The Salvation Army has been operating in New York since the 1880s and extended its reach to East Northport, New York in approximately 1950s.As Salvation Army is a faith based organization, it provides a host of humanitarian programs to the community along with worship services.The humanitarian outreach has made it a vital part of the East Northport community.Other than worship services, it provides programs like: food and nutrition, transitional care and work release, emergency assistance in food and seasonal services, it also provides elder nutrition services along with senior citizen clubs.The East Northport Salvation Army branch also works with youth through: Boys’ and Girls’ Club, character building programs and community recreational programs. Over the year it had great funding sources from participating church members and the revenue from the clothing store to run many program but that support is dwindling.The decrease in church attendance, area demographic, mismanagement of the clothing store and constant change of personal has had adverse effect on its ability to effectively deliver the needed services to the community.
Demographics
According to the U.S. Census Bureau’s last census (1999), East Northport has a population of 31,250[1].Data taken from the same census also states that 3,576 or 12.5% of the population speaks a language other than English in their homes.Take into consideration when the data was taken, I am certain that the number of non-English speaking population is much higher.In the recent year I have observed an influx of immigrants, mainly Hispanic, into the Long Island area.To take advantage of this trend, the Salvation Army re-locating more Spanish speaking pastors to their house of worship.
The census data suggests that there are significant numbers of households that are run by single mothers.According to the U.S. Census Bureau, there are close to 800 single female parents.Out of that, 10% are below the poverty line. (Please see attached “Data 1” sheet for U.S. Census Bureau information and see U.S. Department of Health & Human Services Poverty Guidelines for poverty guidelines)
Elderly also make a significant part of the single female parent population.There are 238 householders that are of age 65 and over; with 15 families below poverty line.Out of the 797 single mother families, only 324 had full-time job year around; with 6 falling below the poverty line even with a full-time job.In regards to families in general and poverty, 391 families fall 150% below the poverty line.While 528 families fall 180% below the poverty level.
CurrentState
The changing environments are creating significant headwinds for the East Northport Salvation Army (ENSA).In the past, the community was primarily composed of highly educated and wealthy white households but that is changing.With growing migration of the Hispanic population, decreasing traditional financial resources and increase in services demanding, ENSA must act fast to stay alive.Although ENSA is covered by the larger Salvation Army umbrella, it must be self sufficient and find ways to meet the Salvation Army mission “ to help those in need without discrimination.”[2]
Judging from the first hand experience, I’ve noticed some positive and some negative improvements.The current leader of the organization, Major Bender, has done a great job in increasing the church membership.In a strategic move, the Salvation Army relocated Major Bender to ENSA so he, along with his wife (who’s Hispanic), can better serve the growing Hispanic community in East Northport and the surrounding areas.Major Bender has also introduced different fundraising methods to increase the revenue.The annual golf tournament, weekend retreats and food drives have been some of the most successful.Never the less, the efforts are falling short of meeting needs.Most recently, there was a shortage of turkeys for the Thanksgiving program to assist families during the holiday season.The clothing store has been loosing money with adverse effect on the overall budget.
Applying the Four Frames
The East Northport Salvation Army should have a complete organization review to battle the growing problems.There should be review of their structure, human resources, political and symbolic make up.An organization can not successfully serve its mission without neglecting any one of these four aspects.If all four of these frames are executed in sync with each other and the mission, success will follow.
The Structural Frame
The structural frame is “a rational world and emphasizes organizational architecture, including goals, structure, technology, specialized roles, coordination, and formal relationships.”[3] (Bolman & Deal 15)Keeping in mind that the greater Salvation Army has jurisdiction over the structure of ENSA, I still believe that structural change can be applied.The subsequent levels of management, additional personal duties, responsibilities and roles are left up to the local leader to decide.Currently the roles in the organization are not well defined.This structure has served the organization well in the past but it should be modified.There are no formal responsibilities delegated to increase the volunteer program.Few times I have reached out to different people within the organization to start programs but no one knows who I should talk to.The organization should do a better job in identifying the roles while cross training personal to understand other aspects of the organization.To tackle the rigidness of the structure, all should understand the functions and objectives of the organization.
The Human Resource Frame
The human resource frame “centers on what organizations and people do to and for one another.”[4] (Bolman & Deal 117)Abraham Maslow suggests that people have a hierarchy of needs which they strive to fulfill.In the current organization, we know that people are not there for the money but instead are there to fulfill the self-actualization need.The challenge will be to fulfill this need while accomplishing the mission of the organization.Since this team is small, they often interacting with the served population, they must feel the sense of accomplishment of their work.With abundance of workload, running the worship services and multiple programs, the Major does not always have time to oversea everything effectively.This gives employees less oversight and leads to reduced productivity.The lack of efficient oversight, can also have other impacts.The employees tend to follow their own set of rules and beliefs which might not be alighted to the organizations goals.This perceptual distortion, ‘deliberately paying attention only to what we want to see’[5] (Vecchio 42), can lead to a divide between organization and the employees.Although ENSA has hired a Spanish speaking pastor, it does not have any Spanish speaking supporting personal.From my direct observation, there seems to be a hesitance from the existing support staff to deal with the new arrivers.I believe there is a breakdown in goal communication from higher management to the staff.
There is also no formal volunteer program.This vital free human resource is not being completely utilized and if managed properly, can be a great asset to the organization.The increase in Hispanic population is primarily composed of younger people who have the passion to make a difference.I’ve meet many people at the center who would love to get greater responsibility and create a large impact on the community.
The Political Frame
This frame says that “organizations are coalitions composed of individuals and groups with enduring differences who life in a world of scarce resources.That puts power and conflict at the center of organizational decision making.”[6] (Bolman & Deal 209)Without a proper structure, defined roles and HR strategy, a political battle is inevitable.Formally the political power rests with the Major of the center but informally the wife and the secretaries hold sway over the decisions.While deciding where to hold my wedding ceremony last year, I approached another Salvation Army pastor to perform the services.I was turned down because my wife is not a Christian.I then approached the Major Bender about the ceremony but he was reluctant to do for the same reasons.In the meanwhile, my wife (fiancé at the time) came to church with me and got to know the Major’s wife.Overtime Major Bender decided that he can perform the ceremony for us.I believe this was a direct result of my wife’s interaction with Major Bender’s wife.
