From FastCompany.com comes this article highlighting the idea of Innovation Debt. “Innovation debt is the cost that companies incur when they don’t invest in their developers,” Peter Bell writes in his personal blog. “It happens when the team is too busy putting out fires and finishing up features to keep up to date with advances in languages, frameworks, libraries, tools and processes.”
His point cuts across all domains. No matter the discipline, if you don’t invest in your talent, you will incur costs “like interest on an overdue loan.” Like unchecked hypertension innovation debt is a silent killer.
Unfortunately, we’re seeing far too many companies knowingly incurring Innovation Debt. The current era of R&D cost management and de-investing are precisely the corporate decisions that lead to the best people leaving, inability to recruit the right people, loss of productivity, and an innovation funnel that is decreasing in value.
Research conducted by Newlogic and Babson College into the best practices of project portfolio selection has been published by PDMA. Our research determined that leading innovation organization use 10 common portfolio decision criteria: Continue reading
Newlogic recently presented at the “Structural Packaging Summit,” in Orlando, Florida. The event went from February 29th to March 1st and included many speakers that we have interviewed and written about in the past. We felt the event was a great success with thoughtful presentations and dynamic networking sessions. Continue reading
Patent Reform approaches, actually, it is already here given that some of the provisions are already in place, and product development managers need to be thinking about its consequences. That’s why I chose to reach out to Brad Barbera, who is the Executive Director of the Product Development and Management Association, he has been in his current role at the PDMA for about 9 months, but has a 15 year background with the association and over twenty years in the field of product development. Brad and I recently chatted about the issue of Patent Reform and product development.
First, however, Brad had a disclaimer: “I am not a lawyer, we do not have a staff PDMA IP lawyer, and I have not sought specific advice in this area. Everything is based on what I’ve read, and my own personal speculation.”
John: What steps has your association taken to prepare product development members for the America Invents Act?
Brad: We are trying to understand the act; I’m contacting IP lawyers, planning on webinars and in-person presentations at both the international and local levels. But I see that there’s an 18 month window here, where there’s a lot to still be settled, as not all the rules are written. So here at the PDMA we are interested in understanding the implications and helping our members operate effectively in the new system. My biggest single concern is that the rules are going to get in the way of innovation, more than they are going to help. Continue reading
When was R&D First Outsourced?
Outsourcing of R&D began on a small scale prior to the 1970s and 1980s. There are examples of R&D outsourcing dating back as far as the 1500’s with Italian Renaissance artist Michelangelo, who set up a network of specific suppliers to provide the materials and skills he needed to create his work.
More recently, the 1930’s saw companies in the United States were contracted to conduct R&D on the government’s behalf. During that same decade, the largest American and European firms performed 7% of their R&D functions abroad. This number has been steadily rising since the 1960’s, when a sample of 32 multinational companies were conducting 6.2% of R&D abroad, and by 1995 the number had risen to 25.8%.
During the 1990s, as a consequence of globally distributed R&D networks, R&D outsourcing began to rapidly expand. The explosion of outsourcing innovation was additionally facilitated by a number of other factors such as improved intellectual property rights and changes in trade and investment governance. Continue reading
There are many aspects of outsourcing innovation that companies and R&D leaders need to consider. After having looked at several reasons for outsourcing R&D projects, as well as a handful of risks of outsourcing, Newlogic now turns our attention to some of the issues outsourcing brings about that R&D need leaders.
How to Make Selections For Outsourcing R&D Projects
One of the things an R&D leader will be called upon to do is make selections on which projects to pursue. The R&D leader will have delegation over both in-house and outsourced projects, at least to some extent. The R&D director needs to be able to recognize in which areas the company does and doesn’t have competencies. The tasks the company performs well should remain in-house, while the tasks that the company does not do, cannot do, or isn’t as good as it could be, should be outsourced. Vivek Wadhwa of techcrunch.com says that innovation of core products should not be outsourced because the developers of these innovative technologies need to simultaneously interact with each other and their potential consumers, something made more difficult through an outsourcing of this process. Continue reading
R&D outsourcing is a business practice widely used by many companies across many industries across the world. A few days ago, we addressed seven reasons why a company might choose to outsource R&D. However, although outsourcing innovation can be hugely beneficial to all involved companies, the move to do so is not without its share of risks.
In this week’s cosmetics and skin care industry post, the Newlogic portfolio team write about six factors to consider when developing your R&D cosmetics strategy. To research the post we reviewed our cosmetics posts over the last few months, and conducted ancillary research.
1. The Combination of Groundbreaking Formula and User-friendly Packaging
In the cosmetics and personal care industry, breakthrough innovations on formulas and packaging are still keys to success as they directly relate to product performance. Cosmetic and skin care chemists search for the ingredients and technology to advance product efficacy, while they also contribute to design innovative package that improve product applications. This is obvious, but it’s the formula, delivery systems and packaging that make all the difference when it comes to developing innovative cosmetics projects. Your R&D cosmetics strategy has to consider what these fundamentals.
Stacy Leidwinger moderated this week’s #innochat on the topic of “Mapping innovation with the customer experience.” One question stood out for me, “4.How do you avoid innovating for a single customer & drive innovation for a market?”
This question gets at the heart of good R&D strategy. If your company’s business strategy is to achieve category leadership in a product category then you have to organize R&D so that the process of innovation is not just a series of one-off’s but a road map of continuous innovation.
Instead of listening to customers to discover what ideas you should develop, you listen to customers to see what innovations you need to develop that match with your road map.
You therefore have to think carefully about your road map strategy, maybe consider innovation consulting. Look around you at competitors, think about how leadership in one attribute will enable you to maintain or grow your product’s market share. Consumer insights then can be both about designing your road map strategy, and knowing what products will enable you to maintain leadership.
Aiming for new category leadership
Defining beverage category leadership
This week’s #innochat demonstrated the importance of involving patrons in the process of R&D management, this week’s chat was on the topic of patrons, and Chris Zakrajsek asked the following questions:
1. How important is a Patron to an innovation program?
2. Assuming you have the necessary resources, is your Patron necessary?
3. How do you rekindle your Patron’s excitement?
4. How do you help your Patron understand the innovation process and their role in it?
I was thinking a patron can be the CEO of a company, or the business unit manager for marketing or a brand. Patrons are responsible for sales and growth of the company, and are very interested in understanding where their company’s growth will be in 2,4, 6 and 10 years. Whether CEO or project sponsor, patrons have to be involved in the process of R&D management. And R&D leaders have to help explain what projects need to be chosen, by showing the importance of each project to the overall plan for the company.
Without patron’s you would not have innovation, they help create the overall business strategy that fuels how an R&D strategy is developed. You keep patron’s involved by letting them know how the process of choosing which projects to execute on works. You ask for their commitment to growth targets. While the patron might not be responsible for developing the innovation, they are involved in the process of deciding if a project is a good one to execute because it makes sense for the overall business strategy; both in getting their buy-in for goals, and getting resources for the research that needs to be conducted to determine the value of an individual project and its relevancy to business strategy.
Chris, Innochat’s moderator this week had used a polo analogy to frame the post; I’d like to give my own sports analogy. In sports the patron is the general manager, while R&D leaders are the scout/coach. For a company as well as a sports team, when it comes to picking players and projects, the overall team matters as much as the individual players. Each coach has to argue their case for a player and the overall team, and back up the potential with evidence. The scouts and coaches support their general manager by giving them a process for making decisions on individual players as they support the overall team strategy. In good companies just as in sports teams, patrons are supported by R&D leaders to pick the projects that work individually, but also support the overall roadmap for the R&D portfolio through a project portfolio management system.