Innovation – The outrigger model

December 11th, 2011 by Roger La Salle

Innovation – The outrigger model!

© Roger La Salle
www.matrixthinking.com

Tie me with rope – Now ask me to be innovative!

Unfortunately many organisations that have embraced the innovation initiative have done so in an entirely predictable manner, mostly with entirely predictable results.

Almost without exception the innovation department will be bound with red tape and underpinned by a stage gate analysis tool steeped in accounting nonsense and surrounded by naysayers most of whom find it easier to kill rather than embrace new ideas. Remember, people resist change. It’s far easier and safer for people to keep their heads below the parapet and do nothing.

Bound with such encumbrances, why would anybody be interested in being “out there”? It’s just too hard.

Business Plans never do work

Believe it or not, most business plans fail to deliver what was expected. What they do achieve however is to start you on a journey of innovation and discovery where the end point is seldom the initial target.

Interestingly, the failures are usually championed by people with great tenacity but tunnel vision, people who have difficulty in refocusing their endeavours when their ideas are not working. The mindset that persistence will ultimately win is simply flawed as no amount of persistence will turn a bad idea into a good one.

Hence the suggestion that “Fast Failure” is a good mindset with which to explore new horizons.

The good entrepreneur is one who can see when things are not working and with the backing of some money and a good team can re-direct efforts to where the target really is. This is the sort of open mindedness that is essential in any good entrepreneur or innovator.

But do we give our people this freedom? Probably not!

What is your Return on Investment (ROI) in Innovation?

The above is a great question but one that is seldom asked for fear of learning the truth. Too often the ROI is near zero but “hope” still prevails.

One Australia Company has spent over $500k on an innovation department that has yet to produce a single outcome. No doubt there are many more such companies.

The initiative is to be applauded, but the failure is not.

If a full time innovation department is not producing tangible outcomes and real ROI within 18 months at the most, then it is likely the model is flawed.

The simple solution is not found in persistence, but in changing the model.

“If you wish to think differently, then start by doing it differently”.

Avoiding Risk

One risk with a radical innovation model may be that the resulting ideas and outcomes are not seen as “core business” and thus need to be discarded. Indeed so common is the practise of discarding non-core activities that there are complete businesses that do nothing more than collect and commercialise so called “Orphan Technologies” that have been discarded by larger companies as non-core.

It beggars belief that this mind set still prevails especially in the light of some classic successes.

NOKIA, the company that essentially “owned” the cell phone business before Apple, was in the lumber industry before it decided to re-invent itself and become the number one cell phone maker.

IBM, or Big Blue, the supplier of major computer systems in days when computer centres occupied entire floors, one day came to the realisation that the personal computer may be a new horizon. This was something quite new to them and their major systems engineering thinkers.

In order to implement the PC development and avoid the risk to the “mother ship” if this PC was just a “flash in the pan” fad and thus a potential threat to their brand, and to avoid the nightmare that an in-house development would have meant. IBM took a novel approach.

Rather than doing the development in-house”, a development that would have taken a decade or more with all the internal bureaucracy and inertia of IBM, instead they simply put a small team together, put them in a separate building, gave them an objective and let them at it. The outcome was the IBM PC, developed and delivered in just 12 months.

We might call this the “outrigger” model.

The “Outrigger” model has a “lot of legs”

Given the right person to lead the charge, some freedom to operate and some budget, almost without doubt the seed of an idea or opportunity will soon grow into a profitable outcome.

The key to success is to identify a new initiative, put a small team together, fund them and set them adrift to survive or succumb. Let them be an “outrigger” to your core business so they can do no harm to the “mother ship” or the brand if they fail.

The cost is probably far less than funding an innovation bureaucracy, the risk is minimal, but the likelihood of success is high.

There is a clear message here!

If you are looking to get a different outcome you need to provide a different approach. Perhaps the outrigger model presents one possibility!

**** END ****

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to Deloitte, one of the world’s largest consulting firms. www.matrixthinking.com

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Innovation and Leadership

September 26th, 2011 by Roger La Salle

Leadership and Innovation © Roger La Salle 2011

The big question

Despite a number of years warning of the failing health of Steve Jobs, head of Apple, the company share price still fell some 5.2% when he recently announced his retirement.

