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Corporate Innovation Processes: create a pub, not a funnel.

Innovation & Design

Risto Sarvas

Service Designer, Professor, Company Culture Engineer

Ideas are not scientific discoveries. Ideas are conversations over a beer. This has huge implications for a company's innovation processes.

George Eastman came up with the idea of a consumer film camera in 1888 and called it The Kodak. It revolutionised photography by giving access to cameras and personal photographs to everyone from all walks of life. George Eastman was a visionary who saw the market opportunity that no one else saw. A great story and a great man.

Stories are powerful, because they make things simple, understandable and touch our emotions as well. The problem with stories of innovation, such as the one above, is that they have shaped the way we believe inventions and innovation happen. We are made to believe that there is an Eureka! moment, when an idea is found like it is an ancient fossil on a forest path. Finding a fossil of an ancient creature is a discovery. An idea is not a discovery.

The Kodak was the third camera George Eastman had produced. The two previous ones were commercial failures. A fact often omitted in the history books. Only after the Second World War, almost 70 years after The Kodak, everyone in the Western world can be said to have access to cameras and photography. And this was more due to the rise in general income than any technological advancement. So the impact of the Kodak took seven decades to happen. And one more thing: George Eastman saw a business opportunity in selling film cameras to professionals and amateurs, and only after failing in these markets, he decided to go the only segment he had not tried: the consumer market.

None of these facts are highlighted in history books. In other words, a more careful study will reveal that the invention of the consumer camera was like a billiard ball hitting and bumping into obstacles and finally ending up in a pocket that George Eastman was never actually aiming at. So yes, George Eastman had an idea about film photography in the 1880s and he acted on the idea. But was it the same idea that turned his company into the huge Kodak Corporation? No, the idea was originally very different from what actually revolutionised photography.

Think of the last idea you had. You probably told the idea to someone over lunch and talked about it. Then you told the same idea to other people in a pub. This time the idea had changed because you told it slightly differently (all the beer, you know) and you perhaps changed it a little based on what you talked earlier over lunch. After a few pints, you start drawing the idea on a napkin in the pub together with the other people. Again the idea changes. The next morning you decide to blog about the idea, and you are forced to articulate the conversations you've had and the napkin drawings in a new way. Again the idea gets shaped to a new direction.

Fast forward your idea into more serious product development. You continue talking about the idea. Occasionally you document it in emails, powerpoints, whiteboard drawings, post-it notes etc. You tell it in new ways to adapt the idea to your audience (e.g., convincing the CEO needs a different story than convincing the IT department). Perhaps you read books, do benchmarking, talk to potential customers etc. All these shape your idea to new directions. You implement the idea, and you get users to use it. They use it in different ways, and it shapes the way you see the idea and talk and write about it. How much is the idea the same as it was when you first started to talk about it over lunch? Is it still the same idea or not?

It is not the same idea. You are perhaps the only common denominator in the story, not the idea. To put it in another way, which is more valuable: the original idea or the effort put into pushing the thing into the market?

Ten years ago I was in a seminar where a person from Pixar asked a question from the audience: "If you had to choose, which one would you choose: a great idea or a great person?" Most of the audience chose to have a great person, and according to the speaker, so does Pixar. They emphasise the value of great people over ideas, and needless to say, they have been extremely successful in a very creative industry.

If the idea is not as valuable as the work and people in shaping the idea into the reality, why do we often cherish ideas more than the process of shaping? We cherish the ideas because we have heard thousands of stories of invention and innovation where the hero has an idea and then carries the idea into reality. It is so much more complicated to tell a story of how an idea was shaped in a complex process into something, and then these people came and these people went away, and then this email was misunderstood and then someone made this drawing, and then this funding ended and then we kind of did this mock-up for another project that had money in it... and then actually we did this product in a completely different company one year later.

For the last time, back to George Eastman. He was a great innovator, no doubt. He was great because he had a strong vision, he personally knew the technology and oversaw the production and research. He was also directly involved in the marketing of the cameras and film, because he recognised that marketing was as important as the technological development. He also had other great people working with him. In the early days of the company, he hired talented people into strategic positions. He also built a strong connection with MIT in Boston to have a constant flow of talented engineers to work for Kodak. He put a lot of emphasis on people.

Almost every industry, domain and area is in transition at the moment. The societies are changing and old businesses are in turmoil. Kodak Corporation, for example, filed for Chapter 11 in January 2011. To react to the transition, large and established companies are designing innovation processes that curate ideas and even radical ideas. Typically these companies have a funnel that takes in ideas and evaluates them in a handful of checkpoints so that at the other end of the funnel only best ideas get funding. But why curate ideas if they are so mutable?

In these corporate innovation funnels the idea seems to be a discovery that then passes through checkpoints to make it into production. Should these funnels and processes curate the people more than the ideas? What if the focus of the innovation funnel was in helping the people to get through? Checkpoints in the funnel would see that these people have enough resources and autonomy, they would make sure the people have the tools and methods, they would ask questions such as "how many potential customers you have interviewed at this stage?", and so on.

Yes, the idea would be important as well, but the focus would be in the shaping environment, not the idea itself. Ideas are like conversations over a beer. Create the conversations, help them to be creative and productive. Build a pub rather than a funnel. In other words: Curate the people, tools and environment so that they will shape the idea into something beneficial. Leave the idea alone, because it is not that important.

P.S. This post of mine was much influenced by Etienne Wenger's book "Communities of Practice" (Cambridge University Press, 2000) as well as the discussions sparked by Eric Ries's "The Lean Startup" (Crown Business, 2011). Also, the The 8th International Innovation Lab Conference at Aalto University was an inspiration for writing this post. For a good introduction to social construction of technology I recommend Bijker, Hughes & Pinch "Social Construction of Technology" (new edition, MIT Press, 2012). For a more detailed analysis of Kodak and the history of personal photography I point towards Reese V. Jenkins's "Images and Enterprise" (Johns Hopkins University Press, 1987) and also have a look at "From Snapshots to Social Media – The Changing Picture of Domestic Photography" by David Frohlich and myself (Springer, 2011).

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