Michael Fruhling's Blog

A bunch of stuff about innovation…

How Strong is Your Network?

Posted by mdf4u on August 4, 2010

Of my roughly 700 LinkedIn contacts, I have extensive interactions and dealings with ~10% of them, and substantial, but less frequent exchanges with perhaps another 10%.  These relationships are characterized by mutual trust and respect, and these represent my “inner circle.”  The interactions are typified by the things that close colleagues and good friends routinely do for one another (we all know what these are).  A number of these contacts are long standing relationships whose inception preceded LinkedIn.  The remaining 80% of my contacts are underdeveloped connections.  This doesn’t mean that they lack shared value.  These contacts primarily consist of occasional information sharing and enabling networking contacts.  However, they will remain underdeveloped until either of us (or both of us) take the initiative to deepen the relationship.
  
I’ve noticed that a number of my LinkedIn network connections have a direct contact to President Barack Obama.  Given this, I suspect it would be possible for me to also request a network connection to the Commander in Chief…and if I did, I wouldn’t at all be surprised to be accepted.  However, even if we did connect, I don’t expect that he and I (or many of his Linkedin network contacts) will be inviting each other to networking meetings at Starbucks anytime soon.  Why not?  While we’d be connected, we still wouldn’t know each other!  
 
Technology can enable and faciliate contacts, but can’t ever replace personal investment.  That is a very necessary component…and is still the best way to create strong, enduring and productive networks (and friendships).  These are the relationships that bring the greatest satisfaction and utlimately produce the greatest return for all parties.  One gets out of these relationships what one invests in them.  Are you investing wisely?
What are some of the tools and techniques (besides LinkedIn) that you are applying to strengthen your professional network (and not just amass contacts)?

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How Companies Can Kill New Ideas Faster!

Posted by mdf4u on June 28, 2010

Industry data indicates external technology submission reviews can take 4-6 weeks, and will overwhelmingly culminate in a rejection decision. Valuable corporate resources are expended on these reviews. With annual submissions per company continuing to climb, I suggest that companies should consider ways to review and reject them much more quickly.

I suggest that companies should examine their external submission review processes to enable faster rejection. To be clear, I’m not suggesting that this be the primary objective. There may be time and resource-efficient means to identify and disqualify unsuitable opportunities. In doing this, companies can reallocate resources to higher value activities.

I suspect that dramatic reductions in review cycle times can be achieved if review teams run their “last experiments first”. That is, consider the consumer/business opportunity posed by the submission prior to formal technology assessment. Under my proposed system, after an initial sift to remove obviously unsuitable opportunities (e.g. way off-strategy, inadequate IP, etc…), external submissions would be screened by a business team, instead of by R&D alone, as I perceive is the most common current practice. Rigorous assessment of the technology’s credentials would initially be set aside.

Under the proposed system, a review team would first decide its interest based primarily on the potential consumer/business opportunity.  If the team rejected the opportunity, there would be no point in subjecting its technology to formal review. This would result in a much faster rejection than if the technology were reviewed first, its eligibility being based upon compatibility with a set of “Technology Needs”. Conversely, if the team favorably viewed the opportunity they could prioritize technical review based on interest level. For instance, assume that a personal care products company received a submission for a “patented, effective, non-invasive, painless cellulite reduction method”. The company might not have previously articulated this as a technical need. However, a review panel could view this as a very attractive business opportunity. The technology could then be assessed by R&D. This could either result in a “hit”, or it could inspire an energetic technology search effort. A potential negative for this approach could be to reject high quality technologies obscured by poor positioning. I think these instances are possible, but are likely fairly uncommon.

The objective of any process re-engineering should be to achieve more efficient utilization of internal resources. I recognize that my remarks betray my lack of knowledge of the inner workings of corporate external submission review processes. Some companies may have already identified and implemented similar, or even better approaches. My purpose here is to stimulate thinking on this important topic. I welcome your thoughts…especially you corporate “insiders”! Please share.

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Open Innovation Cures Blackberry Thumb!

Posted by mdf4u on May 24, 2010

The following story is fictional.  However, I’ve applied and proven the priniciples described in client engagements.  I hope it prompts you to think about its potential applicability to your business.