Indeed so sensitive was this issue that prior to the announcement trading in Apple shares was suspended on the US stock market.

No doubt Steve Jobs is a wonderful visionary, innovator and entrepreneur, but a company so dependent on the skill of a single individual is a company that perhaps has failed to properly embed innovation and opportunity capture skills into its business.

So whose job is it?

It’s the task of the chief of a company to set the agenda and provide leadership. It’s the job of the staff to do the work in implementing the strategy and plans laid out before them. No business should be too reliant on the skills of a single individual.

Precisely the same can be said of innovation. Any organisation wishing to embrace change or innovation initiative needs to involve its entire staff to get the benefit of their combined knowledge and insights. Further, it is often the lower level staff that has the real and often unharvested insights into the business.

For example, imagine if you wished to take a “big stick” to an airline to innovate its offering to bring new value and new ways of doing business to its customers. Would you speak with the pilots and top management or instead the passengers check in staff, the ticket sales staff, the refuelers and the baggage handlers.

The answer is obvious, but have you ever asked the question.

What about the Customers?

How could we forget the customers!

As they say, the customer is king.

Whilst it may be difficult to have a permanent ongoing arrangement with customers to assist in “innovating” the business, we can instead teach our staff, the ones with the customer interface to observe, to actively listen to customers and to actively look for opportunities. From this we can glean all the information we require, all free of charge. This of course is possibly the most valuable information of all.

Staff Engagement is clearly the answer

Engaging people across all levels of the company has many advantages including:

• Greater involvement in the business and a willingness to follow through on new initiatives – this works to build enthusiasm and ownership
• Inspiring people to be searching for new and better ways, knowing they will be listened to
• Collecting real information from the interface with the customer.
• Building a sense of team within the business
• Taking some of the pressure from the top management.

Making it happen

The CEO of one of the most innovative businesses in the services sector in Asia has a KPI on all divisional mangers that 10% of each successive year’s revenue shall come from new and innovated products. Such is this company’s commitment to innovation, and it works. They achieve this by leveraging staff knowledge through the formation of cross functional innovation teams spread throughout the business.

These teams have a mandate to work using the proven tools of “Innovation” and “Opportunity Capture” to forever create and explore new ideas, pass these through a first evaluation filter, (referred to as the “Technology Diffusion”) then package and present them to senior management.

This process works, is systematic and simple so long as the staff have the right tools, a strong mandate and the ear of management.

What now!

The Steve Jobs approach worked for Apple but it is a risky model. Without doubt a far better approach is to unburden yourself of the task and let the people in your business all be engaged in the journey.

This is the right approach. But have you ever explored this issue? More importantly, implemented the solution?

Finally – remember this simple message

“Those organisations that fail to innovate will ultimately fail to exist and the extinction horizon these days is approaching just five years and narrowing!”

**** END ****

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to one of the world’s largest consulting firms. www.matrixthinking.com

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First Mover – Disadvantage

August 30th, 2011 by Roger La Salle

First Mover – Disadvantage! © Roger La Salle 2011

Innovation Minister makes a statement – but is he well informed?

In a recent statement on innovation in Australia Federal Minister Kim Carr commented that in Australia we are convertors, we are not creators.

Subsequently a journalist took that even further stating that if this is our approach to innovation we will never have a Microsoft or a Google.

How wrong and ill informed these people are, though it’s hard to blame the Minister, he simply takes his advice from his staffers and advisers. Perhaps it’s these people that need some advice?

What is research?

The definition of research within pretty much all governments worldwide is “work of a technical nature that entails some risk”. In other word, there is no certainly of achieving the goal.

This definition forms the basis of grants that fund research work where the private sector would be reluctant to invest and it works well to assist in filtering true research from development activities.

Notwithstanding that research entails some risk, it needs to be understood that in terms of innovation or invention the real aim, certainly from a government investment perspective, is to achieve economic returns and growth in the economy. To suggest that research investment is to simply expand the boundaries of science is pure nonsense, unless perhaps for pure academics.

