This document discusses innovation in hard times. It covers many topics related to innovation including what innovation is, where we are now with innovation, types of innovation, challenges to innovation, and how to promote innovation. It also discusses challenges specific to innovation in the public sector, such as scale, inclusion, and differing time scales compared to private sector innovation. The document provides ideas for how to unlock innovation potential through experimentation and integrating new and traditional technologies. It explores various frameworks for understanding innovation including diffusion of innovations and open versus closed innovation models.

1. Innovation in Hard Times Dr Chris Yapp Chris_yapp@hotmail.co.uk

2. Themes What is innovation? Where are we now? Key ideas Leadership Policy Innovation

4. Key role of Innovation 05/10/2011 4 Invention Innovation Diffusion Necessity is the Mother of Invention

5. 05/10/2011 5 Innovation Generating value from ideas The intersection of invention with insight A Process of Social Change

6. Wikipedia’s list of Innovation Types Business Model Marketing Organisational Process Product Service Supply Chain Substantial Financial Incremental Breakthrough, disruptive or radical New technological systems (systemic ) Social 05/10/2011 6

7. 05/10/2011 7 Rules for Stifling Innovation Regard any new idea with suspicion - because it's new, and because it's from below. Insist that people who need your approval to act first go through several other layers of management to get their signatures. Ask departments or individuals to challenge or criticise each other's proposals. (That saves you the trouble of deciding - you just pick the survivor.) Express your criticisms freely, and withhold your praise. (That keeps people on their toes.) Let them know they can be fired at any time. Treat identification of problems as signs of failure, to discourage people from letting you know when something in their area isn't working.

8. 05/10/2011 8 Stifling Innovation… Control everything, carefully. Make sure that people count everything that can be counted, frequently. Make decisions to reorganize or change policies in secret, and spring them on people unexpectedly. (That also keeps people on their toes.) Make sure that requests for information are fully justified, and make sure that it is not given out to managers freely. (You don't want data to fall into the wrong hands.) Assign to lower-level managers, in the name of delegation and participation, responsibility for figuring out how to cut back, lay off, move people around, or otherwise implement threatening decisions that you have made. And get them to do it quickly. And above all, never forget that you, the higher-ups, already know everything important about this Rosabeth Moss Kanter; Change Masters

9. The Public Sector doesn’t innovate because.... It can’t go out of business Exceptionalism It’s a monopoly or pseudo-competition Lack of competition Lack of skills.. Regulation Targets Politics Leadership Culture Trade Unions.......YAWN 05/10/2011 9

10. Great Ormond Street 05/10/2011 10

11. Dimensions of the Current Challenge 05/10/2011 11 structural Economic Change Market Step Change Niche Portfolio Reactive Proactive Strategic Response Sitting Tight Mopping up cyclical

12. Dynamics of the Current Challenge 05/10/2011 12 New Entrant structural Economic Change Market Step Change Niche Portfolio Reactive Proactive Strategic Response Sitting Tight Mopping up cyclical

13. Innovation is not equal to technology The Solar-Powered Sun Lamp 05/10/2011 13

14. 05/10/2011 14 Problem Types Do we know where We are going? YES Best practice Scaling practice TASK: Operational Management TASK: Process Development NO YES Do we know How to get There? TASK: Direction Setting TASK: Concept Creation Next practice Emerging practice NO After Eddie Obeng

15. Whose problem? 05/10/2011 15 High Political System Think Tank Complexity Consultant Wisdom of The Crowds Academic /Expert Low Low High Uncertainty

16. What value? 05/10/2011 16 High Political System Think Tank Track record Complexity Ideas Consultant Wisdom of The Crowds Knowledge Academic /Expert Low Low High Uncertainty

17. During Step Change? 05/10/2011 17 High Political System Consultancy squeezed as limited track record Think Tank Complexity Consultant Wisdom of The Crowds Academic /Expert Low Low High Uncertainty

18. 05/10/2011 18 Wisdom of the Crowds “In the Future blind People will Be able to drive cars”

19. 05/10/2011 19 Results Probability 0.9 with some 0.2 Today with Resources: 1-3 years In practice: 3-10 years In reality: 10-100 years

20. Innovation Killers Not creating a culture that supports innovation Not getting buy-in and ownership from business unit managers Not having a widely understood, system-wide process Not allocating resources to the process Not tying projects to company strategy Not spending enough time and energy on the fuzzy front-end Not building sufficient diversity into the process Not developing criteria and metrics in advance Not training and coaching innovation teams Not having an idea management system 05/10/2011 20 Source: Joyce Wycoff

21. Unlocking Innovation Potential Anticipate and Exploit Early Information Through ‘Front-Loaded’ Innovation Processes Experiment Frequently but Do Not Overload Your Organization. Integrate New and Traditional Technologies to Unlock Performance. Organize for Rapid Experimentation. Fail Early and Often but Avoid ‘Mistakes’. Manage Projects as Experiments. 05/10/2011 21 Source: Stefan Thomke , Harvard BS

22. Drucker: Innovation and Entrepreneurship Incongruities The Unexpected Demographics Process need Industry and Market Structures Changes in Perception New Knowledge 05/10/2011 22

23. 05/10/2011 23 Deming’s 4 prongs of Transformation Improvement in product or service Improvement in process Innovation in product or service Innovation in process

24. 05/10/2011 24 Sources of Innovation Manufacturer Active Process User Active process Source: Eric Von Hippel, MIT

25. 05/10/2011 25 Diffusion of Innovations

26. 05/10/2011 26 Why do some Innovations take longer to diffuse? Homophily Heterophily

27. Closed Innovation Funnel 05/10/2011 27

28. Open Innovation Innovating with lead users Co-design, co-creation and co-delivery “Open source” Creative Commons Battle over “digital rights” 05/10/2011 28

29. Open Innovation Funnel 05/10/2011 29

30. 05/10/2011 30 Organisational culture Specialists and generalists Personal credibility Tolerance of uncertainty Story telling Leadership

31. 05/10/2011 31 Organisational Roles in Innovation Sponsor Product Champion Organisational Champion

32. 05/10/2011 32 Public Policy Challenge Speed Universal Access Local Determination

33. The death of “the death of distance” Smart technologies need smart people Smart people thrive on other smart people Smart communities thrive on diversity, openness and tolerance Smart communities need infrastructure and support Clusters rule!!!! 05/10/2011 33

34. 05/10/2011 34 The New Renaissance Information explosion City state Blurring of arts/humanities/science/technology New concepts Leading to a new enlightenment?

35. Challenges for Public Sector Innovation Scale Inclusion Complexity Best Practice? Social Innovation Time Scales Innovation Process Diffusion of Innovations NOT It can’t go out of business Exceptionalism It’s a monopoly or pseudo-competition Lack of competition Lack of skills.. Regulation Targets Politics Leadership Culture Trade Unions.... Thank You 05/10/2011 35