SIX
How to Conduct Innovation Challenges
As discussed in Chapter 4, the general structure of innovation challenges is based on assumptions about subjectively perceived current and desired states of performance. In other words, how we perceive the challenges facing our organizations determines how we try to close the perceived gaps. Based on these assumptions, to reframe a challenge is to alter one or more of these three ingredients: the perceived is, the should be, or how to close the gap. Most organizations are fairly good at defining where they are and where they want to be. That is within the sphere of strategic planning—assuming, of course, adequate resources and ability. They may be less effective, however, at generating ideas with the potential to close challenge gaps. This is where innovation challenge events can help. Organizations can set up idea-capturing processes in which they focus their resources on resolving challenges creatively.
Although the basic technology has been available for many years, only recently have organizations begun conducting innovation challenges systematically to generate a stream of ideas for their innovation pipelines. Most of these challenges represent single-event innovation in which just one focused target is dealt with at a time. They can be conducted any number of times based on need and available resources and need not be integrated tightly with existing innovation change processes. The nature and scope of such challenges, however, should be congruent with clearly articulated strategic visions.
THE TYPES OF
INNOVATION CHALLENGES
There are at least two distinct types of idea campaigns used for innovation challenges: competitive and noncompetitive. Competitive challenges frequently offer specific incentives for participants; noncompetitive ones typically involve an organization’s employees and/or key stakeholders without specific incentives, although that is not always the case. No research yet exists to draw conclusions as to which approach is better in terms of organizational outcomes. Some anecdotal evidence, however, suggests that competitive challenges have the potential for a greater quality of ideas.
There is no reason, obviously, why a project to capture ideas without rewards cannot be changed to a competitive one by offering incentives. The primary considerations in making that decision lie in the experience level of program managers who design and oversee competitive challenges. The real issue may revolve around the definitions of incentives. Awarding a small prize—such as dinner coupons—to whoever submits the best idea is likely to result in a less-competitive spirit than a cash award or a small vacation. The inherent competitive nature of many people may be more motivating. During online brainstorming sessions with which I’ve been associated, participants typically are paid a set fee for a given number of ideas. In many cases, they will exceed this quota once they get started.
Competitive Challenges
The most well-known international competitive innovation challenge is The Global Innovation Challenge (www.innovationchallenge.com) run by Los Angeles–based Idea Crossing and hosted by a major business school from a U.S. university. Every year, more than three hundred teams of MBA students from about one hundred universities representing around twenty countries, compete for prizes worth $50,000. The teams generate creative ideas and make a business case for dealing with pressing real-world challenges provided by such corporate sponsors as IBM, Sprint, DaimlerChrysler, the U.S. Postal Service, and Hilton Hotels & Resorts. The process and software (“Challenge Accelerator”) used for these challenges also have been used for internal organizational challenges along with cash incentives or other rewards. Examples of companies using competitive challenges include Illy Expresso’s annual competition for young designers, Peugot Concurs Design competition, DuPont, Grainger, and various nanotechnology competitive events.
According to Idea Crossing, successful competitive challenges are marked by the following eight characteristics:
1.Framed Questions. Open-ended, yet carefully bounded challenges that help to spark imaginative solutions targeted at a core issue.
2.Distributed Access. The ability of all participants (contestants, judges, sponsors and event organizers) to perform their roles regardless of geographical location.
3.Structured Submissions. Use of a standardized concept plan outline and framework for idea submissions.
4.Transparency. All participants receive timely and explicit reminders regarding due dates, event process, and other information to ensure everyone involved has up-to-date information.
5.Scorecard Metrics. All participants, but especially judges, are provided with explicit evaluation criteria so that uniform standards are used to rate all ideas.
6.Judge Selection and Management. The selection of competition judges should be managed carefully. An efficient and flexible system also should be devised to monitor judge’s progress and keep the evaluation process flowing smoothly.
7.Scalability. Idea competitions can vary considerably in the range and number of participants and idea submissions. Hundreds or even thousands of ideas may be involved. It is essential that a robust and proven system be used to minimize administrative burdens.
