The telecom industry: Dealing with constant revolution

Innovation makes the world go round and some industries are more exposed to this fact than others. In this blog we often talk about changing pharmaceutical industry innovation practices. Telecom is another example of an industry for which innovation is a matter of life and death. Changes are deep and numerous. Historically, they sold voice communication per minute, later they enabled access to networks through multichannel communication (voice communication becoming free), today,  they are content providers. So, what comes next? What new technology will transform this industrial model?

In the telecom industry, where the product life cycle is extremely short, innovation has become a necessity and not an option. Telecommunications companies need to develop cutting edge technologies in order to sustain organization, systemization, and efficiency. They have to be reactive and each potential technology has to be evaluated, discussed and integrated as quickly as possible. Furthermore, the whole economy depends on the creation of a dynamic, competitive, innovative telecommunications infrastructure. In today’s world, standing still means dropping back.

This context presents both great opportunities and challenges. Telecoms are constantly innovating and transforming the way we work and the products they offer. The only concern is how to keep a step ahead of competitors in a cut-throat environment. Innovation challenges technology convergence and holds the keys to future business growth.

One solution seems to be to expand innovation horizons by defying collaboration limits and opening up to technologies that might be acquired externally. Think globally, act personally and manage the technology mix consistently. According to the “The Innovation paradox in the telecom industry”[i] study conducted by IBM, 80 % of telecom decision makers acknowledge the importance of collaborating with a wide range of external partners as 51 % of the technologies they develop come from external sources.

All telecommunications companies have already set up their strategy in this direction and have become much more than just providers. Devices are following this trend as the well-known Apple case confirms Siri Inc. integration – the intelligent software voice assistant, was acquired by Apple in 2010 and integrated in the Iphone 4S with 2 immediate benefits: 1st integration within 6 month, 2nd no other competitor platform could develop the feature.

Another example worthy of mention: an open community portal to interact and test product with early adopters: Orange Lab, plus innovation contests for attractive start-up projects and young talents .

Because of the large number of initiatives,  companies are having trouble managing this rich vein of idea flows. Ideas coming from outsiders are communicated to them in a very informal way by email, phone and platforms. Then, to evaluate the idea submitted, there are a number of email exchanges and meetings which lead or not, to a decision to develop the new technology. Since there is no coordinated process, very often there is redundancy and loss of relevant information. This process is inefficient and time-consuming.

And yet it could be performed faster and better. Better because more potential technologies could be captured, enriched and decided upon; faster because this entire process could be organized within a specific time frame.

Inova EXPLORE is a smart solution to this problem. There are many parallels with scouting activities in the pharmaceutical industry.  Since Explore has inherited 10 years of best practice scouting in pharma, it can help telecom industry scout, evaluate new technologies in order to faster integrate them into new products and processes. By involving all employees in the scouting process, Explore gives an exhaustive view of all ideas coming from the outside in general,  and from strategic partners in particular. Thanks to an experienced and valuable platform that has proved its worth, Open innovation managers track, screen and form opinions on external technologies. Efficient information sharing at the earliest possible juncture, and cross-team collaboration result in a top quality innovation process and better informed decision-makers.

Every new technology represents a competitive advantage and innovation has become crucial in the telecom industry. Adopting ideas from outsiders and the systematic acquisition of externally developed technologies is the key strategy they should have in order to be at the forefront of the industry.

We believe that creating “knowledge sharing” by putting the right information in the right hands will contribute to real progress.

Tremendous technology is right around the corner, and all companies need to do is chase it up and develop it.

 

, , , , , Business Models, Innovation Best Practices, Partnering
April 19, 2012Permalink

Supporting an innovation culture: Part 2

Best Practices to ensure that your FEI software implementation supports and improves your innovation culture

This article is part two of a two-part series on supporting an innovation culture.  In part one, we explored the ways in which an FEI software implementation can support, or even improve the culture of innovation within a company.  In this article, we will explore best practices approaches to making sure that the FEI software implementation actually does achieve an improvement in the innovation culture.

Many corporations have implemented enterprise software and have either never used the software (often referred to as “shelf-ware”), or have used the software but not achieved the promised results.  Through ten years of experience implementing Front-End of Innovation (FEI) Software in many of the world’s largest corporations, we’ve identified several best practices to ensure that the software implementation achieves the objectives that were set out at the beginning of the project.

Launch Failure:

Too often, enterprise software projects are launched without a thorough communication plan.  Companies do internal launch publicity when they release a new product to the outside world, but fail to take the same approach when launching new initiatives that will greatly assist the employees.  Since innovation is a cultural change for many companies, it is even more important to have an effective communication strategy when launching a new innovation program.  This is the golden opportunity for the CEO or senior executive sponsor to put his or her “seal of commitment” on the project.

