Kelly and his SRI colleagues had this idea for a revolutionary radar system back in 1988. He assembled his team and they put together their first sketch of what it would 100k like and do. Even though there was initial excitement about the idea, it was going tO be an expenslve project, costing more than $ 50 million [ 0 build something as big as two football fields. His customers for this new radar would be fellow atmo- spheric sclentists at the National science Foundation (べ・ (F) and around the world who are working t0 understand atmospheric effects on the envlronment. Kelly had many meetings with them t0 understand their needs and tO learn hOW tO design a system that would collect the 1 第 .os [ valuable data. ln 1989 , Kelly put together a detailed proposal and submitted it to NSF. lt was not prepared to fund such a project, but it asked Kelly's team tO submit another proposal for a study tO prove that the concept could work. Kelly submitted the proposal, the team won the study, and they showed that the concept was feasible. Then there was a long ia- tus. Kelly and the team kept on working hard, but the project always missed being funded. Finally, in 1996 , a solicitation was issued by NSF, and Kelly submitted a detailed proposa in 1997. The proposal , on. Unfortunately, for political reasons, congress intervened and re- moved funding for the project. Then, after another long delay, NSF asked KeIIy to completely redesign the radar system. To anyone else this would have been a fatal blow, but in retrospect KeIIy acknowl- edges that this review in 1998 greatly improved the system. But again, in response t0 Congress and just before funding the latest proposal, NSF restructured the funding process. This caused still another delay. Work- ing with hiS partners he came up with yet another proposal tO satisfy both NSF and Congress. FinaIIy, in 200 ろ , the system was funded and part of the system has now been built. lt works superbly. John KeIIy is a champion in every sense of the word. He selected an lmportant need, built a great team, and iterated his value proposition hundreds of times. He worked through incredible obstacles and perse- vered for fifteen years tO make hiS innovation come tO fruition. When we 100k back, it is hard to believe this proJect could have suc- ceeded had it not been for KeIIy. FortunateIy, most innovations don't take fifteen years tO come t0 fruition. But some d0. ・ Whether it IS an レ . 切 INNOVatION I タ 9

TipsforSuccess VaIue FactorAnaIysis WhiIe your projects or products can have "value," it is only when you establish the superiority Of your value relative tO the competition that you make headway. People always have alternatlves; there is always competition. lt may be another company, another pr0Ject, another or- ganizatlon, or just the alternative Of dOing nothing. ln the Appendix you will find a detailed treatment of Value Factor Analysis, which, as described in Chapter 4 , allows you to numerically compare the relative customer value Of your product with that Of Oth- ers. lt helps to deternune whether you are only marginally better or have a product that will make an important impact. If you are serious about your business plan, consult that Appendix and use Value Factor Analysis. Picture, Mock-Up SimuIation, Prot0type When you move from the EIevator Pitch to a んⅡ innovation plan, your customers Will need more Of a feel for your new product or service. your customers a picture or mock-up Of What you are creating, even if the mock-up doesn't work. ln today's world 0f computer-aided design, there iS no excuse for not having a professionally rendered picture or mock-up 0f your new product. Of course, if you have a complete working prototype, all the better. For the electromc C1nema demonstrations described above, we lashed together parts 0f a high-definition system we had developed earlier. lt did not have the 応Ⅱ quality 0f the solution we were proposing, but it was good enough [ 0 prove that electromc cinema would be dramatl- cally better than today's め mm projected 61m. ln our workshops, we always insist that part1Cipants create mock-ups Of their business proposals using whatever iS available, whether it IS cardboard, Erector Sets, or Tinkertoys. For example, when the BBC INNOVatION 151

・ Keep the VOice ofcustomer value and continuous improvement 0 〃 ve. ・ Document and S わ 0 肥 lessons learned and Ot わ e 「 / nnova on best p ractices. 〃 gn 肥Ⅳ 0 「 ds and recognition programs with the vision. CVC, like all organizational approaches, must be continually rein- forced. lt iS a journey that takes time. Look for opportunities [ 0 make headway, and come back at it again and again. 宅 all think it will hap- pen sooner than it does. lt takes time for even a positive virus tO infect the entlre enterprise. Jim CoIIins has a wonderful metaphor for organizations that move 伝 om good t0 great" : 14 An enterprise is like a huge flywheel. When you first push on it, it barely moves. But every little push builds mo- mentum and eventually the wheel will spin. Great companies are the ones that align the enterprise and keep the "little pushes" golng in the right direction. Failure comes 伝 01 れ thinking that one or tWO big pushes will get the flywheel moving fast enough and keep it going ・ み e use another met 叩 hor that helps us measure progress: "brick by brick. " If your aim is to build a solid wall, you do that brick by brick. 宅 constantly ask whether we are adding more bricks each week, each month, and each year. At first you don't see much progress, but eventu- ally everyone can see the progress that has been made. And once you get going, you will start adding bigger bricks. 嶬み e are often asked, "What percentage of SRI lnternational's staff fully understands these principles We say, "About 10 percent understand deeply, 20 percent have a good working understanding, and another 3() percent are conversant with the ideas. The remaining 40 percent are familiar with some 0 「 the ideas, like NABC. " lt's like TQM that way; it took Toyota 6 丘 y years t0 get where they are. But you don't need 1 ()() percent understanding Of these ideas [ 0 make a significant impact and improve the success Of your enterprise. You can never achieve 1 ()() percent, but as the parts C01 e together, they amplify one another and the impact increases. Steady INNOVatION progress brings accelerating rewards.

