Innovation comes from freedom to find, not from obeying someone else’s orders. Future talent will demand autonomy and this goes past the simple solutions of the past such as empowerment and being allowed to use initiative. For those that are really talented, will not relinquish their abilities in a career limiting move and hide behind a subordinate role being told what to do.

In the future you will pay people based on their value, on their financial and non financial contribution to your business, not whether they rocked up and worked a 60 hour week. Work is changing. Its become more challenging, more sophisticated, more time pressured, more collaborative, more engaging, more equal, more technological and less reliant on control, command and power. Companies are having to change their decision making processes, their reward structures and abandon their heirarchy.

It means opening up. It is becoming increasing less productive to make decisions in isolation, since in the future, it will require so many different specialists from niche areas to support those problem solving solutions. Its a blinding flash of the obvious but a group of people, almost always, will have more knowledge and expertise than any individual. Future success will depend on leaders being able to pull together and engage the talents of a cross functional nature from inside and outside the organisation.

This type of working increases opportunities to add value but they will bring about significant changes in business infrastructure including, co ordinating people on and off the payroll as well as co creating products.

Business it seems is more complex and sophisticated. There is always something going on. In an increasingly change absorbent world, sometimes its easy to get distracted and lose sight of what we are supposed to be doing. What makes us competitive one day, can overnight become almost obsolete, exposing the business to vulnerability.

At your next team meeting, instead of focusing on cost cutting or even client management, conduct an exercise that identifies your businesses critical value drivers. Ask a number of deep and thought provoking questions.

1.What is it that our customers value most?

2. What are the future opportunities for value creation and where are they shifting?

3. How are we going to ensure that we are moving our capabilities in line and beyond those shifts?

4. What relationship are our customers going to want from us in 3 years time?

That dictates where your core activity needs to be placed. Some would argue that you can outsource or partner on the rest!

With the advent of digitalisation we are faced with unparalleled shifts in how we work when it comes to research, development and the production of new products/services. We will increasingly need to develop ways of joint working where the boundaries move and change like an amoeba. Bringing new and remarkable things to market now means working with a diverse and flexible group of partners with complementary skills and capabilities.

Collaborative research and development is nothing new, academia have been doing it for years. Neither is product development, car manufacturers like BMW are accomplished after years of experience. However, as the playing field flattens so too other companies have to make the significant jump. Traditional thinking argues that the knowledge, information and ideas a company has must be kept in house. When people start sharing that knowledge or remixing it, companies get nervous and, in the worst cases, call in the lawyers.

That’s just not going to work in today’s networked economy. Technology has collapsed the cost of innovation in almost all sectors, even pharmaceuticals. Its simple to become self organised and easy to connect across the world with people who can fill the gaps in your skills matrix. Technology has acted as a catalyst for widening the distribution of knowledge and information and as a result business is been done via a set of very different principles.

We can’t afford all of the talent and the talent doesn’t necessarily want to work for us, on a permanent basis anyway. Research and development is an imperative part of a companies arsenal of competitiveness. As I’ve said before, those that innovate regularly will find themselves shaping the future. Collaborative working will be at the heart of that and that will demand a whole different set of leadership behaviours and attitude. Another reason command and control is dead!

Disrupting the status quo is every leaders prime role. It’s a stark contrast to the ‘command and control’ days of previous business models. Companies need to think about disrupting their relationships with their customers. Yes I did say that! We are far too complacent about them. We need to change the game with openness, transparency and moving from a culture of ‘managing the customer database’ to sowing the seeds of creating a ‘community’ around our brand. Something that will be at the heart of every business in the future.

Look at this model I created. It’s by no means perfected….months of R & D will do that but it shows a shift from an inert account management regime to a community model that will be full of life and vibrant.

Database →                        Relationship →                 Community

You can look at www.club.lego.com/en-US/default and www.harley-davidson.com for great examples. But it won’t be easy, it means unlearning stuff that’s ingrained in our minds. After decades of disappointing relationships, we now have the ability to gain impressive inroads into true partnerships with customers that really do change the dynamics for the better.

Truth is, we are struggling to get off first base. For many it will be a leap of faith, for others a simple transition. But it does require a deliberate plan to achieve it. And. ironically it starts with the database. More on that tomorrow…..

Motivated by Olivier Blanchard’s post this morning; www.thebrandbuilder.wordpress.com/2010/04/05/11-little-secrets/, I’ve come up with my own ‘11 secrets’ in response. It’s not that they are better or worse than Olivier’s, they are just mine:

1. Challenge the status quo, its our job. If we didn’t not much would move forward and we would have invented nothing.

2. Take 2 hours out a day to clear the mind and think. We don’t do enough of it and end up just repetitively doing the same thing.

3. Bang your head together with other people on a regular basis. Nothing like sharing ideas and thoughts.

4. Slow down. Its amazing what we see when we just take the foot off the accelerator.

5. Don’t ever get complacent. Its our worst enemy, destructive and immerses us in a false sense of security.

6. Build trust and credibility. Two words missing a lot these days from business.

7. Stop pursuing a weak universal appeal. Too much competition, need to know what we are offering in a world of niche. Become distinctive.

8. Surround yourself with talented people. Go and build a relationship with 5 people this year who stoke your fire and get you to think differently.

9. Unlearn stuff. The business world is being upended and we live in unprecedented times. That means removing a lot of preconceived ideas.

10. Hold your nerve. Its the difference between sustained business and people chucking it in.

11. Knock their socks off and have enormous fun doing it.

Just shooting from the hip!

