The theme of last week’s Managing Automation-hosted Progressive Manufacturing Summit in Las Vegas, Nev., may have been “Connecting the Enterprise,” but the underlying — and perhaps more telling — theme in experts’ discussions seemed to be the tangibility of innovation: What is it, and how do companies master it? What happened in Vegas isn’t staying in Vegas.

No other strategy for driving the top line is more important than developing innovative new products and services, according to Deloitte & Touche research presented at Managing Automation‘s third annual Progressive Manufacturing Summit last week. Out of seven factors for increasing revenue over the next three years, “launching new products and services” ranked highest, ahead of macroeconomic and external industry factors.

(See also: The Summit So Far: 2007 Progressive Manufacturing Event.)

Moreover, innovation is one of the three key ways companies can be proactive rather than reactive with their customers, according to Avago Technologies‘ Hong Siew in response to an audience member during a panel discussion called Connecting with Customers at the summit. (The other two are benchmarking, or best practices, and sustaining the supply chain at an optimum level.)

So it is of little surprise that Innovation Mastery is the second discipline of “Progressive Manufacturing,” which has this to say on the topic:

• Don’t be satisfied with incremental improvements.
• Strive for breakthrough gains.
• Leverage all intellectual capacities.
• Encourage freedom of thought and experimentation.
• Adopt customer-centric thinking.
• Empower employees at all levels.

Yet while most companies in a survey of 1,000 of all sizes across all geographies say that innovation is the most important thing to them, most don’t have the tools or tactics to sustain innovation in the companies, Douglas Engel, vice chairman and U.S. manufacturing industry practice leader at Deloitte, noted in his keynote The Challenges of Connecting the Enterprise at the summit.

Indeed, creativity is only part of the equation; there is also execution, said Lisa Bodell, CEO of consultancy FutureThink, in the keynote that closed the first full day of the summit. In The 8 Ways Leaders Innovate, Bodell noted the following as, well, the eight ways leaders innovate: 1) a new product or service; 2) a new business model; 3) a new brand experience; 4) a new strategic partnership; 5) a new distribution channel; 6) a new customer segment; 7) a new communication channel; or 8) a new business process.

For an innovative new business process, Bodell cited an automaker that made it easy for employees to provide real-time idea submissions online — in other words, to log creative ideas into a “fancy online feedback box.” The box attracted 50,000 new ideas from 18,000 employees. For a new customer segment, she cited Disney Garden, in which Disney teamed up with an unexpected group: farmers.

How do you get started?

Bodell provided eight excellent tips and tricks for individuals to hone their innovative thinking in everyday life:

1. Look beyond your industry. Subscribe to a magazine whose subject you know nothing about, and “connect the dots” between that subject and your own job.
2. Create an advisory board. Pick three people from outside your industry and/or set up an online forum.
3. Look for the weak signals, pt. I. Look at the long-term signals in terms of the big picture related to political and environment forces, referring to futurist sources such as InnovationWatch.com, EmergingFuture.com and (for fun) Long Bets.
4. Look for the weak signals, pt. II. Visit the patent office online or Google Patent Search to find out what ideas are already registered, as this gives a good glimpse of what’s just around the corners as soon-to-be product offerings.
5. Be an accidental tourist. Get out of your habit by taking a different route to work or visiting a new store, a new restaurant, even a different coffee shop. See what’s out there. “Do something out of the ordinary to discover something extraordinary,” Bodell suggested. Look for “out-of-the box” marketing: notice the location, the product, the message. Although something may initially seem out-of-sorts, it could be an incredible idea that could be replicated in your industry.
6. Become a lab rat. Create a “lab Web site,” similar to Concept Lab Volvo, Boeing’s NewAirplane.com or Google Labs, where things like Google Mars began. It started by soliciting input from users. Don’t put your trade secrets out for public viewing, but invite people to give you comments on what they like or don’t like about your company or product. Moreover, go beyond the focus group and experience your company as a customer.
7. Find a younger mentor. While the typical mindset is to find “an old sage” who has vast experience and wisdom to share, the enthusiastic, technology-savvy 20-somethings may give you your greatest lesson in life. Learn about their world, their technology, their social “communities” (Second Life, MySpace, etc.). You can start by talking to your teenager’s friends.
8. Put some “zip” in your reading list. Visit and bookmark passionate social networks, blogs, wiki sites, etc.

However, to paraphrase from SAP Senior Vice President Sudipta Bhattacharya’s Innovation and Efficiency: Road Map to Operational Excellence discussion: “Innovation is never done in isolation.”

To that end, the following are some tips for brainstorming from Mike Lyons, global SAP xMII development team leader for chemical company Celanese:

• Aim for lots of ideas in a short time (quantity over quality).
• Dedicate at least one scribe.
• Encourage a popcorn style. Lyons: “The best way to kill brainstorming is to start critiquing ideas immediately.”
• Build on others’ ideas.
• Be unconventional in thinking.

All of this having been said, innovation alone is simply not enough.

A lot of people at the Progressive Manufacturing Summit were discussing a very recent BusinessWeek article about innovation and efficiency at 3M. Four and a half years after arriving, CEO James McNerney abruptly left for a bigger opportunity, the top job at Boeing.

BusinessWeek claims:

Now his successors face a challenging question: whether the relentless emphasis on efficiency had made 3M a less creative company. That’s a vitally important issue for a company whose very identity is built on innovation.

The article suggests that departed McNerney undermined the company’s vaunted innovation tradition by applying Six Sigma principles to new-product development processes following his arrival from General Electric in 2000.

For “operational excellence,” product AND process innovation and efficiency must be addressed simultaneously.

In his Progressive Manufacturing Summit presentation, Innovation and Efficiency: Road Map to Operational Excellence, SAP’s Bhattacharya noted how markets are rewarding companies that are able to simultaneously execute on both new product and process innovation.

He pointed to Apple Computer as an example of this “operational excellence.” The company’s iPod is the quintessential example of product innovation, primarily for its ease of use and form factor. However, the iPod would not have become the raging success it is without iTunes, a classic example of process innovation, which changed the way music and other digital content are distributed.

All manufacturers need to think the same way about supporting their innovative new products with new processes, Bhattacharya said. As product lifecycles shorten, the only way to do this effectively is to change innovation processes so they are more tightly integrated with other processes, such as those that are carried out by service, sales and manufacturing groups, for example.

Employers today are moving from “knowledge managers” to “knowledge creators,” from “objects of change” to “agents of change,” futurist and EDS Fellow Randy Mears said in the closing-day keynote, Things to Come: A Peek into the Future of Technology, to conclude the 2007 Progressive Manufacturing Summit.

Links to Summit Webcasts

KEYNOTE: The 8 Ways Leaders Innovate
Speaker: Lisa Bodell, CEO, FutureThink

KEYNOTE: The Challenges of Connecting the Enterprise
Speaker: Douglas Engel, Vice Chairman and U.S. Manufacturing Industry Practice Leader, Deloitte

SOLO PRESENTATION: Innovation and Efficiency: Road Map to Operational Excellence
Speaker: Sudipta Bhattacharya, Senior Vice President, SAP

KEYNOTE: Things to Come: A Peek into the Future of Technology
Speaker: Randy Mears, EDS Fellow

Additional Resources

Global Benchmark Study
Deloitte & Touche

At 3M, A Struggle Between Efficiency And Creativity
by Brian Hindo
BusinessWeek, June 11, 2007