Mary Sellers, Marketing Manager with an OTC products company wishes to pursue new products for young people suffering from Blackberry Thumb.  Blackberry Thumb is a repetitive strain induced hand injury caused by excessive text messaging.  Mary’s research shows that significant numbers of young men and women (aged 13-19) suffer from this condition.  Further, trends show double digit annual growth rates.  Importantly, there are no products being sold at food/drug/mass market retailers that specifically address this condition.

Mary and her colleagues have concept tested topical analgesic products.  These are similar to many available OTC products like Aspercreme and Ben Gay, but are positioned as being specially formulated for Blackberry Thumb and other repetitive stress disorders like carpal tunnel syndrome.  The results are generally favorable, but consumers do not perceive the products as especially unique.  After consulting with an orthopedic surgeon, R&D manager Joe Hale suggests a regimen consisting of the topical remedy, intermittent cryotherapy and joint stabilization to help address pain and swelling associated with Blackberry Thumb.

Joe contacts bfs innovations (!) and asks me to identify some potential solutions for him to evaluate.  Drawing inspiration from other industries, I contact a company that uses a flexible silica gel technology in cold packs for physical therapists. Joe fashions a demi-glove prototype using this material.  It provides excellent relief without causing discomfort.

Mary is very encouraged by Joe’s thinking and the productprototypes.  She incorporates the “Cool Hand” concept into  qualitative consumer research.  Young male consumers in particular, are very enthusiastic about the new idea. They see the system as truly different and something that they personally would use.  They liken the glove to “wearing a cast” “…it’s like a war wound”.   They also like the topical remedy…”It’s for me…it’s not my parents’ medicine.”  Mary and Joe have identified a promising product system that a significant portion of the target audience finds appealing!  They realize that their work isn’t done, but they sense that they’re on the right track.

I trust that this example helps describe the possibilities of applying external innovation in creative collaborations. You’ll note that in the example above, external innovation was introduced during the concept development process prior to the product concept having been fully defined. When Marketing and R&D collaborate early in the concept development process and incorporate well-reasoned external inspiration, they can create exciting product options.  Contact me if you’re interested in discussing and in employing this approach.  You’ll be glad you did.  It works!

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A Guide to Open Innovation Acronyms

Posted by mdf4u on May 13, 2010

The following are some Open Innovation acronyms.  Do any of these seem familar?

SIP (“Submit Idea to Portal”): Technology providers will commonly be requested by corporate open innovation representatives to “SIP” when they seek feedback on their external innovation candidate.  Proper Usage: John: You’re going to love my new innovation.     Mary: I’m sure it’s wonderful.  Please SIP it.

ROB (“Run Over By Bus”): Used by technology provider to describe a technology intermediary who does not respond or provide a timely update on the status of their submission’s candidacy. Proper Usage: John: I SIP’d my innovation 6 weeks ago.  Edith: Sounds as if you’ve been ROB’d.

WOG (“Works out of Garage”): WOG refers to the dynamic and colorful characters that populate the inventor world, and whose early work is often conducted in humble environs.   WOGs are a necessary and occasionally welcome segment in the total technology supply mix. Proper Usage: Mary: Have you had a chance to speak with the inventor of that time travel device?  Gary: Yes.  He’s quite smart and a real WOG.

NFBU (“Not Found by Us”): NIH describes the denigration of external technologies by corporate employees who feel threatened by them.  NFBU represents a version of NIH practiced among employees whose roles can involve adoption of external innovations. With NFBU, an influential person (e.g. person in charge) can champion select technology leads.  Leads lacking this advocacy are considered NFBU and tend to become disqualified from consideration when unable to fend off challenges to their candidacy.  Proper Usage: Mary: I like both ideas.  Which one do you prefer?  Edith: I like them both, too.  But, let’s drop the DIY brain surgery kit.  It’s NFBU.

LSD (“Looking for Sugar Daddy”): Early stage (and often naïve) technology developer seeking a heavily resourced partner to shoulder the cost and risk of completing development and to commercialize their innovation. Also may be a WOG.  Proper Usage: Kurt: This LSD must be smoking something.

