Kindled Meme

– exploring the purpose of connection


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Strategic questions – rethinking winning

I spent today talking strategy with a guy who lives and breaths it – intent on using it to push through a lasting change to the way his company serves its community. And so a post by Roger Martin on the HBR blog today came at me at a useful time.

Roger says that strategy is making of an integrated set of choices – positioning the firm in its industry so as to create sustainable advantage relative to competition and deliver superior financial returns. He encourages people to answer 5 simple questions in a strategy – and he makes a separation between building budgets and delivery plans (which most people confuse as strategy) from the informed clarity of a strategy that sets direction for a period ahead.

Rogers questions are familiar – its the ‘Traditional Strategy’ view – about resources and winning – which Nilofer Merchant has declared as dead.

Nilofer questions whether this self-serving view of strategy is still valid in todays world and looks rationally at the role of collaboration and communities and their co-dependence. This coupling of organisations is know to drive innovation and offer all kinds of benefits as part of a business model – and a strategy is more about a company being ‘coupled’ than about the firm winning alone.

I like Nilofer’s contrarian views and in many cases agree with her – Ive seen the impact and opportunity in innovation partnerships in the UK  – people working as complements to each other can be a real asset and open up opportunities well beyond the capabilities of a single firm competing solely upon its own resources.

Yet, if a firm is resource-rich its theory of business will be grounded in making the most of what its got and controlling all that you need internally – removing ambiguity, being planful and  being in control. The guy I was meeting with today was within a multinational bank – you can be sure he has resources.

I recently found this video by Clay Shirky talking about the communites in the software industry – a great speaker –  he talks about how value is created in loosely-coupled but strongly aligned open-source communities. If you like control and your own resources this doesn’t compute. He makes fun of guys at AT&T who didnt get the open philosophy – about how you can be ‘porous’ to external value.

“They didn’t care that they had seen it work in practice becasue they already knew it wouldn’t work in theory”

It depends how you see the world – and its a strategic choice as to how you leverage partners, customers, suppliers and your own staff. Getting intimate, listening and learning, and acting in close-step with external groups around your business is not for everyone – but the evidence is there that it pays off.

Roger’s article says Strategy is about answering 5 questions – and hurrah – you should  be able to do that on less than 5 pages. Not because strategy is light weight – but because the choices it captures are built upon solid thinking, research and market insights.

When you have the facts to hand – the killer choices you should make become much clearer.

Rogers 5 questions are these:

What is our winning aspiration

Where will we play

How will we win

What capabilities need to be in place;

What management systems must be instituted

When I think of Rogers focus on winning I think of the anecdotes from Prussian military strategy that my MBA taught. Its pretty clear its about winning – with stories of fools that get it wrong.

Rogers questions are not the same questions that my Prof challenged us to ask – but then there is no one dominant way to do strategy. No one model that is correct – we accept all have strengths and weaknesses. All though, are good at framing an inquiry amongst teams and offer a common language make sense of our worlds and structure our choices.

And when I think of Nilofers perspective of how strategy needs to change, I think of new business models with the Key Partners and emerging social business channels that are shaping the world today. Both need engagement, shared beliefs and some degree of trust to make them work.

We still need to win but we will be doing it through others – sharing risk and co-building value. When I look at the ‘TS’ perspective – about the resource-based view of strategy – about finance, IP, assets that you have as the basis of a plan- these are all still valid – but relational capacity is about to become so much more important – culture, attitude and collaborative beliefs that underpin our reputation as good people to do business with.

For my part I believe that traditional strategy is still valid we just have to rethink how we define winning – keeping our eyes on creating and unlocking value and less focus on spilling our competitors blood on the streets.

For a bit of cheeky fun – check out Nilofer Merchants obituary to traditional strategy below.

And this is the link to Roger Martins Blog that started off my reflection.

Nilofer-Obituary-for-traditional-strategy

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Connecting – the colony of humans

All over the world things are changing with a speed that is terrifying and exhilarating – a better synergy between design and business – design and social change – design and entrepreneurship – they can help us come up with more creative solutions.

The next big, exciting, fun thing – to have a huge positive impact on peoples lives.

All this intensive connectivity – there is a super organism building up – in which humans are no longer top of the food chain

This idea that we would all actually be connected? Well its actually happening – and its more fair to say it has already happened – and we are still acting in some ways like everyone is not connected.

A world where that human layer is so critical. The new layer where there is a powerful secondary effect – an emergent power – that is purely delivered through good interactions

There is something bigger – which is the the colony of humans connected in this way – it is a ‘thing’ and it has behaviours and it has responses and reactions. What is different is those reactions responses and collective actions… they happen fast and they happen in visible ways.

You can see it …now. People waking up to this idea that they are powerful and can connect with one another.

The behaviour can become more and more collective as the signals become more and more explicit. We are part of something bigger – many of us are not yet aware of how we are part of something bigger and we are not entirely just our own ‘selves’ anymore.

Connecting.


