Linking strategy and innovation (article)

I’ve posted previously about the need to link foresight to strategy to innovation, but rarely seen concise articles that elaborate on this.  Strategy and Business has just posted one, and it’s worth looking at.  Here’s the first section of the article:

Strategic planning is different from innovation. When developing a strategy, you decide what your activities will be in the future, and you have to stay true to your predetermined course to see results. Furthermore, your plan includes a set of activities that you know how to do. But with innovation, your course of action is inherently unpredictable, and you know in advance that you’ll have to learn to do things that you don’t yet know how to do. Only after your innovation succeeds will you know what those things are.

That’s why your business strategy and your innovation practice must be kept apart: otherwise, the consistency of your plans may constrain your creativity and verve, and the surprises of innovation may distract you from your plan. At the same time, your strategy and innovation must also be aligned, or your organization will be incoherent and risk dissipating your efforts. So how can you integrate strategy and innovation, but still keep them separate?

The answer is simple in principle, but hard in practice. You probably have an annual strategy cycle of some kind; in most cases, the corporate office gives guidance to each unit, and then each unit maps out a strategic plan for the next one to five years. It is during this strategy cycle that you must ask the leaders of each unit to do two things:

1. Come up with a plan over the coming year for what that business unit knows how to do. This will involve about 99 percent of its time and activity.

2. Identify one or more innovations that the unit’s team would most like to tackle over that same year.

Source: The 1 Percent Innovation Solution

Linking strategy to innovation – short article

From strategy and business comes a quick read about the links between innovation and strategy.  It misses the link between foresight and strategy, but makes it’s point well:

Strategic planning is different from innovation. When developing a strategy, you decide what your activities will be in the future, and you have to stay true to your predetermined course to see results. Furthermore, your plan includes a set of activities that you know how to do. But with innovation, your course of action is inherently unpredictable, and you know in advance that you’ll have to learn to do things that you don’t yet know how to do. Only after your innovation succeeds will you know what those things are.

Source: The 1 Percent Innovation Solution

McKinsey article: The four global forces breaking all the trends

There’s a concise piece on McKinsey that sums up four macro trends that are coming down the line:

  1. The age of urbanization

  2. Accelerating technological change

  3. Responding to the challenges of an aging world

  4. Greater global connections

Each of these topics has a wealth of information written about them, but this short piece is a useful primer if you are unfamiliar with where the world is heading.

Admittedly the list would be more complete if it included something about bioengineering, but that’s probably able to be captured in point three…

Source: The four global forces breaking all the trends

Biohackers develop night vision eye drops to see in the dark

Expect to see a lot more of this in the future, as the cost of biohacking falls significantly, and interest picks up from students, tinkerers and makers:

A biohacking group in California has managed to develop eye drops that temporarily give a human being powerful night vision. The chemicals used are still very much at the experimental stage – this isn’t something you’d want to try at home just yet – but the first trial has been very successful.

Source: Biohackers develop night vision eye drops to see in the dark

The implications of quantum computing

At the last Foresight Week event in Singapore two years ago, Peter Schwartz and I had a long discussion about the implications of quantum computing. Where we ended up was that we thought that there was a ‘computing arms race’ developing between Governments and consumers.

At the highest abstract levels, the foundations of computing have remained unchanged since the development of the transistor.  The development of the PC meant that it was inevitable that consumers would possess extremely fast computers, and among other things these would enable levels of security and privacy through encryption.  No matter how fast Government computers became, there would be enough horsepower available to consumers to secure their privacy.

Now this is changing.  The development of the quantum computer means that the next evolution of computing will put the average person into a state of inherent insecurity, because quantum computers will be able to unlock any security currently in use.  An article in the Washington Post highlights this:

Quantum mechanics is now being used to construct a new generation of computers that can solve the most complex scientific problems—and unlock every digital vault in the world. These will perform in seconds computations that would have taken conventional computers millions of years.

This also means that Governments and corporations will once more be leaders in computing, harking back to the days of mainframe computing – when state-of-the-art computation power was unaffordable to the average person.  However unlike the democratisation of computing power that has taken place since the development of the desktop, it’s likely to be a much shorter time span before quantum computing is available in the home – or in your pocket.

In the meantime however, the deployment of this new type of computing is likely to add to global volatility through it’s deployment by security agencies.