The formal power channels do not always have the power one perceives they do.While understanding this, Major Bender, should guide his organization’s objectives.He must find the political power silos to steer clear of political obstacles to accomplishing organizational mission. Another way to look at this frame is to understand that “activities taken within organizations to acquire, develop, and use power and other resources to obtain one’s preferred outcomes in a situation in which there is uncertainty or disagreement about choices”[7] (Vecchio 128) There will always be disagreements within the organization but as an effective manager, one must understand how you must implement the change needed to reach you objective.Politics has a negative connotation associated with it but it is not always negative in nature.We all part take in politics in our lives: playing good cop bad cop to get kids to do something, working the channels at work to gain the promotion or working on a group project.There is always some aspect of politics involved and it is important for a leader of an organization to understand this and know how to navigate through the political channels.
The Symbolic Frame
This frame “cents on complexity and ambiguity and emphasizes the idea that symbols mediate the meaning of work and anchor culture.”[8] (Bolman & Deal 209)Drilling down to the basics, symbols “communicate values, legitimize practices, and help to socialize members and build loyalty.”[9] (Vecchio 346)The Salvation Army brand has the reputation of community service going back to the Great Depression.It is known for its humanitarian efforts during the Katrina disasters.It is synonymous with providing disaster relief, food, shelter, drug rehabilitation and other programs that add value to the community.This image is the greatest symbol to the organization.
The symbolic image is heavily used throughout the organization’s center, communication and events.Great numbers of people come to the center just because of their reputation but they don’t know that it’s a faith based organization.I think that East Northport Salvation Army does a great job in using this frame.
Improvements
All four frames must be coordinated effectively to move the organization forward.Structurally there should be a conscious effort to understand individual responsibilities but also understand overall structure of the organization.The human resources should be better utilized with increase participation from volunteers and addition Spanish speaking personal.There should be an open discussion on employees being accepting of changing demographics and finding ways to better meet their needs.Under the current rotation methodology applied by the larger Salvation Army, Majors/Pastors do not stay at one location for more than 2 years.I think the organization at large should have a discussion to change that rule to better service the communities.The managers have a better grasp of the political framework of the organization.Specifically, the informal political channels give the greatest challenge and will require the most amount of work.The organization does an effective job of using symbolism of its reputation.
To have a better financial position, ENSA should close its clothing store, seek government grants, find innovative ways to raise funds and partner with other organizations.The high dependence on the larger Salvation Army for funding can be disadvantageous if ENSA continues to function in the red.It should also wean off of its dependence on church collections for funding.
To better serve the single mothers and elderly, it should partner with local food banks and/or soup kitchens to reduce cost.The job placement program of non-working single mother/householder should be made one of the top priorities.This can be done though local colleges/universities, unemployment office and job training programs.By utilizing volunteers, it should introduce baby-sitting/childcare programs for single mothers who have employment.This will relieve some burden on resource by moving clients toward self sufficiency.
Sanjeev M. Masih Case Memo IV – Boston Teacher Residency December 11, 2009
Section I
Founded in 2003, Boston Teachers Residency (BTR) has placed 125 graduates in the Boston Public Schools (BPS). It has had significant success with its past strategy but now it faces a few strategic issues: how to modify its method in order to have a deeper impact on Boston Public Schools system, help under performing schools within the BPS network, provide better support for new graduates and compete with other organizations to place its graduates in BPS. The current program “had been hailed as one of the 10 best teacher preparation programs in the nation by an industry journal…”(page 1) Boston Teachers Residency was created to “…recruit, prepare, and sustain excellent teachers in and for the Boston Public Schools.”(page 1) BTR worked closely with BPS superintendent Thomas Payzant to establish the goals and program design to help BPS achieve better results. The graduate student selection was rigorous with a heavy focus on classroom experience in the program. After two months of training, the graduate students worked in classrooms with a mentor and taking formal classes on Fridays. The classes provided theoretical approaches to teaching and solving behavioral problems, while the classrooms became the clinic to test the Friday lessons. The effective combinations helped both BPS and BTR. Founder Jesse Solomon founded the BTR with the help of Strategic Grant Partners (SGP). SGP worked to figure out how they “might help an organization start-up, strengthen their work and/or increase capacity.” (page 2) At the time, the data showed that “only 24% of 4th graders in BPS were proficient in language arts and only 15% were so in math.” (page 3) On the high school level, “fewer than 65% of BPS students graduated from high school.” (page 3) BTR eventually linked with Boston Plan for Excellence(BPE) who’s mission was to be a “…catalyst and support to the Boston Public Schools in transforming instruction to improve the performance of every student.” (page 3) BPE did not have the teaching expertise and dedication that BTR had, while BTR did not have the history, reputation and funding that BPE possessed. There were other programs like the Teach for America but none so dedicated and focused to improve the local Boston Public Schools system. This uniqueness gave BTR the edge above the others.
Section II
Jesse Solomon graduated from Massachusetts Institute of Technology (MIT) in mathematics but failed to land a job in the BPS. After gaining teaching experience in Cambridge, Solomon took part in the first charter school in the Boston area. The City on a Hill Charter School became the “laboratories through which to introduce new and effective practices and strategies back into the public school systems.” (page 2) For Solomon, this experience further clarified that traditional teacher development methods were a failure and a new form of teacher development must be formed. Solomon started Urban Calculus Initiative which helped teacher development and became the foundation for what was later to become Boston Teacher Residency. As the driving force behind the ideology and innovative methodology, Jesse Solomon is the vital piece of the organization. The new superintendent of Boston Public Schools, Carol Johnson, is another vital member responsible for BTR’s success. Johnson has set a new focus on “developing, a district-wide improvement strategy that prioritized accelerating the performance of the district’s lowest performing schools.” (page 1) The sole purpose of BTR is to help improve BPS; so it is imperative that BTR and BPS have their goals aligned. Currently the principals from higher performing school recruited BTR graduates aggressively, leaving the under performing schools without needed talent. The new strategy to focus on under performing schools and BTR’s expertise to fulfill those needs will be critical to Johnson’s efforts. BTR’s recruiter Monique Davis is important to the organization because she will bring in the youth that drive the organizations objective. She must target potential candidates and have them adopt the BTR’s vision. Hollee Freeman, BTR’s field director, is the critical link between school principals and BTR which facilitates the common mission objectives of both organizations.
