Not so for Dr Bettina von Stamm, director and catalyst of the Innovation Leadership Forum. “I am very passionate about understanding and enabling innovation,” she says, and it shows. For the past 20 years, von Stamm, who was born in Germany but now lives in the UK, has been writing, researching, lecturing, teaching, advising, giving workshops, running initiatives and public speaking on the subject of innovation, and travels all over the world with her work.
There are many varying definitions of innovation. However, it’s commonly defined as being the successful commercialisation of new ideas. But, according to von Stamm, the understanding of innovation has moved on and, having worked so closely in this field, she has come up with her own definition: “Innovation is embracing the path of change to create value,” she says. “In my view, it is about the creation of value, and that isn’t quite the same as commercialising, because the latter only puts emphasis on the financial value.”
While it’s important that innovation addresses the concerns of the triple bottom line – profit, people and planet – good innovation, von Stamm says, is innovation that will improve things on all three fronts, the word ‘embracing’ is also important in her definition. Although innovation inherently involves the introduction of change, it is really about embracing that change consciously and proactively. “It doesn’t happen by accident; rather, because we decide that we want to improve something or do it differently, we then consciously pursue that.”
However, often organisations who have joined the quest for innovation have lost sight of the bigger picture. “We get so excited and passionate about our ideas that we forget to challenge and question them,” says von Stamm.
“Because there is such hype around innovation, it has become an end in itself rather than what it should be: a means to an end. We innovate to improve and bring change, not just to be innovative for the sake of it. I think that is where a lot of resources are being wasted. So innovation is absolutely essential, but it’s not innovation for the sake of it; it should be innovation with a purpose.”
In the current competitive and constantly changing global economy, leading companies are becoming increasingly aware that real growth in the future will come from innovation rather than from mergers and acquisitions, and even less from ‘business as usual’.
Von Stamm cites white-goods manufacturer Whirlpool as being, in particular, one of these leading companies. In 1999, Whirlpool’s then CEO, David Whitwam, having seen that prices for the company’s goods were dropping, embarked on a program to instill innovation as a core competency throughout the entire organisation.
This involved far more than designing new products or redesigning old ones. It meant major change to the structure, business processes, strategy, discipline and, most importantly, corporate culture. It was hard work but these innovation-related activities resulted in new ideas, products and services, which have not only led to increased profits, but have also helped deliver real value to the consumer.
“I like the Whirlpool story because they have taken this holistic approach that I’m advocating,” says von Stamm. “They also have the full weight of the CEO behind it, which is vital. The senior leadership of an organisation has to be behind the innovation drive. Employees look to the leaders for clues on how to behave. We might not do this consciously, but, basically, if the leadership is telling us that we need to innovate, and they don’t show any signs of active support and involvement themselves, we figure that innovation is not that important. It’s just a word with no meaning behind it.”
As such, while innovation is firmly on the agenda of most organisations, many struggle to emulate the success of companies like Whirlpool. However, it’s not just a case of copying another’s innovation strategy – an organisation needs to take its own context into consideration.
This is a subject von Stamm knows a great deal about, having done her PhD at the London Business School on the subject of ‘Understanding Context and Complexity in New Product Development’.
“You really have to understand your particular context and what needs to change in order to become more innovative. For example, you may see company X as being very innovative and so you want to copy what they are doing. But I’m convinced that doesn’t work. Each company needs to understand its own culture, heritage and what ‘sacred cows’ are in their organisation that may cause problems,” she says.
“I also believe that there are starting points in each organisation on which they can build. Building on what is good rather than thinking that everything needs to change is part of the art of creating more innovative organisations.”
Innovation is an evolving process that requires learning, challenging existing knowledge and understanding something new. Ultimately, it leads to change and many business leaders find the prospect of changing company behaviour and culture very daunting.
“Innovation is fundamentally about values and behaviours – we don’t change these just because our minds tell us it’s a good thing,” explains von Stamm. “I like to use the example of New Year’s resolutions. Even if you want to change some of your behaviours, it isn’t easy to do and you have to have strong motivation. Being innovative – or even accepting innovation – may mean doing something completely out of your comfort zone.”
To help companies understand the challenges of innovation, von Stamm set up the Innovation Leadership Forum (ILF) in 2004. It is designed for leaders who are responsible for innovation in their organisations and want to improve their innovation performance in order to make a real and significant difference. Through membership in the ILF networking group, these leaders can meet in a non-competitive and non-selling environment to share, discuss, understand and learn.
