Assessing and Fostering a Culture of Innovation

Assessing and Fostering a Culture of Innovation
with Magnus Penker, CEO & Founder, Innovation360 Group
• Prior to the webinar, you had a chance to run the online-
based, personalized innovation assessment
InnoSurvey® on your perspective of an organization of
your choice, and during the webinar, learn to analyze the
outcome of the assessment crafting out an actionable
plan for immediate improvements. The assessment is a
personalized 40-page report containing analytics,
benchmark and recommendations on how to sharpen
your strategy, leadership, culture, and capabilities for
innovation.
• If you want to run the innovation assessment InnoSurvey®
afterwards it is also possible.
• During this webinar we will dive into how to assess and
foster culture and capabilities for innovation. You will
learn how to identify existing strengths and weaknesses
within an organization in order to tailor a solution for
improvement where:
• Blockers are identified and removed
• Amplifiers are activated
• Alignment between aspiration and abilities across
borders are made

Global warming
Mass pollution
Population explosion
Macro conflicts
Hyper competition
Exponential Technology
The World is under Critical Disruption.
PROBLEM
No more Planet B
Health hazards lead to loss of efficiency
Financial apocalypse
Supply chain disruption
Diminishing margins
The potential to solve it all
MACRO EFFECT

Innovation.
Everyone talks about innovation.
From electrified cities to disaster relief, time and time again,
radical innovation has shown mankind marvels that
yesterday was unimaginable. The vast majority of
companies and organizations, 84% in fact, want to innovate.
Yet, only 10 % of them have the tools and guidance needed
to succeed.
SOLUTION
HOW TO ENABLE THE SOLUTION?
Innovation is not something that just happens. Innovation
can be populated with a structured process in place; just
as you need to practice your way to becoming a world-
class athlete, you need a coach and a process to
becoming a world-class innovator.
Innovation Management.

Courageous Individuals
+
THE PREREQUISITE
New Technology
Global Initiatives
Photonic CPU’s
Artificial Intelligence
3D-Printing
Greta Thunberg
James Whitlowdelano
Bea Johnson
UN SDG’s
Paris Agreement
-
Organizations have a lack of
understanding on how to
structure and organize new
opportunities to maximize
rates of success.
Focuses on incremental innovation
Short term Profit
Lack of Commitment

The problem isn’t the lack of
ideas. We all have lots of them.
It’s about getting the where,
why, what, how, and who right.

HELP!
Everyone is
super
excited!
Let’s
innovate!
This is
getting very
expensive!
Too big to
fail!
Typically ideation processes
are like this …
Introduction

GLOBAL REACH
Headquartered in Stockholm, executive offices in New York City, Toronto and Chicago
Operates in 30 countries | 200 licensed practitioners
THOUGHT LEADERSHIP
THE BRIEF
Innovation360 is the leading innovation management company in the world.
Innovation360 has accumulated decades of cutting edge research in innovation management and synthesized
the findings into a distinctive methodology. This allows us to assess the innovation capability and culture of any
organization. This methodology has been used for transformational work in working groups of all sizes, ranging
from unicorns to Global 100 companies, governmental agencies, and the world’s largest financial funds. We
offer you the tools and experience to generate sustainable impact now and into the future.
Published a five-volume book series
Sits on the 56000 ISO Committee for Innovation Management
ABOUT INNOVATION360

CUSTOMERS WANT TO BUY FROM
INNOVATIVE COMPANIES
EMPLOYEES ARE MORE LOYAL
TO INNOVATORS
GDP GROWTH IS
DRIVEN BY INNOVATION
50% 84% 77%
WHY DOES INNOVATION MATTER?
*Source: Lab42
9May 27, 2019

This is how we define innovation. The real-world implication is that we do not see innovation as a shiny
technology or gadget, but that it affects all activities inside an organization. We divide it into seven types of
innovation:
Incremental Innovation
Improvements to existing offer
INNOVATION IS CREATIVE DESTRUCTION, WHERE ENTREPRENEURS COMBINE EXISTING ELEMENTS IN NEW WAYS
- Joseph Schumpeter (1883 – 1950)
”“
Business Model Management System Organizational Structure Processes Products Production Services
Radical Innovation
New offer
These, in turn, can be characterized either as
DEFINING INNOVATION
10May 27, 2019

