Innovative Connections

Mike Parsons and Mary RoseOctober 2010

1

About us

• Our collaboration• Invisible on Everest :

Innovation and the Gear Makers (2003)

• We represent a ‘new combination’

• Mike Parsons –businessman, Karrimor, OMM Ltd, Innovator in Residence, IEED

• Mary Rose, academic, business historian

• Innovation a result not an objective

 2

Beyond Invisible on Everest

• Shared knowledge and trust

• Innovation Courses• Innovation for Extremes • www.innovation-for-extre

mes.net• A  OMM Ltd a business

start-up 2005• IEED

3

OverviewInnovation 2010 Buzz Word

What is innovation and why does it matter?

Innovation is not new

Innovation as new combinations

Innovation and Global warming

Innovation and Survival

Innovation as a ‘Dance of Two Questions

4

Why do governments promote innovation?

• Engine of economic growth

• Key to productivity growth and economic prosperity

• International Competitive Advantage of nations, regions and firms

• Competitive pressures and innovation 5

What is innovation not?

 •  It is not just clever ideas

     

6

What Innovation is not

It is not just new technology

7

What Innovation is not

• It is not just new products  • It is does not take place in isolation

o NB the myth of solo inventors  • Innovation means different things to different people

8

What innovation is not

• It is not just new or new to the world • It is not the same as invention

9

Inventions v innovations • The patent office

is full of inventions that never see the light of day.

• 1-3% were successful

• These we call innovations because they succeeded and were commercialised

10

So how do inventions become innovations?

• Process complex and often messy

• Imagination to see new connections

• People the heart of innovationo Networks of skill and

knowledge from outside firm

o Customers

11

Innovators are not lone geniuses

• Networks allow:• Knowledge and resource sharing

 

 

12

Innovation inside and outside companies

Not just in R&D Departments of large companies

13

Where does innovation occur?

• Supply Chain

• Lead users

• Collaboration with other companies

• Collaboration with universities

• Employees

14

Networks and knowledge sharing

• Boundary crossing and moving out of silos 

• Between individuals

• Between firms

• Between organisations

15

Innovative connections

• Isaac Newton:• ‘ If I have seen further than

other men, it is because I have stood on the shoulders of giants

16

Innovative Connections

Thomas Edison, Menlo Park, USA creator of lighting system not the lightbulb Great networker;with investors, scientists,politicians technicians, manufacturers

17

Innovative Connections: Not just new knowledge

• ‘Anyone who wants to design for the future has to leaf through the past’

   André Malraux   quoted at the BMW    Museum, Munich• Past and present

knowledge and skill

18

Why is past important ?

• Product and process development are path dependent and this affects selection 

• Combinations of old and new knowledge contribute to innovation

19

Influence of past

Innovative designs shaped by past knowledge and skills  Remington's First Typewriter

20

Influence of past

New combinations of old and new can be radical   Weaving Light                             

21

Why might inventions not become innovations?• Solutions to non

existent problems

• High costs• Not user friendly • No market or

user group• Ahead of

international standards, eg. Fax Machine, 1907 22

Innovation is about more than new products

• Processes• Business models• Systems• Services

23

McDonalds

• Did not invent hamburger• Did invent a system of standardised

delivery• A process innovation

24

• Larry Page and Sergey Brin didn’t invent search engines

• New approach to search engine funded by advertising revenue

• Business model

25

Innovation is not just 'new to the world'.......

Radical innovations have significant implications for the environment all companies operate in. 

Radical innovation  can also occur• at the level of the sector• even at the level of the individual company•Innovation is NOT just 'new to the world' but may be within    -sectors    -individual firms

Often new combinations 26

A different way of thinking about innovation

These changes could be of 4 types- • product or service, • process, • paradigm (shift from what's known understood and trusted)  • positioning (brand)

 they may be interrelated degree = ranges between incremental and radical

27

Innovation Space

Source: Tidd.J, Bessant. J, Pavitt. K: Managing Innovation, 3rd ed, Wiley

INNOVATION

POSITION(brand)

PRODUCT(SERVICE)

‘PARADIGM’

( BUSINESS MODEL)

PROCESS(Incremental… radical) (Incremental… radical)

(Incremental… radical)

(Incremental… radical)

28

Innovation did not begin with the ‘Information age’ or even the industrial revolution

• Fire • Protection from

animals• cooking, • light, • warmth• war and

destruction.

29

Man's Innovation Journey 

• 60,000 yrs ago man* left Africa; (fishing skill?)

• 30,000 yrs ago; central heated caves in the Pyrenees

• 20,000 yrs ago; end of last great ice age (clothing)

• 10,000 yrs ago beginning of farming to support  cities and so grew great civilisations............

• Where? the great river valleys of the Indus, Nile, Euphrates & Tigris, Yangtze, Danube

• their civilisations came ..............and went

• why?

• * 'man' meaning 'anatomically modern humans';   30

Innovation is about ingenuity, creativity, curiosity and survival

• What fosters creativity & what stifles it ?