Section III
Since its inception in 2003, BTR had 100% funding from SGP for two years. As BTR matured and formed programs mutually beneficial to BPS and BTR, they have shared funding while cutting direct funding ties with SGP. In 2005-06 BPS gave 20% while private sources gave 80%; 2006-07 40% BPS and 60% from private sources; 2007-08 60% from BPS and 40% from private sources; 2008-10 BPS 51% and while private sources provided 49%. In the 2007-08 fiscal year, BTR had the budget of $3.4m, with an increase to $4.7m in 2008-09, estimated $5.6m in 2009-10, estimated $6.7m in 2011-12, and estimated $6.7m in 2012-13. The increased budget is a reflection of increase in resident population and the larger student population they will teach. As the program develops and gets deeply involved with BPS’s transformation of the under performing schools, BTR’s cost to retain graduates will increase over time while cost per student will decrease. In 2007-08, graduate retention cost was $44k while cost per student was $613; 2008-09 retention cost was $56k while cost per student was $664; 2009-10 retention cost was $58k while cost per student was $627; estimated 2010-11 retention cost is $59k while cost per student is $592; estimated 2011-12 retention cost is $58k while cost per student is $515; and estimated 2012-13 retention cost is $59k while cost per student is $467.
Section IV Strengths - Motivated, educated, highly skilled, focused, inspired staff - Mutual goals that are shared by BPS - Diverse graduate population reflective of diverse BPS student population - Well established track record - Reputation for innovation and ability to adapt to changing school needs - Inspiring leader with a clear vision - Ability to work across the board with BPS, current graduates and BPS students
Weaknesses - Its sole focus on BPS - Its ability to integrate non BTR teachers that are working in the BPS - Long training program - Graduates have too much dependence on classroom mentors - Budget and membership is smaller than competing organizations
Opportunities - Radically changing the way education is provided by BPS - Facilitating a deep cultural change within BPS - Creating a stronger partnership with BPS board and principals - Creating a model that can be replicated across the country - Providing students with greater opportunities through better education
Threats - Non-BTR teachers- cultural conflict - Other organizations; the likes of Teach for America - Loss of support from BPS - Change in federal requirements - Change in state requirements - Loss of support from Boston College and Boston University - The decrease in program quality due to new requirements from BPS
As BTR looks to consolidate its program to better serve the BPS needs, it has a few questions to consider: how to place “cohorts of BTR graduates in high priority schools?” (page 1) Is the current model good enough to produce teachers that can effectively turn around the struggling schools? How to improve the program quality while meeting the new strategic goals set forth by the new superintendent of BPS. Since BTR is heavily intergraded into the BPS strategy, and visa versa; it depends on BPS for funding and employment for its graduates. I strong feel that BTR has too much at stake in its relationship with BPS. I would recommend that BTR have a strategic review of its dependence on BPS and seek ways to expand its educational reach. Since its inception, BTR believes that it should “…recruit, prepare, and sustain excellent teachers in and for the Boston Public Schools.” (page 1) But I believe that it should have a new mission ‘to recruit, prepare and sustain excellent teachers.’ Over the years, it has had great success with its graduates in the BPS system but it should consider expanding into other school systems. Under the current model, the donor (BPS) is driving the BTR program. BPS’s superintendent set a new strategy which BTR must follow. BPS also provides majority of the funding which keeps BTR in business. At the current state, BTR is just an extension of BPS and has very little control over its organizational objectives. Provided that BTR determines the teaching methods, it has no other control. BTR should regain its independence and focus on providing its expertise at a broader scale. I recommend that BTR does this in three folds: (1) diversity its funding (2) serve other communities (3) have an incentive based system financed by the schools. BTR should not receive majority of its funding from the “system” (ie Boston Public School system) it serves. The distance between the “system” and BTR will give BTR independence without the fear of retaliation and loss of funding. The independence will allow BTR to serve its hosts with innovative solutions. Jesse Solomon should seek other strategic partner organizations like BPS to expand its programming reach. Although the current mission is set to serve only BPS, it should update its mission statement to reflect the organization maturity. In the beginning, it served well to focus on one organization with innovative style of teaching but that will not serve the organization in the long-term. By expanding outside the BPS system, BTR will have greater impact on the way education is delivered to students. The decrease in direct funding from host organizations can offset by increasing incentive based fees. Under the current arrangement, graduates receive tuition refunds after completing two years with the school. This refund can be financed by the schools which hire the well qualified teacher. The time for these suggested changed should be in the medium term. I recommend that BTR slowly modify its programs as not to hurt the BPS. It should continue with its current commitments but look to add other hosts starting 2013. The current White House administration favors charter school style teaching which will benefit BTR to gain federal funding. This extra funding will allow it to increase its capacity and expand its teacher based to serve newer hosts in the future.
his manual will explain how the creative process works, how to improve creativity and then how we must go beyond creativity to be innovative.The manual will prove the connection between market and technology evolutions and how they are interdependent.It will also cover the impact design innovation can have on production adoption and examples of how design innovation has been successful.The third step will establish guidelines on how a company can implement processes for evaluating data for experimenting and testing new ideas; then polishing those ideas for further improvements.Last step of the guidelines will focus on how the final step of launching innovation in the marketplace should be implemented.
or most of us, having a reference point helps us imagine.For example, having recorded music led to innovative products like the iPod; if there was no recorded music, would iPod have been created or be widely accepted?We cannot say with 100% certainty but it’s safe to assume that having recorded music helped the iPod.As Mr. Berns puts it, “first, the way we perceive something, which is a function of the low road, depends on the way in which we categorize objects.Without categories, we do no have the ability to see features that differentiate objects.In other words, we cannot see that which we do not know to look for.Secondly, the ability to see these subtle differences depends on experience.And this means that perception can be altered through experience.”[i] (Berns, Page 8)Having these categories helps because the compartmentalization helps the brain save energy.“The efficiency principle, coupled with the consolidation of large amounts of information and experience as we get older, means that the brain needs to categorize.And yet, imagination stems from the ability to break this categorization, to see things not for what one thinks they are, but for what they might be.”[ii] (Berns, Page 8)The preset notions helps our brain work better but it hinders creativity.
