How GE Plans to Act Like a Startup and Crowdsource Breakthrough Ideas

A triumph of crowdsourcing—for a nominal price, GE used the knowledge of someone they would have never otherwise met to innovate its way out a design problem. It was also a proof of concept for the engineering behemoth’s new innovation strategy.

• BY LIZ STINSON
• 04.11.14

Last year, the aviation engineers at General Electric found themselves with a jet engine bracket problem. At 4.48 pounds each, the brackets, little pieces of metal that support engine components, were weighing the plane down. Now, in the grand scheme of airplanes, a five-pound bracket seems pretty harmless, but it was a problem nonetheless, and one GE thought was solvable. “We thought, wouldn’t it be great if you could figure out way to make the bracket lighter?” recalls Steve Liguori, GE’s Executive Director of Global Innovation & New Models.

Traditionally, the only way to make a bracket strong enough to support a jet engine (which by the way, can weigh around 13,000 pounds) was to pour titanium alloy into a mold. This results in a strong, stiff object, but it was far from optimized. GE figured if it could find a way to reduce the weight of each bracket, they could significantly scale down the heft of an engine, resulting in millions of dollars’ worth of fuel savings each year.

GE knew the part needed to be 3-D printed. Problem was, the engineers didn’t have the time or, frankly, the know-how to significantly reduce the weight using advanced manufacturing. “Our engineering knew this problem was there, but based on our focus and priorities we were never able to really get around to it,” Liguori explains. “So we asked them, what are some problems you know we’ve been needing to solve but just haven’t been able to get to?”

“‘Where did you find this kid, and how much aviation experience does he have?’ Zero.”

GE turned to GrabCAD, an online community of more than a million engineers and designers, and presented a challenge: Whoever could redesign a bracket that reduced the most weight while still supporting the engine would win $7,000. More than 1,000 entries came in, with the winning design by M Arie Kurniawan a young Indonesian engineer who reduced the weight by a whopping 84 percent, to .72 pounds.

“I’ll never forget the day we presented this to Jeff Immelt [GE’s chairman and CEO],” Liguori says. “He was like, ‘Where did you find this kid, and how much aviation experience does he have?’ And you know the answer to that question? Zero.”

It was a triumph of crowdsourcing—for a nominal price, GE used the knowledge of someone they would have never otherwise met to innovate its way out a design problem. It was also a proof of concept for the engineering behemoth’s new innovation strategy. Under Immelt, GE has invested a sizable chunk of its annual $6 billion R&D funds into taking advantage of a simple, internet-enabled truth: Now, more than ever, it’s possible to connect with people around the world, so why not take advantage of that to solve some engineering problems?

Accessing the Global Brain

By tapping into the bright minds outside its walls, the company believes it can improve the innovation that goes on inside them. “You pretty quickly start to understand, you can’t do it all,” says Beth Comstock, GE’s senior vice president and CMO, who is heading up the company’s open innovation push. And it does make sense.

Today, you don’t need every expert in-house, nor is it always smart to hire a sole contractor. Rather, it’s totally possible, and often more efficient, to crowdsource for that knowledge. Liguori puts it this way: “For all of the smart engineers at GE, we sure don’t have a lock on all of the smart engineers in the world.”

Comstock believes that by marrying the insight of people outside your company with the smart people inside it, you’ll get to a solution faster than you otherwise would have. And crowdsourcing, she says, is particularly effective way to push people to develop smart new ideas.

The company’s partnership with Quirky, a NYC startup that crowdsources for designs and manufactures the favorites, is one example. The partnership just produced a smart air conditioner, and part of the deal was that GE would open up its trove of patents so would-be inventors could make use of them.

The company is also tapping into Kaggle, a community of data scientists, for its Flight Quest challenge. They’re asking scientists to come up with algorithms to optimize flight paths and reduce delays, and the winner of that challenge will get $50,000. This of course, brings up questions like: Who should get credit? And how much should contributors actually be paid if GE stands to make serious profits off of these ideas? After all, $7,000 for that lighter bracket seems like a pittance compared to its economic impact, or even what GE would have paid a high-caliber engineer to solve the problem.

GE is the clear winner in these deals, but Liguori points out the rules and compensation for each challenge are clearly stated, so it’s not a surprise to anyone who enteres. It’s also true that once the idea leaves the winner’s hands, GE is responsible for funding the development and manufacturing of it. Still, Liguori adds, these questions have merit. “We’re getting into an area about compensation and who owns IP,” he says. “It’s all getting sorted out right now.”

A New Way to Make

Since 2010 GE has hosted a series of competitions similar to Flight Quest and the jet engine bracket challenge, but the company is investing in the ethos of openness other ways, too. In fact, it’s GE’s most recent partnership that’s likely most indicative of how the company envisions its future as a maker of goods.

In March GE announced it would be partnering with Local Motors to create a line of new appliances. The simplest way to describe Local Motors is to say it’s a small company that manufactures vehicles. And while that’s technically true, it doesn’t give justice to the company’s real achievement, which is, the company has developed an incredibly smart platform for tapping into the desires of its community and producing products people actually want.

Local Motors operates with two main directives: Co-creation and micro-manufacturing. All of Local Motors’ vehicles begin online, where community members upload ideas and designs for new projects. It’s in this First Build platform that designs are tweaked and developed through conversations, with the most promising getting prototyped in one of Local Motors’ two micro-factories.

With GE, Local Motors will be translating this process into developing appliances. It will work in much the same way: Interested designers will log on to the platform, First Build, and share their ideas. Throughout the year, a few of those ideas will become prototypes in a GE-dedicated micro-factors and will be sold in small quantities. To put this in perspective, a Local Motors factory is about 20,000 square feet and employs around 50 people. GE’s current appliance factories are around 1 million square feet and employ close to 7,000 workers.

Scaling down has some benefits: The idea is that GE can bring better, more relevant products to market.

Scaling down has some benefits: By engaging with customers early on and prototyping small quantities, GE can bring better, more relevant products to market, and do it faster and more cheaply than ever before. This cuts down on the risk of mass producing an unwanted product, but it also means GE can scale up once a product proves itself in the market.

“It’s not rocket science to say, ‘Hm, I should talk to my customers before I build something,’” says Jay Rogers, CEO of Local Motors. “But executing that is super hard.”

It’s particularly difficult for a 130-year-old company like GE. “We’ve always done it a certain way,” says Comstock, explaining that GE’s R&D process is finely tuned machine that cranks out fully-finished, optimized products. Ideas are often developed in a vacuum—a very smart vacuum—but a vacuum nonetheless. This means products, both consumer and business to business, don’t see the customer until they’re nearly finished.

GE wants to change that. Comstock points to GE’s recent embracing of ideas like minimum viable products, start-up speak for producing a product with just the core features. “If you’re talking about the most advanced science and technology, just that notion makes you nervous,” says Comstock. “A minimally viable product? We want it to be optimally viable.” There may be a certain part of this that seems like marketing, but GE insists that to be competitive in the 21st century, it needs to think like a start up.

Act Like a Startup, Make Money Like a Fortune 500

With 300,000 employees worldwide and more than $16.9 billion in 2013 earnings, GE is definitely not a start up. But GE’s open innovation strategy ties into a bigger internal push at the company to adopt a Lean Startup mentality and management style.

Around 18 months ago Eric Ries, the brains behind the Lean Startup movement, found himself in a meeting with Comstock and a handful of GE higher ups. The entrepreneur was there to talk about his method of management, which encourages failing early, speed to market and presenting customers with a minimum viable product. “You could just see the thought bubble over their heads,” says Comstock. “Which I imagine said something like “this guy is really on to something, and this probably works in software, but this is never gonna work with hardware.”

They decided to try it anyway; and the resulting program, FastWorks, is something of an internal overhaul at GE. All across the company, employees and managers are being trained refocus and retool their workflow. “We’re saying to people it’s ok to try things earlier, it’s ok to bring customers in earlier,” says Comstock. “You’re giving people a lot more freedom to move faster to make more small mistakes.”

GE hopes this effort, along with its focus on open innovation, will lead to a culture where new, unexpected ideas can blossom instead of getting stuck in corporate bureaucracy. Will a Facebook mentality work for a company as old and large as GE? And will it even make an impact? It depends on the company’s measure of success. But one thing is certain: In order to thrive in the modern world, GE is going to have to rely on more than just itself, it’s legacy relationships, and its marketing might.