Like sand in the Sahara, there is plenty of it around. Complacency seems to be the inevitability of lots of business, no matter what size. A visit to No.15 Cafe in Penrith, Cumbria at the weekend was a very visible and tangible example of complacency. The service was terrible, the care of customers of tertiary importance and the experience non existent. It left me feeling extremely irritated. They truly didn’t give a stuff.

It’s tragic because with the advent of abundance, there is too much scarce exceptional experience. The introduction of some ‘branded’ cafe’s shouldn’t make a jot of difference. Competition should not keep us on our toes, we should be there already. An old boss of mine used to say, the worst thing you can do is become complacent, he was more than right.

This experience is a jolt into reality. It got me thinking about my business and whether we are complacent. Every three months, all businesses need to be asking “where have we got complacent?” It’s our obligation to ensure we don’t let ourselves down nor our clients.

We all need to wake up to this blurring between producers and consumers, I include customers in this too. If we had woken up, we’d within our businesses be creating platforms to encourage participation and creation whether online, or call me old fashioned, face to face.

We are possibly witnessing the democratisation of creativity. Communities of people connected around your brands wanting to get involved in how you shape the future of your businesses. If you’re scared by that, you need to ask why?

There are some scathing examples of forerunner industries on how not to do it. Consider the music industry. Pioneers at one end of the scale, taking advantage of technology by creating and remixing existing music to equal quality in a back bedroom. At the other end, instead of trying to build new business models around the freedom of creativity and digital content, business is backlashing big time by suing its customers. A lost opportunity.

Prosumers are not going away. Their contribution to our business is becoming fundamental. Co-creating with customers is extremely powerful. The solutions are likely to be better, the end product more aligned with customer need, and to be honest, it will probably be more inspiring than we could have ever created on our own. It also brings us closer to our fans, followers and audience.

But, it will demand a different way of doing business, new rules and a new set of challenges. Prosumers aren’t just buying our products anymore, they are making them in a fertile ground of innovation. This is more significant than gaining customer feedback, listening to our consumers, pulling focus groups together, customised solutions or design competitions. Its about customers being genuinely involved in co-creating products, marketing, human resource activity at a peer to peer level. If we sincerely want to be around in 10 years time, we need to learn new ways of leading these kinds of communities. And, if we don’t create and engage with these communities of prosumers, they will invent around us.

How we innovate and invent is set to change too. With the advent of globalisation and technology, its easier to find someone, somewhere in the world who can solve your problem right now.  The traditional models are evaporating. No longer will we expect to innovate solely on an internal basis. Its just too expensive, narrow minded and loses you a whole bunch of chances.

We are well past the Issac Newton days of solving problems way ahead of the questions and just not telling anybody about them. Innovation has become collaborative. Technology develops at such a speed, organisations and individuals can longer keep up. That combined with the fact that most of us can’t attract and retain the best people in the world makes sole innovation almost null and void.

Thinking that you have all the answers and spending years developing the ‘great idea’ is a little egocentric and albeit gone. Someone has already sorted it. Peer production, open source communities, customer cocreation are all about harnessing the opportunities that bound in from several places. I call it the liquidity of innovation.

Just look at the examples of www.innocentive.com and www.yet2.com in house innovation is no longer enough, we can’t keep up. Our organisations need to turn innovation on its head. Research and development departments in the past were rewarded for getting patents, in the future it will be about assembling the best team to solve the problem.

By not pursuing a solution to our own innovation problems, we are losing out on an abundance of opportunities. Thats one of the reasons why communities and being close to our customers and people is going to be so damn important in the future. As well as being connected across the world too. Most of us act locally which is important, too many of us act multi nationally and not enough globally!

Social media so called because of how it connects people and allows people to share information and ideas. But actually, social media is more fundamental than that. Its social because its helping shape the cultures of the future, its enabling engagement and its aiding collaboration on unprecedented levels.

It’s effect on the continuum of change ranges from the sublime to the ridiculous. In the future, it will assist in the overthrow of governments, research and development activity that creates amazing products and currently, its helping me meet someone in my home city I have never met before.

To critiscise it is natural, to ignore it is futile but it will, itself need to change too. There will come a point, perhaps a Malcolm Gladwell tipping point, where social media must turn into social business on a more larger scale. There are case studies. Dell reckons its generated $3 million just via Twitter. Gavin Sheppard at www.devonshiretea.com recently said to me that its the best marketing decision he ever made joining Twitter because its bringing results.

It’s truly fab connecting with people, its amazing sharing ideas but its hard work, even daunting sometimes. Social media maybe a more effective way of marketing and removed some cash spend but it adds huge pressure to your time. At some point, even us fans, followers and early adopters are going to have to turn those connections into some kind of business. And that’s where we have to claw back the control, take a hold of social media/business, grab it by the horns and decide how we are going to make it work. That’s our role social media/business can’t do it for us, its really a question of time management and influencing your followers.

At the moment it gives us connections, reach and spreadability, in the future we need to start turning that into long term relationships, robust communities and cash.

Had an amazing two hours with some incredible business people last night. Sometimes, my job really is the best in the world. I’ll be posting a series of blogs over the next few weeks to reinforce the discussions we had at Exeter Innovation Centre but its best described by Phil Rees in his lovely post:

http://deface.posterous.com/marketing-is-dead-0

The Dead Poet’s Society scene could not explain any better what has happened to marketing overnight!