2010 Predictions - Conscious Capitalism and Vertical Learning

Making predictions is no easy business. Take this, for example:

“There is no reason anyone would want a computer in their home.”

— Ken Olson, president, chairman and founder of Digital Equipment Corp. (DEC), maker of mainframe computers, arguing against the PC in 1977.

But, with accurate insights and reflection and analysis of those insights, we can begin to develop a sense of what the future might hold. For 2010, many are predicting change to occur in technology, pop culture and personal life. For beyond—into the next decade, here’s what we think is next for business models, products and services:

The integration of Conscious Capitalism will spur long-term growth.

Conscious capitalism is a new way of thinking about "social responsibility," the idea that an organization (government, nonprofit, business) has an obligation to act not only in its own best interests but also in those of all its stakeholders (customers, employees, suppliers, investors, society).

In the developing consumer driven market, companies will no longer be responsible to only their investors—not if they want sustainable profit, anyway. Instead, companies will either adopt Conscious Capitalism or be forced to once they realize that doing good allows businesses to do beyond well.

And the proponents of this change? First of all, they will be people like John Mackey, CEO of Whole Foods. Along with John Mackey, many CEOs in parallel industries have already begun implementing the integration of Conscious Capitalism.

Secondly, but more importantly, the consumers will drive this change. With the power to choose products and services created by companies who no longer see business as a machine driven by profit only, consumers will exercise this measure of control to empower companies that not only empower them, but also facilitate change for the world.

Vertical learning will be of increasingly high value.

Vertical learning is the pursuit of knowledge of our own assumptions, ways of interpreting experience and our beliefs. But, it has been long overlooked and placed secondary to Horizontal Learning—knowledge acquired through training, education and work experience—expanding our skill sets, in short.

Horizontal Learning is, of course, absolutely necessary. For instance, those who want to design products must learn the proper techniques and acquire the necessary technological information to do so. But Vertical Learning is seen as a lesser skill—introspection is not currently viewed to be equally valuable.

However, with the two working in tandem, we are less likely to think about business models, products and services in binary terms. Instead, we are encouraged to “think through” and think around the obvious obstacles to innovation and renovation—therefore building something of far higher worth.

If we take both into account, we can better see developing trends with objectivity in relation to each other and discern the implications of those relationships as opposed to seeing the individual issues and tasks involved in innovation.

Although making predictions can be tricky, there’s nothing outrageous about these and many other future trends we see developing. After all, businesses alike consumers are ready for positive change in the world—aren’t we all?

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Future Trends: Crowdsourcing Municipal Maintenance

Let’s say you’re driving home from work when all of a sudden your front left tire drops into a massive pothole causing you to swerve right. Luckily, there are no cars in the right lane, but regardless you’ve narrowly avoided an accident, and with good reason, you’re upset.

So what?

Well, a few years ago, you might have complained to your friend in the passenger seat and just kept on driving. But now, people have the power to report local issues with the click of a few buttons and the power of GPS.

City residents can now use an app like SeeClickFix, a mobile application that allows its users to take a photo of a pothole, a burnt out street light, fresh graffiti—basically anything that needs to be fixed by the local government—and report it using a mobile GPS device. Along with a photo and GPS location, users can add notes and track progress, as well as receive and view alerts on nearby city issues. Then, users can see how many other people have reported the same issue and monitor the most reported, a.k.a “hot issues” in the selected city.

Just one app out of the many that have been dubbed “Gov 2.0” by the tech community, SeeClickFix is utilizing GPS location in an attempt to make local government more efficient and responsive—and the app supports a trend that we’ve watched develop over the last decade called “Track Me, Help Me.”

The “Track Me, Help Me” trend was sparked by recognition of not only the popularity and functionality of GPS navigational systems on-board mobile devices, but also by the recognition of consumer willingness to offer up a very valuable piece of the puzzle:

Location, location, location.

Many people with smart phones have come to depend on apps like Google Maps, but now, as demonstrated by apps like SeeClickFix, people are ready to take location to the next level. Whether it be the power to innovate local government operations or the pleasure of playing virtual put-put, consumers are receiving relevant benefits when they give this information away—more evidence of not only “Track Me, Help Me,” but also of the evolving consumer-driven market.

