Recently in Innovation Category

The legendary reggae band releases the 2012 version of the Barack Obama Song >>

The 2008 video version is here >>

I know what some of you are thinking - "Well, did America have a soul to begin with?" I happen to think it did. For me the soul of America is "We, the people..."

Furthermore, I'm quite sure that people, as defined by our founders, did not mean corporations. (See what Charles Handy has to say >>)

But to get back to the topic of inclusivity, I'd like to make a shameless plug for our new book, co-authored with University of Michigan's Professor Michael Gordon, called Inclusivity: Will America Find Its Soul Again?

BUY now >>

I'm guilty. 

I go to my local bookstore, drink a coffee and browse the shelves. When I get home, I rush to the computer and buy the books I fancied - online! If it's a business book, I download a copy on my digital reader, and if it's a literary work, I buy the physical book at a discounted price. 

As a way to assuage my guilt, I've thought of some ways to help my local bookstore survive - because, like so many of us, I love the physical bookstore experience - nothing beats the Zen practice of disinterested info-grazing - and I'd like to continue to enjoy it.

However, I notice at my local Barnes & Noble that they're busy selling Nook ereaders in every cranny. [Do they really think they can compete with the iPad or even Kindle?] Is this really going to save the physical store?  Nope. 

Most likely, it's an idea dreamt up by the financial types at headquarters who've been "missioned" to tap into the digital value-stream. After all, why should B&N just stand there and watch their profits drift lazily down a South American river? It's important to note that despite B&N saying the Nook is a "success," they still rely on brick and mortar stores (retail and college bookstores) for over 75% of their revenue and the competition is going to become even more intense with dozens of new tablet and reader devices being introduced this year.

And how does B&N take a trip down the Nile? Apparently, the secret sauce is that they allow Nook owners to take their devices into any B&N physical store and read any e-book for free. Nooktalk tells us  that in reality, it's not exactly a seamless reading experience.  And now that Amazon allows Kindle owners to "lend" books to each other, the Nook may find itself in the, ahem, corner.

So what can your local bookstore do to take advantage of its strengths? 

Here are three suggestions to shake up the physical bookstore business model:

Daily Book Rental
Why can't the bookstore become a pay-as-you-read library? As a kid growing up in India, I remember borrowing books (alright, some these were Asterix and Tintin comics) from the bookstore for a daily fee.  This business model shows some reverse innovation promise. Can you imagine "tiered pricing" linked to free coffee rewards?  Sign up for the all-you-can-read buffet. And of course, we get to pay fines if we return our books late.

Publish and Distribute Local Books
What if a physical copy of your book gets published in-store and sold in your town's bookstore?  Can you visualize a "Newbie Authors" section where one copy of your book gets to sit on the shelf for a week?  If it doesn't sell in a week, you can either pay for shelf space or you can buy your books back.  The minute you or your mother buys your Great American Novel, a new one is printed and placed on the shelf. The top 5 bestsellers in each town get national distribution and placement for a week.  Book fest!

Nurture Communities of Interest
Some book stores think they are already doing this by sponsoring author readings and cheese tasting events.  But what we need is more focused on the actual needs and interests of the customer - practical and impractical.  Here are some examples of the types of participatory communities that could be grown and nurtured in your local bookstore:

• Healthy Living
• Relationships
• Entrepreneurship
• Food + Wine
• Storytelling/Writing
• Music
• Art History
• Travel

How does a bookstore do this?  If you're Barnes and Noble, you could hire retired teachers to do this; pick people who are enthusiastic and spread their love of the subject.  If you're a small bookstore, you can still find enthusiastic community leaders to do the same - in fact you can specialize, and create a niche around the main clientele in your store.

Does all of this sound a bit off the wall?  Good, then it's worth a try.  The Nook, I'm sorry to say, isn't going to save Barnes & Noble.

P.S. Over at HBR, Sarah Green gives us another suggestion: Amazon should partner with Independent Bookstores!

Michael Gordon's book, Design Your Life, Change the World: Your Path as a Social Entrepreneur [A GUIDE for CHANGEMAKERS] is for changemakers - the people and organizations that want to make a difference in the world. 

The book tries to answer two questions, says Professor Gordon:

1) How can organizations best address important societal problems such as poverty, inadequate health care, sub-par education, and an unhealthy planet?

