My growing fear is that innovation is on course to become the fad of the day in the same way quality was in the 90s.  Having said that, I expect that Braden Kelley’s new book – Stoking Your Innovation Bonfire is going to prove a very helpful guide for organizations making decisions about where innovation is relevant.

For those of who missed, or were too young for it, the quality movement, it was everywhere. There was a big quality award called the Malcolm Baldrige award that top companies did everything they could to win. The premise was that everything needed to he high quality and at the time as a young Accenture employee, it actually seemed to make sense. Why wouldn’t you want everything to be high quality?

These days it’s really obvious to me why you wouldn’t want everything to be super high quality, and there are a couple of basic reasons:

1. Investing to make everything high quality is very expensive
2. Only a few parts of your organization have a direct impact on overall organizational performance, and in a lot of cases, those are the only ones it makes sense to make high quality.

I made a similar point two years ago as the recession started rolling and people wanted to cut costs everywhere. I would say “cutting costs across the board is not a strategy.”

Which brings me back to innovation and the subject of this article.

The simple answer to this complex question is that for some companies, it’s life and death to treat innovation management as a core skill, and for other organizations it borders on frivolous.

But before we get into that, we need to define innovation. My simple definition of innovation is when the product or service that is the result of the innovating doesn’t resemble what was there before it. The ATM doesn’t resemble the experience of getting cash from an actual bank teller. Getting a rented movie mailed to you doesn’t resemble the experience of renting a movie at a store, and certainly doesn’t resemble the experience of going to the theater. I see innovation as being on a spectrum of change, where it’s at one extreme, and at the other extreme is making a minor modification to the work, along the lines of a minor scorecard change. In the middle between the innovation and the scorecard change is what I call a project where the work undergoes some change that is noticeable, but you can still recognize what was there before it, much like a house remodel.

Now I’d like to get concrete about this subject with some real examples.

Pharmaceutical companies are at the extreme in this case because their products are all patented, which means the patents expire, which means they need to be constantly innovating for the next big drug. So they need to be absolute rock stars at managing innovation. In my first book Rethink, I talk about how one pharmaceutical company realized that ideas for new products was at the heart of innovation and they opened that up to the outside world as a way to dramatically increase the flow of new ideas with great success. But this is limited to new product development. There will be times when they may innovate in the way people access their drugs, or the way they buy them, or something along those lines, but those shouldn’t be viewed, or treated as a core competence.

Manufacturing companies, though they have less of an issue with expiring patents, also often live and die by innovation, so viewing innovation management as a core competence makes all the sense in the world – in the area of product development, not everywhere in the company.

Airlines are an industry where innovation almost never happens because it’s essentially a commodity service these days and the only differentiation is price – everything else they do can be copied by other airlines. The planes themselves are another story – but that gets us back to manufacturing which I already spoke to above.

Retailing. Nope. Which isn’t to say it never happens in retail, but it’s usually at the operating model level where a company differentiates and makes its money, not day-to-day innovation. Alice.com is a company I have written about in the past that figured out how to sell consumer packaged goods at cost with free shipping (they can charge a ton for advertising because they give the data about age, gender, and ZIP code about who responds to the ads). That’s a great model, but that’s essentially where the innovation started and stopped for them – I think they will be really successful. Costco is also a favorite company – they figured out how to make money by not making any money selling the products that they sell (they make it on their membership dues).

I am not going to cover every industry, but you get the idea.

The “how” question is easier, in my view.

Once you know where you need to treat innovation as a core area, then it’s a matter of mapping out the work, and who needs to do it, and how to start to get best practice level metrics on it. There are five basic areas of work for innovation:

1. The need. You need to know where the problems and opportunities are where innovation is needed
2. The Ideas. A person or a group needs to come up with the various ways in which to innovate at a level that meets the need.
3. Creation. From idea to reality, understanding what it takes to productize it or reproduce it in a cost effective way can be a chore
4. Execution. Rolling out the innovation takes work and discipline, and doing this in a programmatic way takes time
5. Management. Overseeing the innovation once it has been rolled out is key. Knowing when to tweak it with a scorecard change, whether it needs a project, or whether it’s time to once again innovate

So organizations need to look at these and decide which ones it needs to own and be good at. As I mentioned before, pharmaceutical companies have realized they can open up the idea end to the outside world as they manage the rest of the process.

