Innovation funnel

X-factor understands basic innovation principles!

April 27, 2009 by Jurjan Huisman | 4 Comments

In my humble opinion the television program ‘X-factor’ understands innovation better than the average company in the Netherlands. This may sound strange, but let me explain this by a simple example.

Do you think you could pick the eventual winner of the X-factor out of 14,000 contestants upfront? Do you think an expert like Gordon, one of the Dutch jury members, can pick the winner upfront? And lastly, would you put money on his ability to pick the winner upfront? Personally, I wouldn’t bet much money on his ability to pick the right one out of the more than 14,000 candidates. The funny thing is, that a lot of companies take these low-chance-of-success-bets in regards to their innovation processes. The X-factor program however, has a very efficient innovation process.

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Innovate the Google way

February 9, 2009 by Jurjan Huisman | 3 Comments

The Google StoryRecently I read the inspiring book “The Google Story“. Google is seen as one of the big examples of an innovative company and a lot of people state the 20% rule as a reason for that high level of innovation. The 20% rule refers to the percentage of time that software engineers get to work on whatever interests them. Personally I think that the 20% rule is not the main reason that Google excels at innovation. What is more important to my opinion is the culture and work philosophy at the company. Let me elaborate on that…

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Venture capitalists understand innovation principles

October 23, 2008 by Jurjan Huisman | No Comments

Future of management A little while ago I read a book called “The future of management” by Gary Hamel. Besides the fact that it is a great book full of nice metaphors and examples for management issues, I liked Hamel’s opinion on venture capitalists in relation to innovation:

“Innovation follows a power law: for every 1,000 oddball ideas, only 100 will be worth experimenting with; out of those, no more than 10 will merit a significant investment, and only two or three will ultimately produce a bonanza. Venture capitalists understand this arithmetic. In a given year, a typical VC firm will review thousands of business plans, meet with hundreds of would-be entrepreneurs, invest in a dozen or so companies, and then hope that one or two of them will become the next Google, Cisco, or Amgen. Few managers, though, seem eager to acknowledge the inescapable arithmetic of innovation.”

Innovation Funnel
This actually means that venture capitalists understand how to utilise the innovation funnel. In a structured innovation process, a lot of ideas need to go into the innovation funnel and along the different stages of the funnel the quantity of ideas goes down and the quality of the ideas goes up. In this way, the innovation funnel provides organisations with a staged process for innovation. Innovation FunnelTo use the same amount of ideas that Hamel mentioned: out of the 1000 ideas that are brought in, the 100 best ideas are selected and get a little time and funding to be developed a little further; at the next stage, these 100 ideas are rated at stricter criteria so that the best 10 ideas will go into the following stage. At the end the one or two best ideas will be developed into actual products or services and all the other ideas and knowledge gathered along the process are stored. In any case it is important not to bet on one horse from the start. Diversification of the ideas is needed. As Hamel puts it:

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