• rulers 

• type of society 

• discontinuity - often of thousand of years

• progress is neither certain 

• nor a straight line 31

Creativity and Science

natural phenomena and their associated technologies long used for controlling and stabilising society  stars for forecasting the seasons, floodinggeometry for building and measuring land   The Greek civilisation was the first where used for changing but was lost for a thousand years  re-emerging - 16th Century renaissance   

32

10th Century China  

• Cultivation of rice• Replacement of

the scratch plough with iron plough

• Seed drills, weeding rake and deep tooth harrow

33

10th Century China (2)

• Blast furnaces -1500 years ahead of Europe

• Textiles – while spinning wheel appeared in China and West at same time (13th century) –it advanced at a faster rate in China and applied power to yarn production multiple spinning frame

• Water power –again paralleled Europe but 8th century AD Chinese were using hydraulic trip hammers, 1280 vertical water wheel

34

10th Century China (3)

• 10th and 11th centuries Chinese built accurate clocks

• 960 AD the compass• Ocean going junks • Chinese invented

paper – 1000 years before it reached the West

• Porcelain• Gunpowder 10th

century AD 35

Yet this wave of innovation did not evolve further what went wrong ?

• No such thing as physical property rights let alone rights to inventions

• Movable type printing press of much less significance with Chinese characters

• Increasing isolation 

36

What can be learnt from the Chinese example ?

• Intellectual Property rights are of crucial importance to innovation.

• Innovation may be evolutionary but there are discontinuities.

• Established innovative nations and companies can lose momentum

• Innovations can be still-born• Isolation can eradicate innovation• Innovation needs an open minded and

tolerant society. 37

Path dependence and rail tracks

• 60% world railways standard gauge : width 1,435mm or 4 ft 8½in Why?

38

Deepening wheel ruts and the width of a carthorse

• Roman Chariots• Wheel ruts and broken axles• Mineral extraction• First Railways

39

Deepening wheel ruts and the width of a horse

40

Railways in Europe, United States and much of Asia

41

21st century

42

Past, future radical change and economic crisis

43

Science + technology = Innovation

• Fire – in use for at least 500K years• Basic tools 1.5 m years ago• The Wheel 5000 years ago•  •  dramatic acceleration of Innovation

from 1800 

• SCIENCE explained natural phenomena 

• wind = wings = flight = energy  • lightning = electricity •  • Technology  harnesses the science

behind natural phenomena• creates devices which change our

world

44

Impact of the age of synergy : 1869 + 

Concatenation of events leading to radical change and the world

economy today

• There was a concatenation(chaining together of ) events, science, technology, medicine world had ‘a different programme to guide its future’. (Smil 2005) o Internal Combustion Engineo New Materials and New Syntheseso Communication and Information o New business systems and processes

• United States especially rapid diffusion

45

From 19th Century to Present Day

• Yet past knowledge and skill shaped• Set the world on an energy intensive

trajectory o Carbon emissions tripled since 1950

46

History is about Continuity and Change:75% of all around us today had its origins between

1866 - 1914

47

Radical innovations have shifted economic systems:Energy generation

 Before 1860 : power from water steam from coal

electricity from steam turbines and oil

electricity transmission  48

Radical innovations have shifted economic systems:Communications

49

Radical innovations have shifted economic systems:Materials

50

What Implications for 2010?

51

The earth at night 2007

52

Global Warming

53

US Coastal Areas and Global Warming

54

'New Scientist' suggests that to debate the end of civilisation as we know it could be valuable!

55

A new style of capitalism?

'A message that businesses may find they are surprised to agree with.' Financial Times

Jonathon Porritt grapples with capitalism's reality - a system capable of delivering sustainability and enhancing well being,  Adair Turner (Director General of CBI 1995-9)

56

Mass manufacturing v Mass disassembly

• 1908 Ford T mass manufacturing and assembly. 

• 2008 - Mass Disassembly for recycling.

• Not so much - how could more recycled components be used

• but how to dis-assemble for recycling?

• Is the Patagonia 'Sugar and Spice' shoe the process revolution we need?     

57

Innovating to Survive: End of the 'nice decade'

• The credit cycle has turned and commodity prices are rising' (Mervyn King, Governor of the Bank of England May 2007)

• August 2008 The UK is facing its worst economic crisis in 60 years

• October  09 Recession collides with technical innovation threatening established business models. 

 • October 2010  UK expenditure cuts, threat to science

research 

58

Business Model threatened : Newspapers and publishing

Wednesday 3 June 2009 The GuardianMagazines and newspapers face 'lethal threat' [from recession and internet] Advertising                         Circulation 

59

So what is innovation and what does it involve? • Creativity and stepping out

of line  • Entrepreneurship; the

recognition and assessment of opportunities and threats

• More than just a spark of an idea 

its about 'The Dance of Two Questions'.......... 'what is needed and what is possible?'

60

• Productivity declining some products and food

• China products labour intensive, but labour costs increasing in China -  Food yields improvement slowing - R&D decreased since 1996 - we had surplus food!

• CARS  - Oil to Electricity?Homes/offices  - new eco standards

• IT and carbon footprint

We are on the cusp of dramatic change?recession as a driving force for innovation?

ENERGY the new focus

61

Messages to take away

• Innovation is about knowledge and people and making new connections.

• Personal/people networks are vital in making new connections

• Innovation is a chaotic process initially• Successful innovation needs the

chaos to turn to structures, systems and organisation.

• Innovation is about survival62

Knowledge and Imagination

•  'I have more imagination than memory but without memory I would have no imagination’

• A combination of memory and imagination CRUCIAL to innovation they combine past and future

63

Our measures of success?

• If just one student could be inspired to become an innovator

• If just 10 of you could influence your future boss on how things are done

• And if all of you could be just a little bit more knowledgeable about innovation and innovative processes ………………

• Everything would be worthwhile and have made a contribution to understanding the innovation process……………

• Team working and ability to work collaboratively. 

64