~ Curated by The Marketing Curator and TME Pass The Idea (www.pass-the-idea.com)

Source: http://www.wired.com/2014/04/how-ge-plans-to-act-like-a-startup-and-crowdsource-great-ideas/

Brands react to ‘Digital Darwinism’

Digital transformation not just about bolting on various new technologies as they came along in order to solve problems, but rather about changing entire organisations from the inside out to meet customer expectations that have been totally reshaped by social and mobile.

15 April 2014 
SAN MATEO, CA: Companies and brands are entering an era of digital transformation that will make them more human by integrating and improving the customer experience, a new study has said.

The Altimeter Group’s Digital Transformation report was based on in-depth interviews with 20 digital strategists and executives at organisations undergoing digital transformation efforts. It concluded that social, mobile, real-time, and other disruptive technologies were aligning in such a way that bigger changes than initially anticipated were now needed. 

Digital transformation, it argued, was not just about bolting on various new technologies as they came along in order to solve problems, but was rather about changing entire organisations from the inside out to meet customer expectations that have been totally reshaped by social and mobile. 

Nor was it simply an end goal. Digital transformation is a continuous journey, said Altimeter, describing it as “the result of learning more about the relationship between technology and customer behaviour to earn relevance among them”.

But internal company structures tended to operate in such a way as to make the development of a seamless customer journey even more difficult than it already was. 

As one interviewee who worked for a large pharma company explained: “Business units concentrate on their own priorities when they don’t have a holistic view of enterprise goals. Unfortunately, when individual agendas conflict with the company agenda, theirs wins out every time.”

Altimeter further observed that the expertise required to lead successful digital engagements was often distributed across the organisation. Mobile, for example, was “strewn across multiple teams and not centralised to produce an integrated approach or experience”.

The existence of multiple customer touchpoints also made it difficult to allocate resources effectively. “To earn executive support requires someone to make the business case for funding,” said the report. “But, information to make the business case to map the journey is often elusive.”

What was need more than anything was a champion who was able to think about the entire digital customer journey and educate executives on what needed to be done and why. 

Data sourced from Altimeter; additional content by Warc staff 

~ Curated by The Marketing curator and TME Pass The Idea (www.pass-the-idea.com)

Source: http://www.warc.com/LatestNews/News/EmailNews.news?ID=32839&Origin=WARCNewsEmail&utm_source=WarcNews&utm_medium=email&utm_campaign=WarcNews20140415

P&G under pressure for the next big thing

(Photo: Provided)

Some analysts fret that the Cincinnati-based consumer products giant relies too heavily on a new-and-improved lineup of proven favorites, instead of producing enough breakthrough blockbusters to help power sales and profits growth.

Alexander Coolidge, CIN10:03 p.m. EDT April 12, 2014

Procter & Gamble is selling a new Downy fabric softener with time-released scents that linger longer on clothes. A Secret deodorant that works for 48 hours. And those cute little orange-and-blue Tide Pods that eliminate the extra laundry step of first measuring detergent.

For its efforts, the company was rewarded with recognition from one of the industry’s most respected trade organizations: The Information Resources Inc. ranked these and four other P&G products among the 10 best-selling U.S. innovations of 2013.

Combined, the seven generated $870 million in sales last year, equal to 1 percent of the company’s total revenue.

Are these innovations of the kind that will propel P&G sales growth to the next level that shareholders demand?

“Consumers have come to expect the next best product innovation from our leading brands,” said Kathy Fish, P&G’s chief technology officer, who oversees the company’s $2 billion-a-year research and development efforts. “When P&G gets it right, innovation that delights consumers is an an important driver of growth.”

Some analysts, however, fret that the Cincinnati-based consumer products giant relies too heavily on a new-and-improved lineup of proven favorites, instead of producing enough breakthrough blockbusters to help power sales and profits growth.

Others say the company needs all kinds of innovations to move profits and satisfy customers: Breakthroughs like Crest Whitestrips and Swiffer dusters – products that people didn’t know they needed until they got them, and now can’t live without. Big improvements like Tide Pods, that upsell consumers to the latest version of an old favorite. And incremental changes that extend a brand’s product lines into new flavors, colors or sizes. Think mint chocolate-flavored Crest.

“A common misperception is the belief that innovation occurs only in those moments of serendipity,” Fish said. “What makes P&G innovation unique is that it’s not just one year, but consistent performance over time.”

A dose of innovation delivers, boosts sales

P&G considers innovation part of the company’s DNA – practically inventing the concept of “new and improved.” It’s such a critical value that P&G’s chief executive, A.G. Lafley, said “innovation” 22 times in 53 minutes – once more than “productivity” – during his last presentation to Wall Street analysts.

Analysts say continuous improvements and changes keep products from becoming boring commodities that consumers want to buy at the lowest price – a dynamic that drove P&G to exit the food business in the past decade.

P&G also needs some dazzling new products, though, to grow faster than the sluggish 1 to 2 percent sales growth projected for the year ending June 30, they say.

“Consumer companies deal in mature, slow-growing categories,” said Ali Dibadj, an analyst with Bernstein Research. “To stave off competition and create growth, innovative new products must be developed.”

Chicago-based industry tracker IRI, which compiled the Top 10 list, says new and improved products keep the sales coming in.

“New product innovation is more important than just dollars. It builds excitement, buzz and competitive advantage,” Larry Levin, an IRI executive, said. “Successful new products can establish and protect category leadership, as well as help companies break into entirely new categories. In short, they are game changers.”

Tide Pods was No. 1 on the list for top new products last year. The little ball of concentrated laundry detergent racked up $324.6 million in sales in its first 12 months on the North American market, IRI said.

A hit launch is the gift that keeps on giving: a strong new product introduced in North America can generate even more sales as P&G rolls it out to other countries. Innovations also can be adapted to improve other brands, spurring more sales growth. P&G has done just that with Pods.

Prompted by the robust Pods demand, P&G rolled out the “unit dose” detergent to its Ariel brand in Europe, Latin America and the Middle East. This spring P&G also included unit dose “flings” under its Gain brand.

Those detergent versions are now a $1 billion business across Tide, Gain and Ariel brands selling in 20 countries, P&G says. Pods also are transforming the laundry industry, with unit dose detergent representing 6 percent of all sales and P&G dominating the new segment, controlling more than two thirds of it.

Blockbusters, while rare, offer brief monopoly

P&G’s latest Tide triumph also illustrates how rare true blockbusters are. Crest whitening strips, Swiffer duster and Febreze fabric care invented whole new must-have products.

Those launches created new businesses where P&G enjoyed a brief monopoly, setting the pricing and selling the goods as fast as it could make them. Tide Pods, on the other hand, are used by consumers who once chose powder or liquid laundry detergent – often the Tide brand.

“Swiffer became a new item in the consumer’s closet – she didn’t give up buying Mr. Clean,” said Linda Bolten Weiser, an analyst with B. Riley & Co. “Tide Pods trades consumers up to a premium product – it’s the next best thing.”

Despite Pods’ runaway success and expansion, P&G acknowledges its overall fabric care business lost market share in the past 18 months.

Weiser said consumer products companies often rely on smaller tweaks.

“In their hearts they know what innovation is – but they have to keep saying they’re innovating,” she said.

Some analysts have harsher assessments.

“P&G’s track record of blockbuster product innovation has largely ground to a halt over the last 10 years,” said John Lame, chief executive of Lenox Wealth Management in Kenwood. “Relative to the past, there is an overwhelming larger reliance on incremental changes to move the business ahead.”

What’s wrong with line extensions?

P&G officials say they never introduce a product that isn’t backed by consumer research that tells them there’s an unmet need or desire. And some of those those lowly line extensions turn into huge businesses.

Pampers Swaddlers started out as a line extension just for newborns – now it’s worth $500 million in annual sales. It’s still growing as P&G has added some extra sizes.

Crest Whitestrips was a breakthrough introduced in the 1990s that showed P&G how obsessed some consumers were about whitening their teeth.

P&G extended its whitening business into The 3D White product lineup of Whitestrips, paste, brushes and rinses to form a complete regimen. That portfolio is now worth $1 billion in annual sales and a crown jewel in the whole Crest brand. ■

10 top new sellers

These are the best-selling product innovations in North America in 2013, according to industry tracker the Information Resources Inc. Procter & Gamble products are in bold; numbers are annual sales for the product’s first year.

