Large incumbents and struggling bureaucracies have lost their ability to innovate at speed, with their growth through the years for many reasons. Complexity, dysfunctions, lethargy and redundancies are choking many of them slowly, and some may even be steadily headed towards a stall. Faced with a ‘disrupt or be disrupted’ environment, these businesses have to find their mojo back and innovate at speed to survive, and/or even disrupt their own industry before they get disrupted.
The classic innovation value chain view presents innovation as a sequential, three-phase process that involves idea generation, idea development, and the diffusion of developed concepts. Across all the phases, managers must perform six critical tasks – internal sourcing, cross-unit sourcing, external sourcing, selection, development, and company-wide spread of the idea. Each is a link in the chain. Along the innovation value chain, there may be one or more activities that a company excels in – the company’s strongest links. Conversely, there may be one or more activities that a company struggles with – the company’s weakest link. Such innovation structures are not viable anymore.
Sequential value chain for innovation would have been alright if it had all the time it needs to deliver a steady pipeline. In a ‘disrupt or be disrupted’ environment, it has become an imperative to have innovation at speed. Hence, the shape of strategic innovation no longer can be sequential. To enable innovation at speed, the shape of innovation value-chain will have to be circular. Co-SPIN is an offering to enable a circular innovation process that will be customer-centered, value-focused, speed optimized, and innovation-driven.
Innovation, which is best defined as the profitable application of creativity, always aims to do two things: design breakthrough solutions to important customer problems and develop those solutions economically. It’s about design and development, and it must be tightly integrated and rapidly adapted to the direction and pace of market changes. That’s precisely what Co-SPIN does.
Strategy is already becoming iterative, broken into smaller chunks, and execution is co-created with value focus. The co-located and self-governing efforts are increasingly customer-centered and continuously improving the operating model. In a large complex, bureaucratic, and may be even dysfunctional incumbent company, where does one start. While a top down approach is necessary, it needs to be bottoms up as well. What would such a profound transformation of the company look like?
Learning from nature
What do you see that is common among natural spectacles like hurricanes, tree, rivers, seashells, etc? – Fractals. Here is a visual of a fractal.
It might look like a head of broccoli. But it is an excellent representation of a fractal. A fractal is a never-ending pattern. Fractals are infinitely complex patterns that are self-similar across different scales. They are created by repeating a simple process over and over in an ongoing feedback loop. Driven by recursion, fractals are images of dynamic systems – the pictures of Chaos. Geometrically, they exist in between our familiar dimensions. Fractal patterns are extremely familiar, since nature is full of fractals. Abstract fractals – such as the Mandelbrot Set – can be generated by a computer calculating a simple equation over and over.
Fractals can be a simple model that can be used to inject innovation at speed back into a complex, bureaucratic, and stalling business. We can start small and evolve into a large harmonious fractal organization that embraces a culture of innovation at speed.
First Micro-SPIN attack
Micro-SPIN is an extremely focused small initiative (based on the Co-SPIN offerings) that starts with the right problem first and iterates on the solution. Micro-SPIN is about fast failure and adaptation. But as we’ll see, the key is to fail fast and fail cheap—you’re trying to make cycle times so fast that you limit the cost of failure on each cycle of learning. Each micro-SPIN would look like a microcosm of the organization you want to become. Choosing the right first Micro-SPIN attack is critical. Winning the first Micro-SPIN attack will set the tone for the rest of them to follow. Here are few guidelines:
You want a Micro-SPIN attack on an initiative that is small enough, yet can have real material impact when scaled across the organization. You first impact needs to have tangible benefits with high-visibility across the strategic imperatives of the organization.
You want the first Micro-SPIN attack to have high potential for success, so that it can build the necessary momentum for the Micro-SPIN attacks that follow.
Choose an initiative will address a well known organizational dysfunction for this first Micro-SPIN attack. People in the organization must be familiar with the dysfunction, and even be rooting for this first Micro-SPIN attack to succeed, so that their life becomes better.
Choose the right initiative leader for the first Micro-SPIN attack. The main initiative owner is accountable for winning and delivering the benefits of the initiative. You want your pick from the A-list of leaders who can influence others when they seek to scale their results across the organization.
