And my company relied on AI actually a lot, but more into the scientific part where we do it for data analysis, data science. But, when we talk about using it for understanding the needs and trends, and reaching out in the web, there was a little nugget I picked up. If we don’t associate it with this human centricity part, we are not getting the best out of it, then it becomes just a regular thing.

Liebana: For me, I think, one of the biggest challenges is, we understand innovation from a systematic way. It’s a system. And so, you need to select what are the key agents so that you can create this innovation. So, one of the key aspect for us was how to create a snowball effect in the system so that we create the momentum. And so, when the momentum is built with a lot of different key stakeholders, it’s so big that is very difficult to stop. And it helps management, it helps different stakeholders, “Oh, we have 12 different key stakeholders that they have the buy-in. OK, I want to be there.” Understanding the ecosystem and the system interrelationships and interdependency is very critical to move things forward, to convince people and to have the momentum to make things happen.

Wardhan: Thinking about organization internally, and I’ll say this in the form of the takeaway that I’m going to take back to my team, as well as the other teams that I work with inside, outside my company. We talk about organization from a culture perspective, an enablement perspective for all the employees of the company because that sparks innovation. Thank you for bringing all of us together from such a diverse industrial perspective. I’m going to go back and I’m going to say all of these industries, I’m going to quote names of companies, agreed on people centricity, whether it is internal to an organization or external. That’s what I’m going to take back. And for that, you need organizational anthropology, because you need to understand people inside and outside.

Jha: What I’m hearing, and that this experience has been, is a need for more alignment when it comes to language around innovation or the practices around innovation. That doesn’t necessarily mean we all follow the same process for innovation. We might have different processes. But, when we sit together and chat about innovation, are we all seeing the same thing? So, there is an example of prototype, the word “prototype,” that for example, I said, “Yes, I created a prototype for this project.” So, that might be thinking about a vehicle, a prototype that’s created for a vehicle, which is like $1,000, $1 million. I might be thinking of a sketch on a paper. Someone else might be thinking of a Lego piece. And I don’t care to explain what I mean by a prototype. So, basically all of us have a different takeaway from the same conversation, because of the language misalignment. From an academic perspective, I do see a huge value and maybe an opportunity for all of us to contribute to this in different ways that we can.

Adler: Absolutely. And it comes back to the lexicon. Are we even speaking the same language? I think we are around this table, and I really appreciate everyone’s time. Thank you so much.

As our roundtable panelists close out the discussion, some key takeaways and observations emerged. Implementing the right process, or framework, must encourage innovation. Keep talking about your vision, and make sure your voice is heard at the executive table, whether it’s a big or small step that you are planning in the future. Keep listening and gaining feedback. Cross industry learning and collaboration can lead to new insights. Be problem-oriented when it comes to solutions. Understanding the right system that leads to innovation. There is a need for more alignment when it comes to language around innovation or the practices around innovation. Despite the threat or opportunity of AI, understanding people is a significant way forward. Lead with human-centricity.

Balancing Short-Term And Long-Term Innovation Goals

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In identifying the biggest strengths, weaknesses, opportunities and threats to their businesses, executives in the field also looked back and ahead as they set the stage for the second half of 2023 and beyond. In terms of the current marketplace, innovation executives seemed to be weighing cutting costs versus developing new revenue streams. In connection to this, a common innovation question loomed: Focus on short-term gains or develop with long-term growth in mind?

Focusing on Long-Term Revenue Growth

While during the pandemic the focus seemed to be on cutting costs, the innovation community seemed to be setting their sights squarely on growth as the virus and its impact continued to fade and as recession fears waned. Answering the question, “Is innovation in a downturn/recession more about cutting costs or finding new revenue streams?” 48% said finding new revenue streams was the way forward. Meanwhile, 14% said mostly finding new revenue streams but somewhat cutting costs; 24% said both cuttings costs and finding new revenue streams; 10% said mostly cutting costs but somewhat finding new revenue streams; and 5% of survey respondents said cutting costs.

Long-term growth seemed to be the view from the innovation community when it comes to developing impactful innovation. With an eye on the future, when answering the question, “To what extent can the type of innovation at your company be described as short-term revenue augmentation or long-term impactful/disruptive ideas?” 35% selected long-term impactful ideas; 26% surveyed selected a mix of mostly long-term with some short-term revenue augmentation; 22% said equally both; while 9% and 9% respectively said mostly short-term revenue with some long-term or only short-term revenue augmentation.

Balancing that mix of short- and long term revenue goals is always a challenge in the industry. Certainly, there is no one right answer, as our survey report contributors attest. “New revenue streams are great but they should drive profit. In the beginning, when you’re growing fast, you tend to grow inefficiently because you’re just trying to meet the demand. When that growth slows, you now have to find efficiencies,” points out Brigette Wolf, Chief Marketing Officer, My/Mochi.

Wolf continues, “If a company gets the hottest trend or the coolest thing, you’re going to jump on that to get that revenue. It may not be the most efficient revenue. Over time you’re going to optimize it, we call it a path to productivity. When things aren’t easy, we do expect innovation to be more impactful. If they can’t be just modestly incremental, they have to be seismic. My hunch is that respondents follow ‘fewer, faster, better,’ that’s the mantra because you want the bigger ‘size of the prize.’”

Positive Signs of Business Innovation

Still others, such as Mike Hatrick, Group Director IP Strategy & Portfolio, Volvo Group Trucks Technology, see the survey results as a positive sign of things to come for the industry.

“A pretty wide swath of respondents really think innovation is about finding new revenue streams. If I think about it from the Volvo Group point of view, we are definitely seeking new revenue streams actually by moving more into service minded solutions. This is a reflection of people moving towards services and digital,” says Hatrick.