1. Tide Pods: $324.6 million

2. L’Oreal Advanced Haircare: 141.8 million

3. ZzzQuil: $121.1 million

4. Vidal Sassoon Pro Series: $96 million

5. Clear Scalp & Hair Therapy: $92.7 million

6. Downy Infusions: $90.2 million

7. Ajax Triple Action: $84.2 million

8. Always/Tampax Radiant: $83 million

9. Secret Outlast: $82.4 million

10. Puffs Basic: $74.5 million

 

Source: Information Resources Inc.

 

Coming attractions

So what’s the next big thing from P&G?

IRI has names six recently launched products as Rising Stars that could wind up on next year’s Top 10 list.

• Febreze Sleep Serenity, an air freshener designed for the bedroom to guarantee a good night’s sleep.

• Bounty DuraTowel, a paper towel made to work as well as cloth.

• Duracell Quantum batteries,

a longer lasting version.

• Old Spice Wild Collection, hair care products with the same scents as the brand’s deodorants.

• Cascade Platinum, a detergent that leaves dishes – and dishwashers – spark­ling.

• Iams So Good, a lower-priced pet food. P&G announced last week that it’s selling that brand in a $2.9 billion deal expected to close this year.

• Not on any list, but tantalizing nonetheless: Gillette Body, a razor designed for “manscaping.” P&G introduced it early this year.

~ Curated by The Marketing Curator and TME Pass The Idea (www.pass-the-idea.com)

Source: http://www.cincinnati.com/story/money/2014/04/12/pg-pressure-next-big-thing/7634881/

The Lost World of the London Coffeehouse

The coffeehouse’s formula of maximised sociability, critical judgement, and relative sobriety proved a catalyst for creativity and innovation…coffeehouses all followed the same blueprint, maximising the interaction between customers and forging a creative, convivial environment. They emerged as smoky candlelit forums for commercial transactions, spirited debate, and the exchange of information, ideas, and lies.

publicdomainreview.org  ·

In contrast to today’s rather mundane spawn of coffeehouse chains, the London of the 17th and 18th century was home to an eclectic and thriving coffee drinking scene. Dr Matthew Green explores the halcyon days of the London coffeehouse, a haven for caffeine-fueled debate and innovation which helped to shape the modern world.

A disagreement about the Cartesian Dream Argument (or similar) turns sour. Note the man throwing coffee in his opponent’s face. From the frontispiece of Ned Ward’s satirical poem Vulgus Brittanicus (1710) and probably more of a flight of fancy than a faithful depiction of coffeehouse practices – Source.

From the tar-caked wharves of Wapping to the gorgeous lamp-lit squares of St James’s and Mayfair, visitors to eighteenth-century London were amazed by an efflorescence of coffeehouses. “In London, there are a great number of coffeehouses”, wrote the Swiss noble César de Saussure in 1726, “…workmen habitually begin the day by going to coffee-rooms to read the latest news.” Nothing was funnier, he smirked, than seeing shoeblacks and other riffraff poring over papers and discussing the latest political affairs. Scottish spy turned travel writer John Macky was similarly captivated in 1714. Sauntering into some of London’s most prestigious establishments in St James’s, Covent Garden and Cornhill, he marvelled at how strangers, whatever their social background or political allegiances, were always welcomed into lively convivial company. They were right to be amazed: early eighteenth-century London boasted more coffeehouses than any other city in the western world, save Constantinople.

London’s coffee craze began in 1652 when Pasqua Rosée, the Greek servant of a coffee-loving British Levant merchant, opened London’s first coffeehouse (or rather, coffee shack) against the stone wall of St Michael’s churchyard in a labyrinth of alleys off Cornhill. Coffee was a smash hit; within a couple of years, Pasqua was selling over 600 dishes of coffee a day to the horror of the local tavern keepers. For anyone who’s ever tried seventeenth-century style coffee, this can come as something of a shock — unless, that is, you like your brew “black as hell, strong as death, sweet as love”, as an old Turkish proverb recommends, and shot through with grit.

It’s not just that our tastebuds have grown more discerning accustomed as we are to silky-smooth Flat Whites; contemporaries found it disgusting too. One early sampler likened it to a “syrup of soot and the essence of old shoes” while others were reminded of oil, ink, soot, mud, damp and shit. Nonetheless, people loved how the “bitter Mohammedan gruel”, as The London Spy described it in 1701, kindled conversations, fired debates, sparked ideas and, as Pasqua himself pointed out in his handbill The Virtue of the Coffee Drink (1652), made one “fit for business” — his stall was a stone’s throw from that great entrepôt of international commerce, the Royal Exchange.

 

A handbill published in 1652 to promote the launch of Pasqua Rosée’s coffeehouse telling people how to drink coffee and hailing it as the miracle cure for just about every ailment under the sun including dropsy, scurvy, gout, scrofula and even “mis-carryings in childbearing women” –Source.

Remember — until the mid-seventeenth century, most people in England were either slightly — or very — drunk all of the time. Drink London’s fetid river water at your own peril; most people wisely favoured watered-down ale or beer (“small beer”). The arrival of coffee, then, triggered a dawn of sobriety that laid the foundations for truly spectacular economic growth in the decades that followed as people thought clearly for the first time. The stock exchange, insurance industry, and auctioneering: all burst into life in 17th-century coffeehouses — in Jonathan’s, Lloyd’s, and Garraway’s — spawning the credit, security, and markets that facilitated the dramatic expansion of Britain’s network of global trade in Asia, Africa and America.

The meteoric success of Pasqua’s shack triggered a coffeehouse boom. By 1656, there was a second coffeehouse at the sign of the rainbow on Fleet Street; by 1663, 82 had sprung up within the crumbling Roman walls, and a cluster further west like Will’s in Covent Garden, a fashionable literary resort where Samuel Pepys found his old college chum John Dryden presiding over “very pleasant and witty discourse” in 1664 and wished he could stay longer — but he had to pick up his wife, who most certainly would not have been welcome.

The earliest known image of a coffeehouse dated to 1674, showing the kind of coffeehouse familiar to Samuel Pepys – .

No respectable women would have been seen dead in a coffeehouse. It wasn’t long before wives became frustrated at the amount of time their husbands were idling away “deposing princes, settling the bounds of kingdoms, and balancing the power of Europe with great justice and impartiality”, as Richard Steele put it in the Tatler, all from the comfort of a fireside bench. In 1674, years of simmering resentment erupted into the volcano of fury that was the Women’s Petition Against Coffee. The fair sex lambasted the “Excessive use of that Newfangled, Abominable, Heathenish Liquor called COFFEE” which, as they saw it, had reduced their virile industrious men into effeminate, babbling, French layabouts. Retaliation was swift and acerbic in the form of the vulgar Men’s Answer to the Women’s Petition Against Coffee, which claimed it was “base adulterate wine” and “muddy ale” that made men impotent. Coffee, in fact, was the Viagra of the day, making “the erection more vigorous, the ejaculation more full, add[ing] a spiritual ascendency to the sperm”.

There were no more Women’s Petitions after that but the coffeehouses found themselves in more dangerous waters when Charles II, a longtime critic, tried to torpedo them by royal proclamation in 1675. Traditionally, informed political debate had been the preserve of the social elite. But in the coffeehouse it was anyone’s business — that is, anyone who could afford the measly one-penny entrance fee. For the poor and those living on subsistence wages, they were out of reach. But they were affordable for anyone with surplus wealth — the 35 to 40 per cent of London’s 287,500-strong male population who qualified as ‘middle class’ in 1700 — and sometimes reckless or extravagant spenders further down the social pyramid. Charles suspected the coffeehouses were hotbeds of sedition and scandal but in the face of widespread opposition — articulated most forcefully in the coffeehouses themselves — the King was forced to cave in and recognise that as much as he disliked them, coffeehouses were now an intrinsic feature of urban life.

A map of Exchange Alley after it was razed to the ground in 1748, showing the sites of some of London’s most famous coffeehouses including Garraway’s and Jonathan’s – Source.

By the dawn of the eighteenth century, contemporaries were counting between 1,000 and 8,000 coffeehouses in the capital even if a street survey conducted in 1734 (which excluded unlicensed premises) counted only 551. Even so, Europe had never seen anything like it. Protestant Amsterdam, a rival hub of international trade, could only muster 32 coffeehouses by 1700 and the cluster of coffeehouses in St Mark’s Square in Venice were forbidden from seating more than five customers (presumably to stifle the coalescence of public opinion) whereas North’s, in Cheapside, could happily seat 90 people.