But the GPS centric apps currently available are just the tip of the ice burg. As app developers begin working in tighter conjunction with the government, corporations and organizations, GPS innovation will be streamlined and even more integrated into our daily lives. In fact, many industries have just now recognized this trend and are developing applications to catch up to this unmet consumer need, meaning that even more people will be saying “Track Me, Help Me” while being enabled to accomplish tasks—no matter how big—with efficiency.

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Why Companies Lack Successful Innovation - BusinessWeek

A shortage of innovation isn't always senior management's fault. Marketers deserve some blame for not having the right processes in place

By G. Michael Maddock and Raphael Louis Vitón

It is easy to blame chief executives and senior management for not devoting enough attention to introducing new products, but that is too simplistic an explanation for why radically new products are so rare. Marketers deserve some of the blame for at least three reasons:

Successful strategic innovations need more than a great idea.

There's no shortage of new product concepts. We are willing to bet you could come up with a handful of intriguing ones before lunch if you set your mind to it.

But new ideas by themselves are worthless. You need to move from idea to execution, and that is where the majority of companies stumble. You need a new-product development process—one that is codified, efficient, and repeatable, and which allows you to turn a notion into something you can sell.

But there aren't a lot of marketers who have tried to formalize a new-product introduction. Too often, marketers see their job as simply coming up with the idea. They leave the actual development and production to someone else and then profess to be surprised when the finished product is not exactly what they had envisaged. (This is true, by the way, whether we are talking about introducing new consumer products or selling business-to-business.) It is always nice to have someone else to blame when something goes wrong—such as, the product didn't sell. But it isn't the best use of your time, or of company resources.

The takeaway point from all this is that you want to create a process that will allow you to introduce a new product the same way every time. The procedure needs to be replicable—and easily understood internally—so you can train new hires to execute it. The process should become a legacy in your organization.

There is a shortage of Renaissance men (and women).

This builds off the previous point. As we have just seen, there are two distinct components to developing a successful new product: Coming up with the idea and then putting it into practice—i.e., executing it. We must make sure that it is produced exactly as designed and that the marketing that follows is consistent with the overall message the product is supposed to communicate. Failure can arise when we look for people who possess both skills, but in reality such people are extremely hard to find in any organization. Most people are naturally better at one or the other part of the process.

Instead of looking for someone who is good at both, it would seem more efficient to let people do what they do best. Since most companies have people who are fairly good at carrying out a mission once it is defined for them, it probably makes more sense to keep that capability in-house, and to look to outside resources to help you discover new ideas and fresh needs in the marketplace. Once the outside firm has unearthed those opportunities, the company can develop them.

Marketers tend to be fatalistic.

Marketers seem to go into new-product introductions with the expectation that they are going to fail. So they deal with new-product failures rather like the way an overweight person does with their problem: We periodically make half-hearted efforts to fix things…and then give up.

Just like someone who resigns himself or herself to being overweight, marketers conclude that there is nothing they can do to improve their batting average when it comes to introducing new products. Instead of throwing up their hands and saying "woe is me," they should be studying their past successes to see what they should do the next time they introduce something new.

That, of course, takes us full circle, underscoring as it does the need to have a replicable process to make new product development as painless as possible.

Blaming the CEO and others for not being more supportive about new product development is a waste of both time and mental energy. Look in the mirror and try to figure out how to make things better. Addressing the three problems we just talked about is a good start.

This article originally published in BusinessWeek

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Sportvision's Hank Adams Talks Innovation Efficiency

Does innovation that requires the complete renovation of technologies, ideas and even personnel be performed efficiently, or can a company reinvent rapidly while re-working everything?

Hank Adams, CEO of Sportvision, explains how companies can use materials that already exist to implement new products, services, and business models efficiently.

Hank is a member of the Maddock Douglas Global Expert Network, an exclusive group of thinkers that includes entrepreneurs, professionals and specialists. GEN members span the globe and are hand picked to provide insight and expertise for specific opportunities and challenges. These experts often come from a parallel industry or have a specialized skill that relates to the challenge at hand. And this cross-section of thinking creates relevant, and frequently groundbreaking, ideas. Do you have a GEN? And if not, how do you plan to infuse outside expertise into your next big challenge?

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Wall Street Journal 2009 Technology Innovation Awards: Making a Difference

From The Maddock Douglas Innovation Engine Blog

The winner of the Wall Street Journal 2009 Technology Innovation Awards is on pace to change the world. Sure, Tapulous, the maker of the hit, one million dollar per month games is changing the face of mobile gaming technology—but technology innovations that hold the promise of making everyday life better for millions of people across the world are the ones to watch.

