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At the BIF3 Innovation Summit Irving “Irving Wladawsky-Berger, vice president, Technical Strategy and Innovation, IBM, suggested that the only way a big established company can reinvent itself is having a near-death experience, much as IBM did.

When Wall St. Journal columnist and BIF co-host Walt Mossberg asked Mark Cuban about whether he thought a near-death experience was the only way to keep innovating, Cuban had a different perspective.

“Every day I wake up knowing that there is a 12 year-old out there somewhere that’s trying to kick your ass. If you don’t pay attention to your business your ass will be kicked.”

Near-death or waking up every day and thinking someone could disrupt everything? The latter sounds like a better route.

One of the challenges in getting people to believe in a new business concept is having the right words to describe the concept. At the BIF3 Innovation Summit CEOs Robin Chase of GoLoco, Jack Hughes of TopCoder, William Herb of Linear Air, and BIF3 co-host Bill Taylor talked about the importance of messaging to be able to talk about business concepts in ways that resonate –with employees, customers and investors. Without that messaging, it’s difficult to get people to believe in the idea.

How these execs have distilled their concepts to people “get it” quickly:

• GoLoco: personal public transportation system
• Linear Air: car service with wings
• Fast Company magazine: like Harvard Business Review and Rolling Stone combined

All expressed how difficult it is to hone in on those few words that capture the idea. Note how straightforward these concepts are – and how easy it is for other people to use the language.

A few days a go I was talking to a CMO about his company’s new messaging. “We’ve got it done, but I can’t really explain it to you over the phone,” he said. “I need to walk you through the deck.” Sounds like it isn’t done….

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Asking insightful questions is clearly one of the traits of successful innovators. When explaining how they got into a new area, or hit on a ‘aha” large or small, almost all of the storytellers at the Business Innovation Factory Collaborative Innovation Summit talked about the questions they asked.

“When we arrive at the question, the answer is already near,” wrote Ralph Waldo Emerson. Here are some questions from conference speakers that led to fascinating answers and new business models.

• “How can people reduce their carbon footprint – and actually like doing so?”Robin Chase, founder and CEO of GoLoco, a service that helps people arrange to share rides between friends, neighbors, and colleagues.

• “Can a company reinvent itself unless it goes through a near death experience?” Irving Wladawsky-Berger, vice president, Technical Strategy and Innovation, IBM
  
  
• “We were successful in changing how businesses engage with Stanford for cross-discipline research projects by asking good questions. We would create just one page with good questions and put them out to everyone in the university for Request for Proposals. Often it would take us a month to come up with questions. But by putting out the right questions, we got great proposals.” Ellen Levy, founding managing director, Silicon Valley Connect
  
  
• “What is the path of least resistance for the consumer? …Should this be a product or is it just a feature of an existing product?… Why isn’t there content for high definition TV?…Why is everyone so focused on the Internet when it comes to digital content and not on all the other places where digital content can be leveraged?” Mark Cuban, serial entrepreneur, owner of Dallas Mavericks, founder of HDNet,”Dancing with the Stars” contender

• “Why doesn’t a police chief’s son call 911 when he’s been a victim of crime? What does that say about policing?” Dean Esserman, Chief of Police, Providence, RI

• “Why couldn’t you design apartment buildings in New York that drastically reduce energy costs — for the same cost as typical buildings?”
  Architect Chris Benedict, who recently completed a 38-unit new construction project that uses 85% less energy than standard designs

• “Why can’t people get companies they pay to take their calls and treat them like human beings?” Paul English, founder, the gethuman project.

