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December 14, 2011

Supply Chain Innovation, Part 2

In Part 1 of this two-part series on supply chain innovation, I discussed the importance of networking, collaboration, and culture. Also in that post, I cited Steve Hall who talked about the importance of getting the right people with the right tools into the right relationships to foster innovation. Today's post discusses, among other things, who those "right people" might be. The focus of this post will be two interviews that Dustin Mattison, founder of www.dustinmattison.com, conducted on this subject. The first interview was with Rupa Rao, a Principal Systems Engineer with large global medical device company. ["Harnessing Ideas Across Functions for Innovation," Dustin Mattison's Blog, 18 October 2011] Mattison reports that Rao is involved in "a ground up effort ... to encourage employees to think outside of the box and come up with unconventional solutions to some traditional products their company has in the market." He continues:

"One of the biggest things they had to keep in mind when engaging employees was to make it fun and give them some incentive to participate and play. Employees, especially [from] R&D, come from a creative mindset. They want to make a [difference]. ... It is a question of how to harness [their efforts]."

Mattison reports that Rao's team tried some traditional creativity activities, like monthly brainstorming sessions. As I've discussed several times in past, group brainstorming sessions can actually result in fewer ideas being generated than having the same number of people brainstorming individually then presenting those ideas to the group. Apparently, Rao understands this conundrum and at her monthly sessions "people presented any ideas which they had. The presenters had 5 minutes to give their pitch, which was followed by a brainstorming session which provided them with feedback on how to build upon the idea and make it better." I like this technique much more than traditional brainstorming. For more discussion of this topic, read my post entitled Brainstorming Lives On. Mattison asserts, "One of the things we as human beings do best is point out the flaws in someone's ideas." I'm not sure that is high praise for humanity; but, we do seem to enjoy knocking others' ideas. A better mindset to use is: "How can I make a good idea better?" In order to ensure that ideas were critiqued properly, Mattison indicates that Rao's team used techniques like "the Six Hats and Lateral Thinking."

For those unfamiliar with these techniques, let me give you a quick primer. In the Six Hats technique, the group focuses on the idea before them in six ways (with each perspective represented by a different colored hat). The six hat colors are white, red, black, yellow, green, and blue.

  • WHITE HAT thinking covers facts, figures, and data.
  • RED HAT thinking covers intuition, feelings, and emotions.
  • BLACK HAT thinking covers judgment and caution.
  • YELLOW HAT thinking is both logical and positive.
  • GREEN HAT thinking covers creativity, alternatives, and provocative proposals.
  • BLUE HAT thinking controls and directs the discussion (meta-cognition).

Lateral Thinking is about moving horizontally when working on a problem rather than tackling it head on. Facing a particularly tough problem can be like trying to stop a runaway train coming straight at you. By stepping aside, other alternatives may emerge. Lateral thinking requires you to use different perspectives (much like the Six Hats method). An example of lateral thinking that I've heard goes like this:

Grandma is trying to knit and little Kathy keeps bothering her. Mother suggests putting Kathy in the playpen. Father suggests putting Grandma in the playpen.

Although both approaches keep little Kathy from bothering Grandma, the father's lateral thinking solution gives the individual with the greatest need to move around (i.e., Kathy) the freedom to do so. Rao told Mattison that her team "also went out on a few field trips to local places which don't play in their field, but acted as an outside inspiration to try to come up with creative ideas. They idea was to get out of the box."

"On one trip they went to the innovation tech museum which had a lot of exhibits; all the way from semiconductors to unique robotics. The idea was that people [would divide] themselves [into groups] of 4 or 5 and take their time to view all of the exhibits and think about an exhibit which inspired them to come up with a solution [to a problem they faced]. Surprisingly, there were no stumbling blocks. People came up with many creative ideas. One example was a design of a cover for one of their instruments which was more green and which was cheaper and better. It was very exciting both for the employees and Rupa’s team to see what they could come up with."