This communication plan will start some months before the launch of the process/software and will be maintained over the years. This will create a sound foundation for a sustainable culture and innovation process. Communication is the lever that drives a strong participation rate, which is a key component to the success of an innovation process and a strong commitment of the project teams. There is no universal one-size-fits-all solution for communication because it must adapt to the corporate culture and strategy of the innovation process.  Inova consultant can share with you general best practices gleaned from a variety of successful approaches.  Make sure that your FEI software implementation plan includes a communication/publicity plan within it.

The “afraid to fail” issue:

An innovation culture can only thrive when people are not afraid to fail. Some clients realized that innovation is often an iterative process, where an idea that doesn’t immediately meet management’s objectives, could be of great interest once people will have collaborated on it. To create a positive innovation culture it’s important to enable each employee to contribute their ideas. This is not possible when they are afraid to fail. And therefore a commitment from the management showing the example and accepting failure (even facilitating “chaos” – to a certain extent) is key to the success of the implementation of an innovation process. Thomas Edison is quoted as saying “I have not failed 1000 times, but I have been successful in finding 1000 ways not to make a light bulb.”

The reward question:

The question of rewarding ideas and concepts is more a matter of communication than compensation. Above all, it is an incentive for the staff to participate and create a culture of innovation. The rewards have to be disconnected from the creative task; it should not be perceived as an entitlement but as an extraordinary reward and has to consider the company’s culture.  Rewards do not necessarily reflect only the estimated financial value of the idea. A well-designed rewards system also considers participation, the discussion around an idea, colleagues’ votes, topical relevance, etc.  From this perspective, what is needed is to try to acknowledge and reward as many people as possible to amplify the “buzz” effect.

The main consideration is to create a reward system linked to users’ intrinsic needs and corporate culture.  An interesting study from the Massachusetts institute of Technology (MIT) highlighted that people’s intellectual performance decreases when there is a monetary reward. This can be explained by the fact that that creativity is the result of three main components: knowledge, creative skills and motivation. Motivation is further divided in two types: intrinsic motivation (they want to do it because they want to do it) and extrinsic motivation (they do it because they will get money – they do what the environment tells them to do). The MIT study’s author, T. Amabile, cited that the intrinsic motivation is a major component of creativity, while extrinsic motivation leads to less creativity. Therefore, if you want to foster people’s creativity, a good reward would be giving them the time, and budget to do something that they are passionate about. In an ideal world people would contribute because they want to, not because they have to (do not force people to contribute). Inova’s innovation consultants can share with you some examples of best practices in rewarding innovation.

Training:

Often, innovation processes are implemented without real training on “innovation”. Most of the time training is only focused on how users can perform their task in the process but not on what innovation is, the importance of being more innovative, where to apply innovativeness (link with the corporate strategy), etc. These questions build a strong basis for understanding what the company is expecting in terms of innovation and explain why it is using the process.  To do this, a strong commitment from management is important.

Our clients have appreciated the fact that when implementing  FEI software, training is not only focused on giving actors the competence level required to carry out their tasks in the process/software, but also the “whys and wheres” of innovation as it relates to their company’s strategy, goals and objectives.  This gives the actors (idea submitters, knowledge contributors, innovation practitioners, executives) purpose and perspective to their work, and results in deeper adoption of the software and the feeling that their work is contributing to the “greater good” of the company.

Strategy:

One of the most important objectives of implementing FEI software is to drive the innovation strategy of the company.  Our clients realized that, in order to improve the quality, cost and time to market (of the ideas submitted) an Innovation manager should supervise the operations as a whole. This person is key to the innovation approach of the company because he will measure the company’s performance through key performance indicators and implement corrective actions when required (launch specific challenges, launch communication campaigns, drive the training to be sure that the key messages are reinforced, assuring the quality and efficiency, etc.). During implementation, it is important for management stakeholders to come to agreement on what metrics will be used to measure and guide the innovation strategy.  See our recent post, “Innovation Metrics that Really Matter”, for a discussion on innovation metrics at a recent Frost & Sullivan conference.

Flexibility:

When designing an innovation process, supported by an FEI software implementation, it is important to build flexibility into the process.  In building high-rise buildings in areas prone to earthquakes or hurricanes, engineers have for many years worked with flexible materials and designs to “bend” and “flex” with the changing environment during these significant weather events.  It has long been known that rigid materials and designs can become brittle and will break under stress.  The same holds true with processes supported by software.  A rigid process will break under the pressure of competition, or a changing operational environment, resulting in frustrated users giving up on the software and resorting to other tools to supplement their work. Without the right flexibility, the software won’t support the innovation culture.

Flexibility in the process is established by working with two areas in combination:

  • Workflow:  the process that the idea will follow to be enriched and be turned into a concept (do not overburden employees to only provide excessively required detail in their ideas.  Allow them to start with raw ideas and then enrich them through the benefit of collaboration
  • Access rights and visibility: depending on their responsibility in the system, users will have different activities with different rights and visibility. These rights and visibility can change depending on where the idea/concept is in the workflow, making it easy for them to follow a process without feeling constrained by it.