The classical conditioning showed that “analogous changes at the neuronal level”[iii] (Berns, Page 10) due to repeat task leading to an expected result.The Swiss neuroscientist, Wolfram Schultz’s experiment showed that “the dopamine system adopted to environmental contingencies and essentially learned the correlation between arbitrary events…”[iv](Berns, Page 10) Imagination suffers when there are no or little preset conceptions of anything or experiences.As the brain function on efficiency principle model, conserving much energy as possible and using minimal energy to conduct repetitive tasks, the extra work required by imagination can be difficult.To imagine, we must pay attention to what we want to imagine.“…The parietal cortex plays the crucial role of integrating the effects of attention…The parietal cortex serves as the crucial intermediary between local representations in the visual cortex and global representations in the frontal cortex”[v]( Berns, page 16)The novel external stimulus start the process which creates the imagination stemming from neural networks of neurons.
Since the human brain functions very efficiently, using little energy as possible; it is helpful at times to ‘sleep on’ a problem you might be solving.By giving the brain sometime to connect the strands of data, you can get the result you want.The change in environment can be beneficial, the “jolt attention systems wake and reconfigure both perception and imagination.”[vi](Berns, Page 24)“To think like an iconoclast, you need novel experiences.”[vii](Berns, Page 24)We cannot be contained by the experiences we had if we want to be innovative but we cannot be innovative without our novel experiences.It is important to have the experiences to create a framework but we cannot live in the framework to be innovative.
The above chart illustrates the cycle we go through as we go through the thinking process.Three categories which have a profound impact on the process are:attention, experience and novelty.Attention refers to our physical make up.Novelty is how we structure our thoughts and the double edge sword, experience, has impact on our perception.
4.Verification: creativity idea is consciously verified, elaborated, and eventually applied
Time must be given between stages 1 and 2 to take their natural course.Enough time and attention should be given to achieve the best AHA! moment(s).To a greater extent, most people are products of their experience.Their ideas and perceptions are part of their past experience.New ideas arise from former experiences but we must not allow for former experiences to dominate new ideas.
·Inhibits creativity as consensus are built eliminating criticism and killing new ideas
·Strong participants dominate the agenda
Although group workings are beneficial, keeping the negative side effects in mind is important.Take the following steps to ensure your group does not fall into the pit.
·Make sure everyone is on the same page and create alignment of their goals
·Create an ideal situation for the members to work in
·Allow members to tinker with problems, instead of having a rigid goal
·Allow for informal communication
The managers must creative a structure to support innovation by “effectively presenting ideas to decision-makers”[viii](Levvit, Page 2), wedding out the ideas by risk assessment, balance the “organizational flexibility and rigidity.”[ix](Levvit, Page 2)The managers must not leave things to chance, because “those who declare that a company will somehow grow and prosper merely by having more creative people make a fetish of their own illusions.”[x](Levvit, Page 10)
A good manager must understand the position of their product(s) and how much lifespan a product might have.
An S-curve is “plotted on a two-dimensional plane and demonstrates how the performance or cost characteristics of a technology change with time and continued investments.”[xi](Anonymous, Page 2)
As the market leader, you must understand your strengths and the strengths of the start-up/technology challenging your business.Established firms can take advantage of the start-ups biggest disadvantage during the early phase.“The most dangerous period for a new technology is in the early phase, when its price-performance characteristics are below that of the established technology.”[xii](Anonymous, Page 5)Understanding the early states and the critical time to jump the S-Curve is vitally important for a manager to understand.This can be effectively done by understanding your product’s position, industry, new technologies, the market and having a keen insight into unmet needs.
here are many great technologies available: trip to space, super computers, satellite phones, or many other technologies which are too expensive for broad market adaptation.These ground-breaking technologies offer impressive features which would excite and improve people’s lives but they do not deliver the product/service at a feasible pricing platform.In the case of mobile music, delivery service must factor in, “record labels, platform vendors and white-label music services, online music stores, handset makers, and mobile operators.”[xiii] (Merrill & Yoffie, Page 8)Different parties will have advantages and disadvantages to adopted strategies, so the challenge is to adopt a macro strategy, which aligns multiparty interest while delivering excellent service/product at a reasonable price.
The competitive landscape presents a formidable challenge in many industries for innovation to have a long lasting advantage for any company.For example, in the mobile music industry you have many key players jockeying for influence on how content is delivered and obviously who benefits from it.Currently Apple has a strong lead on competitors like Microsoft, Yahoo, Google, Wal-Mart, Amazon and traditional music delivery mediums fighting on who delivers music to consumers.The handset makers like Apple, Google, Samsung, Sony, Nokia, LG, Blackberry and others are racing to produce the best handset.While, AT&T, Sprint, Verizon and other carrier are contending to dominate the delivery channel as the music artists, executives and other parties are also evaluating and pushing for what makes them the most money.As you can see, the landscape is very crowded, complex and hyper-competitive.
The challenge is to cut through the competitive noise and produce the product via design-driven innovation.This radical method of innovation is based on the idea that “transitional objects”[xiv] (Verganti, Page 3) bridge the emotional and functional aspect for consumers.Transitional objects are “things, such as toys, teddy bears, and safety blankets, that represent the happy world when children were still united with their mothers.These objects help children move from intimate dependence on their mothers to a more autonomous psychological status, and thus these objects become almost indispensable regardless of their actual function.”[xv] (Verganti, Page 3)Simply put, if consumer can connect design of a product with their emotional experiences, they will adopt the product at a deeper level.As the transitional objects bring back happy memories, the product design should “try to answer to a desire of happiness of people.”[xvi] (Verganti, Page 4)
The success of Apple in the mobile music revolution has been its ability to produce, user-friendly functionalities with radical designs.Although at a premium price-point, the end-to-end “experiential system…allow[ed] people to produce, select, buy and share music.”[xvii] (Verganti, Page 6)The functionalities of iTune, iTune store, iPod/iPhone and accessories, gave an easy to use streamlined process that made Apple a success story in the music business.The product, infrastructure, functionalities, interface and content design has resonated deeply with consumers.It took out complications of buying digital music, maintenance, and backup via iTunes, mobility via sleek and stylish iPod/iPhone, all at a premium price and reliability.The designers at Apple “have completed their exercise-that the product is stylish, in line with the dominant language of the market…”[xviii] (Verganti, Page 8-9)Apple did not invent the phone, mobile music device, or concept of delivering music online but it enhanced all these concepts with easy to use platform.Consumers have abundance of options but “we are surrounded by a world of anonymous products, of boring objects, most often lacking any emotion and poesy.”[xix] (Verganti, Page 9)Understand this divide and creating a product which stands out has made Apple a leader in its field.