2) What's the best advice for students who want to address these issues and still live lives of relative comfort?

The reason I'm helping the professor is because now, more than ever, we need the brightest students to tackle the world's biggest problems. And the oil-coal-nuclear lobby isn't making things any easier...

Are you a changemaker?  Go find out >> 

P.S. - you can download the PDF version here >>

I first met Bob Freling at a board meeting of the Solar Electric Light Fund (SELF) in San Francisco several years ago.  At the time, I felt that here was an NGO doing innovative things but not getting enough visibility for their work. They were solar way before solar was cool. 

What struck me is how informal and close the board members were.  One of the board members - Larry Hagman (good ol’ J.R. Ewing) - did a brilliant set of solar commercials which I think says a lot about his character and wanting to make the world a better place (quite the opposite of his TV character!). But I digress.

The story here is that SELF pioneered the use of solar power to fight “energy poverty” across a spectrum of applications with their “solar integrated development model” - from clean water, to drip irrigation to improve food security, to electricity for health clinics, schools, and micro-enterprise.

In his blog post about the $300 House Energy Challenge, Bob explains:

“It’s simple really. First, solar energy powers pumps and filters for clean water. This also enables drip irrigation for critical crops. Once people have those necessities, the solar energy is used to power health care facilities which can power equipment and refrigerate vaccines, for example. This increasingly healthy population can then open schools which are powered by solar to provide computer and Internet-based learning. Finally, these well-fed, well-cared for, well-educated villagers can begin community and entrepreneurial activities to grow their economy.”

Bob’s optimism is tempered with reality. The Millennium Development Goals won’t be achieved without energy access, he explains in another blog post.  In case you forgot what the MDGs are (as I often do) they’re listed as:

1) eradicating extreme poverty and hunger;
2) achieving universal primary education;
3) promoting gender equality and empowering women;
4) reducing child mortality;
5) improving maternal health;
6) combating HIV/AIDS, malaria, and other diseases;
7) ensuring environmental sustainability; and
8) building a global partnership for development.

Note that they are interrelated, ecosystemic problems - and that from Bob’s perspective, energy is the key factor which makes all of them feasible.

With the $300 House project, my eyes have been opened to the fact that the approaches for dealing with the poor are often not very constructive, and sometimes end up doing more damage than good.  That’s what  $300 House adviser Stuart L. Hart is talking about when he says we need to create smaller problems. It is also a concern of our critics on the $300 House. When I spoke to Matias Echanove recently, he was concerned that mass produced housing could in fact disrupt the local economy - the small businesses that are based in informal slums around the country. I hear him. 

Our $300  House project is exploring ways to integrate services and jobs into the ecosystem as well, and we’re reaching out to talk to the leaders in the communities that are interested in this approach. In India, we’ve just completed a survey - with the help of THL - that covers 15 villages in three of the poorest states in India - Uttar Pradesh, Bihar, and Jharkhand.  I’ll go into more detail in a later post.

For me the question is quite simple - we see an explosion of interest in  developing integrated  townships for the middle class in India, but why is there nothing comparable for the poor? To borrow a phrase from the US, why can’t we build “master-planned communities” for the poor?

Is it too much to ask that governments, NGOs and development institutions, and businesses work together with the communities involved to build integrated solutions?  

Unfortunately, there are far too few examples of collaborative development. This is something we all need to look at urgently.  There is also a problem of ownership.  The development community, NGOs, and most governments think they “own” the problem.  Unfortunately, without a business mindset to make solutions scale, their is so little real progress.

The poor remain poor. 

And that’s why the work Paul Polak is doing is so important.  He’s looking at making small changes at the bottom of the pyramid; small changes that make a big difference in the earnings of the poor. This is also the approach advocated by Esther Duflo and Abhijit Bannerjee in Poor Economics.