As statistically showcased by PWC (2010) and Booz & Co (2010), companies that state that their capabilities are aligned to their innovation
strategy will enjoy a greater competitive outcome. By aligning your capabilities to your strategy you will be coherent – and coherent companies
perform better than their competitors.
Normalized (innovation) coherent companies were found to enjoy 22% higher results than their less coherent industry peers.
Being coherent is not the same as spending money on innovation, as shown below.
11
56
80
54
42
67
35
Revenue Growth EBITDA as % of Revenue Market Cap Growth
INNOVATORS
SPENDERS
53
74
45
52
HIGHLY COHERENT
LESS COHERENT
Lowest Possible Score 0
Highest Possible Score
100
Normalized
Industry Peers
Performance = 50
22 %
Companies that align their capabilities to their strategy yield higher profits and growth compared to their industry peers
LARGE STUDY STATISTICAL EVIDENCE
May 27, 2019

Out of the 5,000+ of companies in the InnoSurvey® database, 100 clients were carefully investigated,
27 demonstrated double-digit yearly growth during at least three years. These 27 share the following
characteristics:
• DNA Focus
• Real Need Focus
• Reinforcing the Value Proposition
• Technology-Driven Strategy
LINKING GROWTH AND INNOVATION MANAGEMENT
12May 27, 2019

Emergent Growth Mature
Performance/Valueoffering
Ongoing business
(EXPLOITATIVE –
INCREMENTAL)
Future business
(EXPLORATORY – RADICAL)
Adopted from Tovstiga (2007)
is to achieve a strategically balanced portfolio, between
exploitative (Incremental H1) and exploratory (Radical H2/H3)
innovation – based on a full recovery of an organization´s
capabilities.
An organized and well-balanced innovation portfolio is what
will make you find that next S-curve, and infinitum!
THE CHALLENGE
BUILD AN INNOVATION PORTFOLIO TO MINIMIZE RISK AND
SECURE BUSINESS SUCCESS
Today, Tomorrow, and in the Future
13May 27, 2019

…………………………………….…….……………………………Horizon 1
ROI within current FY
Core Investment Area
Leverage existing capabilities
“What you should do”
Return: Cash
Horizon 2 ………………….………………………………….…..…………..……
NPV – Prototyping and Hypothesis
Acquire/develop new competencies
Projects to be commercialized in H1
“The next big thing”
Return: Data
……………………………………………….……………………………Horizon 3
10x Ideas
Strategic Options Value
Requirements are Uncertain
Feeding Learnings to H2
“What you could do”
Return: Insights
Adopted from M. Baghai, S. Coley & D. White (1999).
INNOVATION HORIZONS
14May 27, 2019

15
RADICAL VS INCREMENTAL
A surprising conclusion
• Radical innovators are often more structured than
incremental innovators. They have to be in order to be
able to carry out their more advanced innovation agendas.
• Incremental innovation firms are often too unstructured to
be able to innovate at the pace required by the market.
• It has been concluded that radical innovators are better at
linking organizational strategy and capabilities than
incremental innovators. [1]
• Linking strategy and capability leads to outsized results [2]
• Incremental AND radical innovation are not at odds.
Combining them is a sensible risk mitigation tactic.
1. Penker, Koh 2018 IEEE International Conference on Industrial Engineering and Engineering Management (IEEM)
2. Booz&Co The global Innovation 1000: How the top innovators keep winning 2010
Example: Data from InnoSurvey on the ICT Industry
May 27, 2019

üI = Incremental
üR = Radical
üT = Technology Driven
üM = Market Driven
üN = Need Seeking
üP1 to P5 = Innovation
Process
üC1 to C5 = Capabilities for
Innovation
(1 = Week, 5 = Strong)
16
Write down on the paper in front of you what
you believe is your innovation profile
Write down with letters, e.g. I, R, T, N, P5, C7
May 27, 2019

WHAT´S THE DIFFERENCE?
1975 1903
US$57 billion paid by P&G in 2011
(a higher value than Ericsson)
Chapter 11
May 27, 2019 17