·Technology Push:Basic Research à R&D à Production à Marketing à Need
·Demand Pull (user centric):Basic Research à R&D à Production à Marketing à Need
·Design Driven: Basic Research à R&D à Production à Marketing à Need
The above models have their positive and negative qualities but keep in mind a very important point:DO NOT EDUCATE YOUR TARGET MARKET, SERVE THEM WHAT THEY KNOW.
Many other firms might understand that design is important but they don’t all understand to which extent the design should stress itself.I’m sure the cost factor limits if the design to incremental innovation or radial innovation.Before “the game changer” iPhone came to the market, most mobile phone design pursuit the incremental innovation to push new models to the consumers.The radical innovation concept at Apple gave birth to the iPhone.The phone was re-invented on how it is used and what it can do.Companies like Apple understand that “firms periodically [need to] search for dramatically new meanings, but their competitors do not.The radical innovators know that meanings in the market alternate between periods of incremental change and periods of rapid and disruptive transitions.”[xx] (Verganti, Page 10)The result is iPhone’s consistent climb with increases in market share, while its competitors suffer and struggle to find a suitable challenger.In order to pursue radical innovation, the company and leadership has to be truly confident in what they’re producing.
Some firms use design-consulting firms to implement the design driven model.Below is an example of this relationship.
The radical product will challenge the norm which people use as a reference point, thus leading to confusion.A steadfast belief can be key to success, as Apple CEO Steve Job said, “A lot of times, people don’t know what they want until you show it to them.”[xxi] (Verganti, Page 13)This line of thinking is a huge divergence from traditional user-centered innovation.As Clayton Christensen states, companies “…are so focused on chasing the needs of their clients that they lose sight of the big picture.”[xxii] (Verganti, page 14)The radical innovators “…give meaning to things…on our values, beliefs, norms, and traditions.In other words, they reflect our cultural model.And that, in turn, reflects what occurs in our personal lives and our society.”[xxiii] (Verganti, Page 14-15)
Firms like Apple employ multiple strategy models.Although just using one model of push/pull/design, will not be effective, there can be clear dominance of a specific model.To be effective, a company must keep in mind all three models and implement parts of all three.Below is an example of what Apple has done in the past.
·The product meets the values and aspirations held by the target market
One cannot assume that radical innovation happens on daily scale but understand that radical innovation does take place and its impacts are enormous.The catalyst for the changes can be, “…rapid changes in the economy, public policies, art, demographics, lifestyles, and, last but not least, science and technology.”[xxiv] (Verganti, Page 15)The overlap of Technology Push Strategy and Design-Driven (Design Push) Strategy is the ‘sweet-spot’ for high performance/radical improvement and meaning/generating of new meaning.
n age old debate whether leaders are born or built; in the case of innovation, is innovation derived from innovative people? Or can innovation be simplified as a process which helps companies create innovative products/solutions for their clients?The third module suggests that, innovation can be implemented as a system.
Knowledge brokering is a method by which old ideas are used to create new ideas.These brokers “serve as intermediaries, or brokers, between otherwise disconnected pools of idea.”[xxv] (Hargadon & Sutton, Page 4)The brokers apply existing ideas to new fields/uses and “…implement[ing] it in a way that [is] accepted by the marketplace.” [xxvi](Hargadon & Sutton, Page 4)This cycle consists of four parts: “capturing good ideas, keeping ideas alive, imagining new uses for old ideas, and putting promising concepts to the test.”[xxvii](Hargadon & Sutton, Page 4)Understanding that having a reference of old ideas that are best business practices, models and technologies that are proven, brokers use the existing goldmine to develop new ideas.As one of the greatest inventors of all time Thomas Edison said, “First, study the present construction.Second, ask for all past experiences…study and read everything you can on the subject.”[xxviii] (Hargadon & Sutton, Page 5)Mr. Edison also said, “To invent, you need a good imagination and a pile of junk.”[xxix](Hargadon & Sutton, Page 6)To collect this ‘junk’, companies hold internal and external forums to share, collect, and learn new ideas used in similar or different industries.The objective is to harness the imagination and methodology used by many different people.
The chaos of daily work life, dealing with personal life and other situation help us forget about the ‘junk’ one might use to create new ideas.To ward off this symptom, take field trips to different places like junk yards, toy stores, factories, etc.Also surround yourself in your office (and other places) with old ‘junk’ that helped you create ideas in the past.Keeping old ideas alive to better serve in creating new ideas can be a challenge as well.By having everyone involved in solving problems, with informal channel of open communication can allow for quicker solution and better products.Testing ideas without the presence of political pressures is a great advantage knowledge brokers bring to the table.As the final step the process, they test the idea solely on its merit and quickly move on if the idea doesn’t live up to testing.
Instead of working with an external Knowledge Broker, some companies opt to create internal departments to facilitate innovation.Innovation Program Office (IPO) at HP was one of these internal departments.The vision being IPO was to “create a business group-level separately funded organization to explore and develop innovation opportunities in adjacencies of that business group or even in entirely new areas that could extend its strategic reach.”[xxx] (Burgelman & Meza, Page 1)With 95% of the R&D budget going to existing products and only 5% going to develop new products, the IPO hoped to tap the innovative ideas from across the company and focus more on developing new products/services that will increase revenue.IPO leader Philip McKinney said, “we hoped by making an explicit focus on adjacencies and potential new growth areas, this would give R&D teams in PSG the impetus to create new businesses.”[xxxi] (Burgelman & Meza, Page 3)The structure was set up as:a project needed a champion who would have unwavering faith in the project, ideas would be submitted via Idea Central with respond and feedback in less than 30days (but typically in two weeks), after passing the initial criteria by the team, approved ideas would be provided a team to fully develop the idea and work out the financials and operational side of the idea.The idea thus develops into further stages with specialist leaders helping guide the idea further down the tube.In the entire process, no idea is prone to be dropped if it fails to live through the tests.The main objective is to improve financial results of the company, thus ideas failing tests most likely will not contribute positively to the bottom line.