The organization central to the innovation culture and the software supports the organization.  It is essential to implement the FEI software in a manner that “bends” and “flexes” to support the organization as it adapts to the changing environment.

In this series, we have explored the ways in which an FEI software implementation can support, or even improve the culture of innovation within a company.  We’ve discussed some best practices gained through Inova’s experience implementing FEI software in some of the world’s largest companies.  As the practice of innovation is continuously innovating itself, we would be interested in hearing from you on what some of your experiences have been while implementing innovation processes at your company.  Please feel free to continue the discussion here in our blog, or contact one of our representatives to explore ways in which Inova’s FEI software can support your innovation culture.

, , , , , Collaborative Innovation, Connected Innovation, Innovation Best Practices
November 18, 2011Permalink Leave a comment

Supporting an innovation culture: Part 1

Can FEI Software implementations support and improve Innovation Culture within an organization?

This article is part one of a two-part series on supporting an innovation culture.  In this article, we’ll explore the ways in which the implementation of Front-End-of-Innovation (FEI) software can support, or even improve the culture of innovation within a company.  In part two, we will explore best practices approaches to making sure that the FEI software implementation actually does achieve an improvement in the innovation culture.

Let’s first start with a working definition of Innovation.   For our purposes, Innovation is a sustainable process which, by the combination of ideas, knowledge, skills and resources leads to the adoption of new and/or better products, processes, paradigms which create value for the company.

The operating elements of this definition we wish to focus on are “sustainable” and “combination”.  In order for innovation to flourish, the company’s Innovation Culture must support a sustainable process that encourages continuous activity, and the combination of ideas and knowledge through internal and external collaboration.  Innovation depends on the creativity of employees, customers, suppliers and partners, and the capacity of the company to convert this creativity into value.  How then, does the implementation of FEI software support this increasingly important culture of innovation?

Through ten years of experience implementing Front-End of Innovation (FEI) Software in many of the world’s largest corporations, we’ve addressed several key inhibitors to establishing a successful innovation culture. They are: collaboration, efficiency, and quality.  It should be noted that software cannot create a culture within an organization.  The organization must at least have a supportive culture of innovation with executive level backing.  However, a bad implementation of supporting software can kill an organization’s will to innovate, while a successful implementation can enhance and support the organization’s innovation culture.

The first inhibitor of innovation culture that many companies face is lack of collaboration. Whether the result of legacy organizational boundaries, intellectual property concerns, or a desire for the purity of one’s technical domain, innovators in some companies toil in isolation, filling lab notebooks with experiments, proving and disproving hypotheses, and trying to solve innovation problems through brute force, without the benefit of other points of view, or additional knowledge to bring to bear on the problem.  These companies have realized that their process was not collaborative enough and the outcome of it was the creation of low quality ideas and low participation. Collaboration allows different people thinking about an issue to discover each other and by thinking together, create more value than thinking separately about the same issue.  In today’s distributed organization, bringing people together in meetings or in hallways to attempt to foster the “water-cooler” effect is nearly impossible.

Better collaboration can be fostered by having a system whereby innovators can discover each other in “virtual space” where their ideas naturally “connect” with the ideas, knowledge and insights of other innovators.  Inova uses “Enrichment Technology” to make these connections possible.  Powered by a revolutionary correlation engine, Enrichment Technology leverages the world’s largest semantic network to analyze the concepts contained within an idea and suggest other ideas, research notes, knowledge papers, and other content, which may be similar to, or improve upon the original idea.  By making these meaningful connections, Inova’s FEI system breaks down organizational silos and improves collaboration.

Enhanced collaboration can be achieved within the company, and also across the company’s borders, with its partners, customers or networks of third party innovators.  Implementing a robust FEI software system can make “open innovation” within and outside of the company a reality.

The second inhibitor that an FEI implementation would address is the efficiency of the process.  Many companies either don’t have an innovation process at all, or their current process doesn’t have enough visibility or traceability to efficiently progress the best ideas through vetting, evaluation and decision-making, leaving innovators to circumvent whatever processes are in place to get their desired result.  This inefficient process slows everything down and frustrates everyone involved, to the point where they give up trying to improve the business and the innovation culture dies.

 

Implementing FEI software can improve:

  • Traceability: Some companies are still working with excel sheets to work on ideas and do idea portfolio management.  With FEI software, they can have a process to fully trace some Key Performance Indicators (KPIs), such as the time to development/market of an idea, the real financial value of the idea after implementation, the novelty, etc.
  • Visibility: Without FEI software in place, innovators don’t know the status of the evaluation of their ideas.  Without the confidence that their ideas are being worked on, the innovator either stops suggesting new ideas, or begins burdening the management team with emails and phone calls, or worst of all, repeat submissions.  By implementing FEI software, status and activities are made visible to everyone who needs to know, and the innovation program runs more efficiently.