POP (“We Pay Only For Performance”): Typically uttered by technology providers, though sometimes also by technology seekers.  Used when the party will agree to compensate the service provider only in the event that the desired result is achieved.   It reflects a desire on the part of the client to not assume any risk in a business development endeavor conducted in their behalf. (Not surprisingly, I don’t sign up for many of these so-called “opportunities”).  Proper Usage: Ted: Michael, sell it in and we’ll both be rich!  Michael: I’ll pass on the POP, Ted.

OI? (“Do You Own It?”): In open innovation, technology candidates can often become known to technology seekers through a daisy chain of network connections.  “OI?” is one of the first questions that a technology seeker will ask to determine the person with whom they should communicate to review a new candidate. (Note:  Do not confuse with the Yiddish exclamation, “Oy!” or “OI”(which, without a question mark stands for Open Innovation)). Proper Usage: John: You’ll love this new innovation.  It’s patented and clinically proven effective.  It’s…   Mary: OI?

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Bridging the Expectations Gap

Posted by mdf4u on April 26, 2010

Last week, I wondered aloud as to whether some consumer products companies engaged in open innovation may be practicing a form of “Not Invented Here” syndrome that I call “Not Found by Us”.  I suggested that even after excluding as (justifiably) unworthy the majority of external opportunities, those identified by the company itself fare considerably better than unsolicited external submissions in internal review processes.  

While I believe this may well be true, another explanation for the absence of unsolicited opportunities among commercialized products could be that it is virtually impossible for unsolicited external submissions to meet the collectively high standards required by most consumer products companies.   My sense is that there is a dramatic gap between the types of external opportunities that companies actively seek and develop and those that are proposed on an unsolicited basis. 

Companies are most interested in on-strategy, highly differentiated, commercially and economically viable, technically feasible and scalable opportunities.  How many of these options are being offered up on an unsolicited basis?  Very few, if any, I’d imagine.  I also suspect that many submissions are lucky if they meet more than one or two of these standards.  Yet, how many submitters are aware of these standards? Also very few, I’d imagine.  Many external submissions are relatively early stage, and as such, are far riskier, and therefore less attractive to companies than more finished propositions.  Opportunities proactively scouted by companies are more likely to meet more of their selection requirements than unsolicited ones.  Even if some may come up a bit short, there may still be sufficient internal “suction” (i.e. advocacy) for these options to treat these as manageable and surmountable deficiencies. 

If what I am saying is even mostly true, then I feel that companies would do the public a favor by being highly explicit about the necessary prerequisites for a credible candidacy.  They should also disclose the real (exceptionally low) chances of success for any submission that fails to meet these rigorous standards.  That way, an interested party can make an educated decision as to whether or not to invest the time in preparing a submission.  I expect that this will cause most to not pursue the opportunity.  Importantly, this disclosure will significantly decrease frustration and disappointment among unqualified would-be submitters.  Also important, it should help free up corporate resources to manage a few, highly credentialed candidates.

Even in instances where a submitted technology makes the so-called “first cut”, companies should continue to be extremely transparent and forthcoming about the overall process, milestones, investment decisions and standards in order to ensure informed decision making, including among individuals who may have unrealistic ambitions.   In my experience, prospects can be reluctant to ask such questions at risk of offending the company and in so doing, jeopardize their candidacy.  Companies, in turn, seem content to keep matters vague in order to avoid the risk of sending false impression as to interest and/or commitment.  In any relationship, open and candid communication is essential for the best shared outcomes.  It certainly should apply to this area.

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Could “Not Found By Us” Be The New “Not Invented Here”?

Posted by mdf4u on April 19, 2010

In considering various open innovation success stories publicized by consumer products companies, I am unaware of a single example of an unsolicited external submission that has reached market.  

On a personal level, until a couple of years ago, I had been a fairly prolific submitter of technology opportunites to corporate open innovation portals.  While I accept that screening processes are highly rigorous, and the odds of success are slim, I still expected at least something to pop.  In five years, not one of my dozens of submissions progressed beyond second pass screening.  In addition, none of my peers who have made unsolicited submissions to corporate portals has met with any success, either.  What could we be doing wrong to be so monumentally unsuccessful at this?   Are our submissions so markedly inferior to proactively scouted finds?  While it’s entirely possible…it does seem somewhat unlikely. 