"GOING DOWN IN THE DISRUPTION VALLEY OF DEATH"
May 27, 2019 19

1. Large corporations tend to prioritize large markets
2. Competence becomes incompetence
3. Suffer from internal conflicts and legitimacy problems
4. Can get stuck in markets preferences
5. Product architecture can create deadlocks in the organization
6. Can successfully develop technology but may lack runways for landing
7. New technology can change the structure of the industry
8. Their investment calculations may discriminate againt innovation
EIGHT REASONS WHY LARGE CORPORATIONS FAIL TO
BE TRULY INNOVATIVE
Source: Dr ChrisGan Sandström, DisrupGve InnovaGon
May 27, 2019 20

S-CURVES FOR TWO HORIZONS
Emergent Growth Mature
Performance/Valueoffering
Effort / Time
Ongoing business
(EXPLOITATIVE –
INCREMENTAL)
Business of the future
(EXPLORATORY -
RADICAL)
The challenge for Innovators:
to achieve a strategically balanced portfolio between exploitative (Incremental H1)
and exploratory (Radical H2/H3) – based on a full recovery on its capabilities
Source: Adopted from Tovstiga (2007)

Lens Horizon 1 Horizon 2 Horizon 3
Scope Core business Growth business Future business
Strategic Focus
Exploit and optimize existing business,
incremental innovation
Expanding existing and building new business,
adjacent innovation
Explore options, place small bets on
emerging opportunities, radical innovation
Innovation Strategy1 Market Reader, Technology Drivers
(incremental)
Technology Drivers (partly radical) and Need
Seeker
Technology Drivers (Radical) and Need Seeker
Leadership Style2
Spiral Staircase Cauldron, Fertile Field, Pacman Explorer
Capabilities with strong
correlation to strategy and
leadership
Clear Vision , Coaching for Goals, Core Focus,
Market Insights
Building on a Platform, Prototyping, Speed to
market, Project Selection, Ideation
External knowledge sharing , Co-Creation,
Open Innovation, Social Science, Technology
Watch
Competencies Fully assembled To be acquired or developed Requirements uncertain
Metrics Return On Investment
Net Present Value based on prototyping and
hypothesis
Strategic Option Value based on scenarios
Source: Penker (2016). Based on the work of Ralph-Christian Ohr and Kevin McFarthing.
1 Based on Jaruzelski & Dehoff (2010).
2 Based on Loewe, Williamson, Chapman Wood (2001). All data is collected and analyzed in InnoSurvey® (2016).
May 27, 2019 23
THE INNOVATION HORIZONS CODIFIED

ONLY1OUTOF10HAVEALIGNEDTHEIR
STRATEGYWITHTHEIRCAPABILITIES

“Because you do not know what you do not know”
This is what you see
Without an x-ray assessment
of your organizaron
The Real Problem
The deep root of the real
problem is what you need to
know
The Gap
This giant unknown is what
is blocking your organization
from optimizing its strategy.
With an innovation
assessment
utilizing InnoSurvey®, you
will be able to identify
innovation blockers and
amplifiers within your
organization.
THE ASSESSMENT IS THE KEY
May 27, 2019 25

TOP 5 LESSONS LEARNED FROM THE INNOSURVEY PROJECT

Radical
Innovators are
more structured
It takes 3 times to
learn a process
Fail Fast, Fail
Cheap
Diverse teams
fight more; if the
fight is about a
higher purpose, it
outperforms
conformity
H1 = Cash
H2 = Data
H3 = Insights
TOP 5 LESSONS LEARNED
May 27, 2019 27
Source: Innovaron360, Magnus Penker (2019)

May 27, 2019 28
Silos
Lack of faith
in the objectives
No higher purpose Fear of failure
Cannot deal with
uncertainty
TOP 5 INNOVATION BLOCKERS
Source: Innovation360, Magnus Penker (2019)

Overall design choices to be made:
• Innovation Management System
(IMS): Governance, Process, Roles, and
Tools
• Capabilities, Leadership, and Culture
• Operational Model
• Strategic Initiatives and Portfolio
Management
ORGANIZING FOR INNOVATION
May 27, 2019 29

