Either way, coming up with ideas is an important activity in any new endeavour.

Here are five tips for better brainstorming:

1. Keep the groups smallish. 3-7 people seems to work best. Too few and there isn’t enough interplay of ideas, too many and discussion is constrained. If you have a larger number, break them into smaller subgroups and focus on subsets of the topic at hand.
2. Set the scene at the beginning. You want unconstrained thinking, but it needs to be ‘on-topic’, otherwise your end up with ideas to solve world hunger when all we need is a few ideas to do this project a little better next time. Set up a ‘car-park’ to capture ideas that deserve attention but not on topic but could be investigated at a later date.
3. Choose a good mix of people. Diversity is important. A homogeneous group will give you same-ish ideas. Be careful about having bosses in the room. It can stifle lower ranked people from speaking up.
4. Use silence to get the ideas out. My preferred method is to use post-it notes. Have each participant write as many ideas as they can in a minute or two. One idea per note. Then go through each idea to clarify and group into like chunks. This prevents a long winded, rambling discussion and emotion laden venting.
5. Follow up as soon as possible. Set an action plan based on the ideas collected, and get it into place as quickly as you can. Momentum is your friend in bringing new ideas to fruition.

Discussing the local economy, Battelino said the strength of household consumption in terms of spending on services had been strong despite subdued retail sales, with households spending more on services, most notably entertainment, dining out and overseas travel.

“At one level this was surprising given the clear signs of caution among households, but it is less surprising when account is taken of the ongoing fast pace of increase in household income. For a time, this increased income was used to rebuild saving, but income growth is now providing the wherewithal to fund consumption,” he said.

Marty Nemko advocated this exact approach a few weeks ago:

2. By reducing our spending to the truly important, we’d gain greater benefits than what our purchases would generate: we’d gain the freedom to do the sorts of work we want, the time to pursue our desired non-remunerative pursuits, and the peace of mind that comes from the absence of big unpaid bills.

Peter Drucker cited 7 sources of innovation:

1. The unexpected occurrence
2. Incongruities
3. Process needs
4. Industry and market changes
5. Demographic changes
6. Changes in perception
7. New knowledge

There is something going on here in Australia at least. People are earning more, probably because they are working more and therefore spending money on creating time instead of things.

Is this a demographic change, a change I perception or a market change? I don’t know, but I reckon it is a sign of opportunity, which by the sound of the established retailers bleating could be permanent.

But why are they stupid. An article in the McKinsey Quarterly on Strategy (sorry lost the link) puts it well:

Spurious frameworks and torrents of data often obscure the basic principles of good strategy. To beat the market, companies must exploit imperfections that stop (or at least slow) its workings. Such competitive advantages are scarce and fleeting because markets drive a reversion to mean performance as middling companies emulate the best and the worst exit or undergo significant reform.
Good strategies therefore emphasize difference—versus direct competitors, potential substitutes, and potential entrants—not industry-wide best practices.

Instead ask yourself, what could be the ‘killer-app’ that could be developed and take over our market? Then get on developing exactly that.

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Related posts:

• Planning fallacy: why people can’t plan and what to do about it.
• Innovation station: McDonalds hamming up innovation and succeeding

But in any project, whether kaizen problem solving initiative or a completely new innovation there is often a drive to deliver quick wins.

Instead of focusing on quick wins, focus on the big wins. These are the hard things, often strategic and often focused at the constraint of the organisation. This means dramatic changes and upside when cracked.

I worked on a project with major Australian bank in their markets division, where there was a focus on delivering quick wins in the form of best practices and improved training. Sure this is needed, but the real benefit lied elsewhere in a major productivity opportunity.

By focusing on the core problem only, and not worrying about the so called quick-wins, maintains the energy required to deliver dramatic improvement organisations need. These major goals are often hard – that’s a good thing, because it means it is hard for the competition.

The synergistic relationship with Kaizen, is in the methods used to solve the problems on the way to cracking the big-win. Further Kaizen is a great tool for team memebers to use to solve the small issues they see every day before they blow up. This keeps management focused on the bigger picture.

In the end, management attention is the ultimate organisational constraint, and thus is pays to focus it on areas which will deliver dramatic improvement.

Innovation is usually large scope change, kaizen is the small continuous change demanded daily.

Innovation – that is large scale is scary – the smaller low key circumvents the fear mechanisms. It’s the frog boiling in water slowly increasing in temperature – but a virtuous cycle instead.

The rule of 72, dictates that if you improve at 1% per day – compounded – then in 72 days you will have doubled your productivity.

Many managers looking at operations with a continuous improvement culture, will be surprised at how productive it is – and doing so with perhaps older or less technology or machinery.

The difference is the utilisation of human capital to design solutions that require little if any capital. More technology is rarely the answer, and more often the when technologies are introduced only 20 percent of the capability is used in any case.

The question is not innovation or kaizen, but innovation and kaizen. After a dramatic breakthrough occurs kaizen is used to solve the inevitable small problems that come up once implemented.

