Booz Allen Hamilton on Money and Innovation

Filed Under Analysis, Business Life, Productivity, Successful Blog | 7 Comments

I Agree, But I’m Not Surprised

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On November 13, Booz Allen Hamilton released the 2nd Annual Global Innovation 1,000 Survey. Business week’s Jesse Stanton summarized the study in an article “How to Turn Money Into Innovation,” on November 14.

The study, which analyzes the relationship between R&D spending and performance, focused on the 1,000 public companies located anywhere in the world that spent the most on Research and Development in 2005. The study by Booz Allen Hamilton found that

  • R&D spending is on the rise, but as a percentage of overall sales it is falling. Companies are finding ways to optimize their investment in R&D.
  • Gross profits as a percentage of sales is the ONLY PERFORMANCE VARIABLE THAT SHOW A RELATIONSHIP.
  • No correlation exists between R&D spending and the number of patents that result.
  • Sales growth, financial performance, operating profitability, and earnings growth show NO STATISTICAL RELATIONSHIP to R&D spending.
  • An increase in outsourcing to and funding in Research and Development in China and India is being fueld by a need to be closer to fast-growing markets

The Booz Allen Harrison study showed that some companies have learned how to successfully underspend in R&D and overperform in providing innovation — their spending on average half as much on R&D as their peers in industry, but their performance is as much as three times higher. The companies that stand out in the study include Kellogg, Apple, Boston Scientific, Tata Motos, Christian Dior, and Kobe Street.

High innovating companies each follow their own unique model.

  • Black and Decker coordinates design from its worldwide headquarters, but aligns R&D closely with individual business units.
  • SanDisk strategic decisions are made by a small group of executives who meet biweekly.
  • Google generates ideas as part of its distinct skills set.
  • Toyota develops products and processes effectively and efficiently.
  • Apple understands customers and product selection.

The similaries found in the Booz Allen Hamilton Survey weren’t surprising.These common factors included what Booz Allend called a “value chain.” The value chain speaks to four key areas in which highly innovative companies exhibited strong competency: ideation, project selection, product development, and commecialization. Innovation is a company-wide investment.

Sustainable innovation depends on having the tools and processes to move from ideation through commercialization. Second, successful companies link R&D with C—customers. At Illinois Tool Works (ITW), for example, R&D engineers are required to spend time working in customers’ plants — Business Week Online on the Booz Allen Hamilton Blogal Innovation 1,000.

Mr. Stanton asks for more concrete answers. I find the value chain confirmation here is powerful enough model. Innovation thrives in a culture that values innovation beyond the simple action of throwing money in the direction of generating new ideas. The investment of currency in innovation has to be considered, thought through as any sound business venture does. Such an invetment recquires thoughtful process from ideation through the decision to move forward on a project, through every customer centered decision that drives the development, to each piece and parcle that introduces and informs the public about the new product during the commercialization phase.

In other words, innovation must be based in quality thinking that that stands on a firm and deep intimacy with the customers’ experience and understanding of the customers’ needs. That is the key driver to productive and useful innovative change that fuels growth.

How new is that idea?

–ME “Liz” Strauss

Click the title to read the Business Week article
How to Turn Money into Innovation

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Stop Writer’s Block: 10 Minutes to Ideas to Write About

Filed Under Content, Idea Bank, Outside the Box, Productivity, Successful Blog, Writing | 21 Comments

Plenty of Ideas — Make Things Up!

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A young man wrote this week,asking how he might open his mind to be more creative. We passed emails back and forth. He said he knows that he stops his ideas. He asked if I might point him to how he might open his mind to let the ideas flow.

Do you have that problem too? Let’s check.

Stop right now and make something up. I’m sure you know how. Make me taller or shorter or older or younger, or any some such. Invent a new character in your life who is all evil or who is all good. That wasn’t so hard, was it? Okay we’ve got the making things up part covered. Most of us learned that in childhood.

Making things up is the stuff that ideas are make of. The exercise training for getting better at doing that involves time spent test driving your subconscious and unconscious a bit.

I’m going to show you one way to do that using a photo, your brain, and about 10 minutes.

Old Moon in New Moon

C’mon turn the page.

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How to Age Ideas Like a Fine Cognac OR Making Compelling Writing the Center of Your Brand

Filed Under Audience, Branding, Idea Bank, Motivation/Inspiration, Outside the Box, Successful Blog, Writing | 13 Comments

I Love My Pocket Journal

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Yesterday in the comments to Inside Out Thinking: Catching Ideas Coming In and Going Out, Hans at Blogosquare asked a question that was one I had when I first started writing. That made me think that others might have it as well. You see, Han’s problem is that he has too many ideas and his exuberance makes him anxious to use them all as soon as he gets them.

. . . I just don’t have to sit back and wait for thoughts, actually they are filling me. When I get a thought, . . . I just can’t wait for that thought to leave me. So I write it down quickly, quickly and post it and there when I see it I feel much relieved.
How in fact to you deal with thoughts when they come in? Should I set myself to some relaxation or things like this? All day long everything I see, read, and hear just give me thoughts and ideas. . . . Right now after reading the post above, I just got that thought and couldn’t wait to put it down, to get it off my mind. Am I not normal? [edited with Hans permission]

Hans, my friend, I value you and your passion for writing. Turn the page and I’ll answer your question with the seriousness it deserves.

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Inside Out Thinking: Catching Ideas Coming In and Going Out

Filed Under Idea Bank, Motivation/Inspiration, Outside the Box, Successful Blog, Writing | 13 Comments

Everyone Has Endless Ideas

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Ideas.

Can’t write without one. I’ve tried. It doesn’t work.

If you’re reading this, you probably know that. So let’s move around that dead, old horse.

What’s an idea anyway? A thought, a stimuli, a catalyst.

Everyone has endless ideas in our brains every minute that we’re alive.

We can get to them two ways — from the inside or from the out.

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Ideas When I Get My Hair Cut

Filed Under Branding, Idea Bank, Outside the Box, Productivity, Successful Blog, Writing | 9 Comments

Ideas Everywhere

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Yesterday, I got a haircut. While I was waiting I looked through a magazine and took notes. I took notes on articles and on advertisements. When I was through one magazine, I had complete ideas for four blog posts — not counting this one — and 27 phrases that I thought might spark ideas later.

Not bad for just sitting around waiting my turn.

I hate actually reading those magazines in places where I get my hair cut, and there’s never time to get into a good book.

–ME “Liz” Strauss

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