THE I360 INNOVATION MANAGEMENT SYSTEM (IMS)
Decision
Spike
Hypotheses
Portfolio
Management
(H1-H3)
Developm
ent
Com
m
ercialization
Ideation
SelecGon
Experiment
Culture
Tools & Methodology
3 Horizons
Strategy
Innovation Governance Innovation Process
Pre Assessment
ME
M
E
ME
E
PE
P
E
PI PE
P
P
I
PI
I
MI
M
I
MI
M
Value Propositon (What)
Platorm
Prod
ucts
Services
CustomerInsights(Who)CustomerExperiences
Custom
erE
ngagem
ent
ValueCapture
Process(How)
Organisaton
LearningC
apabilites
Supply
Channel(Where)
Linkages
Open
ness
Brand
1
2
3
4
5
SalesInn
ovaton
innovaton360group.com
M
arketIn
novaton
Organisaton
Innovaton
The Wheel of Innovaton
No003165554-0001
Ofer Innov
aton
Post Assessment
ME
M
E
ME
E
PE
P
E
PI PE
P
P
I
PI
I
MI
M
I
MI
M
Platorm
Prod
ucts
Services
Custom
erE
ngagem
ent
ValueCapture
Process(How)
Organisaton
LearningC
apabilites
Supply
Channel(Where)
Linkages
Open
ness
Brand
1
2
3
4
5
SalesInn
ovaton
M
arketIn
novaton
Organisaton
Innovaton
No003165554-0001
Ofer Innov
aton
Innovation Support
Capabilities
Leadership
Innovation Board, Task Force,
Sponsor, Project Leader
May 27, 2019 30

31
Decision
Spike
Supervise
Why
What
How
Direction
Strategy
Innovation Task Force Innovaron BoardInnovation Board
Hypotheses
Experiment
Project & Portfolio Manager
Sponsor
Project Portfolio
Management (H1-H3)
Capability, Leadership & Culture
Building
and
Aligning
StrategicDirection
InnoSurvey®
Management Team
Penker, Jacobson, Lindblom, Sävenstedt (2017)
Campaign Design ExecutionExploration
Developm
ent
Com
m
ercialization
Ideation
Selection
Learning Growth andValue
Strategic
Initiative
H1-H3
Innovation Task Force
The Innovaron360 INNOVATION PROCESS
Observation
& information
Campaigns
Intersections
May 27, 2019

NOT ONLY ONE IMS IS NEEDED
different operational models require different management systems
OPERATIONAL MODEL
Management
Allocation
Competence
Budget Cost/Profit
Technology Transfer
PHILOSOPHY
STRATEGIC
INITIATIVE
GOVERNANCELinked to Fulfilling
INNOVATION
MANAGEMENT
SYSTEM
Part of
STRATEGIC INITIATIVE
Horizon
Growth/Profit
Risk Appetite
Innovation type
INNOVATION
MANAGEMENT
SYSTEM
Governance Structure
Process
Infrastructure
Innovajon KPI
(Strategic, Tacjcal, Operajonal)
Design for:
1) Aspirajon for innovajon
2) Ability for innovajon
Several exists in different
parts of the company:
Centralized or
Decentralized or a mix
Strategic initiatives are
executed in parts of
organizations with
defined operational
models
The innovation
management system is
adopted to a certain
operational model, a
certain type of strategic
initiative and the
measured aspiration and
ability. Several must be
defined, most likely one
per horizon
32
THE INNOVATION ENGINE
May 27, 2019

Connection of IMS enables innovation
D5
E7
C4
B3
A1
THE INNOVATION SYSTEMS FOR
DIFFERENT OPERATIONAL MODELS
AND INITIATIVES INTERACT TO
FORM THE INNOVATION ENGINE
Innovaron management systems … … their place in the organization …
COMPANY
• The connections between
different parts of the
innovation engine must
be free from blockers
• The organization must be
aligned with the general
aspiration
• The organization must be
aligned with the specific
aspiration for each IMS
Op.Mod. A
Strat. In. 1
IMS A1
Op.Mod. B
Strat. In. 3
IMS B3
Op.Mod. C
Strat. In. 4
IMS C4
Op.Mod. D
Strat. In. 5
IMS D5
Etc.
… and what they require to work
Innovation 360 Group AB 33May 27, 2019