Consequently with this in mind it is useful to explore the real risks in business.

Without any doubt the single biggest risk with any new endeavour is “market risk”. In other words will the idea once developed have a market, if not, unless it’s for purely academic outcomes, why bother?

Reducing Market Risk

Undoubtedly the single and most effective way to reduce market risk is to find something that everybody is buying or doing and do it better. This is what innovation is all about, Changing things to add value. Doing so to items in high demand virtually eliminates market risk.

First Mover Advantage – forget it!

The winners are the followers or the “convertors” as Minister Carr might say.

Neither Microsoft nor Google nor Twitter were firsts, neither was Henry Ford with the motor car or Nokia and then Apple with a better cell phone.

All of these big winners simply rode on the back of burgeoning success stories. If this is what being a convertor is about, let’s embrace that with enthusiasm and the tried and tested method for “conversion”.

This innovation game is simple if we look at it with the right mindset!

**** END ****

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to one of the world’s largest consulting firms. www.matrixthinking.com

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First Mover – Disadvantage

August 29th, 2011 by Roger La Salle

© Roger La Salle 2011

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Channel Enhancement – a great way to build a business

July 23rd, 2011 by Roger La Salle

Channel Enhancement – Business building made easy! © Roger La Salle 2011

Getting Started in Business

Getting started in business is tough. Winning the confidence of your customer and essentially creating a brand that positions you as a reliable supplier is where we all aspire to be.

But once the hard work is done, the rest is not so difficult.

The Channel

The common name for the means by which a product or service gets from your business to your customer is the “channel”. Unfortunately many of us fail to recognise the real value of this channel and our customer relationship.

In both the product and services innovation matrices one of the “Seeds” (or fundamentals of building a business) is referred to as “Channel Enhancement”. This “Seed” asks you to leverage your channel to the fullest and take advantage of the trusted relationship you have with your customer.

Indeed in many businesses the real value lies in the channel, not the products being sold.

Corporate Takeovers

There are numerous examples of larger companies taking over smaller ones that have developed a valuable channel, not because these larger companies want the products of the targets. What they want is access to the channel, the customers and the database.

This is a smart low risk corporate play we see time and again where corporate giants essentially purchase a market. Buying a market or a business that owns a channel is a measurable cost that can be assessed well in advance of a purchase. Compare that with the risk of trying to create a market from scratch. The uncertainties are really impossible to forecast, so too the cost and even the likelihood of success or failure.

SME’s with a narrow offering are ideally positioned

SME’s are in the ideal position to develop “channel enhanced” products and services as a low risk means of expansion and perhaps even to position themselves as takeover targets.

A simple example

Let us suppose we have built our business making hardware products such as hinges for cupboard doors. Once we have established that as an ongoing self sufficient business it’s time to turn your attention to other needs your customer may have.

To best do this you need to find products that:

• Fit well with your core competency and thus are not technically a “stretch” to introduce
• Have synergies with your present market offering and thus give your customer confidence you can deliver because you are familiar with the “space”
• Allows your customer to reduce the number of individual vendors they have
to work with
• Can provide real value to both your business and that of your customer.

For example in the case of door hinges, what is the opportunity to also sell screws, then door catches and door handles and so on?

All these add on products are ones your customer can relate to and since you are already a trusted supplier, introducing these channel enhancements may be a lot easier than you think.

A Brand is also a Channel

The company “Chanel” started life as haute couture business and developed a high profile brand and a relationship with customers wanting their sought after products, or perhaps their brand.

It does not require much of a leap of imagination to explore the terrain of opportunities that could ride on the brand of the original Chanel offering, again appealing to the high value customers it originally serviced with its apparel range.

Louis Viutton now with watches and clothing and Porsche now lending the brand to all manner of products are other examples. The list is endless if one cares to search.

Capturing your Customer

Petrol service stations are a good example where a customer is literally captured by the supplier and where there is no means of short term escape.

When filling your car with petrol you are captive at the petrol pump. What an opportunity this is to be selling you other things? This is being done to a small extent with petrol pump advertising, but one wonders where this could ultimately go?