The efficiency of a process is key to maintaining the momentum, the sustainability that supports an innovation culture.

Lastly, the lack of quality is a major inhibitor that can be addressed by implementing the right FEI software.  While many companies generate a high quantity of ideas through various techniques to spark participation in the innovation program, the overall quality of these ideas falls short of the expectations that were promised at the beginning.  Our clients realized that it was more important to increase the number of real innovation concepts with added value (for example, increasing the number of sales based on new products) and that having this capability was a pillar to supporting an innovation culture.

By focusing on enriching ideas with other knowledge and insights, our clients were able to improve the quality of their ideas, combine related ideas into big innovation concepts, and avoid wasted time and effort on large quantities of small ideas.  By discovering multiple related ideas submitted in different ways by different people, our clients were able to eliminate duplicate evaluations and foster teamwork and collaboration around a combined “big idea” that could achieve a valuable outcome.

Using the right FEI software to build big ideas and turn them into real concepts will consolidate and support the company’s innovation culture.

In this article, we’ve explored how implementing the right FEI software solution can overcome the three most important inhibitors to establishing and supporting your company’s innovation culture.

In part two of the series, we’ll explore the best practices required to implement an FEI solution and ensure that it supports and improves your company’s innovation culture.

, , , , , Idea Management, Innovation Best Practices
September 26, 2011Permalink Leave a comment

Innovation Metrics that Really Matter

Whether you’re “scaling up” your existing innovation program or trying to take it to the “next level,” the value of your program needs to be measured and demonstrated in order to continue to garner support from the business. Sometimes, the measure of true value of innovation can be elusive. Traditional financial metrics used in other parts of the business (ROI, NPV, etc) don’t always capture the momentum or traction that your innovation program is gaining.

I recently had the opportunity to facilitate a workshop on this topic at the Frost & Sullivan 7th annual Innovations in New Product Development conference in San Diego (http://bit.ly/qwtVzz ).

Participants in this interactive session discussed ways to apply meaningful metrics they can use in their business no matter what level of maturity.  The discussion uncovered a wide variety of potential metrics, and I’d like to share my observations, and then ask you to continue the discussion by commenting on this blog and interacting with others in this community.

The Participants:

This conference brings in a fairly broad group of innovation practitioners, mostly in the areas of new product development and strategic marketing.  I wanted to get a feel for the level of maturity in the group and I discovered a fairly equal mix across two domains.

First, the participants came from companies whose innovation cycle or product development cycle varied from fast-moving (18 months or less) to medium (1.5 – 3 Yrs) to long term ( 3 years and up ).

Participant new product development cycle

Participant new product development cycle

Second, the participants were fairly evenly mixed according to the maturity of their innovation programs.  The “Establishing” category represents participants who were just getting their innovation programs off the ground and who were attending the conference to learn from others.  “Improving” represented those who had some early successes under their belts and were looking to scale their innovation programs to a more enterprise level, and finally “Validating” represented those who whose programs were well established, and were benchmarking against new entrants to remain competitive.

Innovation program maturity

Innovation program maturity

Why?

The group first established some of the key reasons why we should use metrics in innovation.  More specifically, we made sure that the scope of these metrics was deeper than traditional business metrics of Net Present Value (NPV) and Return on Investment (ROI).  Some of the reasons cited were:

  • to drive alignment ( with strategy )
  • to drive behavior – you get what you measure
  • to measure what’s important – back to strategy
  • to manage resources
  • to manage portfolio
  • to sustain enthusiasm
  • to provide fulfillment

I personally liked the last two, because in many organizations, the sponsoring executives (the ones with the money) lose heart just before a breakthrough could be achieved, and the innovators, who often follow hunches and go down rabbit trails in search of answers, don’t receive the fulfillment that the failures along the way are contributing to the overall project.

What is a performing asset?

To put some intention behind the discussion of metrics, I wanted to establish with the group the concept of a “performing asset.”  An asset could be tangible or intangible, but as Ocean Tomo reports each year, intangible assets provide a higher contribution to corporate value than that of tangible assets.

Ratio of tangible vs intangible asset

Ratio of tangible vs intangible asset

Since the goal of a good innovation program is to turn innovation opportunities into performing assets, the group came up with some interesting definitions of what a performing asset is: (or, how can you recognize one)

  • a product that earns revenue & profit
  • your brand
  • your people, knowledge, process
  • your partnerships, channel, suppliers, customers
  • your corporate culture ( think Zappo’s )
  • Intellectual property

The group immediately recognized that the above was devolving into a list of examples of assets, so they brainstormed some more and coalesced a very nice, broadly applicable working definition which served us well for the discussion that followed:

“anything tangible or intangible that is/could be providing material benefit in achieving strategy, meeting goals and objectives, gives you options, gets you in the game, builds awareness.”

