Agile Business Change Blog Thoughts on Agile Strategic Business Change and Agile Delivery

08

FEB

Adapt or die, be Agile, innovate!

08 FEB 2012 | Posted in IndigoBlue Second Wednesdays, innovation | Author Stan Wade | 1 Comment

We had a great session today at the Second Wednesday discussion on innovation. It was really valuable to have both IT expertise and innovation professionals to contribute.

I studied innovation formally at Imperial College Business School in 2006 and as part of that worked with Gartner on academic research on innovation in the software industry. At the time I remember being quite disappointed that industry still had some way to go. It seems that we are still struggling to get senior management to ‘play ball’ and let us establish effective innovation programmes, and yet it was universally agreed that to fail to innovate was an unacceptable risk.

The key problem seems to be the reluctance to accept failure as anything but bad. Failure is still deemed a potentially career limiting event and yet there was strong consensus that one of the key targets of any innovation programme was the ability to identify bad ideas, quickly and cheaply, so they can be abandoned before they absorb too much of our precious research and development budget. In other words, failure is acceptable as long as its quick and cheap. Cheap failure would allow us to run a model similar to the way VCs operate. Back many ideas, identify the strong candidates early and redirect resources to nurture them from the less attractive and failing ones which we abandon. As failure isn’t accepted it’s not easy to abandon these less attractive projects without stigma and the tendency is to plough on with them burning cash as we go. Not good!

We need to accept that not all ideas are good ideas and we won’t discover which ones are good until we have invested some time and money. VCs accept roughly only 1 in 10 start-ups will be a runaway success, and the rest will fail or maybe break even. Why can’t we accept 90% of our ideas won’t play out?

Agile can be valuable here with the ability to identify what ‘horses to back’ early. Incremental delivery gives opportunities to build something we can evaluate regularly with increasing sophistication and a quick development start produces software in weeks not months. Added together, we have a software build model that directly supports the VC style portfolio approach.

Another key observation is that it takes time and resources to generate the ideas to seed projects. That may sound obvious, but getting that time was deemed a significant challenge. This is especially true in some industry sectors where the business day has to run like a well-oiled machine to generate acceptable profits. This problem seems all too familiar to me as there always seems to be a challenge to get time from stakeholders to spend on projects so getting additional innovation time will challenge a lot of companies. Not making the investment however, may be an expensive mistake, if a competitor doesn’t share your views.

All in all an excellent discussion and good to hear peoples’ views and experiences on the subject. I for one would like a follow up session, there was simply too much to discuss in the time we had. It was good to hear people saying they had a different view on innovation as they left, so there had been enough time to make them think differently.