The character of a coffeehouse was influenced by its location within the hotchpotch of villages, cities, squares, and suburbs that comprised eighteenth-century London, which in turn determined the type of person you’d meet inside. “Some coffee-houses are a resort for learned scholars and for wits,” wrote César de Saussure, “others are the resort of dandies or of politicians, or again of professional newsmongers; and many others are temples of Venus.” Flick through any of the old coffeehouse histories in the public domain and you’ll soon get a flavour of the kaleidoscopic diversity of London’s early coffeehouses.

The walls of Don Saltero’s Chelsea coffeehouse were festooned with taxidermy monsters including crocodiles, turtles and rattlesnakes, which local gentlemen scientists like Sir Isaac Newton and Sir Hans Sloane liked to discuss over coffee; at White’s on St James’s Street, famously depicted by Hogarth, rakes would gamble away entire estates and place bets on how long customers had to live, a practice that would eventually grow into the life insurance industry; at Lunt’s in Clerkenwell Green, patrons could sip coffee, have a haircut and enjoy a fiery lecture on the abolition of slavery given by its barber-proprietor John Gale Jones; at John Hogarth’s Latin Coffeehouse, also in Clerkenwell, patrons were encouraged to converse in the Latin tongue at all times (it didn’t last long); at Moll King’s brothel-coffeehouse, depicted by Hogarth, libertines could sober up and peruse a directory of harlots, before being led to the requisite brothel nearby. There was even a floating coffeehouse, the Folly of the Thames, moored outside Somerset House where fops and rakes danced the night away on her rain-spattered deck.

Hogarth’s depiction of Moll and Tom King’s coffee-shack from The Four Times of Day (1736). Though it is early morning, the night has only just begun for the drunken rakes and prostitutes spilling out of the coffeehouse – .

Despite this colourful diversity, early coffeehouses all followed the same blueprint, maximising the interaction between customers and forging a creative, convivial environment. They emerged as smoky candlelit forums for commercial transactions, spirited debate, and the exchange of information, ideas, and lies. This small body-colour drawing shows an anonymous (and so, it’s safe to assume, fairly typical) coffeehouse from around 1700.

A small body-colour drawing of the interior of a London coffeehouse from c. 1705. Everything about this oozes warmth and welcome from the bubbling coffee cauldron right down to the flickering candles and kind eyes of the coffee drinkers – Source.

Looking at the cartoonish image, decorated in the same innocent style as contemporary decorated fans, it’s hard to reconcile it with Voltaire’s rebuke of a City coffeehouse in the 1720s as “dirty, ill-furnished, ill-served, and ill-lighted” nor particularly London Spy author Ned Ward’s (admittedly scurrilous) evocation of a soot-coated den of iniquity with jagged floorboards and papered-over windows populated by “a parcel of muddling muck-worms…some going, some coming, some scribbling, some talking, some drinking, others jangling, and the whole room stinking of tobacco.” But, the establishments in the West End and Exchange Alley excepted, coffeehouses were generally spartan, wooden and no-nonsense.

As the image shows, customers sat around long communal tables strewn with every type of media imaginable listening in to each other’s conversations, interjecting whenever they pleased, and reflecting upon the newspapers. Talking to strangers, an alien concept in most coffee shops today, was actively encouraged. Dudley Ryder, a young law student from Hackney and shameless social climber, kept a diary in 1715-16, in which he routinely recalled marching into a coffeehouse, sitting down next to a stranger, and discussing the latest news. Private boxes and booths did begin to appear from the late 1740s but before that it was nigh-on impossible to hold a genuinely private conversation in a coffeehouse (and still pretty tricky afterwards, as attested to by the later coffeehouse print below). To the left, we see a little Cupid-like boy in a flowing periwig pouring a dish of coffee à la mode — that is, from a great height — which would fuel some coffeehouse discussion or other.

Much of the conversation centred upon news:

There’s nothing done in all the world
From Monarch to the Mouse,
But every day or night ‘tis hurled
Into the Coffee-House

chirped a pamphlet from 1672. As each new customer went in, they’d be assailed by cries of “What news have you?” or more formally, “Your servant, sir, what news from Tripoli?” or, if you were in the Latin Coffeehouse, “Quid Novi!” That coffeehouses functioned as post-boxes for many customers reinforced this news-gathering function. Unexpectedly wide-ranging discussions could be twined from a single conversational thread as when, at John’s coffeehouse in 1715, news about the execution of a rebel Jacobite Lord (as recorded by Dudley Ryder) transmogrified into a discourse on “the ease of death by beheading” with one participant telling of an experiment he’d conducted slicing a viper in two and watching in amazement as both ends slithered off in different directions. Was this, as some of the company conjectured, proof of the existence of two consciousnesses?

A Mad Dog in a Coffeehouse by the English caricaturist Thomas Rowlandson, c. 1800. Note the reference to Cerberus on the notice on the wall and the absence of long communal tables by the later 18th century –Source.

If the vast corpus of 17th-century pamphlet literature is anything to go by then early coffeehouses were socially inclusive spaces where lords sat cheek-by-jowl with fishmongers and where butchers trumped baronets in philosophical debates. “Pre-eminence of place none here should mind,” proclaimed the Rules and Orders of the Coffee-House (1674), “but take the next fit seat he can find” — which would seem to chime with John Macky’s description of noblemen and “private gentlemen” mingling together in the Covent Garden coffeehouses “and talking with the same Freedom, as if they had left their Quality and Degrees of Distance at Home.”

Perhaps. But propagandist apologias and wondrous claims of travel-writers aside, more compelling evidence suggests that far from co-existing in perfect harmony on the fireside bench, people in coffeehouses sat in relentless judgement of one another. At the Bedford Coffeehouse in Covent Garden hung a “theatrical thermometer” with temperatures ranging from “excellent” to “execrable”, registering the company’s verdicts on the latest plays and performances, tormenting playwrights and actors on a weekly basis; at Waghorn’s and the Parliament Coffee House in Westminster, politicians were shamed for making tedious or ineffectual speeches and at the Grecian, scientists were judged for the experiments they performed (including, on one occasion, dissecting a dolphin). If some of these verdicts were grounded in rational judgement, others were forged in naked class prejudice. Visiting Young Slaughter’s coffeehouse in 1767, rake William Hickey was horrified by the presence of “half a dozen respectable old men”, pronouncing them “a set of stupid, formal, ancient prigs, horrid periwig bores, every way unfit to herd with such bloods as us”.

But the coffeehouse’s formula of maximised sociability, critical judgement, and relative sobriety proved a catalyst for creativity and innovation. Coffeehouses encouraged political debate, which paved the way for the expansion of the electorate in the 19th century. The City coffeehouses spawned capitalist innovations that shaped the modern world. Other coffeehouses sparked journalistic innovation. Nowhere was this more apparent than at Button’s coffeehouse, a stone’s throw from Covent Garden piazza on Russell Street.

The figure in the cloak is Count Viviani; of the figures facing the reader the draughts player is Dr Arbuthnot, and the figure standing is assumed to be Pope – Source.

It was opened in 1712 by the essayist and playwright Joseph Addison, partly as a refuge from his quarrelsome marriage, but it soon grew into a forum for literary debate where the stars of literary London — Addison, Steele, Pope, Swift, Arbuthnot and others — would assemble each evening, casting their superb literary judgements on new plays, poems, novels, and manuscripts, making and breaking literary reputations in the process. Planted on the western side of the coffeehouse was a marble lion’s head with a gaping mouth, razor-sharp jaws, and “whiskers admired by all that see them”. Probably the world’s most surreal medium of literary communication, he was a playful British slant on a chilling Venetian tradition.

As Addison explained in the Guardian, several marble lions “with mouths gaping in a most enormous manner” defended the doge’s palace in Venice. But whereas those lions swallowed accusations of treason that “cut off heads, hang, draw, and quarter, or end in the ruin of the person who becomes his prey”, Mr Addison’s was as harmless as a pussycat and a servant of the public. The public was invited to feed him with letters, limericks, and stories. The very best of the lion’s digest was published in a special weekly edition of the original Guardian, then a single-sheet journal costing one-and-a-half pence, edited inside the coffeehouse by Addison. When the lion “roared so loud as to be heard all over the British nation” via theGuardian, writing by unknown authors was beamed far beyond the confines of Button’s making the public — rather than a narrow clique of wits — the ultimate arbiters of literary merit. Public responses were sometimes posted back to the lion in a loop of feedback and amplification, mimicking the function of blogs and newspaper websites today (but much more civil).