With a couple of exceptions, all of my scouting successes have resulted from proactive searches done in behalf of, and in colloraboration with my corporate clients. This is consistent with industry data which shows that the vast majority of proactively scouted searches yield viable leads.  Beyond the insider knowledge that informs these searches and improves their precision, I also suspect that proactively scouted “finds” very likely invite internal champions who help shepherd them through the assessment stages. As most of us know, championed innovation candidates have far greater survival rates than those lacking advocates.

This causes me to raise two essential questions: Does proactive search invite internal advocacy?  (I believe it does.)  Do unsolicited external submissions have internal champions? (I strongly doubt it). 

If I’m right, then “Not Found By Us” is an artifact of existing open innovation portals and current corporate evalution processes.  There’s already a low percentage of potentially useful ideas that enter open innovation portals.  I believe this significantly lowers internal expectations for anything received through these channels.  I also believe that current open innovation evaluation processes don’t enable or encourage idea incubation and/or internal advocacy.  Put simply: I believe that unsolicited submissions have no sponsors, and as a result, they’re likely to die.

I strongly encourage companies engaged in open innovation to consider whether they may unintentionally be allowing at least some potentially attractive opportunities to get away, simply because there’s no one to fight for them.

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Open Innovation: Lots of Activity, But Little Urgency

Posted by mdf4u on April 12, 2010

About 2 years ago, I conducted an industry benchmarking study to assess the relative performance of major consumer products companies in their handling of unsolicited technology submissions. A conspicuous finding was the relatively slow pace at which most companies processed these submissions. With some exceptions, it commonly took longer than 8 or even 12 weeks for them to process submissions and for the submitter to receive any type of preliminary decisive response (beyond an acknowledgment of receipt). 

Fast-forward to the present, and I am pleased to report that most companies engaged in open innovation have recognized this as a deficiency, and have made significant progress to speed their initial replies (mostly rejections, though…) to within reasonable time periods (i.e. 8 weeks or less).   That’s good news.  But there’s still a big problem, in my view.  Allow me to explain.

Let’s assume for a moment that roughly 90% of all external unsolicited submissions are rejected on first pass.  It’s good that these individuals learn of this decision quickly.   However, what about the 10% or so, that have not been given the hook?   Based upon my experience (and this is only my experience…I want to avoid painting the industry with a single broad brush), we still appear to be where we were two years ago.  In my view, there is no apparent sense of urgency to progress these candidates through the evaluation process.  Follow-up is still generally initiated by the submitter, with variable responsiveness.

What are some reasons for this?  While I imagine that it varies by company, I have some educated guesses:

There are no standards for cycle times following initial thumbs up/down, so no one knows what constitutes an “acceptable” duration between communications. 

 No one is assigned to monitoring individual cases to ensure timely progress.  

There are no standards for communicating status/progress beyond initial thumbs up/down and no individuals assigned specific responsibility for this.

Corporate mindset is still to accumulate and manage technology leads, not to manage personal relationships.   Processing of leads is viewed as an administrative obligation.  There is an implicit assumption that a lead that is not rejected is “hooked” and not likely to opt out due to time delays. 

Individuals involved in the discreet evaluation phases don’t have responsibility for the technology after it gets turned over to an operating division.  Said differently, they only see part of the overall process, and don’t “own” the deliverables. 

 I challenge consumer products companies to continue to make strides in managing external relationships and to make measurable improvements in this vital performance area.   I believe this may be the next great frontier for external innovation (and a major competitive differentiator).

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Enhancing Productivity of Innovation Portals

Posted by mdf4u on February 11, 2010

While attending CoDev10 a couple of weeks ago, a speaker representing a multinational consumer products company discussed the productivity of their open innovation web portal.  He shared that the site annually accepted over 3,000 submissions, out of which 8% were being worked on across various parts of the company. 8% out of 3,000 is “pretty good”, he exclaimed. 
 