Rite-Solutions used another but similar method to tap the collective innovative power of its employees.Mutual Fun was introduced to Rite-Solution employees so to harness any “idea that might help the company, either by saving money, developing a product or service, or developing new technology, the employees could create a stock that would be listed on Mutual Fun.”[xxxii] (Rao & Hoyt, Page 4)The central philosophy of trust drove this idea.The founders believed that “the currency of the company…the underpinning of everything we do.”[xxxiii] (Rao & Hoyt, Page 4) was trust.To have a open dialog, sharing of ideas, not punishing people for bad idea, rewarding for ideas that worked (profit sharing for first two years), and not applying blanket punishment of individual violations, served the company well.Along with financial incentives, the promotional structure was geared toward teamwork, collaboration and trust in fellow ‘citizens’.Although the company was mainly involved in defense contracts, it “was open to ideas for new products and leveraged extended their knowledge baste.”[xxxiv] (Rao & Hoyt, Page 6)For some companies, as is the case in Rite Solutions, decentralized company control can be beneficial.Although management had final say on which project moved forward, the choices for the direct was present by the ‘citizens’.The method of this was:employees introduce idea as a ‘stock’, everyone was giving equal amount of money to start with and they invested their money in ‘stocks’ they liked, the highest ranking ideas was given ‘seed money’ to develop and profit was shared.People were rewarded just for participating on regular basis even though they did not personally develop anything.“Mutual fun also enabled everyone in the company to come up with ideas, and to nurture those ideas without facing immediate review.”[xxxv] (Rao & Hoyt, Page 11)
A manager or a CEO can push or encourage employees by providing tools for employees to be innovative but it will not work if the entire structure and policies of the company do not support the effort.By its nature, innovation takes trials and trials can lead to failure.“Learning by experimentation is fundamental to solving problems for which outcomes are uncertain and where critical sources of information are non-existent or unavailable.”[xxxvi] (Edmondson, Page 2) The fear of failure can be economical or social.
(1) If a company encourages employees to experiment but then punishes them for failure, it does not fully support its strategy.“Normative influences, such as organizational culture and espoused values, influences employee beliefs and behaviors by establishing norms and standards that define appropriate and inappropriate forms of behavior.”[xxxvii] (Edmondson, Page 2)
(2) Second type of influences is instrumental influences, “pertains largely to formal reward systems and incentives, instrumental reward influence the ‘instrumentalities’, or costs and benefits, of experimentations behavior.”[xxxviii] (Edmondson, Page 2-3)Keeping these pressures and aligning all policies will best benefit stated goals for any experimentation a company might wish to conduct.“The finding that inconsistency leads to less experimentation among those under high evaluative pressure is consistent with the idea that multiple organizational conditions should be aligned in the same direction to support desired behaviors.”[xxxix] (Edmondson, Page 4)
Provide a full structure for innovation where reward is provided and failure is accepted
Trust people
This can be very difficult, especially if the organization is very large.
Keep an open mind about new idea
Understand the pressures people face
Support the employees to minimize pressure and reward risk taking within the parameters set forth by you.
Observe
Support employees in furthering their ideas
Set up structures to review, implement and reward their ideas
Allow experimentation
The work on experimentations can be allowed on company time or off-work hours
Tap the vast knowledge base of employees
If you have a buy-in from the employees on your goals, tapping their knowledge can be a great asset.Employees will work hard to see the success of the idea.
n the previous three modules, we talked about how one can become more innovative, how to handle market dynamics and technological changes and how innovation can be systematized to better serve the organizations or persons.This final module of innovation will focus on how the final step of launching innovation in the marketplace should be handled.
Most companies focus on incremental changes over radical innovations.“Minor innovations make up 85% to 90% of companies’ development portfolios, on average, but they rarely generate the growth companies seek.”[xl] (Day, Page 3)To the determent of the promises radical innovation offers, “From 1990 to 2004 the percentage of major innovations in development portfolios dropped from 20.4 to 11.5-even as the number of growth initiatives rose.The result is internal traffic jams of safe, incremental innovations that delay all projects, stress organizations, and fail to achieve revenue goals.”[xli] (Day, Page 3) A study showed that, “only 14% of new-product launches were substantial innovations, but they accounted for 61% of all profit from innovations among the companies examined.”[xlii] (Day, Page 3) Companies should pursue projects “that push the firm into adjacent markets or novel technologies and can generate the profits needed to close the gap between revenue forecasts and growth goals.”[xliii] (Day, Page 3)
Although the risk of failure increases as new innovations are pursued, being totally risk-averse will be detrimental to future growth of a company.“The solution is to pursue a disciplined, systematic process that will distribute your innovations more evenly across the spectrum of risk.”[xliv](Day, Page 3)Using two very helpful tools can break down this tall order:the risk matrix and the R-W-W screen.The first allows the user to graphically review risk “across an entire innovation portfolio.” [xlv] (Day, Page 3)The second tool, R-W-W “can be used to evaluate individual projects.”[xlvi] (Day, Page 3)
FIGURE 4.1 THE RISK MATRIX
“The less familiar the intended market (x axis) and the product or technology (y axis), the higher the risk.”[xlvii](Day, Page 4) Channeling new markets with innovative products or technologies presents risks that can be determined by a few factors: target market behavior compared to current customers, brand relevance, and “how applicable its technology capabilities are to the new product.”[xlviii] (Day, Page 4)A competent management team will access all aspect of the risk; evaluate if the new product/technology fits the brand expectation from the customers point of view.Does the product or technology delivery timeline coincide with what customers are expecting?Is the product or technology vastly different than what customers expect?For example, the fast food company McDonald’s, attempted to add pizza to their existing menu but failed.This was due to customer expectations and the increased product delivery time.Quick service, coupled with standardized burgers did not accompany pizza well; the failure to deliver pizza less than one minute left was not favored by the market.To manage your project better than the example mentioned above, consider asking the following after the risk matrix is completed:are you able to manage the project(s) well?And, is “the distribution of Big I and little i innovations lopsided?”[xlix](Day, Page 4)(Big I innovation refers to radical innovations as little i innovations refers to ambidextrous innovations).The danger is to have a lopsided mix favoring incremental innovations.In most companies, majority of the R&D budget is drained by incremental innovation, which allows for steady sales and meeting short-term goals but ignoring the crucial long-term health of the company. The use of risk matrix gives a quick view of product portfolio but R-W-W screen provides “a simple but powerful tool built on a series of questions about the innovation concept or product, its potential market and the company’s capabilities and competition.”[l] (Day, Page 4)The tool is not a magic bullet to kill bad innovations but it allows the user to see the “expose[d] faulty assumptions, gaps in knowledge, and potential sources of risk, and to ensure that every avenue for improvement has been explored.”[li] (Day, Page 4)
The R-W-W screen model forces the development team and management to ask some key questions:“Is the market real?Is the product real?Can the product be competitive?Can our company be competitive?Will the product be profitable at an acceptable risk?Does launching the product make strategic sense?”[lii](Day, Page 7)For most companies, a no answer to first five questions would allow for discontinue of the project but many overlook a no answer to ‘Does launching the product make strategic sense?’It is my belief that a company should follow its strategic goals, if the product has strong support/promise, company’s strategic goals should be re-evaluated or altered.A good example of this would be Apple’s reach into the iPod and iPhone markets.To align Apple’s future aspiration, the company changed its strategic goals and even changed its name to Apple Inc from Apple Computers.