Some interesting food for thought from the first day of today’s conference:

“It’s important to study why bad ideas stay around so long…We need to build hunch-supporting environments and find people who can help us fill out the hunch. Most business organizations not structured to do so.” Steven Johnson, author, The Ghost Map

“People talk about getting out of the box. I think more people should get in the box — but the right box that helps them innovate more easily…We should all give someone the gift of a new box to help them think in. Constraints are liberating. ” Dan Heath, author, Made to Stick

“The best engineers have empathy and are lazy. They can relate to customers and don’t want to deal with the same customer questions or issues so they fix the bugs. This is why engineers should talk directly with customers, and not layers of customer service people. Engineers will hear customers’ pain and then go fix the problems so they don’t have to deal with the same questions again.” Paul English, founder, Kayak.com, GetHuman.com

Dean Esserman, chief of the Providence, RI police force, reflected this morning at the BIF3 Collaborative Innovation Conference about the six years that have past since 9/11. Six years since Bin Laden promised to take down 100,000 American children. “He’s a man of his word,” said Esserman. “But we’ve done it for him. Over the past six years 100,000 young Americans have been murdered. We’re a land that buries its young. That’s the face of violence in America.”

Esserman explained that for a generation we’ve thought that 911 was going to solve our police issues. You have a problem, call 911, the police come. It’s a one way relationship. People talk, police receive.

The problem, says Esserman, is that crime is personal. Most people don’t call the police to report a crime. And when people do call the police they don’t tell them much because the police have become anonymous strangers.

The way to reduce crime? Essmerman believes that it’s creating community policing, where people in neighborhoods know their local cop and have a relationship with him or her, much as they did years ago.

In Providence, there’s a quiet revolution happening where the police are moving back into neighborhoods, establishing relationships where people are starting to trust their local cop. “People don’t have to know and love the uniform,” said Esserman, “just the person in it. That’s where we’re going. We want people to know their neighborhood cop.”

The results of this innovative new model? Providence crime is down for five years in a row, one of the very few cities in the country that can report a decline.

What does it take to create this type of new policing model?

Esserman said it’s because Providence has an honest mayor, who has given the police force back to the people — instead of the police force being the King’s Army, as is the case in most cities.

Another reason is clearly that Esserman is a leader who knows how to get people to buy into a new vision, and restore pride and honor in being a police officer.

That was Walt Mossberg’s opening question to 37 Signals founder Jason Fried at today’s BIF-3 Collaborative Innovation Conference. “I’ve never seen a software company figure out how to deal with feature creep,” said Mossberg. “Even Quicken has become a complete mess because a small percentage of enthusiasts keep demanding more and the software companies listen to them.”

Fried’s take on the issue:

• Just as writers need editors and museums need curators, software developers need good editors. Most software companies missing good editors.

• Just say no. You have to be a hard ass and know when to say no. “We see ourselves as the enemy of mediocrity. If you try to make everyone happy you end up with bloated crap. You have to say no, just like Steve Jobs does. Jobs is as proud of the things he hasn’t done.

• Be more opinionated. We need more opionionated companies. I’d rather have people love us or hate us but not have either. People either like our stuff or they hate it. That’s OK. Those who like it, love us.

• Forget the wisdom of the crowd: I don’t think the wisdom of the crowd would make any decisions. When everyone is involved in everything, the products end up sucking. You need a leader.

Mossberg: Why open source software a failure

While open source has value to big IT organizations, it’s been a failure when it comes to developing software for non-techies, said Mossberg. The one exception being Firefox, although the Web browser still has just 15 percent of the market share.

Why?

Mossberg and Fried agreed the failure likes in the fact that open source geeks are all about the software and not about understanding people.

“Open source geeks – and for the most part they are all geeks — can’t relate to regular people. They wouldn’t know a non-techie consumer from a bag of Cheetos.”

The other reason for failure, according to Fried, is that open source’s reason for being is to democratize software, NOT to develop better consumer experiences. Open source developers build stuff and at the end call in designers to paint the walls. 37 Signals takes the opposite approach: create a great user experience and at the end call in the developers to connect it all.

Innovation isn’t happening fast enough for most executives, according to Boston Consulting Group’s fourth annual study on innovation — and there are some key implications for marketers.

Only 46 percent of the 2,500 executive surveyed said they were satisfied with returns on innovation spending. The place they think innovation is most important (listen up marketers):

• New offerings for existing customers (92%)
• Offerings that allow expansion to new new customers (85%)

The biggest obstacles to innovation: speed in going from idea to sales, risk averse cultures and overly lengthy development times.