8.Delightful Experience. Participants in most innovation competitions are energized by the challenging and competitive nature of the experience. The event should be characterized by a smooth submission process, an easy-to-use software interface, and effective technical and human support.
Another example of a competitive challenge is Toolkits for Idea Competitions (TIC). They have been used in Germany at the sporting goods company Adidas Salomon AG to investigate the viability of customer and user participation to supplement its new product development (NPD) process. Although many customer ideas tend to be more incremental than unique, “lead” consumer users appear to have the ability to suggest innovative ideas. This probably is due to their tendency to encounter marketplace needs sooner than other consumers and their ability to benefit from their needs. That is, they tend to be trendsetters, early adopters, and typically communicate product experiences within their social networks. This, along with their above-average product knowledge, makes them ideal candidates for generating product improvement ideas as well as entirely new product lines or categories.
Noncompetitive Challenges
According to Imaginatik.com, one of the pioneers (since 1999) of systematic, single-event, primarily noncompetitive innovation challenges, the success of idea management projects depends on a number of human problems in addition to more technical and procedural ones. For instance, managers should be supportive and responsive to new ideas submitted by employees and employees must have the courage to suggest ideas they otherwise might be afraid to submit.
In support of the single-event approach to organization-wide innovation challenges, Imaginatik cites an instance in which a large consumer products company used its software (“Idea Central”) to generate 5,500 ideas from 30 different events. Of about 250 ideas selected for further development or implementation, 90 percent came from the single events, while only a few came from more traditional, random idea-capturing approaches.
All challenges should assign an innovation manager to oversee and manage the idea-capturing process and be familiar with all software and processes used. Such managers also should work with sponsors who can be internal or external to the organization. An internal sponsor can be someone who provides the administrative and financial backing for a project as well as frames the challenge statement. External sponsors might be used to provide financial support for nonprofit organizations or even competitive events such as the Global Innovation Challenge.
According to Imaginatik.com, there are twelve essential elements of single-event challenges:
1.Management Commitment. As with any organizational change project, senior management should support the process as well as commit and follow up with idea implementation.
2.Right Tool for the Job. Idea generation can occur in numerous situations involving different amounts of people. For large numbers of people, it may be best to use idea management software to process ideas more efficiently; for smaller numbers, small groups who meet in person might be best. If large-scale idea generation is to take place, idea management software would be a logical choice.
3.Problem Framing. Given the topic of this book, it should be evident that how a challenge is framed may determine an ideation project’s success. Higher-quality ideas are more likely if broader challenges are used. For instance, instead of thinking of what promotional giveaways to use, challenge the participants to generate ways to sell more products.
4.Establish Targets. Before beginning any challenge, think of desired targets such as rates of participation or number of high-quality ideas. Such goals can help structure the planning process, validate the challenge, and provide guidance for future projects.
5.Motivate People. Most challenges work best if participants receive small prizes for the best ideas or “loyalty points” for how much they contributed to a project.
6.Participant Selection. Who participates in a challenge is a crucial decision. Research suggests that the most creative, novel ideas come from diverse groups of participants. However, if an event involves a relatively narrow focus, then less diverse groups might be best. As a rule of thumb, once you have selected the ideal people to participate, add another 50 percent from outside the scope of the project.
7.Tell Them About It. Challenges are more likely to succeed if they are marketed internally via e-mails. Marketing plans for ideation projects should contain information about the challenge, the target audience, the idea submission channels, and the appropriate time to send messages about the project.
8.The Right Review Team. All generated ideas must be reviewed by a designated review team, typically appointed by a project’s sponsor. It is important to include reviewers with experience from other projects and experts external to the core review team also might be included. Such experts can be valuable when judging specialized topics such as technical feasibility. Review teams also should be well versed in the evaluation criteria.
9.Keep Your Eyes Open. The innovation project manager should monitor the process to evaluate the contributions and the degree of collaboration among participants. It is especially important to assess the degree of participation and to encourage more submissions if the number appears to be decreasing below preestablished targets.
