Saturday, February 24, 2007

The ELEGANT Solution - Toyota's Formula for Mastering Innovation

I recently read this book by Matthew E. May regarding Toyota's Mastery over Innovation and would like to quote here some interesting ideas about what innovation really means as explained in this book.
Here's a quote from Thomas Edison.
"There's a way to do it better -- find it."
- Innovation is a core company process. It's not a department. It is everyone's responsibility.
- Innovation isn't about technology or manufacturing. It's about satisfaction & value, and opportunity, and impact.
- If you are not busy with reinvention, you are falling backwards.
- The quest for the elegant solution shapes true innovation.
- Three C's for Innovation - Creativity, Challenge and Courage.
- Innovation is not invention. It is a term in economics rather than technology.
- Elegance = Creativity + Simplicity + Intelligence + Subtlety + Economy + Quality.
- Elegant solution is one in which the optimal or desired effect is achieved with the least amount of effort.
Elegant definition of Innovation by CEO of JetBlue
- Innovation is trying to figure out a way to do something better than it's ever been done before.
Solving the problem of how to do something better than ever.
- It is how to achiveve big leaps through small steps.
- For innovation, the person should have the mindset of an artist and the discipline of a scientist.
Dig your own job !
- Art of Ingenuity - Engagement and Exploration.
Favor getting it right as to getting it out.
- As per Toyota, innovation is the mastery of thinking within the box.
- 3 underlying principles:-
Ingenuiy in craft - applied creativity
pursuit of perfection &
fit with soceity
- Elegance is the simplicity found on the far side of complexity.
- Elegance is about finding the "aha" solution to a problem with the greatest parsimony of effort and expense.
- Being first and fast in the short run isn't necessarily optimal in the long run.
- It takes system thinking - Ability to think well through cause and effect and entails understanding context.
Business is about marketing and innovation.
The Rule of four :
  • Strategy - idea's person, thoughtstarter
  • Tactics - action person, playmaker
  • Logistics - process person, taskmaster
  • Diplomacy - people person, peacekeeper

Questioning and answering upto 5 times - Why is that important ? can help to reach the root cause of a problem.

- Quality is never an accident; it is always the result of high intention, sincere effort, intelligent direction and skillful execution.

- The vast majority of ideas considered revolutionary are actually much more evolutionary than you might think.

- Innovative thinking: What's blocking perfection ? instead of what can we improve ?

- Winning is not always the barometer of geting better.

- If you want big leaps, take small steps.

- Imperfection drives all innovations.

- what separates inventors from innovators is the ability ot hink through all the conditions and connections required to allow a solution to fit seamlessly into hte everyday beat of those who will use it.

- Systems thinking is the ability to provide solutions within the current contect or providing a new one along with the solution.

- Systems thinking is looking into the cause - effect. having a good foresight as well as insight.

- Every solution has 3 governing dimensions:-

solid structure - policies, procedures, physical environment

strong systems - input, output, processes, patterns

social significance - purposes, principles, people

- Learning disabilities hinder 360 deg innovation. Make learning the job. Integrate it into the daily work as the one true way to innovate. Learnership is the foremost practice.

- 4 phase cycle of learning experience - Questioning, solving, experimenting, reflecting.

- Toyota's standard for problem-solving and continuous improvement - PDCA (Plan-Do-Check-Act)

IDEA loops (Investigate, Design, Execute, Adjust)

- Hansei (Japanese word for reflection) - introspection, performed regularly irrespective of performance.

AAR ( After Action Review) - i. what was supposed to happen ? ii. What actually happened ? iii. Why were there differences ?

-I in IDEA: gather the facts, get into the customer's mind

Genichi Genbutsu - Go and see - go to the source to find the facts to make correct decisions, build consensus and achieve goals at the best speed

3 ways to fully grasp the situtation:-

1. Observe - watch the customer, 2. infiltrate - become the customer, 3. collaborate - involve the customer

- Don't try to innovate for the future. - Peter Drucker

- Great innovation needs a father; great timing

- Design dangers :- Creating a future need, Confusing need with lead time

- Act today for tomorrow.

- Toyota's Design Principles:- 1. Balance Today & tomorrow, 2. keep it real and resonant 3. blend creativity and competition

- innovation - design for today - today's problems, tomorrow's solution.

- Getting the big picture requires a big picture.

- Five dimensions of downside risk that people perceive every time they engage in a purchase experience :- economic, functional, social, physical, psychological

- intangible figures into the calculation of the monthly consumer Price Index (CPI). Hedonics is a way of taking into account product improvements when tracking price movements.

- Innovation demands exploiting limits, not ignoring them. Exploiting limitations drives breakthrough thinking.
Stretch goals are a prime tool for innovation.

- A well stretch goal is aligned, audacious, articulate and arduous.

- We generally don't know what our potential is until we put our capacity on trial.

- Purpose of business it create a customer, so, its two functions are marketing and innovation. - Peter Drucker

- Breakthrough thinking comes from breaking the mental barriers created by obvious solutions.

- Great innovation is born of the ability to harmonize opposing tensions

- Elegant solutions are discovered by elegant framing
- To become a great problem framer, focus on asking the right question, not seeking the right answer.

- Don't just blink, think ! always do the math.

- Innovation runs counter to convention and intuition.

- Kaizen - Japanese word for continuous improvement, its about idea submission, not acceptance.
- 3 steps of Kaizen: Create a standard, follow it and find a better way.

- Standard is simply an established best-known method or practice followed until a better way is discovered, tested or accepted. It prevents mistakes from being made twice.

- We can rob creative power from people by attaching a financial award to ideas.
- Kaizen aims to draw the natural curiosity and creativity within people and guide it towards adding value for customers.
- Kaizen does not attempt to light a fire under people. It lights the fire within them.
- Simplicity is the ultimate sophistication. - Leonardo da Vinci

- Complexity destroys value which is what matters most to the customer. Think lean.
- Lean - doing more of what matters by eliminating what doesn't.
- Perfection is achieved not when there is nothing more to add, but when there is nothing left to take away.

- Lean requires a precise understanding of the value: the who, when, where, what, why and how of the customer's need. Requires Innovative thinking, not cost cutting.
- In lean, customers pull compelling value from you effortlessly.

- 3 elements of complexity: inconsistency, overlad and waste
- The beginning is the chiefest part of any work. - Plato
- Innovation must happen at every level of the company.

- Abilene Paradox: Team follows a single person's thoughts to stay in team.
- Key to avoiding Abilene is understanding that team-based innovation is not about team-building.

- Leaders make meaning. 3 basic qualities:- Integrity, Vision & guidance