Operational Innovation !! Technology is here but Culture Needs to Evolve!

“Operational Innovation” is a hidden objective of many companies, even if they do not know it, again this came home last week. Why is it hidden because it is not natural for innovation to driven from all parts of the business, companies have a habit of centralizing it? Actually we can all contribute to innovational improvement to the way to take on, execute our “jobs to be done” during the day.

There is always ways to improve, but the key item I see being missed is the “culture not just innovates, and try”, but capture this and embed it. Innovation is about lifting constraints of risk to enabling trying to change items with improvements, yes this means making “failure” as a success measure. When I say failure people look at me twice in the industrial space. But I am talking constructive failure e.g. freeing people up with an environment where they can try new ideas on improving their job, and this experiment/ trial is done in a safe none intrusive environment into the plants operations. But the user is able to allocate time, and feels empowered to come up with ideas, and try them. Once the improvement is validated and tested, the ability capture this and embed it for consistency across plants and teams.

This is a step change in thinking in the manufacturing environment but the technologies exist today to embed operational processes (which is where there is huge opportunity to reduce variance across plants and teams). Example is the ability to put a simulator/ operator training system in place, as not just a trainer but as a bigger opportunity as environment to enable operational workers to go in a test a new idea, it is real, but a safe environment and measured improvement can recorded. I have seen one company use it with two or 3 of their best operators to put them through the same situation and capture the workflow/ process they took to resolve the situation, and then look to come up with an embedded process which they will put back into their system.

This is similar to what happened on Apollo 13 where they used the simulator to test the start up sequence over and over again until they go it correct, it formed an operational process. What we saying today and you can see in the diagram below the significant value increases in operational improvement come from enabling all people to innovate and contribute and feel like they can contribute in a constructive way. By embedding the process you are moving to a sustainable process, that is model driven.

You will hear many of us in Schneider- Electric  talk about Dynamic Performance Measures , with a context measure and the supporting actions to take that activity to success. Providing the approach for measuring in context, while aligning across roles to strategy, understanding how well am I doing to strategy.

The key learning I hearing around the world is that in the industrial space people and culture is not aligned with innovation, it is about insurance, why not look at the opportunity through safe environments and constructive safe trailing. Yes this is change but the results are proven and ability to improve.

How can we build a culture of innovation not just in technology and product development, but in "Operational Execution" that can harnessed , proven and rolled out across sites. It starts with culture and environment that allows operational innovation, testing, failing and capturing.

Participation architecture and culture key to Innovation

For the last couple of weeks I have been travelling in South Africa, visiting and talking with customers, and listening. But last week at I listened to a talk given by the Ex CEO of Google South Africa (Stafford Masie), and the core of the talk really resonated with what I have been talking about and seeing.

The key was the you need to open up your cultures and architectures to naturally allow participation in your companies evolution from members within the company and outside. Too often our traditional cultures and systems have closed the strategy, innovation of ideas to evolve companies’ offerings in products/ services to a few. But in the software industry we have developed programs that promote innovation from all corners of a company, Google does this using Friday’s for “my innovation”. Key is the culture to enable innovation and then the framework in the company for promoting ideas and selecting valuable ones to be invested in to be evolved.

Stafford Masie's thoughts took this a step further into general industrial space using examples where companies have opened up their products/ offerings to external groups to provide a different, free thought for evolving the offering, to enable certain break through.

In the past I have spoken about “Operational Innovation”, too often people look at innovation as purely technology, but I believe the greatest return on investment is on “operational innovation” in improving the operational processes and efficiency for producing products and services. Requiring companies to develop a culture and architecture that enables:

• Capturing and understanding current operational processes. Across the industrial assets/ plants making certain products. Providing the opportunity for identification of common best practices, both inefficiencies and efficiencies.
• Promotion of participation across the company from workers, operators and others to contribute operational improvement to processes they work on.
• An architecture and environment where operational processes can be tested, in safe area, so innovation can happen through constructive failure and environment to promote trying. A good example of this is where people can try operational procedures in simulated situations and results captured. Something like an Operator Training System used for both training, and “operational innovation” is valuable environment for safe constructive operational process innovation.
• An environment / architecture that allows ideas to improve to be entered there and then in the system, while the idea is “fresh” and context can be captured, but the idea result in evaluated and feedback to the contributor.

Below is a diagram I have commented on before but shows how companies that embedded process after a lean improvements program far exceed those who just manually implemented process improvement. But the real opportunity for improvement comes when people apply continuous operational innovation (red line). Not being content with their current process but have implemented abilities to understand process performances both machine to machine, people to people, and people to machine. Because they have embedded the operational procedure in the system, over multiple sites, they have everyone acting the same way, so improvement is possible.

Core to success in the next decade is the ability to evolve and innovate, and it is the companies that implement an architecture/ system and culture that promote participation that will be key. What are your plans in seating up a system to enable participation and evolution in a sustained manner?