“An excellent piece of workmanship, designed by a great hand in imitation of the antique Egyptian lion, the face of it being compounded out of a lion and a wizard.” — Joseph Addison, the Guardian, 9 July 1713 – Source.

If you’re thinking of visiting Button’s today, brace yourself: it’s a Starbucks, one of over 300 clones across the city. The lion has been replaced by the “Starbucks community notice board” and there is no trace of the literary, convivial atmosphere of Button’s. Addison would be appalled.

 

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Dr Matthew Green graduated from Oxford University in 2011 with a PhD in the impact of the mass media in 18th-century London. He works as a writer, broadcaster, freelance journalist, and lecturer. He is the co-founder of Unreal City Audio, which produces immersive, critically-acclaimed tours of London as live events and audio downloads. His limited edition hand-sewn pamphlet, The Lost World of the London Coffeehouse, published by Idler Books, is on sale now:http://unrealcityaudio.co.uk/shop/

~ Curated by The Marketing Curator and TME Pass The Idea (www.pass-the-idea.com)

Source: http://publicdomainreview.org/2013/08/07/the-lost-world-of-the-london-coffeehouse/

10 Tech Trends That Will Transform Your Industry

People want to learn, borrow, and understand what other industries are doing to solve similar problems

John Foley, Oracle

TECH 4/03/2014 @ 9:27AM

I have bad news for companies that are struggling to improve their customer engagement—it’s only going to get more difficult. Social-savvy, smartphone-carrying consumers will switch allegiances faster than you can say “customer relationship management.”

“Customers are going to get harder to deal with, not easier—less loyal, more picky,” says Oracle  President Mark Hurd.

Hurd was speaking at Oracle Industry Connect in Boston, where more than 1,500 business and technology executives from the communications, financial services, health sciences, retail, and utilities industries, and those from project-intensive industries such as construction and manufacturing, came together to delve deeply into what’s happening in their sectors.

They also shared ideas and best practices where there’s common ground. “People want to learn, borrow, and understand what other industries are doing to solve similar problems,” said Bob Weiler, Executive Vice President of Oracle’s Global Business Units.

The customer experience is one such area—a challenge, opportunity, business goal, and IT undertaking all rolled into one here-and-now, make-or-break imperative.

“The customer is in the driver’s seat. We need to get in front of what her needs are,” said Karen Katz, CEO and President of Neiman Marcus Group , during the Oracle Industry Connect keynote for retailers.

Companies can best manage such challenges with industry-specific capabilities that are designed for the business they’re in, Hurd said. Neiman Marcus, for example, is deploying Oracle Retail solutions to create a more seamless “omni-channel” experience across its stores, call centers, and website, and to help with demand forecasting and other retail operations.

What more can companies do to regain their footing in this fast-changing environment where customers already have the upper hand and are about to wield even more clout and influence?

Here are 10 trends that jumped out during the keynotes and sessions I attended at Oracle Industry Connect. Companies that recognize and respond to these trends will be in a better position to attract, engage, and retain their most influential—and most finicky!­—customers.

1. Customers want to co-create their experience with your company. As businesses pursue customer experience, or CX, strategies, they must remember that social-savvy customers, who are more empowered than ever, expect to have a say in the ongoing relationship they have with the company. Mike Webster, Senior Vice President and General Manager of Oracle’s Retail Global Business Unit, shared the results of a survey, titled The New Retail Democracy, which shows that 73 percent of respondents favor the idea of “individual retail.” “Consumers want to participate in decisions that affect them,” said Webster.
2. Consumers are out-pacing businesses in techinnovation. Consumers and businesses each spend about $1 trillion annually in technology, yet most of those consumer dollars go toward new capabilities, whereas only 18 percent of business IT spending does. Thus, businesses have fallen behind on the new technologies curve. Companies must find ways to modernize by shifting more of their tech spending from maintaining old systems to investing in new capabilities. Hurd points out that Oracle invests in industry-specific research and development, so companies can capitalize on that work without having to do the heavy lifting themselves.
3. Innovation has become a distributed dynamic. R&D, which used to happen behind closed doors, is becoming a more open, iterative process. Because businesses are already behind the tech innovation curve (see trend #2 above), they must find ways to tap into the innovation happening all around them. “We’re moving to distributed innovation processes,” said Professor James Cash of Harvard Business School. “The innovation going on in the rest of the world can probably overwhelm what companies can do internally.” (For an example of how one company is using external innovation to create new customer-facing services, see “BT’s New Playing Field Combines Broadband, Innovation, and Global Sports.”)
4. Big data remains a huge opportunity. Businesses recognize the potential of big data, but few have the pieces in place to convert that potential into a business advantage. Sonny Singh, Senior Vice President and General Manager of Oracle’s Financial Services Global Business Unit, said 63 percent of respondents to an Oracle survey gave their organizations a grade of “C” or lower in preparedness for the data deluge. Here too, industry-specific solutions can help. Check out my blog post on the trend amonghealthcare providers to deploy enterprise data warehouses  with a data model, middleware, and analytics suited to their needs.
5. Companies are moving beyond old-style business and IT alignment. There was a time when CEOs could take comfort in knowing that their business and IT strategies were closely aligned, but those days are over. Tech leaders must go a step further and play an active role in corporate strategy setting and competitive analysis. “You must be participating in the strategy-formulation process,” said Professor Cash in a keynote presentation.
6. Consumers expect immediate availability of products and services. It’s not enough to attract customers with low prices and wow them with great service—you better have what they’re looking for. Oracle’s The New Retail Democracy survey reveals that consumers put a premium on product availability. In fact, 58 percent say availability is more important that price, and 92 percent will not wait for products to come into stock. Retailers must excel at real-time inventory management and be able to share that information with customers.
7. Business transformation requires great project management. I made this point a few weeks ago, but it’s worth repeating: Success at business transformation hinges on efficient and effective execution one project at a time. Otherwise your company’s big ideas, and the investments behind them, are at increased risk of underperformance or failure, and that can have a domino effect on related efforts.
8. Every employee must be prepared for real-time decision-making. Whether you’re CEO or chief bottle washer, there comes a point (sometimes many of them) in every employee’s day when decisions are made that have a direct impact on a customer’s experience, a transaction, or some other business opportunity. “The average employee has to make critical decisions—that’s huge,” said Mark Hurd. That’s why it’s so important for businesses to close the tech gap that separates them from consumers, capitalize on big data, and explore new ways to make every customer interaction count.
9. Industry-specific business challenges require industry-specific solutions.There are areas of overlap among industries, but that doesn’t change the fact that banks, hospitals, department stores, and other organizations have their own idiosyncrasies, business processes, distribution channels, and other industry-specific requirements. A grocery store manager wouldn’t use a baby thermometer to monitor the temperature of fruits and vegetables, would he? Likewise, he wouldn’t use a healthcare app to manage grocery goods.
10. Industries are morphing. Phone companies have their own retail outlets, grocery stores rent movies, and coffee shops distribute music. What’s going on? Industries are changing, and, as they do, companies are adopting new business practices and models. At Oracle Industry Connect, a healthcare exec listened as other speakers discussed ways their industries are using social media for customer feedback and engagement. “This is an area healthcare has a lot to learn from retail and utilities,” she said.

~ Curated by The Marketing Curator and TME Pass The Idea (www.pass-the-idea.com)

Source: http://www.forbes.com/sites/oracle/2014/04/03/10-tech-trends-that-will-transform-your-industry/

Innovation Hubs in the Global Digital Economy

They have managed to bring together a large and fluid community of technologists, entrepreneurs and VCs who share ideas as they move from company to company–as founders, employees, managers, board members or investors.

By IRVING WLADAWSKY-BERGER, Guest Contributor

April 4, 2014, 12:49 PM ET

Last week I wrote about Cloud, Services and the Transformation of Production, based on Part I of Escape from the Commodity Trap: Will the Production Transformation Sustain Productivity, Growth and Jobs?, a paper by University of California, Berkeley professor John Zysman. Part II of the paper deals with the economic and policy implication of this ICT-based production transformation.