Both short-term and long-term options would seem to be on the table to present a firm with avenues for both ways to success, especially during a downturn, which presents challenges and opportunities.

“As far as innovation in a downturn, this is what we hear from our customers again and again: How can we see new technology? How can we then turn that into new revenue streams?” says Leslie Shannon, Head of Trend & Innovation Scouting, Nokia. “Survey respondents are saying they’re taking the long-term view, as opposed to the short-term. A lot of the innovation that we’re seeing revolves around digitization and these are things that require a full rethinking of business processes. That’s the kind of long-term effect. Also, if you’re really going to get a good ROI.”

The survey results seem to reflect positive, and resilient, momentum for the future. Despite pressures from the economy and its mix of signals, innovation seems to be on a pathway to growth.

“In this year’s survey, most respondents feel that the role of innovation is to “finding new revenue “streams” as opposed to “cutting costs.” And if you include respondents that are staying the course, 85% of our community is not focused on cost cutting despite ongoing inflationary factors,” agrees Michele Sandoval, Director of Innovation, E&J Gallo Winery. “This is incredible news given the downward pressures most companies are facing. The fact that most organizations are focusing on new ways to generate revenue speaks to an optimistic future.”

Balancing resources can present challenges to any firm. However, an eye on long-term growth may take time to develop, sometimes years, so one can’t take short-term growth off the menu entirely.

“When I think of those long-term focused innovation ideas, they take a lot of time to both incubate and develop, at least historically. This can impact the balance of resources especially as innovation continues to move at an increased pace,” says Sandoval.

Adapting Your Strategy to Find New Revenue Streams

Adaptation, and flexibility, is the name of the game for many firms driven by agile development methodologies.

Susan Penta, Co-Founder, Managing Partner, Midior Consulting, adds, “Adapting to the current environment also seems to be a theme emerging from this year’s data. Respondents seem to be focused on new revenue streams despite the downturn. Often, the initial reaction to a recession is to reduce risk by cutting costs so that you’re in the leanest position possible but in fact, recession is also where there is often the most opportunity. It’s also typically where the paradigm shifts happen—when things are hard is when people start surfacing the problems and figuring out new ways to solve them. I’m bullish that there were as many respondents embracing growth—and spending their way to increasing top line revenue—as a way through the downturn as there were interested in cost cutting. Those are two very different strategies that would imply that those companies are redeploying funds there.”

The pace of change in the market is rapidly accelerating as well. Innovation-oriented firms, regardless of their specialties, have to be nimble while facing more pressures to keep the lights on.

Despite the current downturn (at the time of the survey), “Most survey respondents are focused on finding new revenue streams, demonstrating their determination to double down on innovation,” says Gail Martino, Senior Program Manager, Unilever.

“Respondents recognize the importance of innovation that has a significant impact in the market and are focused on growing the top line. Interestingly, many survey respondents are working on longer-term projects rather than shorter-term ones, even though a significant number of them are go-to-market people. This trend could indicate a shift in the survey demographic,” observes Martino.

From a realistic perspective, Zeinab Ali, Sr. R&D Leader/Consultant, sees how both short- and long-term revenue goals play out depending upon the organization’s specific situation. That means for most organizations there will still be some cost cutting.

“Survey respondents selected finding new revenue streams during a downturn. I do agree with the data,” says Ali. “However, there is still some cost cutting that must always be done. We always start with creating a new revenue stream and at the same time we must look for opportunities to remove inefficiencies and find cost cutting opportunities. The best innovation is when you deliver a product/service to the consumer and meet customer needs while removing inefficiencies from the system. That is the crown jewel of innovation.”

Perhaps, Ali suggests, innovation needs to balance the two options, eyeing short-term revenue and incremental gains while taking the next steps in their long-term projects.

Ali adds, “A third and a quarter of respondents think long-term impactful, disruptive ideas as opposed to short-term revenue augmentation. For the organization to have patience for a long-term disruptive innovation, you will need to have many short-term innovations to keep the “Light On.” You need short-term revenue stream to fuel the long-term innovation. Balancing the two is critical for the organization to grow. There is always a tug of war between the two, but a mature, innovative organization can and will balance the two.”

Harsh Wardhan, Innovation Program Lead, Google, agrees with Ali’s premise. “When it comes to survey respondents cutting costs or finding new revenue streams, it was far and away about finding new revenue streams. That is the situation. People are optimistic. Cutting costs is also happening a lot. But then it’s two sides to the same coin.”

Finding the Right Position

Still, whether you fall on the short-term or long-term side of the equation, it’s all about growth—which is quite a positive sign compared to where firms were positioning themselves at the beginning of the year.

Sally Dominguez, Inventor, Futurist, Founder, Adventurous Thinking Group, adds, “Survey respondents are absolutely on the more impactful and long-term side of innovation. But I also wonder when people answer this, whether they’re giving the answer they wish were true versus the answer that is true.”

Dominguez continues, “We all know that most companies are still relying on growth coming from incremental improvement. And that’s an innovation; lean, continuous improvement, incremental improvement– a better battery. I would have expected there to be more people admitting that there’s a focus on short-term because you’re trying to keep the ship powering along. It’s definitely in the minds of our survey respondents about finding new revenue streams during a downturn instead of cutting costs. It’s about growth. If you want growth, you need innovation from everybody – inclusive innovation.”

The FEI and All Things Innovation community completed the comprehensive Innovation Spend & Trends Report covering what innovation executives are thinking, how they’re spending and the issues they face. Per the results, this is a senior-level, experienced, cross-industry group that signals a broad range of business-oriented preferences and strategic insights focused on the innovation industry as a whole.

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