discover that most Of the self-protective "barriers" people believe are stopping them in an enterprise are not real. They are "red herrings. One common red herring is the belief that company-wide procedures prevent specific actions, such as being able tO hire new staff quickly or form a new organizational structure. Another example, the perceived inability tO get information 伝 01 another part of the organization, IS mostly illusory. UnfortunateIy, if your experience is like ours, one of the hardest things in the world iS for a junior staff member to visit and talk [ 0 staff in another division without authorization. You might think that nothing would stop someone from talking to others, but if you re- member back tO the early stages Of your career, you will realize that this simple act is a thousand times harder than it should be. lt actually re- quires active support and enterprise-wide approval from management. 、み e have been ln many meetings at leading compames when someone asked one Of their team members, "Have you talked with Jane in the Other divison?" lnvariably the answer iS " 、 O. Removing these psychological barriers to gathering information takes time, but we have a simple tip. 石 [ e down your NABC value proposition and ShOW it [ 0 your supervlsor, pointing out where you need additional information and guidance from, say, an executive across the enterprise. First, thiS ShOWS YOLI have done your homework and you are not going tO waste anyone S [ lme. Second, it will reassure your super- VISOr that you are not dOing an end run but rather that you have a legiti- mate business reason for talking [ 0 the Other person. 、 " e recommend that you write down all the barriers you see in 伝 on [ Of YOLI and then present them as part Of your initiative at your watering H01e. We have found that most staff across an enterprise, once the bar- rier IS made clear, will step up tO help smooth the way. Never assume something is not possible; d0 your homework and ask. Next we will diSCLISS several Other issues that aid in achieving alignment. lt's About Superior ResuIts Many enterprises introduce new ideas by talking about the need tO change the organization's culture. We have worked With many hun- 240 CURtIS に caRLSON aND WILLIam 、 h•/. WILmot

exists, ( 2 ) new ideas are available, 6 ) a way t0 compound these ideas exists, where one idea builds upon another, and ( 4 ) the necessary human, financial, and Other resources are available [ 0 drive the process. The most famous example is Moore's La 、 v, but there are many ()thers. SELLE R VALU E: Seller value = Seller price ー Seller cost. THREE-LEGGED STOOL OF COLLABORATION: The three conditions neces- sary for teams tO form and team members tO collaborate. They are 訪ノん〃 , ・衫 , 印第んなり』を / を and 訪ノル着 , all held together by collaborative, respectful commumcation. TRUST COM MANDM ENTS: The cornerstones of trust and cooperation in any business endeavor. They are け , た g ルり , and g 紘 0 行り研九 VALU E C R EATIO N : A process that starts when a champion addresses an lmportant customer and market need, writes down a value proposi- tion, presents it in a ・ Watering HOle, and then carries it forward [ 0 a 丘 1 Ⅱ innovation plan and a successful project or venture in the market- place. VALU E FACTOR ANALYSIS (VFA) : A comparison of the customer Benefits/ COStS for a proposed new product or service When compared With those Of the competition and the alternatives. VALUE PROPOSITION い . E. , AN NABC): The fundamental ingredients of every EIevator Pitch and innovation plan. They are ( 1 ) the important customer and market 膨 ( 2 ) the product or service 4 訪 , 6 ) the ん〃師な第紘衂な resulting 仕 om the approach, and why these are supe- rior tO ( 4 ) the 0 ″〃 and alternatives. These ingredients define the value propositions required for every project: at least one iS re- quired for the customer and another for either the enterprise and/or lnvestors. Additional value propositions are required for the Other stakeholders—partners, shareholders, employees, and the public. Ef- fective value propositions are quantitative. 502 gLossaRY