The question for marketing is how do we tap into customer insights all the time to be constantly finding new ways to appeal to existing and new customers, and then how do we collaborate with other business functions to speed product development. How can we rip out processes that are designed to mitigate risk but actually choke the innovation process? If you have an innovative idea but it takes 18 months to bring it to market, it may not be innovative by the time it gets to market.

On a related note, the most difficult business function for marketing to collaborate with by far is IT, according to a new Forrest Research project, “Partnering for Success: The CMO-CIO Relationship.” The top challenges for marketing in working with IT, which tie right back to innovation:

• Slow time to market and speed in completing projects
• Rigid processes and an aversion or inability to change

Frans Johansson, author of The Medici Effect, gave a thought-provoking and inspiring workshop today at the Business Innovation Factory.

Takeaways:

• All new ideas are combinations of existing ideas (And the further apart the ideas, the more innovative they are.)

• Diverse teams drive innovation. (Research shows that diverse teams — people from different fields, cultures, perspectives — are much more productive than homogeneous teams. In the first couple of weeks homogeneous teams are more productive, but then the diverse teams kick in in high gear.)

• Innovative teams generate and execute more ideas. (Did you know that Prince has written 1,000 songs that he hasn’t yet published? No wonder the guy’s work has been so amazing over so many years.)
• Innovative teams and people find inspiration from fields of cultures other than their own — and have the curiosity and courage to explore those connections.

• Passion helps us continue driving forward with innovative ideas — even through failures. (How to find your passion? Stating your passion by answering this question helps us define our passions: “What would you like to accomplish in your organization or in your life?”
• Having more resources doesn’t decrease the risk of failure? (So what are so many of us waiting for? It’s not so much about the money as it is tapping into our real passions.)

P.S. — Thanks to Professor Walter Carl for his blog post on Beyond Buzz. In addition to being a highly respected teacher at Northeastern University, Walter is an innovator in word of mouth marketing. Check out some of his research if you’re trying to figure out how to measure WOM. A few things he likes about the book:

• “We hear a lot these days about how companies need to “get into the conversation” but her book makes this very concrete and tangible, peppered with examples from actual companies who have done so successfully (or not so successfully).
  • My favorite chapter is “Building a ‘talk’ Culture” (Chapter which goes into how companies need to rethink how they organize themselves. The table on page 167 “New Functions, New Competencies” is especially interesting. It lists eight functions that are needed to do conversational marketing, what the traditional roles were, and what the new competencies are.
• Most of all, she shows how communication and conversations are central to the lifeblood of organizations, and that it’s essential to develop the requisite skill sets for people throughout the organization.”

Kudos to Australians Kristin Hickey and Derek Leddie of The Leading Edge and David Jenkinson of Fosters Group for their ESOMAR award winning paper, “The Heart Transplant — Customers at the Heart of Your Business.” The authors liken marketing’s obsession with brands to a worn-out, struggling heart and suggest that a customer-centric focus offers the equivalent of a heart transplant.

In an interview with Jesse Blackadder, editor of “Research News,” Kristin said managers see consumer-centricity as a source of sustainable comeptitive advantage for three reasons:

1. It allows an organization to get closer to the customer, increasing the relevance of innovation, communications and other marketing.

2. It provides ane lement of consistent objectivity in the business. There are fewer push-and-pull struggeles between departments based on opinions of differing priorities. The Customer insight and advice provides incontestable direction.

3. Customer-centricity can be a source of bargaining power with trade or retailers.

The paper shows Foster’s journey from being brand centric to customer centric, explores the six barriers to adopting a customer centric vision in an organization, and suggests a five step process for leading a customer-centric revolution.

“Business are already increasing their expenditure on consumer insights, which is creating buoyancy in the research industry,” said Kristin. “However, on closer inspection this buoyancy should be a significant cause for concern. Our industry holds itself up as the expert in the field of consumer insights. Yet to date we have failed to provide strong, compelling leaderhip for businesses searching for consumer-centricity.”