“For the advanced industrial democracies to expand the real income of the citizens and sustain growth in employment and productivity, their economies will have to escape from the commodity trap,” writes Mr. Zysman in the paper’s abstract. “The commodity trap is the price-based competition throughout markets for standard goods and services, which puts pressure on wages and profit margins alike. Clearly, the way out of this trap is to create distinctive high value added products  – both goods and services. The emerging transformation of the production of goods and services is dramatically altering what is produced, where, how, and who captures the value.  It creates opportunities and challenges.”

Early in the Industrial Revolution , the so-called Luddites smashed the new textile machines that were threatening their jobs. Mr. Zysman reminds us that while many of the Luddites lost their jobs, the overall English economy prospered and the average standard of living went up. “It is easier to identify the jobs that are destroyed. . .  than to imagine the ways new jobs will be created. Of course, the character and location of those jobs may advantage some communities and disadvantage others.”

Disruptive innovations–like the power looms allegedly smashed by protesting Luddites– have been displacing human labor for the past two centuries. These periods of creative destruction–when new technology-based innovations led to painful transitions in once-dominant companies and jobs–eventually worked themselves out. Over time, these same disruptive innovations rejuvenated the economy, and led to the creation of new industries and jobs.

We truly don’t know if this will once more be the case in our digital economy. Nor do we know what kinds of jobs and industries will now be created to make up for those that are going away. Hopefully, this will all come to pass after a period of adjustment. Different regions around the world are competing to become innovation hubs, attract talented people, and help create the new industries and jobs of the digital economy.

For the past few decades, Silicon Valley and the Boston area have been the most prominent such digital innovation hubs in the world. Their leading positions as high-tech innovation centers have proved difficult to replicate. Others have tried to become the Next Silicon Valley. While a few of these efforts achieved modest success, most have fallen short of their goals.

Why is it so difficult? The reasons are varied. The prominence of Silicon Valley and the Boston area is closely related to the great engineering universities in their midst–Stanford and UC Berkeley, and MIT, respectively. It clearly takes a long time to build such world class universities. Their entrepreneurial culture is even harder to replicate. They strive to bring innovations to market by partnering with the private sector, including VCs to help them start new companies and established enterprises to jointly develop and commercialize new ideas.

These regions, and others like them, have worked long and hard to establish their entrepreneurial culture. Their innovation efforts have achieved remarkable network effects over the years that give them advantages in scale that cannot be easily replicated. They have managed to bring together a large and fluid community of technologists, entrepreneurs and VCs who share ideas as they move from company to company–as founders, employees, managers, board members or investors.

The high tech innovation model is based on mastering the underlying digital technologies, platforms and tools and then turning them into practical applications. But, are there other kind of innovation models? Can you become an innovation hub if you are not a high-tech center?

In years past, that would have been very difficult, because so much innovation was related to the digital technologies themselves. But as these technologies become increasingly standardized, commoditized, and ubiquitous, their key value is no longer found in creating the technologies, but in their applications and transformational impact on industry after industry.  As was the case with electricity 100 years ago, IT is now going through a transition from an end in itself to an enabler of innovation for those industries and companies that use it extensively and wisely.

New York and London, for example, are unlikely to become high-tech innovation hubs, but they are well positioned to be major centers of private and public sector innovations in activities that involve people as providers or consumers of services. Some of the greatest opportunities for innovation, productivity, job creation and economic growth can now be found as we apply digital technologies to problems in the marketplace and society at large, in industry after industry, including healthcare, education, finance, distribution, entertainment and media.

Smart cities–the application of digital technologies and information-based services to improve the quality of life in cities–has emerged as another exciting and important innovation area. These are all innovations that are particularly suitable for NY, London, and a number of other cities around the world, given their considerable talent, management expertise, and market power.

Another model for becoming an innovation hub comes from those with expertise in industrial applications and processes, who then reach into the pool of emerging technologies to transform the products, services and means of production in their particular industry. Germany, for example, is prominent in such industrial process innovation. So are a number of other regions and countries around the world, including Japan, Italy and Denmark.

Mr. Zysman writes about the work of University of Toronto professor Dan Breznitz, who has investigated how countries like Israel, Taiwan and Ireland, became innovation hubs by using different business models and carving out unique positions in the global production ecosystem.

Production is being restructured and decomposed into discrete phases, each phase requiring a distinct set of capabilities and competencies. Different regions can become innovation hubs by specializing in becoming leaders in a particular phase of production. Innovation, job creation, and productivity growth are possible in each phase. Mr. Zysman lists some of these phases of production and the competencies each requires.

• Product creation.  “This is really a set of competencies beginning with conception, definition, and design. We emphasize that there is a major difference between the ability to come up with a new product altogether and the ability to define it and design it.”
• Production engineering, “including manufacturing, the integration of production activities, distribution, and logistics. There is clearly not a single expertise in this domain, and companies and places do differentiate within it. There is a radical difference between the lean production model of Japan or the volume models of Korea and the high quality low volume expertise noted in Denmark.”
• Innovation in the underlying components and constituent elements of products, “that is, integrating science and technology advances. This may be innovation in screen technology or micro processor design, or the production technology for semi-conductors. Each module, each unbundled process, is a marketplace target for innovation.”
• Integrated production, which is called for “if a radical new production systems begins to unfold.”
• Branding or product design and layout.

What can a region do to become a local cluster of innovation in a particular phase of production? “Strategy choices, . . . emerge from two complementary perspectives,” writes Mr. Zysman. “One perspective, building from the past, asks how existing community resources can be deployed and redeployed in new market and technology circumstances.  A second perspective, imagining the future, seeks to envision and generate radical new trajectories of growth. . .  [T]his strategy does not build from a completely blank slate, new directions certainly require generating new competencies and establishing new infrastructural capabilities.”

In the end, we are left with complex questions with no simple answers. Will there be enough new jobs to offset those lost to automation? Where will those jobs be located? “Will the 21st Century world of production and the economy in which it is embedded be an evolutionary extension of what we know, or a radically new era?  For what world must policymakers prepare?”

“We can tell rival stories, but for now they are just that: stories about utopias and dystopias. The outcomes, both the character and the consequences of the evolving or revolutionary production system that emerge. . . will turn on policy choices of government and strategic decisions of firms.”

Irving Wladawsky-Berger is a former vice-president of technical strategy and innovation at IBM. He is a strategic advisor to Citigroup and is a regular contributor to CIO Journal.

~ Curated by The Marketing Curator and TME Pass The Idea (www.pass-the-idea.com)

Source: http://blogs.wsj.com/cio/2014/04/04/innovation-hubs-in-the-global-digital-economy/

Companies that lack a systematic approach to harnessing their people’s creativity will forfeit growth opportunities

September 10, 2013

• The Key to Creative Breakthroughs—and Not Being Left Behind by the Pace of Accelerating Change—Is Doubting Everything, Even Deeply Held Beliefs, According to Thinking in New Boxes, by Luc de Brabandere and Alan Iny

BOSTON, September 10, 2013—In an age of accelerating change, when the lifespan of good ideas gets shorter and shorter, companies that lack a practical, systematic approach to harnessing their people’s creativity will forfeit growth opportunities and cease to be masters of their own destiny, warns a new book by experts at The Boston Consulting Group (BCG).

Most creative breakthroughs start with doubt that the way things are done today will still be viable in the future. But most individuals and organizations aren’t willing or able to radically reappraise their deeply held beliefs, say the authors of Thinking in New Boxes: A New Paradigm for Business Creativity (Random House), which officially goes on sale today. Those who do follow a systematic process for questioning and replacing beliefs can expect to produce game-changing innovations. Those who don’t can expect to get blindsided—and left behind—by change.

“Revolutionary breakthroughs happen because someone had the audacity to think the unthinkable and completely redefine the way we see the world,” says Luc de Brabandere, a senior advisor and fellow at BCG and a coauthor of the book along with BCG senior global specialist Alan Iny (Twitter: @alan_iny).

Adds Iny, “Many conventional notions about creativity—like ‘thinking outside the box’ and ‘blue-sky’ brainstorming—are inadequate and can even hinder the creative process.”