・ another meeting ・ funding ・ additional partners and employees ・ a reference tO another person Ask yourself before you begin,'What do I really want here?" ls itjust tO survive the one-minute pitch or tO accomplish something? ユ「 you don't want 色 specific outcome, don t waste anyone s [ 11 e. Practice and Make lt Contagious Both the message and the delivery must be practiced and improved by suggestions from Others. You don't want tO give a canned sales pitch. Refine, recast, redo—lterate, iterate, iterate. you communicate and it doesn t resonate with the team members, or outsiders, refine your pitch. Talk tO Others about hOW tO cast the message the next time. . NO 〃ツ・〃 g どな″ル g / 坊第灯オ〃と , SO expect [ 0 change and refine as you go. Here iS a test: Can your friend, WhO doesn't understand your busi- ness or JOb, understand What you are saying? Passion sells. Former secretary Of state General COlin powell said, "Enthusiasm iS a force multiplier. " Winning presentatlons are With passion. Passion IS a ViSible Sign Of your commitment. lt iS tangi- ble proof that you are a champion: someone who can be believed and followed. ・ We do not mean that you must be flambo ant. On the con- ) なネいない、 trary, presentations can be understated and sald SOftly. But Others can tell if you are committed and enthusiastic about spreading the gos- pel 0f your project. And passion is contagious—when you make the ideas important and relevant, they almost spread by themselves. Others think, "Gee, if this is so important to them, maybe I could be part of thiS t00. The nice thing about contagion is that it cycles back to you. The next thing you kno 、 V, one Of your team members iS in a meeting giVing a passionate plea for your prOJect. The contagion reverberates through- ラに純たツ out the team and the orgamzatlon. 156 CURtIS R. caRLSON aND WILLIam W. WILmot

and / 〃 20 / ど〃オ . Burt'S team has always satisfied these motivators, which IS one reason their impressive liSt Of innovatlons contlnues tO gro 、 v. Achievement People want tO make a positive contribution in their careers. They want [ 0 make an impact and achieve meaningful goals. By focusing on lmportant customer and market needs, your team can contribute and make a difference. Paul COOk is an unrelenting serial entrepreneur. His first mapr company was Raychem, where he developed a family of novel plastic materials. He has won many honors, including the NationaI MedaI of Technology. When he retired from Raychem, he formed CeIINet, and after CeIINet he formed Diva Systems. And at seventy-five he formed another new company, AgiIeTV. Why do people who no longer need to keep working so hard? Clearly, they want to continue [ 0 use their skills tO achieve goals that are important tO them. ThiS iS an enormously powerful human motivator. Consider our friend Carla, WhO works as a volunteer in a hospital for severely handicapped children. The children she works with are all born deaf and blind. To communicate, they tap out a form of Morse code on one another's hands. Progress is often painfully slow. ln some cases, it takes years Of training for a child tO learn even the simplest messages. We asked Carla why she did this work and she said, "Oh, I love it. You can [ imagine the satisfaction when a child, after years Of work, first taps out a simple message on your hand. " ThiS iS certainly a maJOr achievement. SimiIarIy, we have a family member, Donna, who is a nurse. She works in a state psychiatric ward, Where patients with the 1 れ OSt extreme emotional and mental health issues are confined. The patients include schizophrenics and sociopaths. TO an outsider, it seems like the most dangerous and demanding work. When asked why she does this when she could work in any hospital, she said,"They truly appreciate what I dO. lt's important. Most people do not want to work just for money, stability, or enJOY- 222 CURtIS R. caRLSON aND WILLIam 、 M. WILmot

four conditions are in place: ( 1 ) an important need is [ 0 be satisfied, ( 2 ) there are sources Of new ideas, ( 5 ) a compounding process IS in place that builds on previous advances, and ( 4 ) appropriate human, financial, and Other resources are available tO accomplish the work. Rapid ex- ponential improvement requires identifying the best ideas quickly and compounding them 0 丘 en. Consider again Linux and Wikipedia. First, both address important needs that have no visible upper limit 0f achievement. Second, both tap into a continuous supply 0f new ideas from around the world. Third, with Linux, Torvalds provided the first kernel that allowed rapid, com- pound growth—individuals added improvements t0 his core kernel and one improvement built on another. ln the case Of Wikipedia, its software framework and organizational design provide the platform for one idea tO build on the next. Fourth, the resources needed tO drive these exponential-improvement communltles are provided primarily by people Of passion, people whO want tO make contributions tO tOPiCS they care deeply about. The ー〃 S なノ 0 ″翔 4 / described an example where a security vulnerability was discovered in Linux.. A person ln Germany e-mailed a friend in the United States, who got others in- volved, and within twenty-four hours the problem was fixed. Tapping into knowledge, ideas, and skills over the lnternet can be powerful when people care. 7 Contrast this with your organization when it has a similar problem. How long do you think it would take to get it fixed—days, weeks, months, never? VirtuaIWateringHOIe AS we have illustrated in the examples given, the lnternet provides a way tO create virtual ・ watering HOles. lt iS alSO a useful meta hor for the power and difficulties that arise in high-performance teams, as we will discuss in Chapter 11. How useful can the lnternet be at helping us gather new ideas? MOSt are familiar with the observation that the potential value Of a radiO or television Stat10n IS proportional tO the number Of listeners or viewers. If you add another viewer, the value Of the radiO or television 116 CURtIS R. caRLSON aND WILLIam W. WILmot