-Ric

P.S. Look for my new book Surviving Business Earthquakes, exclusively at Starbucks starting in October

So here’s the really big idea.

A lot of us use GPS for a variety of things today, especially driving directions.  But when we get driving directions, like the directions from my home to the Blue C  Sushi restaurant in Seattle’s Fremont neighborhood, there’s one basic issue – the directions are provided in a totally reactive way.  The search engines don’t know where we want to go until we tell them.

But there’s a way to change that.

What’s the one place that knows where we will be hours, days, even months in advance?  Our calendar.

What if when a calendar appointment is created, we get prompted with a “would you like directions to this appointment?” and you could answer yes or no.

Then, if you clicked “yes” what if it asked you how familiar you are with the departure location and the destination (high/medium/low buttons would probably do the trick) that way it doesn’t spend the first 10 lines of the directions telling me how to get from my house to Interstate-5.  I know how to get to I-5 and I know Seattle’s Fremont neighborhood pretty well too.

Then when it’s about time for you to leave for your appointment, it goes out to scrape information about accidents and events from DOT and related sites so if there’s a likely slowdown, it can recommend a different path.

Then, if you want to sell some ads, tell me that Blue C is on the left side of the street just after the gas station.

So then Bing can run the searches and send me an e-mail with the directions, which might also be a good reminder of the event. Proactive search.

Integrating Bing with Outlook would be great for Bing and Outlook and I would use it every day.

Go bing or go home.

-Ric

By the way, if you haven’t used Bing Visual Search, it’s really a great experience.

At lunch I was talking with my friend Bruce about this article that was in the paper today by David Pogue.  On the one hand, this company called Square that has a little doo-dah that plugs into a mobile device could really transform payments and transactions between non-merchants, I thought the more stunning portion was the data on how much the credit card companies get at the point of the transaction (3%-4% of the value of the transaction plus a flat fee of 30 cents). So not only are the credit cards sticking it to people with cartoonish interest rates, they get the merchant on the front end.

Wow.

So you can read the article, but basically with this device, anyone can perform a credit card transaction (no sign up, no monthly fees) in exchange for giving up 2.75% and a 15 cent fee.  So if you are at a yard sale and want to buy a mirror, you can just swipe your card on the phone of the seller and conduct the transaction with your credit card.  VERY cool.  It seems like this would spawn a variety of new software products and it could further reduce the amount of cash people use. I would think the percentage charged would be less, but that may come with volume.  $2.90 received for every $100 spent is a LOT of money in any volume.

The article said that Apple declined to modify their phone to have a groove for credit cards, which is why this little slidey doo-dah has to be plugged, in but this sounds like such a great opportunity for Microsoft and their new Windows Phone 7 to have a major area of differentiation from the iPhone.

Fingers crossed.

-Ric

No is the answer to the question that is the title of this post.

Here’s why.

There was an article in the Saturday paper by Kim Severson called “Told to Eat Its Vegetables, America Orders Fries” and none of it surprised me because I think kids are not the right thing to target in the war on obesity which is really a war on type 2 diabetes which is what leads to heart disease, stroke and lots of other things.

The good news is that it’s not that hard to get rid of type 2 diabetes (which by itself costs $14,000 per person per year to treat, and 1 in 4 Americans has it or has the genetic marker to get it) and all of the downstream diseases.  Typically if a person loses just 6% of their body weight, it all goes away.  That’s not an incredible amount.

The bad news is that people aren’t losing the weight and the problem is getting a lot worse, faster, and it is now especially bad in kids.

I have lots of suggestions on how to move the needle on this, and I was lucky enough to spend some time last month with the US Surgeon General Regina Benjamin talking about it.  She’s great, by the way.

