The process of innovation

The process of innovation
THINK ASIAN
By ANDREW SHENG

Thomas Edison used to say that invention is 99% perspiration and 1% inspiration. What he really meant was that the 99% perspiration was spent on the process of innovation and perhaps only at the last minute could he have a mental breakthrough to create something new.

We are truly living in the age of innovation, where technology has created new ways of living and communicating that we could not have envisaged. Thirty years ago, when the TV series Star Trek began, we saw Captain Kirk flip his communicator and speak to the Starship Enterprise. Travelling in the Moluccas in the Spice Islands this Christmas, I was amazed how in the most remote islands of Indonesia, young people were communicating with their friends using the latest Blackberrys.

Yet, at Saumlaki airport, two bikers had to go out to the runway first to chase away the cows before our plane could take off. How do we create something new? The management guru Peter Drucker said that he had to learn a new craft every three years to obtain new insights into old problems. For example, he studied Japanese literature to gain understanding of how Japanese thought about problems. According to him, every innovation comes from the cross-fertilization of ideas from different fields.

INSEAD professors Kim and Mauborgne put it very elegantly by saying that you need to move out of traditional, heavily competitive areas like the Red Sea to explore Blue Oceans where there are few competitors. This is easier said than done, because breaking out of old mindsets is very painful. We would all like to play tennis like Roger Federer, but I don’t have the patience or the willpower to diet, exercise rigorously, practice and compete day in, day out.

Innovation is a process, a cycle of steps that must be rigorously followed to achieve what you set out to achieve. First you must have a Strategy or goal what you want to achieve. This is the search and browse function. It is like shopping in a supermarket. Some people begin with very clear ideas of what they want. Others browse by looking to see what attracts them.

Genghis Khan mausoleum in Inner Mongolia, China. The ancient ruler must be one of the greatest of institutional innovators, because he created innovative teams of warriors out of individualistic nomad rabble.

The second step is to Prioritise, because we must narrow down our choices. Many people have difficulty making up their minds, because they want everything and end up doing nothing. Success comes from having focus.

The third is to Incentivise. If you set a goal, you must create the incentives to achieve that, either to reward yourself or your colleagues. Incentives mean both the rewards and the punishments. People tend to forget that we fail mostly because the incentives are wrong. If you reward failure, you will get failure.

The fourth is to set the Standards. Success or failure must have benchmarks. Are you aiming for the Olympics or just the Asian Games, the local market or the global market? A small country like the Danes can create badminton champions because they start their children young and train them through competitive leagues, using world champion trainers.

The fifth is the Structure. People think that innovation comes from individual genius, forgetting that genius can only create if the ecology is right. Michelangelo grew up in an age of great artistic creativity. He learnt from great masters and had inspired pupils, as well as rich patrons. If he was Robinson Crusoe on a lonely island, no one would appreciate or discover his genius.

It also takes passion and leadership to create the right ecology for genius and originality to thrive. Most bureaucracies stifle creativity because they want everyone to think alike. The greatest universities encourage their professors and students to think out of the box.

Sixth, you have to have Process. The word ‘process’ is so boring, whereas Innovation is so sexy. This is because most people associate Innovation with Product innovation, whereas the greatest achievements have been in Process Innovation and Institutional Innovation. Henry Ford did not create the motorcar, but he revolutionised manufacturing by inventing the assembly line process of production. The Japanese improved on this by creating the Just-in-Time assembly process, without famous engineers but through workers on the shop floor.

In my view, Genghis Khan must be one of the greatest of institutional innovators, because he created innovative teams of warriors out of individualistic nomad rabble. His teams invented new methods of mobile warfare and siege techniques. He destroyed the old order and conquered all the way to Europe, forcing the Europeans to respond through their cultural and scientific Renaissance.

Seventh, you have to execute or implement what you want to achieve. Most of us make New Year wishes, but by the middle of the year, we would have forgotten to execute that wish, because it was too difficult, inconvenient or we got distracted by something more exciting. Execution is tough, because it creates what Schumpeter called “creative destruction”.

There is no gain without pain. No wonder most of us do not achieve what we desire. The “last mile” problem is the most difficult and painful. We all want to be Olympic Marathon runners, but we cannot finish the last mile. As Napoleon used to say, execution is everything.

Finally, we must Review our achievements, be honest where we went wrong and change for the better. The cycle of innovation begins anew. As a habit, I have always made a year-end review of what I achieved and where I failed. In 2009, I am grateful that my book From Asian to Global Financial Crisis was published. But this year, I failed in spending more time with my family.

My New Year wish for 2010 is to write a new book and spend more time with my family. Time is what we spend like water when we are young and treasure every moment when we are old. That is the cycle of change.

Happy 2010, everyone.

● Andrew Sheng is Adjunct Professor at the University of Malaya, Kuala Lumpur and Tsinghua University, Beijing.