Variation was seen by Deming as the disease that threatened US manufacturing. The more variation—in the length of parts supposed to be uniform, in delivery times, in prices, ln work practices—the more waste, he reasoned. From this prem- ise, he set out his 14 points for management, which we have paraphrased here: 1 . 2. 3. 4. 5. 6. 7. 8. 9. Create constancy Of purpose towards improvement. Replace short-term reaction with long ー [ e ロ planning. Adopt the new philosophy. The implication is that management should actually adopt his philosophy, rather than merely expect the workforce [ 0 dO SO. Cease dependence on inspection. If variation is reduced, there is no need t0 inspect manufactured items for defects, because there won't be any. Move towards a single supplier for any one ltem. Multiple suppliers mean varlation between feed stocks. lmprove constantly and forever. Constantly strive t0 reduce variation. lnstitute training on the job. If people are inadequately trained, they will not all work the same way, and this Will introduce variation. lnstitute leadership. Deming makes a distinction between leadership and mere superVISion. The latter iS quota and target based. Drive out fear. Deming sees management by fear as counterproductive in the long term, because it prevents workers from acting in the organization s best interests. Break down barriers between departments. Another idea central [ 0 TQM is the concept Of the 'internal customer,' that each department serves not the management, but the Other departments that use itS outputs. 10. EIiminate slogans. Another central TQM idea is that it's not people who make most mistakes—it's the process they are working within. Harassing the workforce without improving the processes they use IS counterproductive. 11. Eliminate management by 0bjectiveS. Deming saw production targets as encouraging the delivery of poor-quality goods. 12. Remove barriers to pride of workmanship. Many of the other problems out- lined reduce worker satisfaction. 15. lnstitute educatlon and self-improvement. 14. The transformation is everyone's job. 11 The research on lawsuits and physician-patient relationships is compelling. see, for instance, "Talking May Be Best Preventative Medicine," New ノりん 4 ルノ翔 4 / , February 28 , 2005 ; Jordan DoIin and Theresa N. Essick, "Failure [ 0 Communicate: lnsurers Can Help Reduce the Burden of MedicaI Malpractice Lawsuits by Urging Their PolicyhoIders to lmprove Physician/Patient Relationships," B R 印んル , December 2004 : p. 92 ( 4 ) ; and Charles S. Lauer, "To Err ls Human; and a Heartfelt NOtes 507

Helping each team member move tO the new vision f0110WS a pre- dictable sequence: ・ ldentify the strength [ 0 be leveraged. ・ Expand and incorporate the strength int() the new VISIOn. ・ Take small steps to try it out. ・ Engage other team members to help. Give up elements of the 01d vision that no longer fit. ・ Celebrate the results. At some point, elements of the 01d vision must be le 丘 behind if the new VIS10n IS tO be successful. 嶬 see examples of the need to help others vault the void every day. Take, for example, the case Of Kevin. Kevin comes r01 lreland and is a lively, some would say exuberant, talker WhO manages a maJOr new con- tract with a J 叩 anese firm. He is exactly the kind of Ⅱ ow one would enJOY talking t0 in an lrish pub. But he is just the opposite of his Japa- nese counterpart, Takeshi, whO iS rather quiet.Kevin and Takeshi were about one year intO a complex business relationship when Takeshi sent an e-mail tO Kevin saylng, "The contract iS canceled. " Kevin was caught by surprise, so he constructed a long, negative e-mail in reply. But be- fore clicking the send button, he decided to call a colleague and tell her that the contract was in jeopardy. The colleague recommended that Kevin: ( 1 ) not send the e-mail, ( 2 ) immediately schedule a trip [ 0 Japan to see Takeshi, 0 ) sit down with Takeshi to ask him privately about his needs, and ( 4 ) practice using listening skills. Kevin said, "But I don't know how t0 get him t0 tell me what his real issues are. He doesn't talk much. " ". Kevin," his colleague said, lmagine that you are in an lrish pub, drinking with Takeshi. Pretend that you are talking t0 another lrishman, just like you did for years. The key is to listen to Takeshi and get him to talk to you. Make sure that he talks at least ten times as much you do. You have all the skills ・ you JLISt need tO move them intO the new envlronment. Kevin practiced with another colleague [ 0 prepare appropriate ques- tions for Takeshi. During their meeting and after a few bottles 0f sake, INNOVatION 2 2 9