“The robustness of a market is almost always less certain than the technological ability to make something.”[liii](Day, Page 7)One of the key concepts of the risk matrix model states that, “product failure becomes greater when the market is unfamiliar to the company than when the product or technology is unfamiliar.”[liv] (Day, Page 7)A study by consumer product company Procter & Gamble found that 70% of product failures happen when the market is not correctly assessed and understood.It is always better to understand the market instead of doing costly technology pushes.This leads to my second point on why market should be well understood.Technology pushes can be costly and be detrimental to a company’s image and bottom line.It is important that problem solving focus should be on what “problems should be solved or what customer desires need to be satisfied.”[lv] (Day, Page 7)In the “Marketsoft” case study, Greg Erman followed the right steps to determine which problem needs to be solved while keeping in mind is there will be market for his future product.Erman conducted “twelve in-depth customer interviews to validate the product concept.”[lvi](Lassiter & Gardner, Page 5)The next goal is to ask: Is the market real?If the answer is yes, these four conditions should be satisfied: “The proposed product will clearly meet a need or solve a problem better than available alternatives; customers are able to buy it; the potential market is big enough to be worth pursuing; and customers are willing to buy the product.”[lvii] (Day, Page 9)In the Marketsoft case study, the company used Language Processing (LP) Method to understand information from potential customer interviews.To make the process standard, the company divided the process into three steps:preparing the teamwork environment, create the physical environment to encourage teamwork.Making uniform quality language, as different people use different language styles, all communication is unified.Lastly, the data is structured from abstract to high levels.(a) Product desire can be assed by “observational, ethnographic [research] and other tools to explore customers’ behavior, desires, motivations, and frustrations.”[lviii](Day, Page 9)After this, (b) determine if consumers can buy it by studying barriers that might limit their abilities.Next ask, (c) is the market size adequate?If the market is too small, the product should not be produced.After all of this, the critical question is, (d) will the customer actually buy the product?Study their barrier to purchase, competitive products, substitutes, value proposition, cost, etc.The consumers might not be willing to give up the familiarity of the existing product thus refusing to purchase the new product.These are only some examples of variables to assess but the important point being that all aspects must be reviewed and discussed.
Can the product be competitive?Before the development starts, (a) ask if the product concept is clear.It’s crucial that everyone understands what is being developed.“As the project progresses and the team becomes immersed in market realities, the requirements should be clarified.This entails not only nailing down technical specifications but also evaluating the concept’s legal, social, and environmental acceptability.”[lix] (Day, Page 10)Once all of this is determined, (b) find if the product can be made.
There are some key questions to evaluate:
·How will the product be made?
·Does it require new technology or can existing technology and materials can be used?
·Will it be profitable?
·Can it be produced cost-effectively and delivered without a loss?
·Will it meet consumer friendly price point?
·Will the technology/materials used create a barrier to entry for competitors or can they easily create the same product?
There might be a market for it and the consumers might be willing to buy it, but if the product is a money loser, it doesn’t warrant its product.During the various stages of development, the product evolves.“Trade-offs are made in performance attributes; unforeseen technical, manufacturing, or systems problems arise; and features are modified.”[lx](Day, Page 10)With each trade, the original concept erodes and the leftover product might fall short of original intentions.The inevitable erosion of original concept must be monitored as it might lead to a defunct final product.
Can we win?Can we defend the castle?Odds are that if there is an opportunity, you’re not the only one trying to utilize it.The establish market players will either copy your innovative product or create something even better.Three reasons for product failures are: ‘new product didn’t achieve its market-share goals, prices drop much faster than expected and market was small, or grew more slowly than expected.’[lxi] (Day, Page 10-11)Keeping these in mind, I will discuss what managers should do to test product’s competitiveness.(a) Does the product have a competitive advantage?Research to find if the utility provided by the product is unique or can it be fulfilled by other offerings in the marketplace.Seek possible cheap alternatives and see “whether the product offers additional tangible advantages- such as lifetime cost savings, greater safety, higher quality, and lower maintenance or support needs- or intangible benefits, such as greater social acceptability….and the promise of reduced risk that is implicit in a trusted brand name.”[lxii](Day, Page 11)(b) If you do have the advantage, can the advantage be sustained?Although patent is the first line of defense, there are many other tactics one can use to lock in advantages.If your product is knowledge based, what insurances do you have that people with the knowledge wouldn’t leave and join/become competitors?“Can the company lock up scarce resources or enter into exclusive supply contracts?”[lxiii](Day, Page 11)Although all of these tactics might seem harsh, seeking legal means to preserve ones competitive advantage is necessary for the product and company to be relevant in the marketplace. In certain industries, “products [are] relatively easy for…competitors to copy…but having an innovative business-model design isn’t something that’s so easy to replicate.The more layers there are to your competitive advantage, the better your chances of maintaining it.”[lxiv] (Sucher & McManus, Page 5) After employing all possible strategies to shore up your advantage, you must still question (c) how will competitors respond to your product.A competitor might never be able to challenge your product but management must have a strategy in place to deal with this threat.It is important to have a strategy in place to bare the effects of price drops.