Leading and lagging indicators of asset performance

With this definition in hand, the group began to identify how to measure the performance of an asset.  We discussed the importance of having both leading and lagging indicators of performance.

Leading indicators are important because they happen while you’re on the journey to the destination.  They provide risk management (early warnings) and optimization (of time, of innovation mix).  Some examples of leading indicators cited by the group were:

  • Number of days I brushed my teeth ( it was an illustration … you had to be there )
  • Amount of spectrum purchased ( example given by a wireless company going into new markets )
  • Patent diffusion ( how many products my patent has been used in )
  • Speed of information deployment in an organization (given by a consulting firm who treats thought leadership as an asset )
  • Cycle time
  • Qualitative assessment of ideas (on strategy vs. off-strategy)

Lagging indicators then provide the way to assess the effectiveness of our actions, provide a basis for improvement, course correction, etc.  Some examples were:

  • Cavity-free dentist visits ( as above… an illustration )
  • Average revenue per user
  • Time to market
  • Market acceptance of product
  • Renewals (repeat customers)
  • Customer satisfaction scores

Framework for turning innovation opportunities into performing assets

We finished up our lively discussion with a lesson from dogfighting (the kind with airplanes, not real dogs).  John Boyd, nicknamed 40-second Boyd, was an air force fighter pilot-turned-instructor, who gained fame among fellow pilots in air warfare school because of a standing officers’ club wager.  Boyd started out every sortie being pursued by a student pilot in another airplane. If Boyd couldn’t maneuver his aircraft and turn the tables on his dogfighting counterpart within 40 seconds, he would buy a round of drinks in the bar.  Popular lore recounts that Colonel Boyd never had to buy a drink.

Years later, John Boyd retired from the Air Force and applied his techniques to corporate competitiveness, and he developed a framework for decision making which serves us well today.

OODA loop

OODA loop

 

It’s called the OODA loop, which represents the cycle of decisions that are made in the fighter cockpit on a micro level, or in corporations on a macro level.  OODA stands for (O)bserve-(O)rient-(D)ecide-(A)ct. The important part of OODA is the feedback loop, where the results of your actions become the observations that re-orient you to make your next decision.  To win a fight and stay alive to fight another day, one needs to “get inside of” their opponent’s OODA loop.  In a military operation, these actions take place in seconds.  In corporations, this process slows down when strategy is rigidly followed until the next years’ planning cycle.  It is critical that the results of our actions inform our strategy to either validate that we’re on track, or to correct our course.

Our group reached the agreement that every strategic goal should be tied to a lagging indicator, and in turn tied to a leading indicator, and then management needs to have the courage to recognize when these indicators are showing them that a course correction is needed and then to act decisively.

By applying a bit of dogfighting principles to our innovation strategy, we can achieve a dominant position in our markets, and solve some of our society’s toughest problems.  Tally-ho!!

Let’s keep the conversation going… feel free to comment on this page and share your valuable insights.

 

, , , , , Alignment, Innovation Best Practices
July 18, 2011Permalink Leave a comment

A unified Business Development and Partnering system, lessons learned from a Biopharma Leader

We recently finalized the deployment of our Business Development & Licensing product suite at one of the largest global pharmaceutical companies. This deployment represents a significant shift from a company that was plagued with the challenges and inefficiencies of a widely decentralized, geographically and culturally diverse community of business development teams to a highly agile, well-coordinated global team that has earned its place as Partner-of-Choice in the eyes of its alliance partners.

As the nature of business development and strategic alliances has evolved into a world of complex global relationships with alliances spanning multiple regions and multiple therapeutic programs, this client recognized that a fully decentralized organization, with its many separate information systems, was unsustainable.  With the help of our system, our client has consistently ranked among the top five most desired companies to partner with [1].

Our client now has one single software framework to manage the full lifecycle of partnering activities, including search & evaluation in alignment with company strategy;  sustainable and reproducible processes for in/out licensing, R&D collaborations and M&A; and alliance management. The same system is used across divisions from consumer health to therapeutic areas in pharma to animal health. More than 300 professionals now share a single database with stored information on all external interactions (academia, biotech…), licensing opportunities, post deal obligations like milestones payments, etc.  Until recently the Business Development IT infrastructure that supported these diverse communities consisted of 21 different systems with very little if any coordination between them.

This situation is far from unique. Many of the large pharmaceutical companies still employ several different databases across their Business Development activities. Business Development comprises three main disciplines:

Over the years, each group has built its own homegrown system to manage its data. Their needs were different and in some cases, legal departments mandated the separation of those databases to avoid IP contamination.