At a much larger scale, we see an example in the Gates Foundation’s approach - which is all about examining the ecosystems of poverty.  A common criticism of the Gates Foundation goes along these lines: “How can people like Gates, living in a different universe, help people at the bottom of the pyramid?”  This is a false and damaging argument, but answered quite well by Sam Dryden:

“Some people may ask how my team and I—working at the world’s largest foundation located in a prosperous corner of a rich nation—can relate to a subsistence farming family in Ethiopia or Bangladesh. This is a very reasonable question to ask. The farmer has a direct connection to the land and we are considerably removed, both by distance and culture. We begin by realizing these differences and humbly listening to farmers and their families, learning and respecting their cultures, ways of living, and knowledge of place and home. The solutions we seek are those appropriate and welcomed in this context, not those imposed by distant values or interests.”

And finally, perhaps there is an alternative to the giant top-down programs, and incremental bottom-up “Let the Poor Do It Themselves” approaches we’ve encountered. 

With the $300 House, we’re thinking micro-development - is it possible to build integrated micro-solutions at the village level?  And in cities, at the neighborhood level? 

Why not?

When I first started working on classifying online ecosystems, I had no idea that my thinking there would influence my thoughts on the $300 House. But now it seems like the systems approach to understanding wicked problems is pretty much the only way to go.  None of this is new, of course, but I'm still impressed at the power of ecosystem thinking.

Here's how Nobel prize laureate Gunnar Myrdal was thinking about the problems of race and poverty:

The "vicious circle" has not yet made its way into our political thinking though, if we judge the policy makers of today's Congress. Heck, they can't even bring themselves to accept the effects of global warming - in no small part thanks to our lobbyist friends.

The idea of poverty as the outcome of a dysfunctional ecosystem is explained here as well:

Note that this applies to poverty in the US as well, not just the emerging world.

So, part of tackling the issue of affordable housing for the poor is to try to understand the interconnected nature of these problems.  I tried to draw causal arrows between the various problems, but gave up. In essence, we have a problem of insecurity, in which all of these factors must be addressed simultaneously if we are to change the vicious cycle of poverty, disease, and suffering.  Here's what I ended up with:

The poor live in an insecure, unbalanced universe. 

I'm calling it the "ecosystems of poverty."

Next we'll look at the idea of integrated development (another old idea) which fell out of favor, but must be re-evaluated in today's light if we are serious about poverty alleviation.

Sometimes not knowing what you’re doing can help you do it.

Here I make a fool of myself at the Guardian’s Activate2011 conference in London:

Thanks, Adrian!  Read the article here >>

And if you haven't already, submit your ideas to the $300 House Open Design Challenge!

The final Harvard Business Review post in the series, and hopefully the start of some real change at the bottom of the pyramid.

Our goal is to go social for social business. Can social co-creation help the poor?

Keeping fingers crossed.  Thanks to Ingersoll-Rand for the sponsorship and to all the judges and advisers at 300House.com!  Thanks jovoto and COMMON. Thanks Shaun.

Thanks also to Scott Berinato at HBR and of course - VG, my partner in crime.

This chart by the folks at the Eurasia Group, got me thinking. Something just doesn’t make sense:

Then it hit me.  This is a rather conventional way to screen for global opportunities.  If we looked at other screens like “innovation potential,” “middle class expansion rate,” “Gini coefficient shrinkage,” or “corruption index,”you’d see a very different picture.

Seth Godin posts a very insightful blog entry on the HBR site. He's talking about the challenges of marketing at the bottom of the pyramid:

When someone in poverty buys a device that improves productivity, the device pays for itself (if it didn't, they wouldn't buy it.) So a drip irrigation system, for example, may pay off by creating two or three harvests a year instead of one.

Read all about it >>

The Solar Electric Light Fund's Bob Freling has posted an entry in Harvard Business Review about his Solar Integrated Development (SID) Maturity Model and how it fits into our concept of the $300 House.

Here's Bob waxing eloquent:

Together with potable water, nutritious food, accessible health care, educational opportunity, and economic empowerment, the $300 House completes this virtuous ecosystem in which individual households and their communities can march hand in hand towards a bright and sustainable future.

Read the whole post The $300 House: The Energy Challenge >>

The Gap screws up with their logo redesign. A giant failure of imagination in the boardroom.

