Busy week last week; three days at Frost & Sullivan’s GIL 2012: Silicon Valley followed by two days at Marcus Evans’s 3rd Annual Process Driven Innovation conference. I was impressed by the level of executive presence at each of these events and by presentations by innovation leaders across a diverse array of industries.
At GIL, David Matheson assisted Keith O’Brien of Frost & Sullivan in presenting “Innovation Portfolio Management: Balancing Value and Risk.” The presentation featured a case study based on a real-world company, renamed Beta, Inc. to preserve confidentiality. The study followed Beta as the company sought to generate better returns from its product portfolio as it coped with evaluating and comparing the value and risk of all projects in its development pipeline. The process helped Beta:
- Reduce the amount of time it takes a project to move through the phase-gate process
- Conduct consistent project evaluations, including comparison of different types of projects for funding decisions.
- Weed out underperforming projects quickly
- Facilitate cross-regional projects
At the Marcus Evans event, I presented “Delivering Value from Innovation,” focusing on managing the innovation portfolio, including selecting the most promising projects when there are more projects than resources, developing and managing a portfolio to maximize value and balance risk vs. reward. Other speakers reported on successful processes for managing innovation at their companies, while several pointed out that, while process is important, one cannot overlook the impact of people within the process. I strongly agreed with the speaker from a Fortune 100 company who pointed out that the emphasis should be on developing innovation capability rather than on using process to control activities.
At each event, we asked participants about the mix of innovation projects in their portfolios. Their responses validated findings at other events. Between 60% and 80% of the executives reported there were insufficient innovation projects in their portfolios; lots of room for improvement.