A Five-Step Plan to Practical Creativity—and Enduring Growth

In the book, de Brabandere and Iny offer a five-step plan to spark the next big idea. This starts with the recommendation to doubt everything. The systematic approach is based on their work with hundreds of companies around the world as well as analysis of famous cases of creative breakthroughs: Dick Fosbury and his daring decision to go over the high jump backward instead of forward; the innovators who triggered a technology revolution by believing that software did not have to be a product and could be collaboratively developed in an open-source environment; the team at NASA who decided to land an 800-pound supercomputer called Pathfinder on Mars by using airbags instead of booster rockets.

Thinking in New Boxes is a guide to understanding how creativity works, and it is filled with specific exercises to jump-start the creative process in a way that is both inspired and practical. The systematic approach is relevant for any area or function within an organization—and not just for new strategic visions but also for almost any other goal or activity, from growth to cost-cutting to organization design.

• What is a box? The human brain needs frames of reference, or sets of mental assumptions, to make sense of the world. It’s how cognitive functions work. Sometimes these frames of reference are known as paradigms or mindsets. Humans literally cannot think without these “boxes.” Boxes help people conceptualize and understand the world, assign meaning, reduce uncertainty, and take action. But outdated beliefs can prevent people from seeing and adapting to change or, more important, seeing opportunities to create change. For example, Blockbuster was stuck in a mental box that defined the company’s business model in terms of retail stores. Blockbuster’s leaders could not see the market shifting and passing them by as Netflix created a new box that replaced “retail” with “subscription” and “store” with, first, “online streaming” and then “content creation.”

• Why are new boxes needed for breakthrough thinking? Individuals cannot get outside of mental boxes completely—the idea itself is impossible. The conventional notion of business creativity, “thinking outside the box,” is a misnomer because once people step outside of an old box, they are automatically thrust into a new one. The brain must create a new one in order to keep thinking, perceiving, and ordering the surrounding world. Thinking outside the box gets people out of their comfort zone, but it gives no inkling about how to redefine beliefs to create new boxes or about which new boxes to pick out of an infinite range of possibilities.

• How can leaders and their companies create and choose new boxes?There is a systematic process for doing so, according to the authors.Thinking in New Boxes outlines exercises that deliberately challenge and dismantle preconceptions; encourage views that may be unconventional, unpopular, unattractive, or even seemingly misguided; lead people to imagine radical and unlikely scenarios and how they may impact the organization; and force people to intentionally make large leaps away from past practices and beliefs.

“The biggest misconception about creativity is that it’s passive,” notes Iny. “People have this misplaced notion that ‘creativity’ just happens, that big ideas magically pop into your mind, but very often that’s not how it works. Creativity requires a structured process.”

“To paraphrase the chemist Linus Pauling, the best way to find truly creative solutions is to force yourself to have lots and lots of ideas,” says de Brabandere. “At first, some of those ideas may feel radical, or even impossible, and totally contrary to how you see the world. But that is precisely the point. The practical benefit to thinking the unthinkable is that it opens your eyes to risks and opportunities that you may not otherwise see.”

~ Curated by The Marketing Curator and Pass The Idea (www.pass-the-idea.com)

Source: http://www.bcg.com

The Current State of Open Innovation

Open Innovation can help companies in mature industries to get “out of the box”

Posted on March 19, 2014 by Kevin McFarthing

I spent a thoroughly enjoyable two days recently at the Open Innovation Forum in Baltimore. It had a packed agenda, including lots of opportunity to network and uncover the “state of the nation” of Open Innovation. My conclusion is that OI is in a healthy state. Whilst there is nothing truly revolutionary, the picture is one of good solid progression and increasing adoption, with continuing promise for the future.

There were several key themes running through the conference. Nobody does OI just for the sake of it. It is driven by necessity and opportunity; necessity from a lack of resource or competence; and through a vision of the prize that OI can bring. Implementing OI is not always straightforward, but there are plenty of examples of good practice from which to learn. There is an increasing emphasis on crowds of different types, not just from companies whose raison d’être is crowdsourcing.

Suppliers remain probably the strongest source of inbound OI, yet there still appears to be a tension between delivering growth opportunities and meeting short-term commercial goals. OI leaders aim to strike the balance through strong, open relationships.

An often under-estimated area of OI is the receiving company deciding the commercial and technical feasibility. Fortunately there appears to be more attention being given to providing resource and structure to this important activity.

Finally, the softer elements of trust, relationship and top management support were a continual theme throughout the conference. These elements are founding principles of OI and should be central to any implementation program.

1. OI is driven by necessity and opportunity.

Several speakers related their experience of resource constraints driving the need for OI to deliver, thus making external partnerships essential. Dr. Victoria Scarborough from Sherwin Williams demonstrated how OI can help companies in mature industries to get “out of the box”. This is not necessarily radical innovation, but providing many more and varied opportunities to strengthen the portfolio of incremental projects.

According to Roger Chandler, Intel’s business model is totally dependent on OI, particularly as they are one of the world’s largest software companies. A perhaps neglected area of OI, indeed all innovation, is understanding that the hardest part is defining the problem. While talking about how their ideation includes extreme ideas, Roger produced my favourite quote of the conference – “just south of crazy is awesome”.

Olga Patel of Mattel emphasised the need for OI in her company – whilst still seeking ideas internally through an internal portal, the Mattel Innovation Exchange, they source all their innovation externally. They have adopted Nine Sigma’s Nine Sights platform to address small inventors, invention brokers and crowds. Together with “My FP Idea” (for the Fisher Price brand) they invite open-ended submissions as well as targeted challenges.

2. Implementing OI

Dr. Victoria Scarborough from Sherwin Williams described implementing OI as following the classic stages of change management – unfreezing, moving, institutionalising. Top management must therefore “loosen the reins” and give OI teams the scope to explore.

A key part of implementing OI is metrics and associated targets. According to Dr. Shimei Fan of Unilever, their target is to have 70% of pipeline projects with a significant input from OI. Their 2013 result was 58%, up from 38% in 2011, so they are well on track to meet the target. Rather than simply characterising innovation as closed or open, Unilever are aiming for a “seamless” approach. This involves moving from arms length, cost-driven old style projects to long-term partnerships, integrating strongly with internal operations. A good example is the collaboration with Dow Chemical on High Throughput Screening of small molecules that has already resulted in 20 patent applications.

Luis Solis of Imaginatik described a five-step approach to implementing OI.  It starts with an OI strategy; constructing the “sponsor spine”; finding ways to find time; securing a line of credit, not just for the current year; and finally unveiling the role of trust.

Dr. Svetlana Dimovski of BASF outlined the work of an internal group tasked with implementing OI company-wide. In such a large and complex organisation, they break down OI into front end, R&D pipeline and commercial. They have built an extensive toolkit from ecosystem development to support for their scouting network.

3. Clusters, communities and crowds

Shelley Kuipers of Chaordix showed how crowdsourcing has moved very much beyond idea generation and management. Their community of over 750,000 participants is providing predictive insights. The simple crowd segments into brand and user groups; then into leaders and “prosumers”. The latter group are the ideal ones with which to co-create.

Beth Beck of NASA used their innovation communities of practice to show how collaboration can often be chaotic, particularly when dealing with complex challenges. The key is to embrace the chaos, and to channel conflict and disruption into positive innovation output.

Dr. Barbara Sosnowski of Pfizer outlined how their landscape is evolving from a disparate group of players to a holistic ecosystem, fuelled by collaboration within bio-innovation clusters.

Mike Morris of topcoder and Lee Odess of Brivo Labs described app development using topcoder’s >600,000 strong community of coders. This “factory of capacity” can dramatically reduce the time and cost of software development.  Payment is clearly a motivation for the community, but recognition, achievement and the chance to work on interesting projects are also very strong motivators.

Frank Digiammarino of Amazon Web Services showed how the availability of massive web capacity can now support open problem solving such as the 1000 genome project and Cancer Research UK’s “Genes in Space”.

4. Working with suppliers

Dr. Sophia Zhou of Philips showed their approach to stratifying suppliers, from the basic level through to strategic partner. The latter group, of which there are only a handful of companies, have very strong relationships and multiple joint projects, developing joint IP through co-creation.

Dr. Andrew Skulan of Clorox described their segmentation of suppliers into transactional; preferred collaborators; and strategic partnerships. It’s no surprise that the so-called Level 3 group are the main focus and source of supplier innovation, as well as the highest expectations.

Supplier and inventor showcases also feature at Under Armour with the annual Futureshow.

