W827-Corsi.qxp_Layout 1 10/04/2015 16:54 Page 1 CONTROL, SYSTEMS AND INDUSTRIAL ENGINEERING SERIES This book explores innovation capability in industry by studying the EP ra principles of the maturity levels that apply when operationalizing wt innovation. In four parts, the authors provide a methodological guide, anric k with methods and tools to be applied to businesses and other N C Innovation Capability e organizations, both public and private. ao ur s i Part 1 provides an introduction to the subject of innovation as a means to progress. It focuses on the need for a method, provides a modern Maturity Model framework for innovation capability and introduces the idea of maturity levels. Part 2 discusses the maturity levels themselves – the five levels are analyzed individually to provide a basis for the following section, which discusses the implementation of methods. I n Part 3 focuses on building innovation capacity by concentrating on n concrete examples of innovation within the industry. Each maturity level o is discussed within this context to define the factors that underpin v Patrick Corsi success. a t Part 4 presents the five maturity levels as a collection of dynamic tools, i o Erwan Neau but also looks beyond these by discussing inter-level dynamics and n factors which could impede or halt progress. C a p a b i l i t y Patrick Corsi is an international consultant in innovation engineering at M IKM, London, UK and Brussels, Belgium, and an Associate Practitioner a in intensive innovation at the Centre de Gestion Scientifique at Mines t u ParisTech in France. Previously, he had an extensive career with IBM r Corp, IBM France, THOMSON-CSF, the European Commission as well as i t a successful start-up experience. y Erwan Neau is Director at AONOV Innovation in Angers, France. He M developed systematic methods for diagnosing innovation processes in o business and guiding innovation approaches. He advises SMEs on their d best capacity to progress their development. e l Z(7ib8e8-CBICHH( www.iste.co.uk Innovation Capability Maturity Model Innovation Capability Maturity Model Patrick Corsi Erwan Neau First published 2015 in Great Britain and the United States by ISTE Ltd and John Wiley & Sons, Inc. Apart from any fair dealing for the purposes of research or private study, or criticism or review, as permitted under the Copyright, Designs and Patents Act 1988, this publication may only be reproduced, stored or transmitted, in any form or by any means, with the prior permission in writing of the publishers, or in the case of reprographic reproduction in accordance with the terms and licenses issued by the CLA. Enquiries concerning reproduction outside these terms should be sent to the publishers at the undermentioned address: ISTE Ltd John Wiley & Sons, Inc. 27-37 St George’s Road 111 River Street London SW19 4EU Hoboken, NJ 07030 UK USA www.iste.co.uk www.wiley.com © ISTE Ltd 2015 The rights of Patrick Corsi and Erwan Neau to be identified as the authors of this work have been asserted by them in accordance with the Copyright, Designs and Patents Act 1988. Library of Congress Control Number: 2015937459 British Library Cataloguing-in-Publication Data A CIP record for this book is available from the British Library ISBN 978-1-84821-827-7 Contents ACKNOWLEDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi PREFACE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xiii LIST OF ACRONYMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xvii PART 1. THINK UP A METHOD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 CHAPTER 1. INNOVATION: AN UNFINISHED JOURNEY . . . . . . . . . . . . . . 3 1.1. The journey as the end . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1.2. Application of maturity levels in the innovation process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 1.3. The effects of the knowledge society . . . . . . . . . . . . . . . . . . . . . 7 1.4. What the current socioeconomic context indicates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 1.5. Who can benefit from this book and how? . . . . . . . . . . . . . . . . . 10 1.6. How to use this book? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 CHAPTER 2. EVALUATING THE ABILITY TO INNOVATE . . . . . . . . . . . . . . 13 2.1. The art of change is not one-size-fits-all . . . . . . . . . . . . . . . . . . . 13 2.1.1. Change is an awareness of a phenomenon’s time derivatives . . . . . . . . . . . . . . . . . . . . . . . . 14 2.1.2. Any system reflects the maturity of its subsystems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 2.2. A failed timing translates into zero progress . . . . . . . . . . . . . . . . 16 2.2.1. When the emergency is in conflict with the ability to innovate . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 2.2.2. Moving up the time axis leads to influencing time . . . . . . . . . . 17 vi Innovation Capability Maturity Model CHAPTER 3. A METHOD TO PROGRESS . . . . . . . . . . . . . . . . . . . . . . . . 21 3.1. Progress in the ability to innovate requires a method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 3.1.1. Provide a starting point for the method . . . . . . . . . . . . . . . . . 25 3.2. A new basis for competitiveness contributing to a greater whole . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 3.2.1. The importance of selected vocabulary . . . . . . . . . . . . . . . . . 27 3.3. Two extremes revealing a relative immaturity . . . . . . . . . . . . . . . 28 3.4. Evolving the concept of innovation . . . . . . . . . . . . . . . . . . . . . . 30 3.5. Controlling the acceleration is now the issue . . . . . . . . . . . . . . . . 31 3.6. An algebra of the different levels of maturity (Innovation Capability Maturity Model) . . . . . . . . . . . . . . . . 33 3.6.1. The progression route starts anyway from the lowest point reached . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 PART 2. A DISCOURSE ON THE METHOD . . . . . . . . . . . . . . . . . . . . . . . 37 CHAPTER 4. TWO ESSENTIAL PRELIMINARY LEVELS 0 AND 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 4.1. Level 0 or “we are not concerned” . . . . . . . . . . . . . . . . . . . . . . 39 4.1.1. What is level 0? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 4.1.2. An example at level 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 4.1.3. Examples of organizations at level 0 . . . . . . . . . . . . . . . . . . 