Paul Sloane Talks about Strategies for Creating Effective Innovation Processes

By: Chuck Frey / Paul Sloane

Paul Sloane is renowned as a thought-provoking, entertaining and motivational speaker. His books have established Paul’s reputation as the leading expert on lateral thinking and lateral leadership and he has published numerous articles on InnovationTools.com. With his consultancy, Destination Innovation, Paul helps organizations to develop a vision, culture and process for innovation. In this thought leader interview, he shares his thoughts on how to establish effective processes for innovation.

Frey: In your opinion, what is the biggest innovation-related challenge that organizations face today?

Sloane: The big problem is that innovating is not sufficient. You have to innovate faster than your competitors. PepsiCo is innovating faster than Coca Cola. Samsung is innovating faster than Sony. Reckitt Benckiser is innovating faster than P&G and so on. Coca Cola, Sony and P&G are all dynamic, innovative companies but they are finding it hard to keep up with agile competitors. It is a race and only the fittest will survive. Setting the right metrics for innovation and allocating the right resources are critical.

Frey: Why do organizations find it difficult to do innovation?

Sloane: One of the issues is that innovation is important but not urgent. Managers tend to focus on what is urgent – fixing issues and putting out fires. Drucker said, “We feed today and starve tomorrow.” Improving innovation is an ongoing strategic challenge. It requires strategic leadership and it involves taking risks. Many executives are uncomfortable in these areas. They prefer predictability and control. It takes strong leadership to jolt the corporation out of a “business as usual” mindset and into an innovation mindset.

Frey: It’s hard to even come up with a cohesive definition of what innovation is. Why do you think that’s the case?

Sloane: People confuse creativity and innovation. But it is very simple. Creativity is about conceiving new ideas. Innovation is about implementing them. Another misconception is that innovation is about new products coming out of R&D. Innovation applies to every aspect of the business – products, services, methods, processes, routes to market, partnerships and even to the fundamental business model itself.

Frey: Which is more important: a culture for innovation or processes for innovation? Why?

Sloane: They are both important but if I had to choose one it would be processes. The culture of an organization is based on behaviors. These can be changed by actions and processes. So for example if the culture is complacent and risk averse, then the leader needs to implement processes that encourage and reward entrepreneurial activity. Changing the culture of an organization is a tough challenge but it can be done by a determined leader. One of the best places to start is with the processes that support and drive innovation.

Frey: What advice do you have for innovation managers or leaders who are trying to put innovation processes into place in their organizations?

Sloane: Start with the idea generation process. Develop a good system for generating and evaluating employee ideas to focus on specific challenges. Put resources into evaluating and trialing the best ideas. Broadcast success. Put metrics in place as goals for innovation and measure against them. That is a great start. Another important thing is to look outside the organization. Borrow ideas and innovation practices from dynamic organizations. Keep fresh with innovation news from magazines, the internet and books (especially mine!)

Frey: Why do you think that so few companies have innovation metrics in place to measure their progress?

Choose a small number of metrics that suit your business goals and add them to your balanced scorecard.

Sloane: Innovation metrics are imprecise and can be manipulated. But they are still worth having. The most common metric is percentage of revenue from products or services launched in the last 2 years. This is backward looking and it can be rigged – but it is a lot better than nothing. Other useful metrics include; number of ideas generated, number in the pipeline and number implemented, mean time between conception and implementation, resources devoted to innovation, return on investment. Choose a small number of metrics that suit your business goals and add them to your balanced scorecard.

Frey: Judging from your blog, you appear to be a fan of collaboration for innovation. Why is it important today?

Sloane: It is hard for big organizations to be really innovative and agile. What major telecoms company would have developed a Voice over IP solution that cannibalized its core business? It took a small company, Skype, to do it. The tendency in big companies is to invest in success – not in disruption. So it is smart to harness the creativity and entrepreneurial skills of smaller organizations. This is what P&G, Kimberley Clark and many others are doing. They combine the creative genius of the tiny business with the marketing and production muscle of the large enterprise. It makes sense.

Frey: It is OK for CEOs to change things but how can you help your organization become more innovative if you are in a middle or lower ranking position?

Sloane: It is very challenging but it can be done. First build a coalition of like-minded people in other parts of the organization. Try to get a high-level sponsor. Build a strong case for the innovation initiative with supporting evidence. Then propose a pilot. Pilots are easier to approve. Although there will be forces resisting the change you will be surprised at the support you get. Even conservative CEOs recognize the need for innovation and the benefits of entrepreneurial activity.

Frey: I know that you write books of lateral thinking puzzles – do these have any relevance in a business innovation context?

Sloane: I believe that they do. Lateral thinking puzzles encourage questioning, challenging assumptions and the ability to look at problems from fresh perspectives. I often use them in my innovation workshops to stimulate people’s thinking. Every business problem is in some way a puzzle and there is always a fresh and lateral solution that can be proposed. You can try redefining a business issue as a puzzle. So instead of asking, “How can we sell more of our premium lawnmowers?” you might pose a puzzle: “A man persuaded every golf course in the state that they had to use his lawnmowers. How did he do it?” Quite likely, you will get more creative ideas with this approach.

Frey: What else should innovation managers and leaders focus on during the next two to three years, to increase their odds of success?

Sloane: One thing that I would recommend is to recruit and develop counter-cultural thinkers. Would a young Richard Branson work for your organisation? Or would he go elsewhere? Don’t recruit clones of your current executives. They will only conform. Look for mavericks. You want some intelligent, constructive rebels who will challenge how you do things. They are harder to manage because they are dissatisfied with the current set-up.  But they are the source of your future innovation success.