Idea management: Everyone’s an innovator
What is it about the back of a paper napkin that sparks creative solutions? The casual restaurant setting, or maybe the serendipitous meeting of key people who might not otherwise cross paths? Yet these incidents are usually confined to a few people and occur on a random basis. What if there were a way to draw insights from an entire enterprise on a predictable basis, and without all those expensive meals?
The premise behind idea management is that the innovation process is too important to be left to chance. Idea management, like knowledge management in general, has long been practiced by successful organizations and is not dependent on software. But some emerging software solutions are allowing the innovation process to become pervasive in an enterprise, and easier to carry out.
Innovation is most often associated with product development and the R&D process, although it can and should extend through all functions of an organization. When Sun Life Financial merged its Canadian operations with another Canadian insurance company, a consulting firm advised Sun Life Financial to use a systematic process for capturing and evaluating employee ideas to identify improvement opportunities during the integration. Jay McBurney, director of Program Management at Sun Life Financial's Canadian business, researched the available software products and chose Idea Central from Imaginatik to use in three pilot projects.
"We liked the approach of Idea Central, because we felt the software took into account the behavioral and organizational issues working with idea management," says McBurney. The three projects, using a hosted version of Idea Central, included both new product development and operational issues such as process improvement and cost savings. The software provides a structured method for initiating the collection of ideas, evaluating them and selecting a subset for execution.
For the product innovation pilot, Sun Life Financial was looking for major new products and high-value enhancements to use in a product blueprint for 2005 to 2007.
"We invited 50 senior staff to participate in this event," McBurney notes, "and 45 submitted ideas." Many functional areas were represented in the group, including sales, marketing, pricing, legal and IT staff. Seventy-eight ideas were captured during the month-long initiative, nearly double the target. The best ideas in each category were promoted to the blueprint, which will guide product planning for the next several years.
One aspect of Idea Central that McBurney finds appealing is its ability to filter out ideas that do not meet the designated criteria early in the process. "With other methods, such as stage gates," she points out, "an idea may consume significant time and resources before it is eliminated at a later gate." Sun Life Financial made sure that anyone who could veto an idea was included in the product development event from the beginning.
A broader constituency participated in another event, this one oriented toward time and cost savings. About 800 people were invited, from whom Sun Life Financial derived 528 ideas. A project team of 13 people evaluated the ideas for their potential impact. Those individuals are charged with implementing the ideas.
"Establishing a path for innovation is critical," says McBurney. "We assign idea champions who are responsible for making sure the ideas selected don't languish but continue to move forward."
The need for improved innovation is driven by the pressure of an increasingly competitive market, according to Mark Turrell, CEO of Imaginatik. "Companies can get lucky for a year or two innovating by accident," says Turrell, "but eventually they need a sustainable process or they will lag behind their competitors." Idea management helps companies use their human resource more effectively, ensuring that people from across the organization are actively feeding the innovation pipeline.
Ideas are best processed when people are focused on a specific topic and the timing is aligned with the business cycle, Turrell observes. "If you want ideas for a Christmas product line that is shipped from Asia in September, manufactured in June and developed in April, the ideas must be in no later than March," he says. The old-fashioned suggestion box does not offer the focus or timing of a directed campaign. Innovation can be in many realms, from products to channels or pricing models. "The key is to get the right ideas to the right people at the right time," he concludes.
In addition to developing ideas that solve specific problems, idea management can foster many benefits that defy quantification. Those benefits derive primarily from having employees feel more a part of the organization. In the Micro Motion division of Emerson Process Control , the use of idea management software began after the IT department initiated a transition from Microsoft Access to an SQL platform for its corporate database. Micro Motion, which makes precision measurement meters, had maintained a database of suggestions in Microsoft Access.
Kenny Jerabek, business improvement manager at Micro Motion, explored a variety of software products that he learned about through the Employee Involvement Association (EIA, eianet.org). EIA supports methods of communication between employers and employees for idea expression and exchange.
After investigating a variety of options, including overseas outsourcing of a custom application, Jerabek selected NextNet from General Ideas Inc.. Jerabek was impressed by General Ideas' customer service and the ability of NextNet to be tailored to Micro Motion's existing idea evaluation methodology. He initiated a continuous improvement process designed to keep pace with the rapidly changing needs of Micro Motion's own customers and make best use of the company's human capital.
"People feel valued when you are receptive to their ideas," says Jerabek. "Sometimes the contributor was someone who was upset, so the suggestion may not make sense on the surface, but there is always a valid reason why the idea was submitted." He is enthusiastic about the breadth of access that General Ideas' software provides.
"Suggestions come from people throughout the firm--a single individual in our mailroom saved us $70,000 in mailroom costs through her ideas," Jerabek says. Highlighting the value of improved job satisfaction that results from feeling connected to the company, he explains, "Employees really like knowing they have made a difference, no matter where they are in the firm."
"Idea management software has evolved over the past few years," says Matthew Greeley, CEO of General Ideas. "At first, the goal was simply to capture ideas into a database. Then workflow and scorecarding were added, and now the goal is to provide seamless integration with other enterprise applications through Web services." He cautions, however, that Web services applications are not fully mature at this point.
Greeley views idea management as a component of knowledge management that is tied to the critical business processes of innovation. "Idea management has many touchpoints to knowledge management," he continues. "Expertise location, for example, helps employees find someone who can answer sticky questions and push a concept forward."
Just as the software itself has been changing, so has its use. "A few years ago, the focus was on cost reduction," recalls Greeley, "but about two years ago, companies began looking at ideas for top line growth: new products and new lines of business."
A key element in idea management is that the process is not just for people labeled as creative. "The innovation process requires individuals who are original thinkers," Greeley says, "but it also needs sustainers, modifiers and those with other skills. Not everyone is an inventor, but everyone can play a part in the innovation process."
The innovation imperative
"Companies will have to figure out how to adopt an attitude of innovation and make it systematic," says Carol Rozwell, VP and research director at Gartner. In order to sustain competitiveness, companies must expedite their innovation process. Many other business processes have been streamlined, but innovation poses special challenges because it is currently complex and "low on repeatability, structure and predictable outcomes," according to Gartner. Rozwell points to an emerging set of tools that is supporting several facets of innovation, including idea management, innovation life cycle management and product development software.
"Idea management software allows companies to develop customized idea input forms, route them to the appropriate individuals and receive comments from multiple evaluators," she notes. Each idea can be scored and prioritized according to pre-defined criteria. Most idea management software is being used within companies, but extending it to customers and suppliers is both likely and desirable. Many ideas come from those sources already, and capturing them in an ordered way will become increasingly critical so as not to lose valuable input from key partners.
Judith Lamont is a research analyst with Zentek Corp., e-mail jlamont@sprintmail.com.