Imagine if there was a snack vending machine associated with the petrol pump, or perhaps a cold drink dispenser, what a bonanza this would be and all because you have been held captive by the channel for a few minutes with no escape.

But for petrol stations it even gets even better!

When you have filled you car you then go into the shop to pay. What a great opportunity this is for further exploiting your presence with up sells and some products sold at many times supermarket prices. And we often buy them, either from impulse or convenience.

What now?

Put a small team together and explore the opportunity for “Channel Enhancement”. It’s a great way to build a business!

**** END ****

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to one of the world’s largest consulting firms. www.matrixthinking.com

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June 22nd, 2011 by Roger La Salle

Platform technologies – The secret to Open Innovation © Roger La Salle 2011

Making the simple seem complex

How many who are motivated to build their business on the back of innovation have come across the so called “Open Innovation” model?

It seems quite amazing that such an endeavour could even lay claim to its own title, but then again there are many that revel in making the simple seem complex and representing this old and widespread practice as a breakthrough in thinking with a shiny new label.

Promulgating widespread problems in search of solutions, especially in medicine has been around for centuries and in the case of mathematics and physics, some of the classic problems have been around for 1,000’s of years. This concept is by no means new.

Just to mention a few of the “innovation plays” these days we have at least the following:
• Open innovation
• Closed innovation
• Fast failure innovation
• Front end innovation
• Incremental innovation
• Radical innovation
• Disruptive innovation; and no doubt many more.

In reality, it does not matter what label you put on your innovation endeavours, it’s the outcome that is all important. Let us put this unnecessary labelling to rest and keep it simple. Now there’s an innovation in itself!

Put simply, the word innovation means “change”, and the best definition of innovation is “Change that Adds Value”.

This definition is founded on the simple basis of removing the single biggest risk in business, market risk, and innovation properly done achieves just that.

Enough said!

Open Innovation – The alarm bells are ringing

The idea with open innovation (one that would appear obvious) is that if you don’t have the internal skills to solve a problem then look outside the organisation. That’s Open Innovation, as distinct from “Closed Innovation” which asks you to look inside the organisation.

However, there are some proponents of this open innovation model that suggest that we should tell the world our problems and let people come forth with solutions. This is a concept perhaps more applicable to philanthropy than business. In a business sense how can the IP and ownership issues be managed? One can only ponder!

You can be sure the discoverers of new drugs, such as cures for widespread diseases such as TB, Cancer and the recently reported bio hazard associated with vegetable ingredients in Europe will not be freely forthcoming with solutions, though they revel in the knowledge of the problem.

Drug empires are built on solving these problems.

What many people fail to realise is that it’s the identification of a problem worth solving that is the real “gold”.

Problems are the reciprocal of opportunities

When we see a problem worth solving, keep it in house and only if you do not have the internal skills then by all means look outside, but do it carefully and systematically.

Further, if you find a potential solution provider develop a contracted relationship to work the solution with you in the box seat and you owning any resulting IP.

Where to now for Open Innovation!

Perhaps the best chance for this so called “Open Innovation” is when a business possesses what may best be described as a “platform technology” that is a gateway for millions to develop applications that make use of the platform, with the creator of the platform being locked into the value chain.

The new smart phones are a good example with applications coming on stream at an amazing rate and the phone providers “clipping the ticket” at every turn.

This is a wonderful business model, but is this a new approach?

Is this a new Idea?

Platform technologies are not new, but perhaps were not developed with the platform concept in mind.

The wheel is a platform or foundation technology with an endless variety of uses stemming from its creation. So too were the inventions of the ratchet, the gear box, the internal combustion engine and even the electric motor.

Unlike the new smart phones that have intrinsic value in themselves these old stand alone technologies have none. Stand alone, the wheel, the ratchet, the internal combustion engine and the electric motor have no purpose but are simply building blocks for others to employ in their innovations.

Can I have one?

Many businesses are in fact in possession of “platform technologies” but many fail to realise it and thus have not embraced appropriate opportunity search and capture methodologies to leverage their position.

The starting point is to identify your platform then develop an opportunity search model, the rest will quickly fall in to place.