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Influencing the UK’s Innovation – Collaboration with the TSB

The are many factors that compel companies to work together on their innovation programmes – learning and exploration of new markets and technologies, or tapping into each others resources and capabilities. But in the UK – when asking SME business leaders what gives them the push to collaborate – the UK’s Technology Strategy Board (TSB) and its grant funded innovation schemes is a major driver for being part of the UK innovation ecosystem.

While ‘Open Innovation’ is often cited in academic literature as being tough for SME’s  – they have a “liability of smallness” and don’t have power and influence in their industry or the resources and maturity of multi-nationals – none of that is a barrier for agile and adventurous UK SME companies – and the path to collaboration is made all the easier due to the policy choices of this UK government body.

When performing the literature review for my own research, the world of innovation and collaboration throws up lots of lessons – but when trying to pin down the academic understanding of “What drives successful inter-firm collaboration?” – government intervention was not what I was looking for.

But during 12 semi-structured interviews ‘The TSB” kept emerging. I’m all for the force of innovation and collaboration – but I found that effective macro-economic policy also plays a part in supporting the UK as a place to be ‘open’ in innovation.

Out of twelve C-level interviews, eleven of the candidate use TSB funding.

This is what they said:

“I mean the Technology, Strategy board, actually is probably a fantastic example of enabling Open Innovation in UK because of all the TSB funded projects. We’ve done one –  we’ve been involved in three big ones and we’ve got a fourth one where we are putting the final application in now.  And they’re obviously, you know, you have a collaboration agreement, you have a number of companies involved and they’re very good at getting people working together.  Maybe companies are not being as open as they could be, they don’t have to be totally open, but they do get people sitting around together and talking which is very good.”

“The TSB is picking up a large chunk of the role of the US VC fund because we don’t quite have the same investment culture here. A lot of the early-stage investors have gone away. We don’t quite have the investment culture here in the UK.”

“I must keep highlighting that the Technology Strategy Board has a key role to play – they are pretty good – they could probably do even more if they have more money – but they are a big help – the key mechanism for driving businesses to work with other businesses.”

The TSB and Knowledge Transfer Partnerships and the “_connect” infrastructure also uncover potential new markets

“We are member of a couple of the knowledge transfer networks. We are just in receipt of a confirmation letter from the TSB for a collaborative activity around an innovative use of our equipment.”

While the TSB has formal programmes these can be used to support growth in venturing too

“We have used our IP to form a new company that was done with a TSB grant. We licensed some of our IP into that new company. That company was established and we together assigned a value to the IP that we took as a stake in the company as part of the funding round.”

Working under TSB requirements also give a structure to a partnership and can set out key terms, boundaries and expectations:

“You have to start to be very careful about co-creating explicit IP and if you actually expect to create protected IP. We will do that but we have to go through more detailed negotiations. It tends to be more of the TSB funded grant where you have to make sure that everything is notified in advance. This is inconvenient but we have done it and it’s fairly surmountable and were also on an EU grant at the moment where these things have to be codified in advance.”

The TSB funding is UK-centric – the world may becoming ‘flat’ – but the stimulus is local. Yet opportunity is frames by such boundaries

“Up comes this call for TSB funding and we looked at them and thought this is just perfect for the first time ever I am looking at TSB opportunity that fits exactly what we need and we’ve managed to find UK manufacturing partners and fabricators who are willing to partner in that.”

“I think what the TSB do is fine, within the terms of their remit. The problem is they are not on a firm footing – they are bounded to support UK-only partnerships – and the industrial base of this country has been so badly damaged. If you look at the Fraunhofer Institute in Germany there are so many of them – such a fertile ground because there are just so many small family run manufacturing businesses within with an interest in innovation within Germany.”

Often Universities can be good partners – but more than that the TSB encourages this connection:

“There’s this one particular project I’m working on well with thinking of setting up a knowledge transfer partnership which would involve the University so we’re looking at a particular case because the university have access to a particular expertise that we want to benefit from.”

“You sometimes need a university when you go after aspects of different funding, you need a university partners sometimes to access the funding. If they see ‘multinational company’, ‘service company’ and ‘university’ together then they will fund it if you bring in all three parties.”

“We have had two TSB grants to work with Universities on for Cambridge and one for UCL and we have an ongoing relationship there.”

Buts its not just TSB funding –  early stage and highly innovative companies in the bio-tech, chemical, medical device and  software also tap into Research Council grants such as EPSRC ,and EU sources of funding permit partnerships beyond the UK.

In the future we see us doing more of our own in-house product development its just and we have programmes in place to do that but again these are grant funded through EU  funding that we have been able to secure –   we just cant justify the cost of doing that on from investor capitol.

Under the auspices of framework 6 and 7 programs of European Union funded activities we have developed new techniques  new service and products.

The choice and approach to funding was strategic and not just a form filling exercise – there are many stakeholders that can help drive your choices  and for those that scan the globe in search of knowledge you may build partnerships that allow you to tap into schemes such as DARPA – a practice that has been very successful for some UK businesses as these guys show here.

Understanding funding and its role in innovation is clearly a strategic capability in the UK and Europe.