But before I start into the suggestions, I want to first look in the rearview mirror to investigate a “war” that we seem to have largely won, and that’s the war on cancer.  My question is why we have been more successful at getting people to quit something that is literally, clinically, addictive in smoking, and we are losing ground on things that are easier, or cheaper, or just taste better?  Or is it really just an education issue?  Or is it really a business issue?  This is a big topic and I am not going to tackle all of it today, but here are some thoughts:

1) People were told that if they smoke they will get cancer, which most people equate with death.  And a lot of people know someone who got lung cancer and died, my maternal grandfather in my case.  I read the obituaries in the paper every day and not once have I ever seen the cause of death listed as obesity.  I wondered about the old fashioned cause of death “consumption” but it turns out that’s another term for tuberculosis, not consuming too much food.  I would assert that people don’t know being fat can kill them just as smoking can.  They know heart disease will kill them but I don’t think people know the direct link is there between diabetes and heart disease. So RECOMMENDATION #1 is to turn the dial on the messaging and let people know that donuts and pizza and candy bars and burgers aren’t so different from cigarettes, they are just harder to light (I imagine).  People aren’t scared enough about obesity.

2) People are hearing a lot about the obesity issue but it’s very rare that I hear anyone talking about the solution.  My friend Jenn Ty tells me that Robb Wolf’s new book The Paleo Solution offers great guidance, but I think we need the Surgeon General to do public service announcements with facts like the 6% number I mentioned above.  I am pretty sure the old messages from former Surgeon General C. Everett Koop had an impact.  So RECOMMENDATION #2 get out some simple messaging from the Surgeon General and others.  One company that is well suited to get behind this is the bank ING, their current ad campaign recommends that people know what their “number” is in terms of how much money they would need to retire.  Extend that to knowing what your “number”is for your target weight (current weight minus the six percent).

3) The other end of this is the business end.  At $14,000 a person per year, either you or your company or an insurance company is paying for that.  I wrote before about how Safeway had no choice but to push on a corporate wellness program because their health care costs are growing way faster than their profits and they need to turn that tide.   The evidence is there that the 6% number is real and companies need to do more, and some of it is experimentation with different programs and messages, because corporate culture will play a role.  Different messages, different programs, different incentives, people need to move on this now.  So that’s RECOMMENDATION #3 on rethinking all of this – corporate America and the insurance folks need to do more experimentation to drive these costs down.

4) A lot of people talk about childhood diabetes.  Yes it is a problem, but until you get the parents educated and aware, and on board, focusing on the kids will be a waste of time and money as Severson’s article points out.  That’s no surprise to me.  Start with the parents and it will trickle down to the kids.  RECOMMENDATION #4, focus on the parents first, and the childhood obesity piece will follow, not the other way around.

If we don’t slow the growth of diabetes, people will end up in the hospital, and we know that whole system is already a mess, so we need to stop this upstream of the people going to the hospital.

I would love to hear your feedback.

-Ric

As far as I can tell, anyone who has an iPhone that is stuck with AT&T hates AT&T, but accepts it as a given that the service is poor, unpredictable, and generally awful.

But somehow, I think we have come to accept the AT&T bad service as a sort of benign neglect that the network is so bad that the hate has taken on somewhat of a familial hate, where we despise the company, but because in some weird way they are like family so we put up with them, like certain relatives that we might see once a year at Thanksgiving.

That was true for me until yesterday just before 1:00 PM.

That was when I got my monthly text message from AT&T announcing how much would be billed to my credit card.

July 21, the message told me that my monthly bill was $117.83

August 21, the message said the monthly bill was $119.46

Yesterday, the message told me my monthly bill was $412.21.

That’s a 254% increase from the previous month, when the previous month delta was 1.4%

Assuming this was all some sort of mistake, I called AT&T and the woman on the phone quickly assured me that this was because of a significant increase in usage, something that didn’t, and doesn’t sound right to me.  But that gets to the heart of why I am writing this blog.

Since it’s their word against mine, and I really wasn’t expecting my cell phone bill to be 254% higher than it was the month before (it didn’t seem like I used my cell phone any more than usual), I put my tail between my legs, as it were, and asked the woman if there is any way to set alerts to let me know when I have crossed certain billing thresholds so that I can cut back on my usage – really trying to make the best of a bad situation.   My real goal was to prevent this from happening again.  Her response was that I can login and check up on the status of my account any time.  Figuring she hadn’t understood the question, since it has already been established that it’s REALLY easy for them to send me a text message, I told her that didn’t answer my question.  From there she told me in a very stern, unfriendly tone “your phone is your responsibility and it’s your responsibility to keep track of your usage.”  Really!?