Choose a process leader for the first Micro-SPIN attack. This person will be an expert in the Co-SPIN process and will be able to customize it for the initiative success. He/she will eventually be part of a corporate portfolio of Micro-SPIN attacks that aligns to a specific strategic imperative at the corporate-level.
Choose the right team with the right number of participants. The team should comprise anywhere from 4-15 members (often called a Squad) representing different essential expertise in strategy, process, design & technology.
Create a charter for first Micro-SPIN attack initiative that will include: a) Which overall strategic imperative is this initiative tied to? b) How will we define success of this initiative? c) What is the first prototype we need to develop, that we can fail fast on, learn from it, and adjust for the second prototype; d) What is the repeatable model we are trying to create, which upon having a successful prototype, we can scale across the organization; e) What behavior changes will be required to scale-up the successful prototype across the organization.
Train the first Micro-SPIN attack team along with its leaders on Co-SPIN process and inculcate what it will take to be customer-centric, value focused, innovation-driven at the optimum speed.
Execute on the first Micro-SPIN attack to convert a strategic priority into a successful prototype. Turn that successful prototype into a repeatable model. Consolidate the behavioral changes necessary in the repeatable model. Outline the deployment plan, operating model, and deployment roadmap. Hand of the repeatable model with the successful prototype for scale deployment. Iterate with the next sprint from the backlog through to a successful prototype and hand of for scale deployment. Then do the next, and so on.
Ensure retrospective meetings for reflecting on the lessons learned, from each of the iterations, on the process, to carry forward into future iterations and Wave 1 of the Micro-SPIN attacks. Celebrate the success of the first Micro-SPIN attack completion and successful scaled deployment.
Wave 1 of Micro-SPIN attacks
The organization will have to learn to walk before it can run, as it adopts the behaviors, processes, structures, accountabilities, and culture required for innovation at speed. While the first Micro-SPIN attack is in progress, identify 3-4 Wave 1 Micro-SPIN attack initiatives. Commit resources to run those 3-4 Micro-SPIN attacks. Agree now to carve out three hours of a monthly executive meeting to review the cycle results of those three Micro-SPINs. Assign initiative leaders, process owners and teams for these initiatives. Train the leaders and the teams with Co-SPIN processes and learning from the first Micro-SPIN attack. Continue to stabilize your Wave 1 Micro-SPIN attack, which means ironing out all the kinks in how your teams are working. Remember, at this stage, Micro-SPIN attacks are still in early test mode, and you’re still running the rest of the business as usual.
Wave 2 and expanding further
Just as when the first Micro-SPIN attack was launched, it is assumed that a clear roadmap for the corporate strategic imperatives is in place to which all the Micro-SPINs will align with into the future. The roadmap should show clearly the major elements of value that will move you from your current state to your desired future state. Each subsequent wave of micro-SPIN must link clearly to the capabilities or the major sources of value identified by your roadmap of strategic imperatives. Micro-SPINs aren’t little projects; they are directly tied to the strategic imperatives that are most critical to creating value in your company.
Establish a nerve center for the micro-SPIN portfolio that will collect and evaluate the learning from all the Micro-SPINs. From fractal imagery point of view a Mega-SPIN might look more like:
The portfolio would be driven not only by the strategic imperatives, but also imperatives around culture shifts that are essential. Hence, it will be important to hold frequent Micro-SPIN ID Workshops that will develop list of candidate initiatives for Wave 2, Wave 3, …etc. The goal of the Micro-SPIN ID Workshops is to develop a long list of these candidate initiatives and figure out, into which Wave it will fall, what is the link to the corporate strategic agenda and which could be best scaled across the organization.
As these waves of Micro-SPINs get stabilized, they form islands of changed organizations around them that would eventually form a mosaic of islands across the enterprise. What you will notice as these waves wash across the organization is that your people will naturally start to think about the need to redesign your company’s operating model, its legacy processes, its incentive systems and so on. Encourage this, and don’t allow the old structures to get in the way of the new ways of working. Align them as soon as possible. Depending on the outcomes and experiences of your first three waves, the nature, speed and scope of these changes will vary, but they will naturally gain momentum as the organization learns from experience and the positive outcomes accumulate.