This is part of my series on thought leaders in the innovation space. Check out the other articles here.

Born in Cupertino, Diana Stepner is rare in the technology industry as a true Silicon Valley native. Growing up with a love of technology, one of her first jobs out of business school was at Epsilon where she was first exposed to customer segmentation. In London, she gained experience in product management and learned the ins-and-outs of applying customer segmentation practices for clients. Inspired, Diana returned to grad school for a Master’s in Information Management Systems, specializing in Human Computer Interaction.

Armed with a mix of experience in startup innovation, emerging technologies, and new approaches to customer experience, Diana landed at Pearson where she headed up Future Technologies and Innovation Partnerships. She is now Pearson’s VP of Product Management for Learning Applications, a portfolio of innovative products geared toward increasing confidence and improving learning outcomes for college and career success.

More than ideas

Diana believes that success in innovation is more than ideas. “What I often find from innovation programs is their target is around ideas — creating ideas, training, tweaking, refining ideas. In my experience, the trickier bit is actually turning the idea into something real.” Creating something real means bringing an idea to market and giving it the proper resources to get the word out and effectively compete with existing players.

“In market is the halfway point, and then you’ve got just as much work to do to refine it, iterate, and make sure it has legs to stand on.”

At Pearson, ideas are the first step in a product lifecycle approach that covers the full evolution of a concept through the phases: Idea, Explore, Validate, Grow, Sustain, Retire. While some programs hand-off a project after the early phases, Diana finds that people who really believe in an idea often want to see it through. By pairing these individuals with those more practiced in growing and sustaining a product, the lifecycle approach provides valuable learning opportunities for innovators to grow their skill set.

Openness, transparency, evangelists

Diana encourages companies to pursue innovation with openness. “Everybody should have the opportunity to test ideas and find out if there’s a better way to do something.” Approaching innovation in this way helps to infuse innovation into the day-to-day so that it becomes a part of the culture. But Diana cautions against programs used as a symbol of good culture.

“Over the years more and more companies have done incubators and accelerators, and it often comes across as something the company is doing to show that they value their employees and listen to their ideas. It’s almost a checkbox.”

Listening to employees’ ideas is something every company should do and one from which they benefit. “But the culture itself shouldn’t need an innovation program for people to feel that way…If not done for the right reasons, it comes across as the company doing an innovation program to feel better about itself.”

In addition to being open to everyone, innovation programs also benefit from communication and transparency. At Pearson, a group of representatives is sourced from different parts of the company to be future technologies champions. “Champions give visibility everywhere into future technologies.” By establishing a network there is visibility, communication, input, and feedback from day one.

Innovation efforts also benefit from an endpoint. Introducing this constraint provides a checkpoint to evaluate the work product with the business sponsor and determine if there is enough commitment to continue moving forward.

Gauging compatibility

Diana’s advice for innovation programs that partner with startups includes considerations like personality, shared goals, and responsiveness.

“In the beginning we just looked at a lot of technologies that would address the challenge, but if people don’t like each other, the technology really doesn’t matter.”

One way to evaluate compatibility is through colocation, even when it’s temporary. “In the beginning of Innovation Partnerships, we did all of the work virtually.” Learning from early experiences, startup teams were brought into the same location with their corporate sponsors to do their initial planning, to a positive effect. “They formed more of a bond just being together for two days.”

“We did a lot of match-making of startups to other parts of the company so they would get more exposure. We had general sessions so they could voice any concerns and have open conversations so they could talk to us about anything.”

Diana learned throughout the partnership process that responsiveness is key. “Whether in an innovation program or not, when ideas are put forward or startups come forward, oftentimes companies don’t respond.” In these situations people left with unanswered questions wonder if their idea wasn’t good, they didn’t contact the right person, or maybe their wording wasn’t right.

“We’ve learned to be honest, to respond, and to tell the person or startup ‘yes’, ‘no’, or ‘I need more information’ pretty quickly so they’re not left hanging. People were good. Even if the answer was bad, at least they got an answer, then they can move on.”