10. People Need Closure. Following an innovation event, provide the participants with feedback regarding the project’s outcome and thank them for their contributions. Also, if you are not able to review all the ideas, indicate so to the participants. Honesty is vital in such situations.
11. Path to Implementation. Once the review team has chosen the best two to five ideas, the sponsor should initiate an implementation plan, including the order in which ideas should be implemented. The sponsor also should mobilize any resources needed for successful implementation.
12. Plan for the Next Event. Single-event innovation challenges may appear to outsiders as just that: one event directed at one target. In fact, that is accurate. Innovation challenges are directed at one target at a time. Instead, they should be viewed as supporting systemwide, sustained innovation initiatives. Thus, multiple events should be planned at least a year in advance along with details as to how each event will fit with the next and the organization’s overall strategic plan.
PREPARING FOR INNOVATION CHALLENGES
Innovation challenges are more likely to be successful when senior management aligns itself with an innovation vision and seeks to communicate it to all stakeholders to obtain their buy-in. As with any major endeavor, preparation is the key to success. Everything needs to be in place before ideas are collected. One of the first tasks is to create—as much as feasible, given limited resources—an organizational climate conducive to innovation. This, of course, assumes you are not interested just in a single event. If, instead, your focus is more on integrating innovation challenges with existing process change innovations (highly recommended!), then you must focus on how to create an innovative climate—a subject for another book, however.
Jeffrey Baumgartner, a Belgian innovation consultant and developer of Jenni idea management software, proposes that all organizations create an “innovation manifesto” to prepare for innovation initiatives. He suggests something like the following:1
In view of the fast changing marketplace, continuous introductions of new technologies and our competitors’ relentless growth, our company declares that innovation shall rule our products, operations and actions. Henceforth:
1.Top management shall embrace, encourage and nurture innovation at all times. Every decision they make will take into consideration how that decision shall affect the innovativeness of the organisation.
2.Top management themselves shall adopt more creative behaviour—via training if need be—and demonstrate their creativity to employees, clients and shareholders.
3.The company shall communicate in every possible way the importance of innovation, the innovations we have performed and our future innovation goals. Such communications shall be both internal and external and target employees, customers, shareholders and the general public.
4.We shall establish a reasonable budget for implementing radically innovative ideas. The return on investment of implementation of those ideas shall take into consideration not only income, but also learning value. There will be no [negative] consequences for implementations that are not financially successful.
5.Managers shall ensure that . . . team members [have] time to be creative and understand that being creative, which leads to innovation, is a critical component of [their] job responsibilities.
6.Realising that innovation is our future, we shall all learn to greet new ideas with open arms and consider the innovative potential of those ideas. Rather than criticise ideas, as we have done in the past, we shall challenge those who propose ideas to improve their ideas and make them more innovative.
7.Creative thinking skills shall become a priority in our internal training programmes.
8.Employees shall be rewarded for their innovative ideas, even if those ideas are not implemented or are not profitable.
9.No employee shall ever be reprimanded for sharing an idea to others in the firm, even if the idea seems preposterous. We understand that one employee being scolded for sharing a silly idea can do irreparable damage to our firm’s innovativeness.
10.We shall adopt an idea management process and system in order to encourage, capture and evaluate innovative ideas from our employees.
11.Project teams shall be filled with a variety of people from various divisions in order to ensure breadth of creative thought and innovative solutions in all our projects.
12.We shall take great pride in our innovativeness and strive to improve it daily.
Other elements involved in preparation include making decisions such as who should participate; how they should participate; how to reward participants; how to process ideas; and what, if any, idea management software program to use.
CONDUCTING INNOVATION CHALLENGES
Once an innovation vision and mandate for strategic change have been established, management must begin the work of collecting ideas to resolve innovation challenges. Historically, this has been done in-house; within corporate R&D departments; via consultations with vendors; and by scouring a variety of market research reports and, sometimes, soliciting consumer ideas for new products. Unfortunately, some research suggests that consumer-based market research often isn’t accurate enough to identify more than general trends.