Ibis Biosciences' T5000 sensor, which won Gold at this year’s awards, allows for the detection of unknown organisms—a viable solution for the identification of novel infectious diseases. In short, the T5000 is intended to answer the question: "What microorganisms are in my sample?

How will this apply to us? Take a virus like H1N1 as an example—immediate detection and strain identification can help protect the masses and make responding appropriately to unknown diseases faster and easier—which could mean saving lives.

Ibis Biosciences Inc. developed the sensor to fill an unmet need—rapid identification of the unknown. And the T5000, the product that meets that need, is the first in a long line of rapid detection mechanisms that will alter the way we respond to disease.

But what about the communication that connects the two?

As disintermediation begins to fundamentally change industries, consumers will start demanding bioscience and healthcare communication that’s easier to digest. People want a deeper understanding of the bioscience (and tertiary) technologies that have the ability to change their lives.

As Maria Umbach suggests for the insurance industry, the next opportunity to innovate may be in the way we speak to consumers.

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Laugh a Little, Innovate a Lot - BusinessWeek

When looking for a big idea, you don't necessarily want to hear "Eureka!" but laughter

By
G. Michael Maddock and Raphael Louis Vitón

How much fun are you having at work these days? Let's face it. Having fun isn't as easy as it used to be, even for the most courageous, creative, and curious. Today just reading the headlines can turn an optimist into a fearful pessimist. The stories all seem to make you worry the very real possibility of losing your job.

Here is a critical insight for you. It is impossible for teams to innovate effectively while they are afraid. Impossible. Nothing kills great ideas like fear.

The good news is that fun is the antidote to fear. So if you are an innovation leader in a company that has become fearful, your people are on the road to failure unless you can change your culture. Cue the music, it's time to infuse some fun into the workplace.

The place to start? With you.

Leaders know how to laugh at themselves. Show us a person that can stand up in front of his team and say, "Call me stupid, but I have no idea how to do this," and we will show you a person with great leadership potential. Humble leaders with this trait create cultures that don't take themselves too seriously; cultures willing to take risks; cultures capable of creating and supporting a greater number of ideas.

The Daily Huddle

Why not start every day with a fun meeting? The daily huddle is simple practice that jump-starts the day and sets the stage for big ideas. Verne Harnish, "growth guy" and chief executive officer of Gazelles, which is an outsourced corporate university for midsize firms, taught us about the daily huddle. He developed the practice after studying and writing about John D. Rockefeller in his book The Rockefeller Habits.

Our company meets every day at 9 a.m. for no more than nine minutes. The agenda is simple. We share good news, bad news, and how well the company is doing. We use video to connect offices so everyone can attend the meeting. We encourage everyone to take a turn at running the huddle. Most importantly, we try to make them casual, transparent, and fun

In the last year, our daily huddles have included baby pools—where everyone guesses when someone's baby will be born; whether it will be a boy or girl and what it will weigh—costume contests, music trivia, engagement announcements, love poems, and ballads to welcome new employees. Yes, there is a lot of silliness, and not surprisingly, there is a lot of laughter. Much of the laughter has led to jokes, observations, and comments that have in turn led to ideas that have directly impacted our clients and company. (See www.bringchangehome.com, a viral marketing campaign with the humble goal of simply changing the world.

Says Harnish, "Of all the practices we teach, the daily huddle is probably the simplest and most powerful way to infuse fun, accountability, and momentum. When companies embrace the huddle, we always see a positive impact to their bottom line and culture.

Loosening Up the Suits

He's right. In fact, our clients actually like to come to these huddles. That should tell you something about the experience.

We first started noticing the liberating possibilities of linking fun and work in the early '90s in a meeting with an extremely conservative, extremely large utility company. You have probably been in a similar room; think suits; think fear; think awkward silence.

During this "mandatory" brainstorm session, someone offered up an idea as a joke. "I know," he said, tongue firmly in check. "We can send customers a bill that actually explains all the charges in plain English." He meant it as a joke, of course. And one joke led to another. Then something amazing happened: At one point the most senior person in the room commented, "You know, that's really not that bad of an idea. We could actually do that." Eventually the idea that started as a joke wound up being seen by 40 million consumers as a new kind of phone bill—one that was simple to understand. Not only did consumers embrace the joke, so did other phone companies who have adopted the idea. How great is that?