The importance of vision (McKinsey article)

Again from the McKinsey Quarterly comes a useful article about the challenges faced by new entrants to C-level positions. Of note was the reference to the difficulty of creating a shared vision:

When asked about different aspects of their transitions, executives rank business-related activities among the most important to the transition’s overall outcome. The largest share say it was very or extremely important to create a shared vision and alignment around their strategic direction across the organization (Exhibit 2). This is also among the most difficult aspects to carry out: just 30 percent of all respondents say it was easy to create a shared vision in their new role.

This has been an extremely important piece of the work that I have assisted the Canterbury DHB with over the last seven years, and has been one of the keys to the successful transformation programme (for more detail see here).

Visions are not created by black and white typing on a Powerpoint slide, neither are they broadcast down from a stage.  The best visions are co-created with the people that work in an organisation in such a way that they share ownership, and feel like they are part of something bigger.

This directly links to some previous work – also from Mckinsey – about strategy co-creation which you can read about here.


Source: Ascending to the C-suite | McKinsey & Company

The eight essentials of innovation (McKinsey article)

The most recent McKinsey Quarterly has a concise article that sums up a multi-year research project by the organisation.  As the title suggests, it breaks the findings into eight areas.  While the article is rich in highly quotable insights, the one below caught my attention:

Innovation also requires actionable and differentiated insights—the kind that excite customers and bring new categories and markets into being. How do companies develop them? Genius is always an appealing approach, if you have or can get it. Fortunately, innovation yields to other approaches besides exceptional creativity.

The rest of us can look for insights by methodically and systematically scrutinizing three areas: a valuable problem to solve, a technology that enables a solution, and a business model that generates money from it. You could argue that nearly every successful innovation occurs at the intersection of these three elements. Companies that effectively collect, synthesize, and “collide” them stand the highest probability of success. “If you get the sweet spot of what the customer is struggling with, and at the same time get a deeper knowledge of the new technologies coming along and find a mechanism for how these two things can come together, then you are going to get good returns,” says Alcoa chairman and chief executive Klaus Kleinfeld.

(Source: The eight essentials of innovation | McKinsey & Company )


Observations from presenting at the Nobel Cause Symposium



I’ve just returned from spending three days with some of the smartest minds in the world on climate change at the Nobel Symposium in Hong Kong.

I presented about visions for cities, and how energy saving in street lighting is a very tangible way to cut carbon emissions through dealing with a small group of decision makers.

There’s very few scientists that dispute the data about the challenge of climate change, and the evidence is very strong.  However after listening to speakers present data and show compelling graphs, it occurred to me that challenge is no longer data, it’s how you form the narrative.

This is a common problem with many experts, who have difficulty creating a story that resonates with enough people to start a social movement.

No story, no movement.  No movement, no change.


(More details about the symposuium are here: Programme — Nobel Cause Symposium, and here. The photo is of six Nobel Prize winners signing a memorandum imploring decision makers to take stronger action to combat climate change.)

John Oliver reframes complex narrative with ‘Dick Pics’

I watched the John Oliver show about the renewal of the Patriot Act upcoming in June.  His central argument is that the American people don’t care about NSA mass surveillance programmes as it’s too complicated.

He goes to Moscow and interviews Ed Snowden, and you can watch Snowden struggle to understand how to frame his story.  Then John Oliver reframes the massive complexity of NSA surveillance  around, errrr…Dick Pics sent online.

He shows Snowden interviews with people in Times Square before and after the reframing, and the results are absolutely clear when it comes to the formation of great narrative.

The full clip is 30min but you need to watch it in it’s entirety to see the beauty of the formation of the story.  Before the reframing people aren’t particularly worried about the powers of the NSA.  After the reframing they are passionately against it.

It’s a virtual masterclass in how to reframe complexity in such a way that it can trigger a narrative to be re-told.  It’s also an extremely topical and relevant story in itself.

Last Week Tonight with John Oliver: Government Surveillance (HBO) – YouTube.

Strategy article on megatrends and opportunity


This is a five minute read which is well worth the time.  It outlines some collisions between megatrends that are already in plain sight and makes the point that:

If you are a leader in government or a company, you still have time to build the necessary strategies and capabilities for a robust and effective response.

The challenge with this is always how to focus a board or executive team on the long term, and in my experience this is challenging at the best of times.  For further context about this, I recommend reading about the three-box model in an HBR article from 2011.

Essentially this points out that most leaders focus on operational efficiency today, when they should actually be thinking about creating more value by inventing the future.  From left to right, Box One is operational, Box Two is Change and Box Three is the future.  Most value comes from Box Three, but nearly all leaders focus on Box One.  In a world of accelerating change, this is not the value to endure organisational longevity.

For the megatrend piece, go here: How to Seize the Opportunities When Megatrends Collide.