Finding an innovation strategy
To be successful, the innovation strategy must align with many factors and be supported by a system
EXTERNAL
OUTLOOK
360
ASSESSMENT
( S & W)
Incremental
Radical
H1-CORE
X%
H2-NEXT
X%
H3-FUTURE
X%
INNOVATION PORTFOLIO
INNOVATION ENGINE
Innovation Governance
Innovation Process
Leadership
Culture
Tools
Task Force
Project Leader
Process Owner
Sponsor
Innovation Board
PURPOSE
VISION
MISSION
CORPORATE
STRATEGY
GOALS FOR
INNOVATION
INNOVATION STRATEGY
STRATEGIC
INITIATIVES
Capability &
Competence
34
Operational Model
Management Allocation Competence
Budget Technology Transfer
Source: Innovation360 (2019)
May 27, 2019

May 27, 2019 35
ASSESSMENT IS THE KEY TO BUILD THE INNOVATION ENGINE
Because you do not know what you do not know

THE INNOVATION360 FRAMEWORK
Strategic Quesjon
• Proﬁt?
• Market?
Type of Innovajon Strategy
• Incremental/Radical
Innovajon Strategy
• Need seeker
• Market reader
• Technology driven
Type of Innovation
• Products
• Processes
• Organizational Structures
• Management System
• Production
• Business Model
• Services
Leadership Style (5)
Culture (8)
Innovation Process (4)
Capabilities (16)
ME
M
E
ME
E
PE
P
E
PI PE
P
P
I
PI
I
MI
M
I
MI
M
Platorm
Prod
ucts
Services
Custom
erE
ngagem
ent
ValueCapture
Process(How)
Organisaton
LearningC
apabilites
Supply
Channel(Where)
Linkages
Open
ness
Brand
1
2
3
4
5
SalesInn
ovaton
M
arketIn
novaton
Organisato
n
Innovaton
No003165554-0001
Ofer Innov
aton
Source: Penker (2011, 2017)
Why ? What ? How ?
Patent US D813,884S
Aspirajon Ability
May 27, 2019 36

37
Incremental performance engine
H1 – highly efficient but can only handle incremental
innovation
H2/H3 – built for radical innovation, but not able to
scale on its own
Radical innovation engine
INNOVATION ASPIRATION
What Letter did you have?
What did your report say?
May 27, 2019

May 27, 2019 38
Need Seekers Market Readers Technology Drivers
Need Seekers, Market Readers and
Technology Drivers
• Are different strategies for business
development. A company often has a
combination between two strategies.
• Need seekers is proven to be the most
successful strategy. Look for potential
opportunities by applying
superior understanding of
the end-user and rapid go-
to-markets
Capitalize on proven market
trends and superior
understanding of customers
and compertors
Drive for both breakthrough
and incremental innovations
based on new technology
WHY - STRATEGY
Source: Barry Jaruzelski, Kevin Dehoff, How the Top Innovators Keep Winning. Booz & Company Inc.
(PwC today) Strategy + Business, Issue 61, Winter 2010

Strategy
WHY?
May 27, 2019 39
THE RESULTS FROM YOUR REPORTS

May 27, 2019 40
The Cauldron The Spiral Staircase The Ferjle Field The PacMan The Explorer
A style where you climb
upwards without losing the
overall goal
An entrepreneurial style
where the business model is
frequently challenged
A style where you invent,
outsource and finance start-
ups
HOW - LEADERSHIP
Source: Loewe, Williamson, & Wood, European Management Journal, 2001
A style where you explore
possibilires and invest rme
and money in them without
demanding short-term
proﬁt
A style where the
organiZation tries to use
existing capabilities and
resources in a new way

HOW?
INNOVATION LEADERSHIP STYLES
May 27, 2019 41

42May 27, 2019
HOW – INNOVATION PROCESS

43
The Wheel of Innovation®
May 27, 2019

Patent US D813,884S
Source: Penker (2011, 2017)
Highlighting perspectives, best practices
and corrective actions relating to:
THE WHEEL OF INNOVATION®
Market Growth
Internal
External
Profit
What / Who?
Who / How?
What / Where?
How / Where?
Market Growth (top line)Profit (Bottom Line) Internal
Transformation
External
Transformation
Offer
Innovation
Sales
Innovation
Organizational
Innovation
Market (eco system)
Innovation
ME
M
E
ME
E
PE
P
E
PI PE
P
P
I
PI
I
MI
M
I
MI
M
Platorm
Prod
ucts
Services
Custom
erE
ngagem
ent
ValueReassurance
Process(How)
Organisaton
LearningC
apabilites
Supply
Channel(Where)
Linkages
Open
ness
Brand
1
2
3
4
5
Ofer In
novatonSalesInn
ovaton
M
arketng
Innovaton
Organisaton
alInnovaton