While innovation partnerships are talked of as burdens on the SME (transactional costs) – leveraging the TSB with the right partners is a rite of passage for the UK innovators I interviewed – connecting knowledge, businesses and facilitating conversation and structured outcomes.

Having a government intervention is not the ideal of free-market efficiencies – but it does seem to making up for market failings – it gives the collaboration conversation some real teeth.

Business was always about scarce resources – with this funding strategy it seems the open innovators are finding what they need.

Well done TSB.

 


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Tim Cook’s liberal use of the C-Word #collaboration

Tim Cook’s Apple is unquestionably the dominant technology firm on the planet today and whilst they hold a position of considerable power in the consumer market place, Apple couldn’t do it without a collaborative culture internally and without calling upon the expertise of other firms in their supply chain and ecosystem.

Apple is a formidable force but its success has always been built in collaboration with others – the iTunes world is a mesh of partnerships and the products themselves draw on a selection of select external partnerships. When people muse over the details of Samsung being a supplier to Apple as well as a competitor they miss the point – Apple can’t have all the smart people and smart technology in-house – they have always work pragmatically in partnership.

This belief in collaboration was communicated clearly as the world gained an insight into Tim Cooks view of the company and how it was shaping up one year on without Steve, and this “collaborative DNA” came through in his Bloomberg interview last week.

There have been some heads rolling at Apple lately. How did he see the shake down and personal changes?

“The key in the change that you’re referencing is my deep belief that collaboration is essential for innovation—and I didn’t just start believing that. I’ve always believed that. It’s always been a core belief at Apple. Steve very deeply believed this.”

Despite being very much part of the IPhone promo-video Steve Forstall took a bullet last month and the stars of Apple had to realign. As people speculated if the change was down to the muted response to the iPhone5’s non-too-radical feature set or the crashing disappointment of the maps fiasco – Tim is now framing the change in terms of a culture of collaboration.

“You have to be an A-plus at collaboration. And so the changes that we made get us to a whole new level of collaboration. We’ve got services all in one place, and the guy that’s running that has incredible skills in services, has an incredible track record, and I’m confident will do fantastic things.”

Collaboration is a mindset and a competence – but you also need to be values aligned with the guys you are working with. Like rowers in a boat – there needs to be unity, and clearly Tim has found that affinity with Brit, Jony Ive.

“I love Jony. He’s an incredible guy, and I have a massive amount of respect for him. What bonds us? We both love Apple. We both want Apple to do great things. We both subscribe to the same principles. We believe in the simple, not the complex. We believe in collaboration. We both view Apple as here to make the best products in the world. So our values are the same.”

The Jobs era was legendary –part inspired genius, part tyrant – very much in control and having the last word. But you do get a sense of changes under Tim Cook – acting as a connector of the talent rather than the master.

“Whether there’s something that I think I know really well or I don’t know at all…I always enlist other people, because the people around the table are phenomenal people. And I’ve always found even when I thought I knew the most that there was something more that could be added and make it even better.”

But what is it in the water in Cupertino… or have these guys mastered some kind of process?

“Creativity is not a process, right? It’s people who care enough to keep thinking about something until they find the simplest way to do it. They keep thinking about something until they find the best way to do it. It’s caring enough to call the person who works over in this other area, because you think the two of you can do something fantastic that hasn’t been thought of before. It’s providing an environment where that feeds off each other and grows.

“Creativity and innovation are something you can’t flowchart out. Some things you can, and we do, and we’re very disciplined in those areas. But creativity isn’t one of those. A lot of companies have innovation departments, and this is always a sign that something is wrong when you have a VP of innovation or something.”

The full transcript of Tim Cooks excellent Bloomberg interview can be found here.


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Sharing…have you met my baby?

“I thought of this great idea check this out!  Look.. Meet my baby!”

Yet, sharing is tough – if you love something you have to let it go – thats the hard bit because then it leaks out…  You were being Authentically Helpful but someone else could be Unethically Opportunist – and take your great stuff and pass it off as theirs. Its the Arrow Paradox – you have something uniquely valuable but then as soon as you share it  the ‘unique’ has gone. Its the paradox of innovation – you’ve got to be open but then you find yourself wishing you’d been closed.

“Stuff” gets abused by free-riders, knowledge leaks and sometimes there is outright theft of facilitation models that were known to add real value to customers – sometimes stolen by people we trusted. I think we have permission to be pissed. I attended Oxford Jam earlier this year and some guys were getting really hack off about how this happens.

But then again, it was always going to happen. It is great stuff!

And there’s nothing that’s been shipped that isn’t a prototype anyway… nothing that cant be done better – if our ears and minds are open we learn whats needed next – we find ‘the edge’. The game was changing anyway. They copied ‘our baby’ but they didn’t steal what we have brewing in the lab.

And they don’t steal our personal brand of ‘being a helper’ and they don’t steal our vision, our relationships and reputation as great partners. They don’t steal the trust that people invest in us for being good people to do business with.

Its natural to want to invest energy  in resentment of being ‘hacked’ or ‘asset stripped’ – but its better to  just crack on. Be sunny and light.

Don’t know about you but I just cant create if I’ve got a cloudy head… let’s shine 🙂