This reminds me of the signs in rooms that declare maximum occupancy rates (who is really going to keep count?)

This reminds me of elevator weight limits (do they expect us to announce our weights to ensure the total doesn’t exceed the limit?)

With our mobile devices, it’s completely unrealistic to keep track of the total of the minutes we use, and if AT&T wants to charge me a dollar a day for a report to be sent to my device to tell me about my minutes, when the bill for this utility service can swing by 245% in one month, I would pay that, though weekly probably makes more sense in my case.

The point is that this is predatory behavior and AT&T should be ashamed of themselves.  It’s bad enough that I am stuck with them because I have an iPhone, but for them to be so rude to me and not give me any option to easily, simply report on usage should be a crime. A felony.

Shame on you AT&T.

I hope Elizabeth Warren of the new consumer protection bureau puts you high on your list, someone should go to jail for this.  A 245% swing in cost for a commodity function is wrong.  AT&T needs to do some rethinking.  Now.

-Ric

OK, last week I traveled again and again I was amazed at how outdated some of the elements of commercial travel remain.

Here are the problems:

1) TSA lines take way, way too much time and line length seems almost random

2) These days announcing that “we have a very full flight” has almost the same effect as shouting “FIRE!” in a theater

3) Most of us check in well before the gate has been announced for the flight, and figuring that out can be a hassle

4) Seat assignments have never been more complex, especially when flights are canceled.

5) The limits on carry on luggage are not enforced

I don’t think any of those are too controversial, and here are my thoughts on how to improve each, and I just hope someone, somewhere, especially at Alaska Airlines, is listening.

1) TSA.  If we can’t speed up the line, and I don’t have a good way to speed up the line, but most people these days have a mobile device in their pocket and it just wouldn’t be too hard to have a site that gets updated every 10-15 minutes that says what the typical wait time is so that you can at least plan a little bit for this.

2) Announcement.  It’s easy to check how full the flight is when you check in the night before, so I always know, but beyond that the airlines have the message board up above that lists the number of people on standby.  Can’t people connect the dots that if there are people on standby (usually) then it’s a very full flight?  Give us some credit and for people who can’t figure it out yet, they’ll learn.

3) Gate.  The airline knows my e-mail address. I know this because they send me an e-mail 24 hours before my flight with all kinds of information.  If they already do that, why not shoot me another e-mail when the gate is announced, and if the gate changes, e-mail me again.  Most people check their wireless devices in the airport.

4) Seat assignments.  In the rethink talks I give, I help organizations see through some of the industry labels they use to describe themselves to help them really isolate what business they are in and what business they aren’t in.  Today their aren’t many things that differentiate commercial airlines beyond price, not the way we check in for flights, and not even the flights themselves or the food we are served.  So what’s left?  Seat assignments are nothing more than an inventory management challenge. Every flight has a set number of seats, the inventory, and that supply of inventory needs to get mapped to the demand side.  It’s really not as complex as they make it.  I should just be able to go to the web site of the airline and list out the things that are most, and least important to me about my trip.  Take last week, I went to Denver to give a talk to some people from the Qortex company and their friends and clients.  So if I could have just told United that I wanted to get there Wednesday PM and leave Friday morning and I wanted seats on the window in the back, it should have been pretty easy for them to pick flights and seats for me and save several clicks.  Similarly, if a flight was canceled, I could have let them know that it wasn’t urgent for me to get back Friday afternoon, so rebooking would be easy, but if it had been urgent, they could have just called me. They say they can’t make outbound calls, but that’s a silly policy, but if true, then they should text me – that’s free.

5) Luggage.  Argh.  This is the reason boarding is such a nightmare.  The overhead bins fill up, and checking luggage takes FOREVER to get back and stuff gets lost.  But I see lots of people with nothing under the seat in front of them and that’s a big part of why the overheads get full.  There needs to be enforcement and it will make things a lot better.

That’s what I think.

What do you think?

-Ric