• Weaknesses?
• Strengths?
• Risks?
May 27, 2019 45
HOW – INNOVATION CAPABILITIES
What LeUer did you have? THE RESULTS FROM YOUR REPORTS

1. What would happen if you
did a 360? Will you have the
same results?
2. Would you like a base line?
3. Would you like a
benchmark?

Team 8
56
Team 7
Team 5
Team 3
Team 1
Team 2
6747
61
41
41
INNOVATION IQ SCOREBOARD
Team 4
39
60
Team 6
47
The innovation IQ can help identify pockets of an innovative culture in the organization.
These pockets can be used in the change management to become a more innovative
organization. The innovation IQ becomes a strategic KPI to show progress
May 27, 2019

FIRST STEP : BASELINE & BENCHMARK INNOVATION ASSESSMENT
ME
M
E
ME
E
PE
P
E
PI PE
P
P
I
PI
I
MI
M
I
MI
M
Platorm
Prod
ucts
Services
Custom
erE
ngagem
ent
ValueCapture
Process(How)
Organisaton
LearningC
apabilites
Supply
Channel(Where)
Linkages
Open
ness
Brand
1
2
3
4
5
SalesInn
ovaton
M
arketIn
novaton
Organisato
n
Innovaton
No003165554-0001
Ofer Innov
aton
ME
M
E
ME
E
PE
P
E
PI PE
P
P
I
PI
I
MI
M
I
MI
M
Platorm
Prod
ucts
Services
Custom
erE
ngagem
ent
ValueCapture
Process(How)
Organisaton
LearningC
apabilites
Supply
Channel(Where)
Linkages
Open
ness
Brand
1
2
3
4
5
SalesInn
ovaton
M
arketIn
novaton
Organisato
n
Innovaton
No003165554-0001
Ofer Innov
aton
Baseline &
Benchmark
Amplifiers to activate and
Blockers to be removed
(Suggestions to improve IQ)
Division X
Innovation Connectivity
(Align organization around aspirations and
strategy, prioritize amplifiers to activate
and blockers to be removed)
Division Y
Division Z
63
ME
M
E
ME
E
PE
P
E
PI PE
P
P
I
PI
I
MI
M
I
MI
M
Platorm
Prod
ucts
Services
Custom
erE
ngagem
ent
ValueCapture
Process(How)
Organisaton
LearningC
apabilites
Supply
Channel(Where)
Linkages
Open
ness
Brand
1
2
3
4
5
SalesInn
ovaton
M
arketIn
novaton
Organisato
n
Innovaton
No003165554-0001
Ofer Innov
aton
Business
Area
48
May 27, 2019

Patent US D813,884S
THE WHEEL OF INNOVATION®
Market Growth
Internal
External
Profit
What / Who?
Who / How?
What / Where?
How / Where?
ME
M
E
ME
E
PE
P
E
PI PE
P
P
I
PI
I
MI
M
I
MI
M
Platorm
Prod
ucts
Services
Custom
erE
ngagem
ent
ValueReassurance
Process(How)
Organisaton
LearningC
apabilites
Supply
Channel(Where)
Linkages
Open
ness
Brand
1
2
3
4
5
Ofer In
novatonSalesInn
ovaton
M
arketng
Innovaton
Organisaton
alInnovaton If you did not do the free online
assessment with an AI generated
analysis and benchmark with clear
recommendations, go to:
https://innovation360.com/innovation-assessment/

T H E H O M E O F I N N O V A T I O N

Assessing and Fostering a Culture of Innovation

Recomendados

Recomendados

Más contenido relacionado

La actualidad más candente

La actualidad más candente (20)

Similar a Assessing and Fostering a Culture of Innovation

Similar a Assessing and Fostering a Culture of Innovation (20)

Más de Naba Ahmed

Más de Naba Ahmed (20)

Último

Último (20)

Assessing and Fostering a Culture of Innovation