The Equation

There are two lessons here. First, it is not difficult to stage events that create this type of result, and leaders should be intentional about creating them. More important, we must learn to pay attention to laughter. Where there is laughter, there is an idea that holds people's interest. The pleasant by-product of all this: Work becomes more enjoyable, and that, too, increases the chance that you will be able to innovate successfully. It turns out that if you are having fun, you are more creative.

Here is an equation for you to consider the next time you are wondering why nobody is coming up with big ideas: I = F + H.

Ideas equal fun plus humility on the part of leadership to support the idea—and embrace those ideas that may come out of it.

This article originally published in BusinessWeek

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The Future of Mobility - Jeannie Weaver on Clearwire's 4G Service

There’s been a lot of buzz around 4G and what it means for innovation. Maddock Douglas recently interviewed Jeannie Weaver, Regional General Manager at Clearwire, the first 4G network already up and running, to talk about the future of mobility.

Innovation is defined as the synchronized intersection of an unmet need or insight, the idea (business model, product, or service) that meets that need and the communication that connects the two. Let's uncover the innovation behind Clearwire and what it means for the future of mobility.

What was the unmet need or insight that Clearwire is responding to?

Consumers want and need to be able to access data at broadband speeds on the go—and we don’t think that experience should be painful.

What was the idea that inspired Clearwire - how are you filling the unmet need?

The current 3G network is provided by voice-centric cell phone companies who are accommodating the data needs of consumers. Clearwire is just the opposite—we are a data centric network. The reason AT&T is having trouble bringing quality data service to market right now can be attributed to building a network based on voice and having to retrofit for mass data use thanks to the iPhone. Clearwire is built for data volume from day one.

And the communication—what has Clearwire been doing to make yourselves known to your target consumer audience?

We want people thinking about Clear—we want to intrigue them. We are currently implementing multiple layers that include grassroots salespeople, partnering with local businesses and street teams. We are talking to people the way they want to be communicated to.

With 400 million people already using 3G (HSDPA/WCDMA) technologies today, what is Clearwire’s plan to increase mobile usership?

We ideally want to take marketshare and entice those customers on an inferior network to utilize our faster 4G network.

Clearwire has been extraordinarily helpful in industries with location challenges, construction for example, where people are working in remote areas—Clearwire is plug and play and the pricepoint is very attractive for small and medium sized businesses.

What roles do you see big investors, Sprint, Google and Intel playing in Clearwire’s future?

Sprint holds 51% of Clearwire and they have provided the funding that is allowing us to build out our network. Intel is creating laptops and other hardware with built in WiMAX capabilities, and Google will continue to assist Clearwire strategically.

Comcast is currently reselling our service under their brand, and advantage to Clearwire because we benefit when network usage increases.

What does the future of mobility look like and how do you see Clearwire affecting that future?

I think we already are. Having the capability to accomplish things on the go, but have an experience like a home broadband connection is amazing. Clearwire will effectively support and drive a better mobile experience while helping to feed the cloud.

Also, imagine if the 4G network were implemented in, for instance, Chicago’s parking meter system—there’s a huge lag time when a customer uses a card to pay, resulting in a long wait. The ability to speed things up can make so many day-to-day things easier—and safer. For public safety purposes, the ability to live stream video could bring surveillance to a higher level of efficiency. Devices with built in WiMAX capabilities will become more common as manufacturers rush to provide consumers with the ability to lifestream rich content to their personal and social networks on the go.

How do you see the future playing out between LTE (Long Term Evolution) and Clearwire 4G?

Both technologies are sound and in the future, 4G will seem like a commodity. Yet, we have the advantage of speed to market. We'll see how the rest plays out in 8-12 months as LTE goes online in major metropolitan areas.

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My Life Is A Video Game: Technological and Social Innovations from Maddock Douglas

Let's start with some numbers: in the first 24 hours of it’s release, Modern Warfare 2 sold 4.7 units, or 310 million dollars in the US, Canada and the UK. Within the first 5 days, MW2 took in US$550 million worldwide. And yes, these numbers beat out music, book and movie releases during the same period. For some people, this shift in popular media might seem ludicrous. But for Maddock Douglas, it’s an event among many that continues to confirm a future innovation trend:

My Life is a Video Game.