New product processes in particular also seem to be characterized by an internal or “closed” focus. The “Not Invented Here” syndrome still appears to thrive within some organizations. Such a focus, of course, limits the pool of potential innovative solutions. In its place, many practitioners and researchers such as Eric von Hippel, author of Democratizing Innovation, now are calling for more open source or “distributive” innovation in which ideas are sought outside traditional organizational networks. “Crowdsourcing” and similar means of collaborating with broad bases of consumers are becoming more common wells of innovation from which organizations can draw. The Idea Crossing approach described previously was dubbed “Crowdcasting” by Business 2.0 magazine.2
For the most part, internal or external sources have tended to be formal initiatives for new products and processes to the exclusion of other aspects of organizational life. Idea generation for improving organizational challenges such as customer service, the interface between marketing and R&D, communication between departments, or brand awareness all seem to receive much less attention and emphasis. In the past, this might be excusable to some degree, given limited resources to mobilize idea campaigns on topics other than core innovation issues such as new products. However, the current availability of knowledge experts, unarticulated consumer insights, ethnographic research methods, and idea management software removes most excuses for not engaging in targeted and deliberate idea generation for a variety of innovation challenges.
WORKING THROUGH THE STAGES OF
INNOVATION CHALLENGES
One way to increase external participation in idea generation and to take advantage of technological advancements is to conduct formal idea campaigns or competitions. In the past several years, increasing numbers of organizations in all sectors have been turning to software solutions that go beyond the simple suggestion programs of the last couple hundred years. Software now is used regularly to collect and process vast quantities of ideas from employees, even those who are geographically dispersed. And, market research increasingly is being conducted on the Internet using virtual focus groups of consumer panels to both generate and evaluate new ideas. Some of these are collected from internal employees whose contributions are considered to be part of their jobs; other times, organizations are conducting competitive innovation challenges in which participants compete for various incentives. Moreover, the participants increasingly are externals such as consumers and creative professionals.
Most enterprise idea campaign software is available for hosting on an organization’s intranet or by an idea management consulting firm on its servers. The majority of enterprise innovation software is designed for idea management campaigns in which employees submit ideas that then are evaluated by review teams for later implementation. As mentioned previously, idea management software involves participation by externals such as subject matter experts, consumers, or creativity professionals. The second form of enterprise idea software is designed to conduct idea competitions in which diverse groups of participants (sometimes working as teams) submit ideas and receive various types of incentives for the quality of ideas they submit in comparison with those of others.
Although not all innovation challenges may be competitive, the basic process stages are fairly similar and parallel generic problem-solving stages: Define and frame a challenge, solicit and collect ideas, evaluate and select the best ideas, transform ideas into workable solutions if necessary, and implement the ideas. Such stages provide a structure that ensures a successful project outcome. Nevertheless, the ultimate key to quality innovation challenges lies in the details of conducting the process—just as with any complex process—and in the essential elements needed to conduct idea campaigns. The stages of three firms that conduct innovation challenges are discussed next.
Idea Crossing’s Process
Idea Crossing emphasizes the importance of executing competitive innovation challenges by thinking through an entire event before setting it in motion. Once deadlines are communicated, they must be upheld. Missing deadlines can shatter participants’ confidence in the event and its outcomes. It is therefore critical to follow a very well thought-out and tested process. Although the one described next is certainly not the only recipe for conducting a successful competition, it is one Idea Crossing has used and refined over the years of running these events. The organization calls it the Three P Three E process and its stages are:
1.Preparation. This is the most important of all stages. The aim is to define the strategic goal(s) of the competition, as well as to define target participant base, and to decide on a time line, judging methodology, and prizes. Setting the strategic objective of the event outcome is often time-consuming, and it should involve the highest levels of an organization. The most-common objectives (beyond the generation of ideas themselves) include engaging an organization in a creative exercise; finding new talent (e.g., from within the pool of top MBA candidates); or extending a brand’s position as an innovative, forward-thinking, and consumer-engaged company.