But Umair Haque asks the right questions:

• Do designers have a seat in the boardroom -- or just in the basement? How often does your CEO ever talk to a designer?
• Are designers empowered to overrule beancounters -- or vice versa?
• Is the input of designers considered to be peripheral to "real" business decisions -- or does it play a vital role in shaping them? Is design treated as a function or a competence?
• Are designers seen just as mechanics of mere stuff -- or as vital contributors to the art of igniting new industries, markets, and catgeories, sparking more enduring demand, building trust, providing empathy, and seeding tomorrow's big ideas?
• How much weight does senior management give to right-brained ideas, like delight, amazement, intuition, and joy? Just a little, a lot -- or, as for most companies, almost none?

Seriously.

We all need to wake up. The Chamber of Commerce approach to design isn't going to work anymore.

David Smith's HBR post on the financial challenge of the $300 House raises some very important issues:

Cracking the challenge of slums is the world's biggest problem of the next quarter-century, because the ecology of slums and the ecology of cities are linked. We cannot have a healthy global economy without healthy cities, and we cannot have healthy cities without tackling slums.

Join us >>

We're building a "creationspace" (JSB's word) for the $300 House-for-the-Poor at 300house.com >>

Please sign up, and tell your friends!

Ever since the Haiti earthquake, I’ve been thinking about why we don’t have a quick-build house made of sustainable materials at a price point that the poor can afford (with micro-credit if needed).

The $300 House-for-the-Poor is an extension of the concept of “reverse innovation” (inspired by my client and friend VG) in which innovations developed in poor countries are then brought back for use in developed countries and other parts of the world. Housing impacts health, energy, education, and security.

What if we could build sustainably designed houses for the world’s poor at an affordable cost? What if these same designs could provide relief to refugees and victims of natural disasters? The we I’m referring to is a collaborative of companies, governments, and NGOs.

This type of a structure will be engineered in the same way the TATA Nano was engineered - without the traditional assumptions.

Once built, the $300 house should be used across the globe - from Haiti, to Africa, India, and yes, even in this country, to help the homeless.

So what are we waiting for?  It’s time to get busy designing the $300 House!

The political intentions of our GOP friends would leave the US with a hollowed-out economy.

Here is an example of how Obama’s unpopular bail-out for the auto-industry led to the creation of a new and critical cleantech industry - electric batteries - in this country. What say you, FOX News?

In the past year, the lines have crossed in North Carolina. Electricity from new solar installations is now cheaper than electricity from proposed new nuclear plants.

Take away government nuclear subsidies, and the case is closed!

Read the report >>

Watch:

Good for you Alex Bogusky! Can this ex-ad-man save the planet?

More on Hunter Lovins and Catherine Greener >>

Go J.R.! Note he mentions my client - the Solar Electric Light Fund. Stay tuned for more news about them...

I like the SolarWorld ads Hagman does quite a bit. Here he's talking to Sue Ellen (who seems to be blaming him for BP's mess in the Gulf):

Shine, baby, shine! Well said, Larry Hagman!

The thing about Hagman is he put his money where his mouth is - years ago - by converting his estate to solar, before solar was cool.

Vijay Govindarajan on the HBR blog: The U.S. Must Grab the Lead on Green. High time our business leaders started leading, as VG encourages them to do. 

According to VG:

At the company level, many energy businesses are unwilling to cannibalize their existing services and their current investments. At the national level, the same dynamics are in play. Aided and abetted by the U.S. Chamber of Commerce, the traditional energy lobby (oil, coal) is using its political and economic muscle to stifle innovation in alternative energy and clean technologies.

Don’t get me started on the losers at the US Chamber of Commerce!

A nice story from the World Bank blog about a grass-roots organization's efforts to stop petty corruption in India and around the world:

...the idea was first conceived by an Indian physics professor at the University of Maryland, who, in his travels around India, realized how widespread bribery was and wanted to do something about it. He came up with the idea of printing zero-denomination notes and handing them out to officials whenever he was asked for kickbacks as a way to show his resistance. Anand took this idea further: to print them en masse, widely publicize them, and give them out to the Indian people. He thought these notes would be a way to get people to show their disapproval of public service delivery dependent on bribes. The notes did just that. The first batch of 25,000 notes were met with such demand that 5th Pillar has ended up distributing one million zero-rupee notes to date since it began this initiative. Along the way, the organization has collected many stories from people using them to successfully resist engaging in bribery.

I like it. Now let's send some "zero dollars" to the Famous Five justices Supreme Court, the Blue-Dog Democrats, and the entire Republican party.