The ILF consists of 14 members from primarily large, multinational organisations, including AkzoNobel, BOC Linde, British Gypsum, Cancer Research UK, Cargill, Diageo, GlaskoSmithKline, Marks & Spencer, Mars, NHS Institute for Innovation & Improvement, Ordance Survey, Scottish Health Directorate, Shell and Smith Nephew.
“One thing I really like about the group is that not only are the members diverse in terms of the industries they represent, but also in terms of their professional backgrounds. They come from strategy to marketing to R&D to innovation specific. This variety makes for very interesting and rich discussions during the meetings,” says von Stamm.
The group meets four times a year, three of which involve workshops around a certain topic. “Topics are varied and can be about the role of design in innovation, online communities or open innovation,” she says. “One of my favourite topics was the last one we had which was ‘Ambiguity: friend or foe of innovation’.”
The fourth and last meeting of the year is the ‘Innovation Leadership Experience’, which lasts for a day and a half and focuses on understanding innovation challenges through doing rather than talking. It could involve working through why individuals are resistant to change, or it could be about experiencing what it means to innovate and demonstrate behaviours that support innovation.
“My absolute favourite example is when I invited a salsa dancing instructor to give a two-hour salsa class. It was at the end of the first day but I didn’t put it on the program as I knew people would have found a way to escape,” laughs von Stamm.
“But it was all to do with the fact that you may find this experience very uncomfortable but if you ask people to innovate and change their behaviours, this is probably exactly how they feel. So knowing how they feel, you can probably approach them somewhat differently.”
Another phrase we’re hearing a lot of is open innovation. The term came to the fore when Henry Chesbrough, a professor and executive director at the Center for Open Innovation at the University of California, wrote his book Open Innovation: The new imperative for creating and profiting from technology, published in 2003. “Open Innovation,” he writes, “is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology.”
In simplified terms, von Stamm explains that it’s knowing that not all the bright people work for you and there are many others whose insights you could benefit from. “That is the fundamental starting point and then it’s about finding ways to involve these people in your organisation’s activities,” she explains. “To a certain degree, this is always taking place as organisations work with their suppliers and customers. But I think open innovation is a magnitude shift – it’s the degree to which external groups are involved and given access to things that were previously only accessible to employees.”
Some multinationals have made the decision to embrace open innovation, including IBM and Procter & Gamble (P&G). IBM, one of the world’s largest patent holders, has made its technology freely available to developers, partners and clients.
So, with its Eclipse platform, competing companies are invited to cooperate inside an open innovation network. IBM believes that by doing this, it will encourage markets to grow and will, of course, lead to them getting more than their fair share.
P&G’s goal is that 50 per cent of its new products come from outside its labs through an open-source innovation strategy called ‘connect and develop’. The company has helped establish several networks of inventors, scientists and suppliers, which it turns to for ideas that can be developed in-house.
However, according to von Stamm, being involved in open innovation requires a complete mind shift. “It requires organisations to think much harder than before about what their essence is and what their crown jewels are. What can they share and make available to other organisations and what do they need to hold on to? It requires a very different way of thinking,” she says.
“If you think back 20 to 25 years, most organisations were pretty closed. Even their own R&D departments would be shut off completely from the rest of the organisation. So, the entire mindset around that has, in my view, changed quite a lot.”
In fact, open innovation has also led to the emergence of new companies, such as Innocentive. Established in 2001, this US-based company calls itself the open innovation and crowdsourcing pioneer that enables organisations to solve key problems by connecting them to diverse sources of innovation, including employees, customers and partners.
Essentially, it’s a broker between those who can’t solve a particular problem and those who might be able to with a cash prize for the best solution.
“I find it quite intriguing that the solutions often come from people outside the field where the problem originated because the people within the field are constrained by their existing knowledge. Whereas people from outside often don’t have those barriers and can therefore propose solutions that are often strikingly simple or strikingly different,” says von Stamm.
This really just scratches the surface of von Stamm’s thoughts and research into innovation. She could fill books on the subject, which she has, having penned three books, as well as numerous self-published reports, including her most recent: ‘The Fourth Innovation Best Practice & Future Challenges Report’.
“I absolutely love my work. I meet so many fascinating and wonderful people from whom I learn at least as much as I hope they learn from me,” says von Stamm. “Creating a truly innovative organisation, where everyone feels the desire and ability to contribute to the organisation’s innovation journey, can help remedy a big problem we are facing today: disengagement.”