An interesting note: to become customer-centric Fosters took customer insights out of market research and created a new organization which is part of the senior leaderships team, working closely with the CEO and senior business strategists.

This week’s BIF-2 Collaborative Innovation Summit, put on by the Business Innovation Factory in Providence, RI, featured stories from some of the most innovative minds in the world – from science, medicine, business, the arts. For some great, in-depth blog postings about individual storytellers, check out the Corante innovation hub. For some notable quotes that especially resonated to me and the reasons why, read on…

Innovation is not a process. It’s creating an environment that helps teams of people quickly build trust and relationships. Then people have the right framework to create.

Ivy Ross, executive vice president, product design and development, Old Navy on the secret of quickly getting new ideas from teams

Innovation is often just looking at what you have and taking it somewhere new.

Diane Hessan, CEO, Communispace on the value of really knowing your customers

Whatever Budweiser does, we do the opposite.

Mark Hellendrung, CEO, Narragansett Beer, on the wisdom of NOT copying the market leader

Nothing happens without an innovation intent or point of view.

Larry Keeley, Doblin Group, on the most common obstacle to innovation

Just by making half a turn the whole world can change.

Liz Lerman, founder of the Dance Exchange on how taking a slightly different view can help us see new things

Sometimes doing research is an excuse for not doing anything else.

Jane Fulton Suri, chief creative officer, IDEO, on the need to rediscover the value of research – observing patterns and themes in new ways for inspiration, imagination, empathy

But I couldn’t let that stop me.

Josh Koppel on what he did when Apple iTunes 7.0 in effect killed his innovative TuneBooks products two weeks ago

There too much design research and process around creative beautiful objects and not enough on the customer experience.

Jeneanne Rae, president of Peer Insight, on the huge lack of understanding around services innovation and understanding a customer’s entire journey

A good marriage is about a conversation, not sex.

Day One moderator Richard Saul Wurman on how conversations connect people and ideas in meaningul ways

Execution is successful only if the author of the idea passionately embraces the execution team.

Mary Pat Ryan, executive vice president, Sirius Satellite Radio, on the critical need for passion to transcend the big idea and seep into everyone making the idea real

There’s more history under the sea than on the earth

Oceanographer Bob Ballard on the value of creating new technologies that can help children explore what’s under the ocean, from ocean exploring vessels right to the classroom

“They are us.”

Inventor Dean Kamen on the need for people to get more involved in helping kids realize what a blast science, engineering and technology can be, urging tech types to volunteer in the FIRST program

All new ideas are combinations of existing ideas.

Frans Johansson, author of The Medici Effect, on the tremendous value of combining ideas from different fields and looking at the connections and intersections of those ideas

It was difficult to reconcile my desire to be an artist with the reality that I was an administrator.

Roger Mandle on how he came to see his role as president of RISD as one of an artist, creating an environment for creativity and innovation, like onoing performance art among talented people

If you suppress one factor too much it can lead to other problems.

Bill Tsiaris, surgeon-in-chief of Ophthalmology, Rhode Island Hospital, on the complexity of angionesis

Don’t be a star, be a galaxy.

Peter Gloor, MIT professor and author of Swarm Creativity, on the value of connecting talented people to achieve innovation

Social networks like MySpace have nothing to do with core relationships. They are impermanent really just advertising vehicles.

Wall St. Journal columnist and conference Day 2 moderator Walt Mossberg on the value of going to conferences like BIF2 and meeting people face to face

Theater is where civilizations throughout history have shaped their democracies. But make no mistake firends, Broadway is not a democratic place.

Trinity Rep artistic director Curt Columbus, on the value of regional theater as the vital public square for people to talk about ideas shaping their communities and lives.

What’s the next great idea for you? What is the next big chapter in your life?

Randy Antik, founder of Swat Team Partners, on the questions worth asking ourselves to stay passionate, engaged and innovative

The other day I was thinking that the brain is the most important organ in the body. Then I realized who was telling me this.

Several speakers paraphrasing comedian Emo Phillips, pointing to the need to consider the source and its intent when assessing information, and criticism.

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