The most essential activity, however, is properly framing the challenge question. Idea Crossing spends a significant period of time with clients framing the core challenge questions, the subject of this book. The company brings in experts in the field and works closely with senior client executives to ensure challenge questions direct participants to consider issues core to the strategic objectives of the event, as discussed in other chapters. A properly framed challenge question is part art, part science—and can make or break the event. And, a well-articulated question helps to ensure participants generate innovative solutions to clients’ most-pressing business challenges.
One final aspect of the preparation phase involves assembling background material for contestants. This includes a concise packet of information, referred to as a challenge brief. This document allows the organization to provide its current thinking and background data on the problem at hand to participants. It also helps guarantee contributors will not duplicate client efforts or generate off-topic ideas.
2.Promotion. One of the key decisions in the preparation phase is the target contestant base. Depending on this decision, the promotion phase can involve a large-scale public marketing and PR campaign; take the form of more targeted communications (such as inviting students from the top one hundred global business schools to compete); or may simply be an internal, corporate, e-mail campaign. Whether the ideal participant group is based on geography, age, gender, or other demographic metrics, corporations should design and launch a targeted, yet viral marketing campaign aimed at generating significant buzz among the identified pool of contestants.
Converting educated and interested individuals into registered contestants requires clear communication. Describing the benefits of participation in a compelling and succinct manner is critical to attracting registrations. Equally important, clearly articulating the submission criteria, event time line, and judging methodology reduces the volume of questions from potential registrants (and the administrative support burden of event organizers).
3.Participation. The first step of the participation phase is to broadcast the challenge question, along with the challenge brief, to participants. Different challenge questions are given to different groups of participants, according to their topic preferences or areas of expertise. This introduces some complexity to the assignment process because the preferences of participants must be balanced with the need for a uniform distribution across all topics.
Organizations often decide to expand on the question and challenge brief with a global conference call to discuss the question in real time with contestants. These calls frequently elicit useful information as the central question is discussed and the current business strategy around it is reviewed.
Participants then are given a discrete period of time in which to generate and submit their concept. It is important that the event organizers define a standard submission structure before the event begins. This helps to standardize all ideas so that they can be judged on a level playing field. Often, idea submission structures can include criteria areas such as feasibility, value proposition, competitive advantage, and bottom-line results. The final list will depend on the target audience.
Finally, when in the participation phase, organizations may wish to provide creativity and brainstorming tools. Although there are myriad techniques and exercises found online, many organizations have their favorites and may wish to include these. Several examples are also provided in Chapters 8 and 9.
4.Identification. The key to effective idea evaluation rests on identifying a qualified judging panel and providing it with an understanding of what constitutes a winning concept. Organizations should define a standardized judging scorecard, with both quantitative and qualitative metrics. This scorecard should not be kept secret from contestants. In fact, it should be widely distributed and understood by participants as they generate concepts. Judges should be familiar with not only each evaluation criterion but also the relative weighting of each.
Some competitions should employ a two-phased judging methodology, especially if the event seeks to identify a small percentage of concepts for further exploration. If necessary, organizations should work to define first- and second-cut judging panels and scoring criteria, guaranteeing only the best ideas are bubbled up for review in the second cut.
5.Extraction. Organizations should extract only the most promising ideas for further review or pilot. This phase allows clients to invite contestants in for face-to-face presentations of fleshed-out concepts. To do this, Idea Crossing recommends that clients conduct an exciting and high-energy final round event. This event can crown the first-, second-, and third-place ideas and may be used to determine pilot funding or project go-ahead publicly. The importance of concluding the event with a high-visibility final round cannot be overstated. It is an obvious and very public show of support for the challenge, the participants, and the ideas generated.
6.Exploration. The final phase provides an opportunity to conduct a 360-degree review of the competition, including key learnings and opportunities for system or process enhancement. Such an exhaustive review can help organizations prepare for subsequent innovation competitions. In addition, organizations should provide access to all ideas for authorized employees, searchable by scores, keywords, topic areas, et cetera. During this final phase of the competition, talk usually begins around the next event. Idea Crossing suggests that companies make innovation challenges an annual part of their business calendars. Not only can additional competitions build off previous ones and resolve new challenges; they also can contribute to a more innovative corporate culture.