In short, if you wish to embrace the so called open innovation model do so with great care, but better still, identify a “platform innovation”, own the IP, tell the world and let the market do the rest.

**** END ****

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to one of the world’s largest consulting firms. www.matrixthinking.com

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May 7th, 2011 by Roger La Salle

Comparison – a great tool for business and life!

© Roger La Salle
There may be more to luck than mere Chance!

In a book entitled “The Luck Factor” published just a few years ago the author documented the outcome of his research thesis into what makes some people lucky and others seemingly unlucky.

I’m sure we all know some people who seem to sail through life with hardly a problem, no ill health, a good marriage, good kids, generally life is smooth sailing. In other cases some people seem to have all the bad luck, health problems, marital and work issues and maybe children who are more trouble that perhaps one would expect.

One of the interesting things the author observed was that the so called “lucky people” were the ones who had a more open mind than the others. They held no firmly entrenched views and were always willing to listen and learn and see an opportunity when it presented itself, curtesy of their open-mindedness.

Leave your baggage at the Door

In business open minded people are by far the best performers especially where important decisions are being. Good performers bring no baggage to an issue in the form of firmly held views that simply will not allow them to be swayed. Instead they are always willing to listen and learn and explore new initiatives. Indeed the entire art of “change management”, a big business these days, is about trying to reach these people who find it so difficult to move their thinking to a new place.

Comparison is a great way of learning

There is a lesson here for all of us and one that can be discovered and learned with a systematic process using the “Opportunity Search Matrix”, an extension of the innovation matrix that was developed several years ago.

In an opportunity search matrix there are five “Seeds” or fundamentals that are the search criteria for an opportunity and eight “Catalysts” that are ways of thinking about the seeds. The development and use of this matrix greatly systematizes the search for an opportunity in both business and for life in general.
Opportunity Search Matrix

Catalyst

Seed

Tracking

Comparison X

One of the important Seeds is “Comparison”, that is to compare your performance in any endeavour with others doing the same task.

Tracking literally means to follow or observe how any person skilled in some area works or operates and see what you can learn. The lessons to be learned by this simple process can have life changing effects, providing you are prepared to look, listen and learn.

In using the process it soon becomes clear that in many cases it is our software, our mental approach and knowledge, rather than our hardware that differentiates us from each other.

Some examples

Golf is a great example. Some of the best golfers are by no means large people, they simply have some special gift, we perhaps can call software.

So too with footballers and cricketers, Sir Donald Bradman was by no means a big man, he just had exceptional software.

I once used the comparison tool and learned to swim efficiently in literally a few seconds, simply by observation.

Some years ago when watching my nine year old daughter swimming I noted that she and all of her friend could swim 5 km or more, where I, with a lot more hardware, could barely swim 50 meters. With that observation I decided to see what the difference was. The answer was soon obvious. Good swimmers, those unlike me who had not been taught to swim, use the big muscles of their back to roll their shoulders and swim, whereas the no knowledge swimmers use the small muscles of their arms. With that simple observation I was able to jump into the water and replicate this correct swimming action within seconds.

You too can do this in all fields of endeavour.

It works in Business as well

Do not discount this as mere theoretical nonsense. There are many examples where the above approach can be used to good effect.

Have you ever wondered how some workers can use a shovel all day long but when you get into the garden you can barely work for an hour before exhaustion takes the better of you? Is the difference strength or fitness?

Yes, perhaps to a some extent physical attributes may play a role, but may I suggest if you use the comparison and tracking tools to observe you will soon notice that those skilled in the art of using a shovel do most of the heavy work with their legs, not the small muscles of their arms. Observe and embrace this simple change in technique and you will be amazed at the difference it makes.

In business the same can be applied.

For example, if you take group of sales people and plot sales made per person over a period and compare performance you will generally find one exceptional performer.

$ Sales/month Top performer

Sales people

Is it Hardware of Software?

Think about it, what’s the difference, software or hardware?

The difference will almost always be software or the approach to the task used by the best performers. The secret is to recognise this and use the comparison seed and tracking catalyst to see what the best performers do differently. Learn from them and then up skill the lesser performers. Perhaps you may not bring these people to the same level as the champions, but you can be sure, if they are open to learning you will lift their performance markedly with a little training.

