Do you create waves or ride waves or both? Which one is relevant to your innovation program and why?

Speaking at the InnoFuture2007 in Melbourne, Australia, as a panel member on different takes to innovation from some key industries, I represented the ICTI [Information Communication Telecommunication and Internet industry].

This is roughly what I spoke about although you’ll miss the foxtrot steps I took and smiles shared between me and my audience. So as I don’t speak to notes, this is a slightly different take…

Technology and the regulatory climate shaped the ICT industry in the 1990s. Gordon Bell coined the term ICT at the time. The change was based on the de-regulatory moves, which allowed new entrants to the industry to carve out technology based, specialized, roles like cable TV network, utility network or mobile network.

Now the players of the broader industry are moving again. Internet did not really feature in the shift in the early 90s but now some fifteen years later technologies that made the Internet possible are the foundation for redefining the broader industry, with the ever increasing appetites for the next thing and with the ability to get there with ease .

This time the changes are based on the ALL-IPization of the networks and the applications leveraging the networks for telcos, media, services and enterprise. Standardization takes away previous hurdles for business connectivity, hence creating convergence in the broad industry landscape.

The ALL-IPization enables whole new ways to think about business innovation, process innovation, social networking in the enterprise.

It is about creating an innovation platform on which to build whole new businesses and models with smarts in the way in which the Enterprise change ‘layer one mash-up’ of voice, data and video is leveraged for the benefit of the network hangers on – things and people. The implementation of the next steps is still in its infancy with some examples in some core business areas like call centers.

The 90s smallish Internet bubble has gotten bigger and all players are shifting roles and stepping on each others toes in the process. And yet, we all recognize that no one can do it alone. So maybe it is just a gentle brush on the toes rather than stepping. The question is where does it all go?

ICTI is like an innovation avalanche coming your way. It does not matter which industry you are in and the ICTI industry will have an impact. Sometimes devastating impact. I don’t buy encyclopedias anymore, having trouble storing my books as it is, and I love books, to have and to hold.

The ICTI industry itself needs to rethink its definitions:

“Who am I in the scheme of things?”

“Innovation and foresight are important when things change fast.”

“M-hm and why is that? Shouldn’t I just be quick on my feet?”

“Oh yes, that too. If you are quick on your feet with everything that comes your way then you’ll be busy pandering to stuff that has nothing to do with where you could add value and differentiate. Your innovation and foresight programs need to figure out what it is that you wish to delight mankind with.”

Each industry is more inclined to innovate in a manner, which naturally suits the industry’s business model.

I have worked in two different types of innovation, foresight and product or service creation roles. One was with Nokia in the 90s for almost ten years and the other with Computer Sciences Corporation so far for almost five years. So I tell here a little story about both.

The approaches to innovation are very different. The differences have to do with the client type, the economic era, the political and other contexts, the portfolio, the ethos, the business model, the purchase decision speed, the position of the player in their segment, the maturity of the organization.

Nokia in the 90s is a different Nokia from the 00s and yet the same. CSC of the mid 00s is different from the CSC of the 90s and yet the same.

Nokia and CSC

I can highlight some of the key differences in the innovation approaches by just discussing three elements: portfolio, context and ethos.

At Nokia [Mobile Phones] the output was, still is, a very identifiable product, produced in the millions for global consumption. The portfolio or output innovation context dimension can be described as “done and frozen”. This means that the product thinking happens some years before the product in out on the market. Once you pass a stage in the development cycle you should not mess with the foundations.

We did work hard on the personalization profiling in software and hardware and other areas but that’s for another day, much of the product still adheres to the done and frozen description.

The business context in the early 90s was danger, I call it “do or die“. The company, as well as the country Finland was in great difficulties due to the sudden loss of the Soviet Union business. Luckily Nokia had already identified the need to diversify to new markets but that was not enough. The context allowed for unabashed gung-ho approach to the growing and emerging mobile market. The early 90s atmosphere was fearless and the small number that we were was just busy getting it done.

The ethos – after the first successes with the 2110 – became “We shape things“.

At CSC, in the mid 00s, the same three dimensions are very different. The porfolio or output is living and tailored. This means that the services delivered have a varied finalization degree and once the service is established for the enterprise client the service keeps changing due to clients’ changing needs and also due to continuously changing means to deliver the services.

The context in the early to mid 00s has been caution in the enterprise world. Some of it has to do with the burst Internet bubble in 2001 and it led to economic decision making becoming more and more contracted in the enterprise for anything but the very basics. Do more with less is the client message, which will not go away in a hurry.

The innovation ethos at CSC is “We solve problems“. That is a good ethos when much of the ‘every day IT use’ technologies in the industry have not exactly been to the level of auto manufacturing standards. Beyond the basics of IT in the office use, CSC has always had a complex and demanding client base. In those environments there is a need for particular problem solving. More and more these problems are solved leveraging off-the-shelf technologies but still needing solutioneering beyond the initial technologies or problem statements.

Now IT services are rapidly moving to a new type of clientele, which is not IT savvy or interested and will walk away from it if it does not work. These are field workers who have not so far been in the true realm of IT services. I’ll get back to this mobile avalanche one in a later blog.