Companies who leave people with feelings of unease and uncertainty may not have the opportunity to work with that person or startup in the future.

The product lifecycle

To measure innovation efforts, Diana returns to the Idea, Explore, Validate, Grow, Sustain, Retire product lifecycle approach. One positive marker she relies on is whether an idea is moving through the phases. “Does something go from Idea to Explore or do you end up with a whole bunch of things from Idea that don’t get to Explore?” It’s fair to assume there will be more items in the Idea stage than Explore and Validate.

But looking at the mix is a signal for Diana on whether efforts have weight. Diana also looks to revenue and competition as a means of measurement. She considers whether an idea is bringing in new revenue or helping fight off competitors to determine what’s worth pursuing further.

Measuring success

The prerequisite to measurement, according to Diana, is a clear, realistic definition of success. “I think the expected return and impact are the types of things that need to be decided up front because that will influence who puts forward ideas and, basically, what the optimal outcome of each phase should be.”

Measurement and executive sponsorship are strategic components of any innovation program, and both can serve as protection against a program shutting down. Yet, Diana cautions that sponsorship is not always a guarantee of longevity.

According to Diana, one way to guard against shut down is having products in the market that are gaining traction, bringing in revenue and customers, or involve partnerships that are significant. “Those types of external factors which are benefiting the company are harder to shut down than just the program itself.”

Startup success

By partnering with numerous startups, Diana has the opportunity to see innovation success stories on a regular basis. “Every couple of months a startup that was part of the innovation programs at Pearson will reach out. Often they’ll tell me about the success they’ve had or the funding they received or that they got purchased by another company, and I love that.” Even startups that Pearson declined to partner with reach out to Diana to share what they learned from that “no”. “So that sense of community continues even after the programs are done.”

For example, Innovation Leader periodically holds facilitated discussions around a specific topic or theme. “I really like that in Innovation Leader’s group discussions can get messy. There are some really down and dirty conversations, which reflect reality. And you learn a lot from the people involved. It’s like a really good dinner party where you’ve got exciting people sitting next to each other, you mix up the group, and the conversations just flow.”

If you want to read my other articles about innovation experts and practitioners, please check them all out here.

The post Ideas Are Only The Beginning appeared first on Voltage Control.

This is part of my series on thought leaders in the innovation space. Check out the end of this article for links to others in the series.

Let’s start with a great anecdote that Peter Nicholson shared with me. When Elon Musk was just a student at Queen’s University in Ontario, Peter was working for a big bank in Toronto. Elon called up Peter out of the blue and said he was looking for a job for him and his brother. They had lunch, and Peter ultimately gave Elon a job. (“I’ve never known anyone who had the combination of vision and determination,” he says.)

As this tidbit indicates, Peter is a fascinating guy to talk to, whether about innovation or anything else. With his unique expertise in government policy, education, and business, our conversation on innovation took unexpected twists and turns.

Before we dive in, here’s some background: Peter was born and raised in Nova Scotia, educated in physics and mathematics, and has served in numerous posts in government, business, science, and higher education. His public service career included positions as Deputy Chief of Staff, Policy, in the Office of the Prime Minister of Canada and as Special Advisor to the Secretary-general of the OECD in Paris. His business career has included senior executive positions with Scotiabank and with the telecom holding company, BCE Inc. in Montreal.

The Drive-Through Window

From the very beginning of our conversation, Peter took me through an equation-filled journey of economics. It is a perspective on innovation that we rarely see. As the former policy strategist to the prime minister of Canada, he has a more global view that is very intriguing.

The equation that he shared with me is called The Growth Accounting Equation, and it’s used to measure how different factors influence economic growth. This equation was relevant because Peter was talking about his view that: “Innovation is really the fundamental driver of economic growth…[This is] because it is the ultimate source of productivity growth.”

However, Peter was quick to clarify how he defines productivity; he doesn’t mean people working more: “The notion of productivity conjures up bad images for workers …People misunderstand it as: ‘I am being driven to work longer hours, do more for less?’ And it doesn’t mean that at all, it means: getting more valuable output from the unit of labor input. It doesn’t mean working longer or harder. It means working smarter.”