The law of thermodynamics dictates that entropy degrades any system. In business this is the ‘maintenance gap.’ Kaizen solves this gap, fixing the small problems, continuously resetting the system at an incrementally higher level.

Examples of innovation would be exploring new markets, or new products, whereas Kaizen would look at feedback from salespeople about the particular options and quality of the delivered product and make a plan for improvement.

An improving business can’t have one without the other; kaizen when combined with innovation will improve a company’s strategic agility, enabling businesses to rapidly exploit new opportunities and maintain quality and stability at the same time.

An innovator is essentially a change agent, challenging the status quo with the uncomfortable notion that we can do things better. For the innovator trying to make things happen on the ground with customers or though endeavouring to reshape market structures, this requires tenacity, drive and passion. Incumbents will always fight hard to protect their turf.

Many know McDonalds for its bland fast food, process driven approach; and now they’ve turned that same method to innovation. It demonstrates the power and importance of innovation being treated as a process, and given visibility and accountability within an organisation.

Innovation for the modern age:

Customers are inherently selfish (aren’t we all in the end customers?) and have more choice and information about alternatives than ever before.

Driven by their self-interest the value provided to a customer becomes measure of success for a business and thus every activity a business undertakes must be viewed the lens of the customer perception.

This is what McDonalds has done so well, as outlined in the article above, “The question, Weil says, is, “How do you increase service speed and efficiency and optimize the customer experience at the same time?”

Serial innovation:

Repetitive innovation is the key driver, with the world’s most sustainable companies reinventing themselves year after year. 3M famously demands that 25 percent of sales from any year come from products that didn’t exist 5 years ago.

 Successful companies also have a process to embed innovation in their culture, as McDonalds suggest, ““Denis is big on frameworks,” says Sigi Moeslinger, whose New York — based Antenna Design created the interfaces for the ordering kiosks Weil is experimenting with. “He’s big into producing things that are transferable and sharable throughout the whole company.”

Measure your business:

• Could you say you have a codified approach to innovation, or even what about problem solving?
• What percentage of sales are coming products and services that didn’t exist five years ago?
• Do you know where your ‘moments of truth are’ with your customers and are they improving or degrading your value proposition from the customers perspective?

But planning rarely helps, because beyond a certain level of actions you run into a high level of uncertainty where any extra time is futile.

This is never truer than in strategy. An article in Sloan Management Review puts it well:

Strategy: Plan Less, Experiment More

Almost all thought leaders — and many executives — cite the rise of experiments and the necessity for the analytics capabilities that underpin them. Practitioners use terms like “test and learn” and “sense and respond” to describe an approach that at its most rigorous includes a hypothesis and a control group, and at its least rigorous still demands an information sophistication not all companies have.

Experiments can be large and organization-wide or tightly targeted and miniscule (which they more often are). Either way, they can powerfully supplant traditional methods of plotting a business’s course. Survey respondents may have had that supplanting in mind when placing “strategy and business development” significantly behind only “financial management and budgeting” as the business activity to which they apply analytics.

The point is, in management more experimenting is required. This implies setting a hypothesis, testing measuring, and empirical evidence.

Cal argues this concept particularly as it applies to starting a business or writing a book. Focus instead on total immersion of the facts, and fundamentals of the idea, allowing the solution to emerge.

A conceptual model

In my consulting I like to use conceptual models to help me think through problem solving and designing new processes for my clients. I wrote in this previous post a model which I use.  

One, getting clear on the purpose; two, total immersion of the current reality; three, the deep dive looking for the root cause of the problem or driving force of the idea; four, design the solutions; five, test, measure and roll out.

I think that having a conceptual model, such as the one I outlined, or any other you prefer helps you know which stage you’re in and give you a nudges to when to move to the next.

For example, you’ve been collecting facts about a problem, and you think you have some solutions or quick wins you’d like to test. But have you really thought about the root cause? If not, you will very probably only address the undesirable effects and only paper over the problem.

Paralysis by analysis

What Cal doesn’t really address is a tendency for people to succumb to paralysis by analysis; though he’d probably say the idea should have so much pent up energy of its own it should explode of its own volition.

I’m somewhere in between, where I focus on open iteration of ideas, here no pride is taken; I will show my work no matter the stage of completion. This is where perfectionists get caught: they refuse to show their work until it is just right, consequently way over engineering or missing the point altogether.

If you focus on the model, and progressive iteration throughout the phases, you will come up with an idea that will keep you awake at night with excitement.

The other alternative is, one now has excess resources which can be focused on positive randomness.

This is a concept that has fascinated me since reading the Black Swan in which Nicholas Nassim Taleb elucidated the idea of unexpected consequences being devastating in their consequences. But it also works in the reverse where you can benefit from unexpected positive outcomes.

By using the excess resources you can expose yourself to potential positive outcomes by such as inexpensive marketing activities such as networking, blogging, or as Taleb puts it, ‘going to parties.’

So what are the negligible cost activities you can get involved in that could have dramatic and huge upside if they paid off?