With the growing volume of data, many BD executives are seeking new IT solutions to increase departmental efficiency. As they do so, they realize that it is also time to merge the different systems into one.  Over time, they have seen that duplication of data caused various difficulties. For instance, a search & evaluation team might be screening a new technology; while a transactional team from another division might be closing a deal with the same company. If a scout meets a biotech in a conference, he/she needs to know who in his company is already interacting with them. Duplication of data creates unnecessary time spent by the teams to retrieve information. BD executives have also realized that successful partnerships take years to develop. With the high turnover of BD professionals in most organizations, the knowledge of interactions with these developing partnerships is hard to maintain and a common system provides an essential “corporate memory.”  Contrary to the separate system approach mentioned above, strong authentication and access control capabilities in one single database provide the security and protections mandated by legal departments, and is far easier to manage, since access control is managed with one consistent policy.

For the reasons stated above, many biopharma companies are making the decision to migrate to one single BD database. Once the decision is taken there are several important considerations on the way to successful implementations.

  • The first consideration is the choice of a system. Often pharmaceutical companies start by evaluating the existing disparate systems in use, hoping that one could cover the needs of all of the teams.  This hope is seldom fulfilled by one existing system, and choosing one over others often creates conflicts. Project leadership is often vested in one group, resulting in resistance from other groups, ultimately leading to termination of the failed project. Our experience with several of our clients indicates that a fresh look at the needs of all teams without bias toward one system or another, incorporating best practices gained from experience with many pharma companies, leads to a stronger set of requirements and a more successful implementation with a sense of ownership from key stakeholders from all departments.
  • The second  is to configure the system based on the different requirements mentioned above. Traditionally, projects start with writing detailed requirements.  Unfortunately, gaining consensus among many participants with sometimes conflicting interests can be difficult and leads to some requirements being impossible to fulfill.  By taking a core group of stakeholders from the key departments, and allowing them to “model” their requirements in a dynamically configurable framework, this group of stakeholders will begin to achieve consensus, and develop a sense of collective ownership in the system.  This is best done in an in-person, workshop format. Without such a concentrated activity, achieving consensus on requirements can easily take more than a year.
  • The third consideration is the definition of an access control policy. Putting everyone on one system should not mean that everyone sees everything.  Finding the right balance between security and collaboration is not an easy task. Experience from other companies and strong access control configurability are key success factors.
  • The last consideration is the integration with other systems. Indeed, having one single system gives the opportunity to integrate the system with other business tools. For example, we highly recommend interfacing the BD&L platform with Project Portfolio tools to automatically track project milestone achievement and initiate related alliance payments. The BD&L system chosen should have an open architecture with strong web services capability to allow such connections.

As partnerships and collaborations continue to provide a greater share of BioPharma’s pipeline of new products, I strongly believe that most BioPharma companies will require one integrated system for all their BD&L and partnering activities. The system will help extend BD activities across the organization, facilitate a closer working relationship with R&D and foster better external interactions. Since the goal of these partnerships and collaborations is to advance the state of health and well-being in our society, there is very good news ahead.

Guy Henninger, SVP l Business Development, Inova Software Inc

[1] Collaborative Innovation: Partnering for Success in Life Sciences, S. Henderson et al,  IBM Institute for Business Value, October 2010

, , , , , , , , , Connected Innovation, Execution, Partnering
May 16, 2011Permalink Leave a comment

Vertical*i and Inova Announce Merger!

We proudly announce our merger!

Vertical*i, Inc. and Inova SA today announced they have entered into a merger agreement effective December 6, 2010. The combined company will be known as Inova Software Inc, in North America and Inova Software, SA in Europe.

inova_verticali_merger

inova_verticali_merger

Read complete press release

, , , Uncategorized
January 12, 2011Permalink Leave a comment

It’s 3AM, Do You Know Where Your Intangible Assets Are?

For many years, public service announcements and newscasts on television began with the phrase, “It’s 10pm, do you know where your children are?”  In the decades of prosperity following World War II, as households increasingly were led by two-career marriages and children became more independent, this phrase became popularized as a way to take a pause at the end of the day, check on the kids, then tune into the news.

Just as our children embody the know-how, values and behaviors we invest in them throughout their upbringing, we invest in our companies in very much the same way.  Our intangible assets embody our know-how, our corporate values and our competitive advantage; our business processes embody our corporate behaviors.

Our management training teaches us to focus on our tangible value, our hard assets on our balance sheets and our profit and loss on our balance sheets.  ERP systems came to market just in time to help us measure these tangibles in countless ways, giving us up-to-the-minute dashboard views of our business and balanced scorecards for us to measure against pre-defined thresholds of success as defined by whomever.  These systems have even allowed us to make our business processes repeatable, making us supposedly more efficient at doing what we’ve always done before.

Yet, while we continue to be more efficient and drive our costs down and our profit up, we may be losing sight of where our children are… the learned know-how that comes from our operations or the competitive advantage that may be slipping through our fingers as others pass us by.