“[Productivity] doesn’t mean working longer or harder. It means working smarter.”

He gave an excellent, and unexpected, example of this smarter, more innovative way of doing things — the drive-through window. “Somebody got the idea that if you knocked a hole in the wall, and put in a bit of cheap communications equipment and hired an extra person…you could enormously increase the seating capacity of your restaurant without any extra cost. So, that was a big win-win. The capital input is very small. There’s a little bit of extra labor that you have to put in, but the output at the end was vastly exceeding those inputs.” To Peter, this is one of the defining characteristics of innovation: when the rewards greatly outdo the money or effort.

Lessons from Canada

When we hear about innovation today, we often get a very U.S.-centric point of view. But, because Peter is Canadian, he shared his thoughts on the innovation space in Canada and, particularly, how it has been shaped to where it is today: “Canada’s always had terrific technological competence…But, had never, ever developed this focus on the end customer. It is also reflected in the fact that Canada has no consumer brands at all.” Why is this? Peter chalks it up to simple supply and demand.

He says: “Canada’s role in the North American economy has been upstream at the commodity end. The US has some raw materials but it relies hugely on Canada.” Peter sees Canada’s focus on raw materials (vs. end products) as fundamental to where it is today. “The US has got enormously sophisticated end products and Canada has virtually nothing.” He’s even seen how this has impacted the current Canadian start-up world: “I have spent time with incubators in Canada and what you hear…[is that the] biggest gap in start-up culture in Canada is not just marketing but simple sales skills…they have not developed the business skill set that we associate with an end customer focus and a marketing focus and a branding focus.”

“The takeaway from that is that where you end up specializing, over time, has a big effect on the cultural approach to innovation…”

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Getting Fisherman to Agree

I asked Peter to share a story of successful innovation, and in keeping with our conversation, his example was one-of-a-kind. “It’s a good example of a tremendously valuable innovation that wasn’t in the least technical,” he said. The story was about a fisherman. To cut to the chase (and likely to overly simplify!), Peter read about how catch limits in the Canadian fishing industry was leading to fisherman spending too much on bigger and better boats, an oversaturated market, and plummeting prices.

Peter took matters into his own hands: “I said well, what we’ve got to do here is create a property right. And the way to do that is to give each individual fishing enterprise a certain percentage of the quota and then they can catch that in the most efficient way that they want. They don’t have to race. It totally changes the incentive structure.”

“The key was to get people to agree, that alignment piece. That’s 90% of my work.”

But to make this idea work, he had to get the five fishing companies together. Which he did one day, gathering all of them in one room. And in an afternoon, he succeeded in getting them to agree to how they were going to allocate their fish stocks. Peter said of this personal feat: “Here’s a great process innovation, which has had tremendous economic impact…the key was to get people to agree, that alignment piece. That’s 90% of my work.”

Don’t Miss the Internet

As well as hearing personal stories of success in innovation, I also love to hear stories about what didn’t work. With Peter’s background in Canadian telecom (he used to work for the holding company that owned Nortel), he shared his perspective on the time in the 1990s when the telecom companies were transitioning to the internet as the main form of communication. As Peter explained, all of the leading global telecom companies “failed to make the transition to the internet protocol form of communication. How did this happen? It wasn’t because these companies didn’t know, didn’t understand the technology.”

Instead, Peter cites that the reason these companies missed the boat was because they didn’t want to disrupt their major customers: “Their big customers, the people that were supplying the quarterly financial results, were the old wireline companies and… the major customers did not want this disruptive technology…it was really going to vaporize their business model but, of course, it was going to happen anyway.” One of the lessons here, from someone who was there as it was unfolding, is to not to worry so much about cannibalizing or disrupting your current business that you miss the much bigger opportunity.

I hope you enjoyed this synopsis of my conversation with Peter Nicholson. If you want to read more, check out my articles about two other innovation experts: Gary Hoover and Kellee M. Franklin.

The post The Man Who Gave Elon Musk a Summer Job appeared first on Voltage Control.