8% actually is pretty good.  I feel it could be even higher if submitters actually tailored their submissions to address the company’s stated technology needs.  In my experience in working with this company and others with web portal programs, far too many submissions represent what an individual has to offer.  This is quite often not what the company has expressed as its need.  As a result, the signal to noise ratio for submissions is typically quite high…a fact that most companies will readily concede. 
 
Are there things that companies can do to encourage higher numbers of well-targeted submissions made to their web portals?  I believe there are:
 
For example, Procter and Gamble and others often prepare a detailed spec for each of their published technology needs. Web portals do not currently require an individual to “check off” on whether, or to what extent, the submission meets each of the individual criteria specified for the technology prior to hitting the “Submit” button.  Some online job submission applications incorporate this type of “self-qualification” approach within their process.  What if innovation submissions required this, as well? 
 
I’m also convinced that numerous submissions are dismissed because they are poorly written by the submitter.  Could web portals be configured to allow submitters to produce and upload short video product demonstrations instead of relying exclusively on the written word?  A picture is often better than 1,000 words…especially in instances where the innovation has been reduced to a functional prototype.  Pepsi is accepting video submissions as part of its Refresh Everything initiative (see www.refresheverything.com).  Why not others?
 
Companies should also consider rewarding “good behavior”.  That is, reward submitters who both adhere to published guidelines and also passed the first cut.  Companies could call these “entrepreneurial grants”, or simiilar.  For a modest financial outlay, they would encourage submitters to replicate good performance.  Not too long ago, I participated in a Your Encore challenge in which I was awarded a nominal sum for my submission, even though it was not selected as the winner.  Incentives can be used to encourage desired behaviors. 
 
They could also seek to enter collaborations with individuals with a track record of quality submissions.  At present, companies treat each online submission as a discrete event, with roughly 92 of 100 applications being rejected in the first pass, and many others ultimately being declined.  The relationship between the applicant and the company essentially “ends” once the company declines the opportunity.  Certainly, each web portal sponsor should be able to track which submitters consistently provide the highest quality submissions.  They could actively seek to cultivate these as more attractive technology provider resources.  What a pleasant, impactful surprise to applicants for companies to actually reach out to contact these individuals to enlist their assistance on a paid engagement or even on opportunities that had a high likelihood of a payout!   
 
In summary, open innovation web portals are a useful tool to enable companies to consider unsolicited opportunities.  It’s not too early for companies to start to explore ways to make them more productive.   

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Serendipity, Innovation and You

Posted by mdf4u on February 1, 2010

Last week, Todd Abraham, SVP Nutrition and Research at Kraft Foods related a fascinating anecdote during his CoDev10 keynote address.  He recounted how Kraft had been seeking a “clean water” additive for their powdered drink mixes.  This would permit residents in developing countries to safely enjoy Tang and Crystal Light.  While unable to solve Kraft’s specific challenge, TyraTech instead suggested a safe, affordable technology that would prevent waterborne parasitic infestation that chronically afflicts millions of Asian, African and South American residents.  

In speaking about the enabling technology, Abraham said, “It addresses the problem with the problem”.  Kraft seized this tantalizing opportunity and is developing a daily-use beverage incorporating TyraTech’s technology.  It has the potenital to improve millions of lives.    To be absolutely clear, Todd didn’t suggest that companies should exclusively or even predominantly rely on serendipity to drive innovation…and certainly not at the exclusion of searching out approved technology needs. He simply acknowledged that open innovation and serendipity can create attractive, strategically relevant innovation opportunities, if one is open to them and if appropriate, is willing to champion them:  “It would have been easy for us to have said we’re not interested…You have to know an opportunity when you believe it exists …You may find something a little different than what you looked for, and that’s important too.”  

Echoing this sentiment, Chris Thoen, P&G’s Director of Global Open Innovation writes, “serendipity and connecting the unexpected dots are very important still in addition to the targeted proactive searches for new opportunities”.   Related to the importance of serendipitous innovation, is the important role that champions play in advocating for candidates that lack broad corporate acceptance.  By now, most people are familiar with the origins of the 3M Post-it Note.  Did you realize that the scientist who devised the easy-release adhesive was initially unable to attract interest within 3M?  It took off only after a colleague successfully sold the concept to 3M management 4 years (!) following its discovery. 