Apply this to your own efforts, mindset and approach and see the results.

This method is both rigorous and systematic, and most of all, it works.

A simple lesson learned from my dog

Finally, let me leave you with the dedication to a book I recently wrote, an example where I have learned something from my dog. Yes, I compared myself with my dog!

This is a life lesson well worth learning and one that I have passed on to my adult children and one we can all embrace as a way to a better life, health an happiness.

The dedication in my book reads:

“This book is dedicated to our recently departed dog “Wally” – perhaps a strange dedication, but this dog taught our family so much. To be loved, just show great joy and figuratively “wag your tail” whenever you see a loved one.

One of life’s great secrets I suggest.

**** END ****

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to Deloitte, one of the world’s largest consulting firms. www.matrixthinking.com

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Reduce your budget and Grow the Business!

March 22nd, 2011 by Roger La Salle

Reduce your budget and ”Grow the Business” – Now there’s a novel idea!                                

© Roger La Salle 2011

The business of business is simple

In business, whether profit driven like so many corporations, government services or not for profits organisations, of which there are many, at this time of year we start to review our budgets.

 Essentially all businesses are driven by simple arithmetic.

Profit (or final outcome) is derived by subtracting costs from revenue. It’s really all very simple.

In business in the aim is to grow revenues and of course profits. The mandate to achieve this is given to the senior executives that form the so called management team.

The message is to grow or stagnate and risk being overtaken by more aggressive competitors.

 The inevitable budget session

Predictably, as our executives develop their next year’s budget you can be sure there will be a requirement for more funds, more money to spend so the department can grow and consequently achieve the forecast improved outcomes.

It is quite amazing that despite all of the technological marvels we provide our staff with to make them more effective and more efficient, costs continue to grow.

Even in Government departments it is a long held tradition to get together in early June of each year and “blow the budget” by purchasing anything that can navigate the overseers of expenses in the few weeks before that mystical 30th of June, year end.

Is this a better way?

One wonders what may happen to ever expanding budgets if some inversion to this thinking was applied.

Take for example the head of a department that may have an annual expense budget of, say $20 million. Predictably the executive comes to the budget session with a well justified request for an additional 7% for the next year. Say an increase to $21.4million, a quite modest increase, but one the executive assures top management is essential to “grow the business”.

It may be interesting to consider what may happen if that very same executive was to be challenged.

“No instead of seeking more funds, if you can achieve your goals with 10% less, you will receive 75% of the reduction, in this case a whopping $1.4million, as a cash bonus, perhaps to be split among your staff in proportion to their salaries.”

Now there’s a novel and innovative approach to management.

 What now?

As the budget process starts maybe it’s time to give consideration to this radical, but perhaps very practical way of still achieving the desired results without the never ending need to spend more money.

Instead of more money, find better ways to achieve your outcomes. Again this is innovation, which is not a bad thing to introduce to a business.

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to one of the world’s largest consulting firms.  www.matrixthinking.com

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Solution to the Clever Country

March 3rd, 2011 by Roger La Salle

The Clever Country – if only!
© Roger La Salle 2011

Australians are indeed clever

Australian engineers and scientists are indeed world class, much like New Zealanders we “punch much above our weight”. Numerous examples could be cited including the Interscan Microwave aircraft landing system of the 1970’s that beat all comers, including the USA and Germany in demonstrating the best technology. Cochlear and Resmed are other examples and it is pretty well accepted that we excel in the biomedical sciences.

Australians are great technologists but still our economy relies on the recourses sector and with the decline in our manufacturing base, a growing emphasis on tourism and services in general.

The Governments part

In an endeavour the inspire innovation and investment in the sciences and “brain work” the Government over many years has provided accelerated investment allowance in the form of tax claims as R&D incentives. One may well ask if this is working as a real research incentive? Further, one may well ask just how easily it can be rotted by unscrupulous would be entrepreneurs?

The problem with the present system is that it comes at a great cost to Government whether successes are generated or not. Further, if you do happen to success with a new endeavour, you get punished.