40 4.2. The level 1 or “Do it Right First Time” . . . . . . . . . . . . . . . . . . . 41 4.3. Two examples where innovation at level 1 puts companies under death sentence . . . . . . . . . . . . . . . . . . . . . . . 46 4.4. A company that innovates only by reaction to competition or market trends (general study case) . . . . . . . . . . . . . . 49 4.5. SWOT matrix at level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 CHAPTER 5. LEVEL 2: NOT YET MATURE . . . . . . . . . . . . . . . . . . . . . . 53 5.1. Level 2 or “redo and, if possible, do better” . . . . . . . . . . . . . . . . . 53 5.2. The SWOT matrix at level 2 . . . . . . . . . . . . . . . . . . . . . . . . . . 58 CHAPTER 6. LEVEL 3: MATURITY IN TRAINING . . . . . . . . . . . . . . . . . . 61 6.1. Level 3 or “collective efficacy” . . . . . . . . . . . . . . . . . . . . . . . . 61 6.2. SWOT matrix at level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 CHAPTER 7. MASTERING LEVEL 4 . . . . . . . . . . . . . . . . . . . . . . . . . . 71 7.1. Level 4 or “collective efficiency” . . . . . . . . . . . . . . . . . . . . . . . 71 7.2. SWOT matrix at level 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 Contents vii CHAPTER 8. SUSTAINABLE MASTERY AT LEVEL 5 . . . . . . . . . . . . . . . . . 83 8.1. Level 5 or “dynamic, total and sustainable innovation” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 8.2. SWOT matrix at level 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 PART 3. IMPLEMENTING THE METHOD . . . . . . . . . . . . . . . . . . . . . . . . 93 CHAPTER 9. HOW TO INNOVATE AT LEVEL 1? . . . . . . . . . . . . . . . . . . . 95 9.1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95 9.2. What is an innovation action at level 1? . . . . . . . . . . . . . . . . . . . 96 9.3. What will these actions permit? . . . . . . . . . . . . . . . . . . . . . . . . 97 9.4. The functional dimensions of innovation activities . . . . . . . . . . . . 97 CHAPTER 10. INNOVATING AND CAPITALIZING AT LEVEL 2: RE-VISITING THE PAST FOR ENTERING LEVEL 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103 10.1. Assembling the elements of an approach . . . . . . . . . . . . . . . . . . 103 10.1.1. Prerequisites for level 3 . . . . . . . . . . . . . . . . . . . . . . . . . 104 10.1.2. Set apart what is urgent from what is important . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105 10.2. Who is going to lead the innovation approach? . . . . . . . . . . . . . . 106 10.3. How can we reconcile the three business functions above? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 10.4. The innovability diagnostic phase . . . . . . . . . . . . . . . . . . . . . . 109 10.4.1. A true story . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109 10.5. Questions and issues that resonate with level 2 . . . . . . . . . . . . . . 110 10.6. A level 3 checklist to create an innovation upon request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 CHAPTER 11. TO BUILD UPON LEVELS 1 AND 2 . . . . . . . . . . . . . . . . . . 113 11.1. Driving innovation is a strategic activity . . . . . . . . . . . . . . . . . . 113 11.2. Advice when nominating the Innovation Steering Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116 11.2.1. More about breakthrough or disruptive innovation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124 11.3. An example of repeated yet spiraling innovation . . . . . . . . . . . . . 126 CHAPTER 12. FORGING AND STRENGTHENING SYSTEMS TOWARD LEVEL 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129 12.1. Preparing a culture change in the organization . . . . . . . . . . . . . . 129 viii Innovation Capability Maturity Model 12.2. Starting the innovation throughout the company . . . . . . . . . . . . . 132 12.2.1. The first actions of the Steering Committee . . . . . . . . . . . . . 132 12.2.2. Launching a communication and a training policy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132 12.2.3. Demystification – Awareness – Information – Education – Action . . . . . . . . . . . . . . . . . . . . . . . . 132 12.3. Constitution of the innovation team . . . . . . . . . . . . . . . . . . . . . 133 12.3.1. The management group of the innovation portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133 12.3.2. An innovation information system . . . . . . . . . . . . . . . . . . . 134 12.4. The analysis group of customer needs . . . . . . . . . . . . . . . . . . . 134 12.4.1. Innovation communication . . . . . . . . . . . . . . . . . . . . . . . 135 12.5. Monitoring issues and management caution with level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135 12.6. When knowledge management comes of age . . . . . . . . . . . . . . . 137 12.7. Is creating excess of knowledge an issue? . . . . . . . . . . . . . . . . . 138 12.8. The paradoxical passage way from level 3 to level 4 . . . . . . . . . . 139 CHAPTER 13. MANAGING THE DEPLOYMENT AT LEVEL 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 13.1. Changing the method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 13.2. The moment where management is revisited out of necessity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 13.2.1. The case of the smartphones market . . . . . . . . . . . . . . . . . . 145 13.3. Further notes on management . . . . . . . . . . . . . . . . . . . . . . . . 147 13.4. When ideas become projects and projects become successes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148 13.4.1. Firm is not a pyramid . . . . . . . . . . . . . . . . . . . . . . . . . . . 149 13.4.2. “Headgear” the pyramid with the strategic vision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149 13.4.3. At the “heart” of the pyramid is an “anticoagulant” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150 13.5. Preparing level 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150 CHAPTER 14. SUSTAINING LEVEL 5 . . . . . . . . . . . . . . . . . . . . . . . . . . 153 14.1. A frequent misconception on the nature of level 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153 14.2. The two logics prevailing at maturity level 5 . . . . . . . . . . . . . . . 155 14.3. Level 5 is all about rhythm and osmosis . . . . . . . . . . . . . . . . . . 156 14.4. The new art of managing at level 5 . . . . . . . . . . . . . . . . . . . . . 157 14.4.1. First indicator: knowledge originality (KO) rapport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159