These different contexts lead to varied innovation responses.

At Nokia due to the done and frozen portfolio dimension we had to learn to understand the consumer, the buyer, before they did. You cannot ask a consumer what they’d like in three years’ time. They do not have the context, knowledge of the enabling technologies, or an organized sense of other changes occurring around them, at least not around your organizational goals.

Many companies did ask these types of questions in the 90s and maybe still do, in ‘future’ clever or less so focus group settings.

So in search of meaning in amongst the engineering ideas of what consumers might want in 3 years’ time, I led a small diverse team from fields of sociology, technology, business and design, from Finland, UK and US, to 30+ countries from which we collated insights and then translated those into product concepts. I devised a few different programs for better views on the future consumer or consumer foresight as I call it.

As an aside I have been looking for many years now a suitable word to use instead of consumer as it is too limiting in many contexts. People foresight, client foresight, human foresight, audience foresight. I always hated the word user [instead of client/audience] in the technology industry and lately I have heard it being referred to treating people as if they were using something quite different….

Better future needs understanding was one of the innovation responses but we also had to start communicating the future needs with more than just the Nokia decision making machinery and the operational machinery. We needed to take lots of ecosystem players there with us.

The operational changes were also significant allowing for the huge growth [while forecasts in the 90s where always slightly timid] as well as the global nature of the business. The design of the product had to allow for personalization as well as volume production. We spent much time on that one.

The organization fought really hard to keep a fresh open doors and flatness approach and yet naturally mature the operational tools to handle the global business in a streamlined fashion. I spent six months on a business leader program creating a values package to allow an easy introduction to the Nokia Way.

At CSC the clients vary from defense to auto manufacturing to utilities to health care to mobile manufacturing and anything in between. I identify the needs within the client as general needs, industry needs and specific needs and strategic needs.

The demands of the horizontal, vertical and client interface are different. There is a mixture of reactive and proactive needs for innovation. The behavior and models related to those two ends of the spectrum are very different.

CSC has many long running programs to assist clients understand the changing landscape in technologies and the impact these have on the business decision makers landscape. For example the Leading Edge Forum is one such program. CSC has also understood the importance of proactive service innovation and has a program for that called Global Service Offering program, which like the LEF is part of the Office of Innovation and is my CSC homeland. Over the last few years I have been actively involved in the service creation and leading edge forum work – being a change agent – or as I also refer to it “professional pain in the ass”, with a view to what could be done differently.

The service creation work is innovation done proactively to ensure that the across the board service portfolio keeps up with the changing ways in which service delivery can happen and what improvements can be achieved in business operations with those solutions, often harvesting from leading edge cases and adjusting for global consumption.

In addition CSC like all IT services companies have built means to innovate to attract talent where it resides but also to ponder on how to shave the cost profile from the aspects of business still reliant of labor based models. As part of the outsourcing deals there is invariably the question of how will you lower cost over the contract time and what are you doing about off shoring.

CSC like Nokia has also had to think long and hard about the shape of the organization and the cultural aspects. While again there is a need to hold on to key differentiating cultural elements like for example the problem solving ethos there is also a need to keep changing in both horizontal operations and vertical operations – these changes are ongoing and I leave further commenting on the details to others.

The key point is that CSC innovates at the client interface and at the core in parallel models – to bring about a leveraged model of learning and competitiveness. And unlike with Nokia products [the tangible stuff] the CSC services change continuously.

We have a choice with the level of ambition we take with innovation

We can be creating waves, riding waves or crashing waves. The last one is not really a choice but rather an outcome of doing nothing.

Trends like ALL IP, bandwidth at the edge, bandwidth in mobile, connected things, location and presence, time and space and life go liquid, mobile becoming part of the enterprise and everyday life in deeper ways are all pushing the innovation agenda within the ICTI industry and for other industries.

These trends are changing fundamentally many tightly held beliefs about how a particular business functions and why. How? By taking away the hurdles that existed before for doing what is most natural to us humans. Technology is becoming more human. The emergent business behavior promises to be very different from before and cut the models of yesteryear from the will [day or minute in the world of the Internet cycle of launches].

The innovation dimensions are still the same. Both Nokia and CSC have to shift their models towards more transparency, dealing with the prosumer [client or client’s client] on steroids. They are telling how it is whether you ask for an opinion or not, and wanting their share, participating in the creation of products, selling of products and wanting a fair cut in royalties and the like. It is the C – generation, ready to hang in there for the fun of it for a little while but wanting Cash too.

In both product and service side the emergent model is about volume but also about tailoring and rapid adjustments. The output is a merged one of product, service and solution. The people who work on your projects are not necessarily your employees. Maybe they are part of the broader ecosystem, maybe they are part of the open source movement, maybe they are part of another organization, which needs parts of your output for make their model work…..

The emerging world is about continuous launch and the organizations need to be stretchy – like rubber able to reach far and contract as needed but also in thought able to think very differently and having an inbuilt readiness to do that.

Companies need to have their vision and yet move fast. I call this foxtrot positioning. It is innovating to create some waves of your own and riding a few others.

In a way the ethos for the next phase of innovation approaches could be something like, “We shape things and we live it, NOW and in ten years time”

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