Tony Ulwick on Innovation Management

By: Karin Wall

InnovationManagement spoke to Tony Ulwick, founder and CEO of Strategyn, Inc., and publisher of numerous articles on innovation management in the Harvard Business Review and the Sloan Management Review. What are his views on innovation management, what does he like about his job and what should the newly appointed innovation manager who is having a hard time getting the much needed support and buy-in from the top management do?

What does innovation management mean to you?

Some people believe that innovation is ad hoc, a happening that is hard to explain and impossible to manage. Others go so far as to suggest that process stifles innovation. But nothing can be further from the truth.

Innovation is a process that can be managed as a means of devising a product or service concept that addresses unmet customer needs. The end result is a winning idea that gets approved for development and launch, and is ultimately a success in the market. Just like any other business process, innovation can be studied, understood, and transformed into a predictable discipline. I’ve spent the last 20 years of my life doing just this.

In the end, innovation management is about using a process that helps you bring value to your customers because that’s why we’re all in business. We all want to make a difference.

What’s the most satisfying part of your job?

At Strategyn, we tend to be renegades in the industry because we approach innovation from a “jobs-to-be-done perspective,” which is different from the ideas-first approach used in many companies. When managers and executives first read my book or attend a training program, there’s a shift in thinking, an “ah ha” moment. They get it. I get a huge charge out of that. It’s magic.

When you’re passionate about what you do, you feel energized and motivated.  I’m very fortunate to have the opportunity to work in a field where I get to apply my passion for innovation and creating processes to provide value to the clients we serve.

And the most frustrating?

What’s most frustrating to me is that the innovation industry is plagued by poor results. Studies document failure rates at 70 to 90 percent. It amazes me that business executives accept this. In what other industry are 70 to 90 percent failure rates deemed acceptable?

I participated in a panel discussion this spring where I challenged this and talked about Strategyn’s process, where we’re seeing success rates of more than 80 percent. Several competitors in the audience actually got hostile, saying it wasn’t possible. The panelists got defensive. The reaction was quite interesting. But obviously I hit a raw nerve.

What frustrates me the most is comfort with the status quo. The process of innovation hasn’t been innovated for years. It seems ironic, doesn’t it?

What would your advice be to the newly appointed innovation manager who is having a hard time getting the much needed support and buy-in from the top management?

Innovation managers clearly have a challenge. Many feel that they’re Lone Rangers, fighting internal battles, politics, and ignorance. Often, there’s disagreement about what innovation is, what steps comprise the process, what inputs are needed, and in what order the process should be executed.

In this environment, being an innovation manager takes new learning, vision and commitment. It’s not easy. You have to be a truth-seeker, possibly a change agent. In the current economic climate, the innovation manager faces challenges on two fronts – the internal demands I just discussed and the external pressures of innovating in a bad economy.

When I work with innovation managers on internal issues, I walk them through this five-step process:

1. Understand the problem – Identify the problem and work to get the management team’s buy-in that the current process is ineffective.
2. Select an effective innovation process to adopt – Identify a process that will work in all situations; is measurable; aligns strategy people and resources with customer needs; provides a common language and has a proven track record.
3. Gain management approval to adopt the new process – Collaborate with key team members to formulate an effective market growth strategy that takes the risk out of innovation for the manager.
4. Build a competency in executing the new process – Create a team that is dedicated full time to innovation and incentivized to perform so that the innovation process becomes a part of the company’s operational DNA.
5. Institutionalize the process – Reinvent the company’s often fragmented and inefficient strategy and innovation processes, dedicate and entrust a small number of people to execute these new processes, and invest in new tools that will not only make sure big thinking takes place  – but that it takes place consistently, effectively and with few resources.

Using a “jobs-to-be-done” approach takes much of the risk out of innovation. Convincing management that 80 percent success rates are possible is part of the answer. And once management sees that, the innovation manager will no longer be a Lone Ranger. He or she will be the innovation leader.