Imaginatik’s Process
Imaginatik.com’s idea management approach is based on four major components, each of which contains several defined activities: requirements and decisions prior to launch, preparations for launch, during the event, and closing the event.
1.Requirements and decisions prior to launch
a.Gain executive support and commitment.
b.Define objectives and measures of success.
c.Define desired types of input.
d.Define audience.
e.Define intellectual property.
f.Define reward approach.
g.Define approach to idea implementation.
h.Define review team approach.
i.Identify required technical resources.
j.Define communications approach.
2.Preparations for launch
k.Collect challenges from executives.
l.Select and prepare review team.
m.Prepare communications and feedback.
n.Configure the application.
3.During the event
o.Launch internal marketing campaign.
q.Manage the audience.
r.Manage the review process.
s.Manage executives.
4.Closing the event
t.Finish reviews and conclusions.
u.Present results to executives.
v.Distribute rewards.
w.Define plans for implementations.
x.Evaluate the performance and establish potential improvements.
y.Send closure communications.
Jenni Idea Management’s Process
Jenni software captures ideas using a four-step process:
1.The challenge is defined. These statements typically begin with, “How might we . . . ? or “In what ways might we . . . ? Once the challenge is selected, the campaign is promoted to participants who, ideally, will represent a diverse mixture of individuals in order to increase the creativity of the ideas. (The Jenni program, as well as Imaginatik and others, makes it possible for managers to initiate idea campaigns themselves so that an entire organization always does not have to be involved.)
2.Open, collaborative idea generation is begun. A space is provided where ideas can be submitted and viewed by others for possible “builds.” Such openness, also characterized by ideas from people who may not know each other, helps to foster a spirit of collaboration. Moreover, the transparency of the process helps prevent people from submitting duplicate ideas.
3.Peer reviews of ideas are conducted. One way to do this is to use five key criteria. For instance, for a project involving new product ideas, reviewers might ask questions such as: “How profitable is this product likely to be?” and “How well does this product integrate with our existing product line?”
4.Ideas and criteria are sent to experts for additional or final evaluation. Once ideas are evaluated, a list of overall scores can be created such as listing the ideas from lowest to highest scores.
As incentives to participants, they can receive recognition for the best ideas, personal notes of thanks from key managers, small gifts, work-related privileges such as attending a conference, a higher class of flying, or time off. Regardless of what rewards are used, mention them at the outset of the conference. Finally, Baumgartner notes that the end of one idea campaign can be the beginning of another. Thus, the solution to one challenge might prove to be the challenge for another idea campaign. For instance, one new product idea might be used in a new project to stimulate ways to improve or launch that product.
In summary, Internet technology now makes it possible to bypass conventional methods of collecting ideas and to gather large numbers of ideas from large numbers of participants. Internal idea competitions truly have merit and should be researched further. Some elements of competitive approaches may not always translate, however, for consumer/marketing research. One problem with soliciting ideas from consumers is using incentive systems such as cash awards. The ideas submitted might reflect a self-selected sample that responds more to financial rewards than the need to solve a problem or the joy of creating. Of course, there is nothing inherently wrong with cash incentives and there is no reliable way to determine participant motivations. I strongly recommend that using consumers to generate ideas online be supplemented by creative-type professionals working in the creativity and innovation areas and/or creative professions such as in the arts, design, and architecture.
NOTES
1.Excerpted from online newsletter Report 103, “Your Innovation Manifesto,” Tuesday April 4, 2006, Issue 79, available at http://www.jpb.com/report103/archive.php?issue_no=20060404. Retrieved January 25, 2007. Published by Jeffrey Baumgartner, Bwiti bvba, a jpb.com company, Brussels, Belgium.
2.Melanie Haikon, “Want Fresh Ideas? Try ‘Crowdcasting,’ ” Business 2.0, November 21, 2006.