In our September newsletter, we illustrate the emergence of distributed capitalism, where a global network of resources (including assets both tangible and intangible) is delivered to an increasingly individualized consumer.  We highlight the need for a business infrastructure that accelerates the fluidity of these assets into, through and out of your company into the hands of these increasingly demanding customers.   In order to make the fluidity of these assets work to achieve our desired business goals, we need to focus on the assets themselves and ask the following questions:

  1. What is the individualized co-created customer experience my end-user is trying to achieve? (unifying concept)
  2. What assets are needed to supply this experience? (It’s important here to look at all aspects of the experience as a type of asset [e.g. Components, packaging, branding, business model, content, etc.])
  3. What assets do I possess? (could be a patent, a manufacturing process, a brand name, etc.)
  4. What assets are available to me from outside? (through licensing, co-development, acquisition or other means)
  5. What assets can be leveraged by others? (through out-licensing or other partnering activities)
  6. What is the process by which the unifying concept in #1 above will be realized through the execution of #2 – 5 above? (project milestones)

Each of these unifying concepts with its portfolio of assets represents an asset-centric business opportunity, one which delivers the greatest value in the shortest execution time to the end-user.  An asset-centric business opportunity management system is an essential part of a collaborative business network infrastructure that is required for companies to succeed in today’s age of distributed capitalism.

Register for our upcoming Webinar, where we discuss ways to use Vertical*i’s collaborative business network infrastructure to accelerate intangible asset into, through, and out of your company to build shareholder value.

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September 14, 2010Permalink Leave a comment

True North – Where is your compass pointing?

In Steven R. Covey’s Book, the Seven Habits of Highly Successful people, the author writes that aligning one’s self with True North principles, meaning identifying with our own moral compass, are essential for all of the other habits in his book to work and have meaning.  Written in an era where many companies lost their core values in a time of rapid economic growth, it was not surprising that the world of corporate strategy began to wrestle with the concept of a company’s mission and values in light of True North principles.

Senior executives, looking to regain the moral footing that made their companies great during the industrial revolution responded by defining their values and trying to tie the results of business operations back to these values.  As the 90’s brought new information technologies to measure EVERYTHING in a company and display it neatly on a balanced scorecard so executives can see their business through red-yellow and green traffic lights and speedometer dials, these same executives became enslaved to the data that took almost a full year to collate, cleanse, and report into the “annual corporate strategy document.”

Despite the technological advances made in the 10-15 years hence, many companies still deliberate annually as if anything more frequent or more flexible would threaten the core values of the company.  Kept in proper perspective, a company’s core values will remain constant, and will be the touchstone by which its strategy is measured.  With this perspective in place, why then, do many companies keep strategy so disconnected from the fluid reality of tactical operations?

For some, the answer is cultural. It’s the way we’ve done it for the past xx years.  For others, it’s structural.  The strategic planning committee meets yearly, and the business units “roll-up” their numbers every October so that the strategic plan can be rolled out next February, or later. Whatever the reason, this calendar-driven culture of strategic planning fails to take into account the dynamic inputs that come from the results of day to day tactical operations.

If properly connected, tactical business systems should provide inputs to strategy so that the strategy can be adjusted to take advantage of market opportunity, respond to competition, or seize critical capabilities when available.  This represents a paradigm shift from calendar-driven planning to event-driven planning, and requires systems and capabilities to make these connections strong and viable.  In this month’s newsletter, “Alignment: Where Leadership and Management meet“, we show how this event-driven planning can make our companies more competitive.

Please comment on this blog if you have some real-life stories of how companies have made this shift to more dynamic connections between strategy and operations.

Attend this month’s webinar on Tuesday, August 31st where we will explore how to connect strategy to our business development operation, to get more out of our licensing activity and contribute to our corporate goals.

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August 25, 2010Permalink Leave a comment

Winning at Dealmaking – Shots on Goal vs. Taking the Right Shot

Having just watched the 2010 World Cup soccer final end in a 1-0 victory, I was struck by a number of things.  First, how a country’s fortunes, political capital, and all-around national pride are impacted by a World Cup victory… or loss.  Second, how few points are scored in a 90-minute soccer game.  Third, how shotmaking did not determine the outcome of the game.

Since I’m not a soccer expert, I don’t claim to know the intricate details of the World Cup final but a quick look at the statistics tells me that both teams were fairly even in shotmaking.  The big differences were in penalties and time of possession.  Being an armchair sportsman, I entered the viewing public at about 60-minutes into the game, and from what I could see, the winning team was in control of the game most of the time, made well-planned attacks on the defense, and ultimately managed the game to take advantage of the opponent’s 1-man weakness due to the Red-Card ouster of the Netherlands’ Heitinga in the 109th minute.