If all the above are in place, a manager must now ask, can our company be competitive?“The team must determine whether or not the company’s resources, management, and market insight are better than those of the competition.”[lxv] (Day, Page 11)If the answer is not yes to all, the company will have a difficult time holding back the competition and remaining competitive.(a) Superior resources refer to “superior engineering, service delivery, logistics, or brand equity can give a new product an edge by better meeting customers’ expectations.”[lxvi] (Day, Page 11)An old Indian proverb states, ‘only stretch your feet as far as your blanket can cover them’.A great product, accepting market, competition at bay but if you do not have enough resources to cover consumer expectations; you will be left in the cold.A good example is Herman Miller’s restructuring of its resources.The company determined that it is vitally important to “share innovative business practices, which necessitated moving human resources, product development, production resources, and ideas across the organization.”[lxvii] (Sucher & McManus, Page 6)(b) Appropriate management talent and support is needed for the project.“Success requires a passionate cheerleader who will energize the team, sell the vision to senior management, and overcome skepticism or adversity along the way.”[lxviii](Page 12)Although there must be a shared vision and passion, there must be room for constructive criticism so ideas can be refined.(c) Going back to importance of the market, a manager must ask ‘Can we understand and respond to the market?’There are many methods to seek answers.Best way is to “repeatedly [seek] the feedback of potential customers to refine concepts, prototypes, and pricing ensures that products won’t have to be recycled through the development process to fix deficiencies.”[lxix] (Day, Page 12)The goal is to understand the pricing point earlier in the process and adjusting the price to make it market friendly.It is safe to say, “As customer size increase[s], typically so [do] the volume sold, product complexity, product price, and length of time between order placement and order fulfillment.”[lxx](Sucher & McManus, Page 10)The processes and controls in place should be flexible enough to effectively take on the challenges as the market forces.
·Will the product be profitable at an acceptable risk?
oAre forecasted returns greater than costs?
oAre the risks acceptable?
·Does launching the product make strategic sense?
oDoes the product fit our overall growth strategy?
oWill top management support it?
Being in-tune with the market at all stages of development process can help the product become a success upon launch.But we must still ask, ‘is it worth doing?’(a) Will the product produce revenue or are the costs too great?If the forecast lacks profit, the product should be discontinued.Historically financial projects have failed to accurately predict launch financial performance.To gain a better perspective, management “should depend on rigorous answers to the prior questions in the screen for their conclusions about profitability.”[lxxi] (Day, Page 12) (b) Next, it is important to understand the risks:“How will small changes in the price, market share, and launch timing affect cash flows and breakeven points?”[lxxii] (Day, Page 12-13)The smallest change in any particular number can have an enormous impact on the financials, while over-looking any potential threats or competitors can be harmful.The company Herman Miller uses Economic Value Added (EVA) tool to drive innovative idea decision-making using financials.The leadership team used this tool to better distribute and allocate resources across the organization.“To make business decisions, projected impact on sales and cost of capital were evaluated, and those projects that resulted in a positive EVA evaluation would be then be accepted.”[lxxiii](Sucher & McManus, Page 5)Clear guidelines help employees clearly understand the idea evaluation process.EVA also spread business literacy across the organization and helped in performance evaluation.
As stated earlier, companies take on products without clearly evaluating how the product fits into over all corporate strategy.A good manager must ask, ‘does launching the product make strategic sense?’The product can be a blockbuster product but it might cause harm to other products in the portfolio and alter brand image.
Evaluate:
·Does the product fit our overall growth strategy?
·Will top management support it?
On the first point, how will the product contribute to “driving the expansion of manufacturing, logistics, or other functions?Will it have a positive or a negative impact on brand equity?Will it cannibalize or improve sales of the company’s existing products?”[lxxiv](Day, Page 13)A short-term spike in sales might not be worth negative impact on the company.The product might have negative reaction from other stakeholders and it might harm their businesses.In the E Ink case study, the company had a great technology push product but with little success at mass-market adoption.To sustain the cash flow, management decided to enter into the retail sign sector.In the end, the idea failed and the retail sign business flopped.The desperate move to provide liquidity; the company abandoned its core strategic goals.All spectrum of the impact of the new product must be evaluated.To the second point of management support; if the development team rigorously go through R-W-W screen, they will have an easier time gaining top management support.
·Incremental- small changes to portfolio based on customer feedbacks, doesn’t change the architecture
·Discontinuous/revolutionary- you make completely different product
·Architectural reconfiguration- change your process of production
Issues blocking the innovation progress
·Not enough deviation
·Incremental strangles
oIncremental is rather safe, less risky, requires less budget, keeps shareholders happy, focuses on the known instead of unknown, keeps in line with creativity, as failure/risk is low-institutional hostility is limited or removed
Key Element to achieving integration
·Clear, emotionally engaging and consistent vision
·Senior team with diverse competences
·Simple core values that span innovation streams
·Common-fate reward system for all senior team members
How do you innovate in the downturn economy?
Work under one roof and under one management team to take advantage of resources and leverages while working independently of each other but sharing information and ideas.If there is no leverage to be had, then separate the divisions.
Supporting Innovation Internally
·Zero tolerance policy on failure is bad for innovation
·Intelligent failure (ground rules)/out of control failure
·Internal sponsorship
·Internal culture support risk taking
Guideline for intelligent failure
oStart with prior assumption to learn from prior mistakes
oStart small so the calculated risk is manageable
oKeep the feed-back loop short to make it relevant and timely/failing fast
oFocus on learning while allowing for mistakes instead of focusing on excellence
oFreedom to fail “should not be confused with a license to commit foolish mistakes.”
oPsychological safety net:using intelligent learning instead of making mistakes
The 7 points to innovate in the downturn:
1.Don’t panic, no layoffs
2.Plan of ambidextrous innovation
3.Focus (going back to your core)
4.Plan for intelligent failure
5.Keep an eye out for opportunities- peripheral vision
6.Stop digging- if you have a bad project, abandon it.
7.Understand processes and innovate all around to better use resources
[xxx] Robert A. Burgelman, Philip E. Meza, Innovation at HP: The Role of the Innovation Program Office (IPO)Stanford, CA: StanfordGraduateSchool of Business, 2008.
[xxxii] Hayagreeva Rao, David W. Hoyt, Rite-Solution: mavericks Unleashing the Quiet Genius of Employees Stanford, CA: Stanford Graduate School of Business, 2006.
[xxxiv] Hayagreeva Rao, David W. Hoyt, Rite-Solution: mavericks Unleashing the Quiet Genius of Employees Stanford, CA: Stanford Graduate School of Business, 2006.