Yes, in Australia we pump money in to the front end at great risk, then if you do succeed you get punished with a tax on your profits.

A Better Alternative

The search for an alternative should be made with the mindset of SME’s, not that of big businesses, these should not need incentives to research and innovate.

The system embraced should strike at the very heart of business by rewarding success and encouraging profit.

Thus a better system may include the following attributes:

• No cost to government
• Ultimate reward to Government with taxes on wages if the innovation is an export success that creates employment
• Clearly focuses innovation at export markets
• Can be readily audited

Such a system may seem like “snake oil”, but perhaps could be implemented with the following guidelines:

• No government money is used in seeding new initiatives and there are no accelerated investment write offs
• A tax holiday will be provided for a period, (suggested 3 years) for all income generated from exports where sales have been made to places where patents or formal IP protection is claimed (This could include registered designs, copyright and plant breeders rights)

If such a system were to be introduced I believe the shift in the mindset of SME’s and entrepreneurs would be almost instantaneous, focused and profound.

In short they would be saying – “Find me an export opportunity that I can protect with IPR and let me at it”.

The Naysayers

Doubtless there will be an endless stream of critics to the above suggestion, but one may question if the present system really works? Is it achieving its aim, what is the cost to Government and for what return and finally, is it being rorted?

Where to from here?

Let’s start the debate!

**** END ****
Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to one of the world’s largest consulting firms. www.matrixthinking.com

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Harnessing the Power of People

November 29th, 2010 by Roger La Salle

Harnessing the Power of People!
© Roger La Salle
www.matrixthinking.com

The power of many is greater than the sum of the individuals.

It is common knowledge that a linked worldwide network of computers is in use to provide a virtual super computer, the power of many being much greater than that the individual.

So too social networks have been formed and open innovation models developed where problems are presented to the wider community in the hope that somewhere somebody may be able to proffer a solution. Again the power of many being much greater than the individual.

It may be possible for many businesses to exploit some of these open innovation and wide area models but for many this is giving away too much of the “farm”. Perhaps it’s best to keep opportunities in house and use the power of your people to find the solutions. This is without doubt the model preferred and embraced by most businesses, and for every good reason – confidentiality.

Why past attempts have failed

Attempts to tap into the power of a company’s own people have often foundered because they failed to embrace some simple rules and models.

The old fashioned “Staff Suggestion Scheme” is an example of a model that in theory sounds good but unfortunately these have not really delivered what they promised and the reason is simple. This model is fundamentally flawed.

For a person to lodge a staff suggestion requires these following three activities:

Problem Identification Proposed Solution Idea Submission

The simple issue here is that a proposed solution seems to be a necessary pre-cursor to a submission, whereas the person who has identified the problem may not be in the best position to propose a solution. Consequently, the identified problem may languish for want of a solution and subsequent submission.

A Better Model

The real secret to tapping into the latent talents of your people should not require them to solve the problem but perhaps better still, simply highlight or identify issues in need of exploration and solution.

Thus the staff suggestion scheme should in fact be a “Issue identification Forum”

The model then simply becomes:

Problem Identification Issue Submission

Once a problem has been identified it is far easier to have one of the “Innovation Circles”© (that one would assume many businesses have now embraced – refer previous article) investigate and resolve the issue at hand.

A Simple Example

The following may be an overly simplistic example but the reader will no doubt get the message, it is the highlighting of the issue where the real value lies.

Suppose a production worker notices that the tamper tape on packets of pills they manufacture and sell is not really providing adequate tamper protection. The worker notices this but in putting forward a staff suggestion the worker should not be required to suggest a solution that may include alternative tamper tapes or attachment gluing material. The worker need only highlight the problem and be rewarded for that. Leave the solution to the experts, perhaps those forming an “Innovation Circle”© these are the people charged with resolving issues and developing innovative solutions to problems.

In Short

Simplify your staff suggestion scheme, make it easy for all staff to submit issues in need of resolution, reward them for that and leave the solution to the experts.

Understand that the real opportunity lies in identifying the problem, more so than the solution.

**** END ****

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries. www.matrixthinking.com

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