So, in Soccer, it’s a well-managed game that wins matches.  In Business Development and Licensing, it is both a well-managed game and a well-informed team that wins value for the company.  In our recent newsletter, we looked into some statistics provided by Campbell Alliance that show how the dealmaking landscape is becoming more complicated while at the same time becoming more valuable and more critical to a company’s success.

Business Development teams are being asked to do more with the same number of dealmakers, yet must process more potential deal candidates in the hottest areas of interest.  All of this must be done in a landscape of increasing competition.  So, is it better to have more shots on goal? Or take the right shots.  While sports teams invest millions to produce the right mix of talent on their teams, the cost is much the same whether one takes many shots on goal in a game versus few.  However in the field of innovation, where every shot on goal expends costly and valuable resources, there is a considerable difference between quantity and quality.One of the most amplified examples of this difference is the Pharmaceutical industry.

In the drug development lifecycle, billions of dollars are spent bringing forward potential molecular candidates through the process to become an approved drug.  All along the way, failing candidates are winnowed away until a winning candidate is successful.  This failure based model is only successful if a company “fails fast, fails inexpensively”.   The costs of this model, among other things is one reason many companies turn to licensing deals to de-risk their portfolio.  By in-licensing potential candidates, we can leverage the investments of others and select the candidates with the best chance of winning.

Since one trend identified in the Campbell Alliance study is toward Phase II deals, the burden of scrutiny falls on the dealmakers’ due diligence process.  Further, it is important to have a very clear picture of what a successful candidate looks like, with respect to your corporate strategy, cultural fit, and other holistic factors in addition to the raw scientific criteria, and to impose this picture on the earliest stages of the dealmaking process.  By having this clear picture, we can narrow the funnel of potential candidates and make fewer, but better, shots on goal, yielding more value from the goals we achieve.  If we don’t do this, we run the risk of failing later, and failing more expensively on many deals, robbing us of valuable resources to expend on the winners in our portfolio.

We invite your thoughts and comments by clicking below.

To preview how a comprehensive dealmaking system which gives you a holistic view of your dealmaking activity results in better shots on goal, we invite you to attend our webinar on July 27th

Please register by clicking here: JULY 27th WEBINAR

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July 13, 2010Permalink Leave a comment

Do Mergers and Acquistions Bring Lasting Value?

Over 300 billion dollars of value evaporated between the moment the AOL Time Warner merger was announced in January 2000 and December 2009, when AOL spun off and started to trade as its own public company again. While this transaction is certainly an extreme case when measured in terms of value destroyed, a significant number of studies find that over 50% of the merger and acquisitions failed against whatever criteria of success was used by the acquiring company, when the transaction was made.  Yet, at the same time, the number of deals averages over 23,000 transactions per year between 1995 and 2009.  This is 3.5 times more deals than the yearly average between 1980 and 1994 and 7 times more deals than the fifteen years span between 1965 and 1979.

In terms of value, the average transaction value reached $110 million in 2006, equating to a 15% compound annual growth rate for the period 1981 to 2006.  By all means a remarkable increase. Many well known and well run global giants would not be where they are today, without M&A as an important engine for growth.  This may seem a paradox. Why would more and more organizations want to go a difficult, high risk path that, on average, produces less than 50% of chances of winning?

Well there may be very good reasons.  First, as pointed out in a BCG study (1), “headline averages are both specious and misleading.  M&A can destroy value, but it can also create very substantial value”.  Second and more importantly, aggressive deal making just reflects the increasingly shared belief that corporate partnering programs are clearly superior over organic growth strategies.  Indeed, the competition for market share and the resulting shrinking of profit margins reduce the number of opportunities for high rates of return with organic business growth. Furthermore, organizations that sit on the sidelines and don’t participate in the M&A market often see their rivals acquire key targets for faster growth, better competitive positioning and higher returns. And they only sit so long until they become the target.

Therefore, the main challenge for management is to understand how to increase the odds and become successful in executing their M&A strategy.  And some really seem to have figured it out since, as another BCG study (2) highlighted “highly acquisitive companies generate 29 percent higher returns over ten years”.

M&A execution, from target sourcing to target integration is a corporate skill that has to be acquired, improved through practice, and ultimately, institutionalized. It comes with costs, but one should rather look at those as an investment that will provide an organization with the ability to consistently beat the odds and deliver value through well executed M&A and, over the long term, achieve significantly higher shareholder returns than less prepared competitors.

We invite your comments and observations on this topic.

Our upcoming webinar on June 29 will present a comprehensive business support system that manages M&A Opportunities, as well as the broader context of all types of partnerships and alliances.

(1) The Brave New World of M&A: How to Create Value from Mergers and Acquisitions, The Boston Consulting Group, July 2007
(2)  “Successful M&A: The Method in the Madness” Opportunities for Action in Corporate Development, The Boston Consulting Group, December 2005

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June 14, 2010Permalink Leave a comment