As the person who recognized, conceived of and validated the Cheer Free laundry detergent concept (i.e. safe and effective for folks who claim detergent sensitivites) while with P&G, I am skilled at recognizing and creating unobvious consumer insight-driven product opportunities…and with being a successful new idea champion.  A global consumer products external business development executive describes me as ‘the best I’ve ever seen”. A global food products R&D VP says my “skills as a story teller are absolutely top notch”.

 So, I ask: is your team tasked with providing bold innovation?  Does it seek, recognize and champion compelling, strategically relevant “outlier” opportunities?  Does it currently struggle to successfully sell innovations to internal stakeholders?     

If you answered “yes” to any of these questions, please call or write me today at (614) 937-2408 or michael@bfsinnovations.com.  

 

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Change the Game

Posted by mdf4u on January 22, 2010

Over the course of 5 years, I have dramatically redefined my business model and service offering to accomodate the realities of corporate external innovation and to better address my clients’ evolving needs.  This has allowed my business to grow and thrive.   Without having taken this action, I’d now be doing something else for a living    

 

Back in 2004, I naively thought that I could make an attractive living by representing technology providers to big name consumer packaged goods companies.  Why not?  Companies were starting to express interest in external technologies.  I have strong ability to attract and cultivate attractive technologies and providers.  I have excellent relationships and contacts at a diverse array of companies.   

Since then, I’ve made scores of unsolicited technology submissions to a variety of companies.  How many of these have been adopted?  Ummm….Two.  Why has my batting average in this area been so abysmal?  In hindsight, it’s actually quite simple to understand. 
 
If the problems were easy to solve, the companies would have solved them by now.
The largest companies engaged in external innovation are looking to fill technical needs that their considerable internal R&D resources have been unable to fully satisfy.  
 
Stiff competition:
While many companies routinely accept external innovation submissions to satisfy unmet needs,  they are simultaneously proactively pursuing multiple alternate approaches.  If it’s truly important, then companies will allocate money and resources to try to solve it.  They’re not just waiting around for an unsolicited solution.  Proactive search efforts may include designating technology scouts (internal and/or external) to search for solutions, placing incentivized challenges with companies like NineSigma, Innocentive and Innovation Xchange.  
 
Companies are looking for the Right technical solution, not just a solution:  
Many of the top companies have exacting requirements.  They can choose to be as rigid and/or as patient as they desire in addressing these.  They likely have a variety of solutions to choose from.  They may just not have found the optimal one yet.
 
Savvy Companies, Smart Solutions and Game Changing:   
In recent years, I’ve been pretty successful in getting technologies (and providers) adopted by client companies.  Importantly, I’ve achieved this from the “inside”, not the “outside”.  Through a combination of corporate technology scouting, new business opportunity creation, and technology brokering, my business has grown by about 200% in the past two years alone.  The reason for this success is primarily because I’ve significantly revised my value propositon.  As opposed to 2004, where I almost exclusively represented external technology providers, now, I primarily provide technology scouting /intermediary services for major corporate clients.  My clients KNOW what they want.  Instead of me guessing at needs and their nuances from the “outside”, I can be far more successful by collaboratively and iteratively identifying and evaluating multiple technical and product solutions.
 
Technology scouting absolutely remains an essential component of my work.  However, beyond solving precise “need gaps”, it fuels active collaboration to help my clients identify distinctive new business opportunities.  An intriguing “found” technology or new product can inspire my R&D clients to develop seed new business ideas.  I assist them to conduct early stage, exploratory on-line consumer reserach to build the foundation for new opportunity discussions with their Business Teams.  As my clients are actively involved and engaged in the creative process, they take ownership of select opportunities and will advocate for these with colleagues.  A technology that is intriguing but may not be “quite right” can prompt incubation and become an inspiration for further new opportunity creation.  It can prompt additional search and/or development efforts in which I can participate. 
 
I’m personally convinced that collaborative development via external innovation solution identification can offer companies robust opportunities for business growth.   The ones that choose to play this game and play it well can be big winners.  I’m happy to be able to join and assist some of them in this pursuit.    

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