Today, video games are becoming less ancillary and more integrated within our daily lives. As Mike Maddock said at Future Trends 2009 (video link) we use a Wii fit to get in shape—and to build on his point, we already are using video games to:

Test and improve our logic

Delve deeper into history and war.
Build our vocabularies

Train for jobs

And the list goes on.

As Maddock Douglas thinks about the future of many industries, we understand that consumers are becoming less and less passive. They want to be immersed and involved.

As the definition of “video game” becomes broader, individuals continue to utilize gaming for not just entertainment, but also for functional purposes.

Consider foursquare, the mobile app that allows you to “check-in”, tells your friends where they can find you, and recommends places to go & things to do near your current location. Foursquare openly credits a gaming component to their success, as every foursquare check-in (when users find new places—i.e. restaurants, stores, bars etc. in their neighborhoods) earns them points. And, after accumulating a certain amount of points, they’re awarded badges or even made “Mayor” of that location, which may qualify them to earn freebies.

It might seem silly to some, but to foursquare’s investors—the likes of Jack Dorsey, creator of Twitter, Kevin Rose, founder of Digg, and SV Angels LLC, The angel group founded and backed by Ron Conway, it’s a seriously fun way to “make your city easier to use.”

As demonstrated by many forward thinking companies like foursquare, where function and gaming mesh together, the chance to innovate is far beyond maps or joysticks.

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The Future of Agent-Based Industries: Disintermediation

Orbitz.com has been doing it for years. And, so has Ebay. In this digitally inclined age of emerging e-commerce in which demand for evolved/innovative business models has risen dramatically, cutting out the middleman (or agent, dealer, distributor, etc…) sounds obvious and easy enough. After all, taking steps out of the picture always leads to lower prices for the end consumer and results in higher margins for the company- therefore it is the best thing to do, right? You might have guessed this was coming:

Wrong.

Disintermediation, the removal of intermediaries from traditional distribution channels, is never such a cut and dried issue. For a company like amazon.com, disintermediation is a part of their business model—not just a marketing plan ; yes it works, for them. But for other companies that have jumped on the disintermediation trend in an attempt to innovate, stay relevant and generate more revenue; confusion and failure can follow. Just ask PeaPod (who at one point was expected to put grocery retail chains on their heels, but now remains an ancillary service). In every case, there is a delicate strategic balance of dancing with the one that brought ya and “working the room.”

So how do you decide whether or not disintermediation is the right path to travel down? What indicators signal the future of your industry lies in disintermediation?

1. Tune in & Evaluate.

Take an intensive, analytical look into not only your company’s channel strategy, that of your direct and indirect competitors and also at your industry as a whole. Is it slow to change? Ripe for change? Time for a challenger to shake it up? Most importantly, do your customers see value in the intermediate? Can you specify and quantify that value? Sometimes the consumer’s need can only be met by the intermediate – in homeowners insurance for example, the complex nature of the buying cycle can best be met by the agent (and only the agent), in other cases the best way to meet the need is to get the intermediate out of the way. Do segments of your customer base work around your middle man and flock to your competitors’ sites in droves to make purchases -(e.g., auto insurance : Geico, Progressive)?

Pay very close attention to your channels. Are they growing around you or with you? What is your channel strategy? Are they appropriately integrated? (From your customer’s perspective – not yours). Do they converge with your web strategy in the right places to add value—or not? By examining the foundation on which your distribution rests, as well as the channels of parallel industries, you’ll find even more insight that will be extremely useful in developing and executing industry & brand-specific strategies.

The answers to these among many other questions will allow you to assess whether or not there is a strong unmet need that may be fulfilled by disintermediation.

2. Diverge.

Compare your market’s trends and challenges with other parallel industries that may be sharing the same issues. By observing and learning from the strategies that thought and business leaders have executed under similar conditions, you’ll have a wider solution set and a helpful frame of reference.

3. Shift your perspective.

Consider looking at your channel as a stakeholder model, in which the elements are interdependent. This perspective demands that all strategies and upper level decisions are created based on their interwoven relationships and on solutions that deliver a win-win-win. And since removing the intermediary will affect the other interdependent components of the channel, you’ll have a leg-up on deciding if disintermediation is the best choice for your business, and your customers.

So should you disintermediate? Or not? The answer is simply relative.

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