Ten Rules for Strategic Innovation

By Rob Wright, Chief Editor, Life Science Leader
Follow Me On Twitter @RfwrightLSL

By  Rob Wright

At the 2011 Partnerships in Clinical Trials Show I met Vijay Govindarajan, professor of international business at Dartmouth and author. He shared with me some of his thoughts on innovation. I really liked what he had to say and I asked him to write a “Leadership Lessons” article for a future issue. Stay tuned. Vijay was kind enough to send me a copy of the book he co-authored with Chris Trimble, “10 Rules for Strategic Innovators.” Reading his book reminded me of something a professor once said to me. “You can tell the difference between an undergrad and graduate student by how they copy an article.” When I was in graduate school, I physically went to the library and sorted through what we reffered to as “the stacks.” These were the hard bound journals and the pride of the university. Once you finally found that key article for a theory you were studying, you would take it to a copier and pay ten cents per page to copy the article. Graduate students knew the importance of paying the additional 20-30 cents to copy the reference sections of these articles. Poor undergraduate students rarely did this, saving their precious dimes for 10-cent beer or wing night, and thus the difference.

Don’t Skip the References
If you have ever read or written an academic article, you know the importance of references. When in doubt, cite anyone who could have possibly contributed to a theory’s development. Depending on the journal’s preference for citation, references can disrupt the flow of how the article reads. You might read an interesting sentence, which is then followed by parantheses listing a bunch of author names and dates. Personally, I prefer endnotes. I bring this up because this is how Vijay and his co-author wrote their book, devoting nearly 17 pages at the end to notes. If I had skipped this section, I would have missed several nuggets. For example, according to Clayton Christensen, cited on p. 199, “a disruptive innovation typically is not attractive to mainstream customers at the time of introduction.” This is why when someone brings up an innovative idea in a business meeting, they are often beat into submission. I can recall ideas being shot down with such classics as, “We tried that already” or “Nobody will buy/do that.” There are a ton of other gems for those who are serious about understanding innovation. I recognized many names from my academic copying days. Seeing C.K. Prahalad’s name gave me a flashback for which I might need to seek therapy — again.

Rule Eight
The authors of the book list and explain the 10 rules for innovation in chapter 10, the last chapter in the book. See, all good things are in the back of the book. Rule eight is the one that hits home most with me. “Interest, influence, internal competition, and politics disrupt learning. To ensure learning, you must take a disciplined, detached, and analytical approach to making predictions and interpreting differences between predictions and outcomes.” This is very difficult. Everyone thinks they can be “detached” and logical, but we are not Vulcans. As humans, we have our biases. Thus, if we believe gross margins to be a key to measuring the success of a business, then we may apply this to the process of innovation. Yet, when companies are pursuing innovation, they are attempting to do something differently. Therefore, perhaps different measures should be incorporated. The author illustrates this with an example of a company pursuing a strategic experiment becoming caught up in a conflict over capital between divisions. This changed the behavior of the team working on the innovation, delayed learning and thus, delayed innovation.

Want Innovation?
Innovation is a hot topic in the life science industry for a variety of reasons — the most obvious of which — the pending patent cliff. Prior to getting Vijay’s book, I had just finished writing “Key Ingredients to Innovation” for the May issue. As a consequence, I have recently been exposed to a variety of theories and opinions on how to increase innovation. One I have personally experienced is the need hire from outside the company, having come from outside my current organization. This seems to go against how most companies strive to promote from within. Obviously, there needs to be a balance of new and old talent, and a structure which allows for innovation to take place. This book provided me with a thorough understanding of the innovation process.