For the final post of this series, I want to explore some of the ways improving your firm’s technical intelligence capability can impact the business. What follows are a series of analysis processes expressed in visual terms. The concepts are not necessarily new, but their application has often been considered too difficult or the resulting insights too controversial. Sound technical intelligence tools and techniques have made these analyses much more practical.
At Reconverge:G2 in Indianapolis, the great challenge for both presenters and conference participants will be to bring forth the practical approaches and tools that can deliver these types of analysis, as well as share examples of how they have helped changed strategies, tactics and investment decisions.
The first “must have” for an astute innovation analyst and wise C-Suite is to build what might be termed an innovation landscape. I like to frame this type analysis project as building a geologic map of industry innovation. Think of how oil company geologists prospect and discover oil reserves. The resulting map would obviously be customized to the industry and firm but could look something like this:
The idea is to quantify and qualify the most important threads of innovation –specific oil fields if you will- along with the potential impact on the specific market –the depth and size of reserves. Ownership of specific threads –or stakes- is overlaid to give management a full sense of where innovation can come from and who will bring it.
Innovation can come from rivals, other industries (substitutes) or flow in from various elements of the business model (the Value Chain). Quality of innovation, using Clayton Christianson’s definitions, runs across a spectrum from evolutionary to disruptive. Such a canvas opens up the “black box” of the future for managers and can help drive both strategies and tactics.
Flowing from the innovation landscape, another critical piece of analysis is to grade innovation threats and probabilities. I have often found that this is the hardest discussion for leaders of technical organizations to have with their C-Suite executives. Fear of losing credibility or resources prevents them putting a stake in the ground and making choices. This is too bad because making an informed assessment of risk and opportunity –which by its very nature is approximate- forces executives to commit resources to more than just the promise that technical organizations know what’s going on. Instead, a reasoned assessment galvanizes action, concentrates resources and improves credibility.
What would such an assessment look like? It would array coming innovation in terms what’s possible with the potential degree of market impact. This would help executives better understand the relative urgency of innovation moves as well as their best options to lead or defend. It might look like this:
And getting to specific innovation decisions, the ultimate technical intelligence deliverable would be to present innovation in terms of the choices the firm can make to either defend against or lead innovation in specific markets. Said differently, what bets can or should be placed? What can be outsourced? What can be ignored? Such a deliverable might look like this:
After evaluating the landscape, grading the threats and possibilities, coalescing options is a crucial game changer. It provides a path forward beyond insight and foresight.
Now, to be clear, such an analysis product can’t pretend to be exhaustive or precise. It doesn’t guarantee choices won’t fail to produce results; it doesn’t diminish the chance rivals will discover novel innovation or outsmart you in the market; it doesn’t prevent poor execution. But it has the chance to paint a pathway to success by describing a more limited set of choices that enable the firm to make bigger, more focused bets.
Why is this important? Because in the innovation game, many firms seem to forget that novel invention has a much better chance to happen when you increase the shear amount of trial and error. Who is likely to invent something cool, the firm with 100 people working on a thousand projects or the firm with a thousand people working on a 100 projects?
The competitive intelligence organization that delivers the insight, foresight and recommendations that help a firm concentrate their innovation efforts in this way is truly making world class impact. Are you doing this?
Originally posted at RECONVERGE.NET.