Dr. John Creek of Reckitt Benckiser (now RB), a true innovation powerhouse where 24% of sales come from products launched in the previous 3 years, described their approach to supplier innovation. Selection and engagement are key, as are strong relationships internally with procurement in order to balance short term commercial needs with long term innovation potential.

5. Supporting startups

Ethan Applen of Warner Bros described Mediacamp, a 12 week “academy” program for startups. This novel approach provides funds and mentorship to kickstart embryonic businesses, and to stay close to exciting future opportunities. WB don’t take equity, but in the true spirit of collaboration are in prime position when it comes to doing deals with the most promising candidates.

6. Proof of concept (PoC)

Dr. Victoria Scarborough from Sherwin Williams runs a PoC lab to evaluate claims from putative OI partners. This modest resource investment can make all the difference in convincing the OI team themselves as well as other corporate decision makers.

For Dr. Barbara Sosnowski of Pfizer, PoC is now delivered at the point of a successful Phase II clinical trial. The dedicated External R&D group help to manage relationships up to this point.

Technical PoC is one thing; a business PoC is very much another. “There are lies, damn lies and Excel ROIs at the Front End”, said Jason Berns of Under Armour.  It’s therefore even more important to look at the quality of the relationship.

7. Trust, relationships and support

Many speakers spoke about the principle of trust as the foundation of OI. This was exemplified by Jason Berns of Under Armour in his description of the key principle used in their approach to partnerships – sportsmanship. So they will pay for unprotected, open ideas that in theory they could exploit freely, but recognise that would be the wrong thing to do. They also aim to be respectful and not adopt a large company/small inventor stereotype. Finally, almost every speaker mentioned the importance of top management support in implementing and sustaining OI.

So, the conference was a good showcase for OI, confirming its healthy state and giving good pointers for its future development. I look forward to next year’s.

~ Curated by The Marketing Curator and TME Pass The Idea (www.pass-the-idea.com)

Source: http://www.innovationexcellence.com/blog/2014/03/19/the-current-state-of-open-innovation/

Nestle talks collaboration and innovation at the Ad Age Digital Conference

Nestle has clearly embraced the idea that collaboration is the new currency.

Apr. 02, 2014 | by Katie Lamkin

The recurring theme for Day One of the Ad Age Digital Conference New York was one that closely aligns with iCrossing’s newly-launched iCrossing Collaboratory: collaboration can lead to break-through ideas. In Nestle’s keynote session, Path to Innovation: How Nestle Brings Startups in the Marketing Mix, Peter Blackshaw, global head, digital and social media, and Mark Brodeur, global head, digital marketing innovation, discussed how Nestle has embraced a culture of collaboration and reaped exciting rewards as a result.

Nestle, a global food and beverage company, will celebrate its 150^th anniversary this year. A company that has been around for over a century is not usually synonymous with innovation. But after what the speakers called a “teachable moment” in 2010, when the company came under attack by Greenpeace over a supply chain issue where Nestle responded inadequately, the company began to rethink its approach to digital marketing and creativity. This began a concentrated focus on innovation, both internally and externally.

In addition to implementing several internal initiatives to champion and foster innovation with its employees, Nestle began to look for external partners that could empower its creativity in the marketplace. Although headquartered in Switzerland, Nestle opened up their Silicon Valley Innovation Outpost in California. This unit of the company began working with small start-ups who are experts in their respective spaces with the goal of bringing new products, ideas and strategies to life for Nestle. The Outpost has hosted several hack-a-thons, brand labs and other creative approaches to problem-solving that has led to new thinking around Nestle’s real world business challenges.

Another great example of innovative collaboration is Nestle’s partnership with Google Android. Through a first-of-its-kind cross promotion (where no money exchanged hands) in September 2013, Google named its latest operating system KitKat, after Nestle’s candy bar brand. When the operating system went live, Nestle released a limited edition KitKat bar with Android-decorated packaging. The collaboration was a huge success for both brands, and wouldn’t have been possible without a creative approach to marketing through collaboration.

Nestle has clearly embraced the idea that collaboration is the new currency. Projects like the Android KitKat wouldn’t have been possible through traditional paid advertising, yet it delivered outstanding exposure and value for the brands. At the iCrossing Collaboratory, we believe collaboration, co-creation and innovation are principles all brands should embrace. As Nestle knows, developing new, strategic partnerships and sharing ideas can deliver exciting, breakthrough moments for brands.

— Katie Lamkin, PR Director, iCrossing

~ Curated by The Marketing Curator and TME Pass The Idea (www.pass-the-idea.com)

Source: http://greatfinds.icrossing.com/nestle-talks-collaboration-and-innovation-at-the-ad-age-digital-conference/

4 Tips for Teaching Creativity

Whether you’re a startup founder, a C-suite executive or a lower-level employee, your job always has a need for creative thinking. Here are four tips for teaching and encouraging creativity, no matter your individual role.

by Nicole Fallon, BusinessNewsDaily Staff Writer   |   March 31, 2014

Just about every entrepreneur and business leader prizes creativity. The ability to come up with new, innovative ideas is vital to keeping up with the competition in any industry. But are individuals born with a creative mind, leaving the “non-creative” crowd at a severe disadvantage, or is it a teachable skill? Many experts agree with the latter viewpoint, insisting that you only need to tap into and harness existing creativity.

“All people have creativity in them,” said Chris Paradysz, founder and CEO of digital marketing agencies Paradysz and PM Digital. “But it is the responsibility of life’s influencers — parents, managers, coaches —to draw out this quality, build confidence and to help to develop it. To be taught anything requires openness on [the student’s] part, but it also requires a teacher who puts passion behind exploring and teaching it.”

Whether you’re a startup founder, a C-suite executive or a lower-level employee, your job always has a need for creative thinking. Here are four tips for teaching and encouraging creativity, no matter your individual role.

Ask unusual questions

Sometimes, the best way to solve a problem is to temporarily redirect the team’s focus. John Canfield, corporate speaker and management consultant, recommends asking unusual, open-ended questions as tools to encourage creative thought. The brain, he said, will work harder to answer these questions, which can pave the way to innovative ideas.

“I am a big fan of using [questions as] tools to guide or provoke thinking,” Canfield told Business News Daily. “These tools do not tell people what to think, but rather how. This provocation allows the brain to go to work by mixing up a wide variety of ideas, [and then] new ideas will occur.”

Build an environment of confidence

Fear, whether it’s fear of rejection, ridicule or job insecurity, can be one of the biggest hindrances to creativity. Employees who don’t seem to offer many new ideas to the group may just lack the confidence to speak up. Strive to create a culture that welcomes all ideas, without judgment or criticism.

“The old-school methods of encouraging creativity still ring true — brainstorming ideas in groups, challenging each other and building on each other’s ideas,” said Anthony Smith, founder and CEO of CRM software company Insightly. “It is important that [these activities are] conducted in a positive way, to encourage all employees to have the confidence to contribute, as sometimes the most creative idea can get shut down just because it is different.”

Canfield echoed the importance of confidence. “Do all you can to reduce fear in the workplace,” hesaid. “Employees and leaders frightened about keeping their jobs or status in the workplace will struggle to come up with original ideas, and if they do have them, they will be unlikely to share[those ideas].”

Turn to new sources

Nothing halts innovation like relying on the same ways of thinking time and time again. Julie Weeks, advisor for American Express’ small business branch, OPEN, believes that specifically seeking out diverse input is the key to cultivating new, creative ideas.

“You can really spark creativity if you go outside of your normal sphere of colleagues and resources,” Weeks said. “Don’t just go to the same old sources. Be mindful of the diversity of opinions [you gather]. Pick up something that’s totally out of your realm of expertise — that’s where you spark a new idea.”

Get out of the office

When your team members feel like they’ve hit a dead end, a change of scenery might be all they need to refuel their creative energy. Step away from the desks, computers and conference calls for a while to give yourself and your employees a fresh perspective.

“Inspiration often comes from unexpected, serendipitous conversations,” said Darwon Choe, marketing manager of adtechnology firm Spongecell. “In addition to traditional meetings, our team and our clients get together for less-orthodox activities like tailgates and even the occasional skydiving excursion. By taking things out of the conference room, we’re able to engage with our clients on a different level and spark conversations that just might be the start of the next big thing.”

~ Curated by The Marketing Curator and Pass The Idea (www.pass-the-idea.com)

Source: http://www.businessnewsdaily.com/6158-how-to-teach-creativity.html