My client, Dean McMann, discusses the "customer intimacy" journey on his site:

Go Google, Go!

It's time. The Chinese government never has any qualms about "doing evil," so it's good to see Google stand up for some principles.

My client Gaurav Bhalla has just published an article in the January-February Harvard Business Review titled - Rethinking Marketing.

Along with his co-authors - Roland Rust and Christine Moormon - Bhalla insists that companies must shift their mindsets from a product-centered focus to building long-term relationships with customers.

This can only be done if companies reinvent the marketing function.

Says Bhalla:

"The traditional marketing department must be reconfigured as a customer department that puts building customer relationships ahead of pushing specific products. To this end, product managers and customer-focused departments report to a Chief Customer Officer instead of a CMO, and support the strategies of customer or segment managers."

You can sign up for Bhalla's Customer-Driven Innovation Newsletter and download "Rethinking Marketing" here >>

Insights on Anger, fear, and escalation of commitment
via strategy-business.com

"...angry employees are more likely to commit further resources to a failing project or choice. By contrast, fear makes people second-guess themselves and often abandon support for efforts that have gone even slightly off the tracks."

OK. What happens when you have other emotions like sadness, joy, or just plain happiness? Do you make stupid decisions when you delude yourself? Or does a cynic make better decisions?

This is something that keeps happening with IBM's FTP server.

I was just trying to download this report: Seizing the advantage. When and how to innovate your business model"...

I have to say, this happens all the time on the site.

What's going on IBM? This is not exactly the best way to win friends and influence prospects.

P.S. - will let you know if I ever get to the document!

UPDATE: Not sure if this is the same document, but I found it on the UK site.

UPDATE #2: Look what I found at Booz >>

UPDATE #3: And this from EY >>

How do you encourage curiosity across a global organization?

"Many consultants out there would rather just give answers and are even afraid to ask questions. We deliberately hire people who aren't like that, even early in their careers, and senior consultants coach them on how to be inquisitive. Sometimes that means asking a client's managers very difficult questions, really pushing them hard to reveal or do things they're not comfortable with--getting a CEO to explain lagging sales, for example, or to acknowledge why a competitor's pulling ahead. Other times that means encouraging constructive dissent--deliberately engaging with people who disagree with you and being willing to probe them on their point of view. That can be tricky, but persistent questioning usually produces the best solutions."

- Orit Gadiesh in an interview HBR, Sept. 2009

Remember when she debuted?  Too bad her purple reign is over...

If you haven’t heard about free2work.org, you will. This is part of a growing explosion of consumer-education organizations dedicated to exposing “worst practices” among multinationals.

The hope is that if consumers know what is going on, they will vote with their purchasing power and seek out the companies that are doing good. I’m all for it. Who wouldn’t be? Oh, I forgot about the US Chamber of Commerce…

On the academic side of things, we see the same story emerging:

Rosabeth Moss Kanter’s latest book, SuperCorp: How Vanguard Companies Create Innovation, Profits, Growth, and Social Good argues that “the model of American capitalism that worked so well to raise the fortunes of millions of people last century appears to have hit a wall. What’s good for General Motors may no longer be good for the country. In its place must arise a new model of the company, one that serves society as well as rewarding shareholders and employees.”

Maybe Doug Smith was just a little ahead of the times when he wrote On Value and Values: Thinking Differently About We in an Age of Me - which to me is still the best book in this space.

Phil Townsend wonders why GE hasn't opened up it's Reverse Innovation model in his post: Opening up Reverse Innovation >>

Townsend makes a good point:

So why can't a company like GE follow down this path with "open reverse innovation" - inviting small companies in India and China to submit their products, services and ideas to be evaluated by GE for global distribution.  Of course, the open model would require an environment of trust - but what better way to create goodwill in new markets than to be seen as a development partner in the China, India, and resource-starved Africa?  A.G. Lafley sits on GE's board; surely he could help them get started.

The common assumption is that the traditional IT vendors will be disrupted by cloud computing offerings from Amazon and Google.  The truth is, Amazon and Google may eventually impact this market, but they will not be the first to disrupt traditional IT service providers.Already we see hosting providers like Rackspace and SoftLayer provide their own suite of differentiated cloud offerings.