Walk into the office of any really creative designer and you're likely to find all sorts of gadgets and toys strewn about. A truly creative person is open to inspiration from any available source, including other people. Intellectual cross-pollination has been the source of inspiration for hundreds, if not thousands, of years. Rao understands this and told Mattison that "one of the things that the company values with this effort is how they are able to get in people from different functions to participate in the activities."

"All of the innovation activities have been open to other functions such as manufacturing (supply chain and operations), quality and marketing. Rupa believes it is really interesting to see their perspective and how they are able to apply the techniques in their day to day lives, as well as to get their perspectives in designing new products. ... Sometimes the cross fertilization and pollination is necessary to come up with out of the box ideas. This is where they encouraged and asked people to get engaged with these processes."

To read more about the power of intellectual cross-pollination, see my post entitled The Medici Effect. The second interview conducted by Mattison was with Joel Larner, Vice President, Program Management for Schneider Electric. ["Supply Chain Innovation - Cross Functional Communication is Key," Dustin Mattison's Blog, 19 October 2011] As the title of Mattison's post states, Larner also believes in intellectual cross-pollination. Mattison reports that Larner "spends about 50% or more of his time helping to build a culture of innovation to expand the innovative products that the company offers for new markets." Mattison continues:

"Innovation is vital for the future survival of any company. It used to be that you could develop products at a reasonable pace. If you had new ideas, you could be competitive in new markets. Today, the pace of change has grown so fast that if you just keep doing ... incremental innovation, you will become a dinosaur. It doesn’t matter what topic of discipline you are operating in; whether it is Research & Development or Supply Chain, the case will be the same."

Larner told Mattison that innovation isn't just about developing new products. A company also needs to be "innovative in the supply chain world."

"You can’t keep bringing out new products, technologies or solutions and deliver them through the same logistics done in the past. There may be new markets requiring new logistics. There may be new parts and components. You also need to be driving supply chain efficiency for cost efficiencies. As much as they focus on innovation in the R&D space they need an equal amount of innovation in the supply chain space to be competitive there."

I like Larner's holistic approach to innovation. It requires enterprise-wide collaboration and alignment. Although Larner dissed incremental innovation, he later admits that "you need some amount of incremental innovation" even if you are striving for "radical innovation" (which has also been called disruptive innovation). Larner also asserts that "culture is huge. It defines where people feel comfortable and not comfortable innovating." For more on that topic, read my post entitled Innovation and Corporate Culture. Larner also insists that "organizational structure has a huge impact on innovation." This is where the Medici Effect comes into play.

"Innovation occurs at intersections. You need individuals with many different thoughts coming into an idea to really make it blossom. If you have an organizational structure which limits this cross functional discussion you have lost the huge value an opportunity to have those intersections occur. If it is always a homogeneous conversation you will get limited growth in your ideas. Instead, if someone brings out an idea and you have an individual from Product Development, Customer Support, Global Supply Chain, and Logistics; each tossing the idea around and bringing different viewpoints into the discussion. In the end what you get is a new idea which meets needs in many of these different areas. Ultimately, you will get a much more innovative solution."

I agree completely with Larner on this point. Another point of agreement has to do with executive support for innovation. Larner insists that "upper leadership should be supportive of innovation" through both recognition and rewards. "Recognition ... signals to the organization what is important in the organization. That is critical."

If you would like to watch and listen to Mattison's interviews with Rao and Larner, click on the provided links. The biggest take-away from these interviews should be the fact that both of these executives have an appreciation for cross-sector collaboration. I have repeatedly stated my belief that the best ideas originate at the intersections of diverse fields of expertise. New York Times' columnist Thomas Friedman once wrote that his "favorite business quote [was] from a consultant who had worked for the German technology giant, Siemens. He said: 'If Siemens only knew what Siemens knows, it would be a rich company.'" Most companies don't take advantage of the combined knowledge of their employees. Why? Because they haven't figured out the best way for them to collaborate and exchange ideas. To read more on that topic, see my post entitled Dynamic Collaboration: Inside and Out.

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