Peter Lee: How to turn ideas into reality

Peter Lee says globalisation means New Zealand is no longer insulated from extreme levels of competition. Photo / Brett Phibbs

Opinion

Picking the right tools for innovation can help firms to realise their ideas in a competitive world, says Peter Lee.

How often do we see a great new product or a new business model and find ourselves saying, "I had the same idea and wish I had done something about it"?

Having spent 15 years in New York and more recently with the University of Auckland's UniServices, I have observed this remarkable ability of New Zealanders to generate ideas with great business potential.

However, with a few notable exceptions, we seem out of practice with realising an idea's full value.

This is unfortunate because ideas are becoming ubiquitous in this connected world and it is the ability to realise those ideas that has now become the key differentiation for corporate competitiveness.

We need to be able to use tools for innovation if we are to make an impact. Globalisation means New Zealand is no longer insulated from extreme levels of competition.

Our geographic distance is becoming less relevant to our ability to meet market demand, on our own shores and overseas. With the Pacific Rim, we have one of the most diverse and progressive entrepreneurial ecosystems on our doorstep.

Our ability and our experience in being able to generate ideas is not in question. What is, is our general inexperience in applying the tools for innovation to transform those ideas into something more tangible.

For more than 25 years, as a member of the Industrial Research Institute, I have taken part in the development and application of a series of tools for managing innovation, many of which have become commonplace in the business practices of many of today's great global companies, which have integrated these tools into a comprehensive process.

Intrapreneurship, as an example, is the practice of bringing entrepreneurship, which is normally associated with more nimble start-ups, inside existing companies. It is a tool that needn't be defined by the type of business or an industry.

In my role with the International Paper Company, in charge of research and development, we wanted to be recognised as not only the biggest but also the most innovative company in our industry.

One of my responsibilities was to create a series of "spin ins" to enrich our product base and make good on our brand.

We created the first range of papers which made it possible to produce photographic quality images from personal ink jet printers, and the first smart package for use in warehouses for more efficient distribution.

Perhaps our most memorable was our development of a radar-absorbing skin for the stealth bomber, which we produced with pilot equipment in the basement of our corporate laboratory in New York.

Open innovation has been adopted by many companies to network with a world of creativity beyond their corporate boundaries, in a way that is not overwhelming but tuned by strategy to invigorate and support their business.

Proctor and Gamble, with its Connect and Development methods, publishes product challenges to attract a world of problem solvers.

Similarly GSK's Consumer Healthcare Open Innovation scheme allows scientists, innovators and start-ups to commercialise their health-related ideas.

The essence of this intrapreneurship was to manage the tensions between the essential entrepreneurial excitement and the processes needed to leverage the resources inherent in a large company.

Fortunately there are many tools available for this purpose. Unfortunately, we are not well practised with such tools in New Zealand and this is a big disadvantage when competing internationally.

While it can seem overwhelming to know of a range of tools for innovation, a company only needs to learn how to add a select few of them to its existing core capabilities to become a world-class innovator in the industry.

For example, if a business finds it lacks a healthy backlog of breakthrough new product concepts, it might choose to practise open innovation.

Or if it has the concepts but struggles to get the vital few into the market, it may look at implementing a process called stage-gate management, for managing their development.

We're all familiar with the legend of David and Goliath - how Goliath chose the traditional armour and tools for close combat fighting, typical of a heavy infantryman of that time, and how David passed on the armour, in favour of the sling.

David had the advantage that he could strike with force from a distance because of his choice and application of tools.

Often businesses in New Zealand have more in common with David, particularly when they face the scale and ability of global businesses.

With a focus on choosing the right tools for innovation, we can begin to face our international competition with the same confidence as David, and expect the same outcome.

Peter Lee is an adjunct professor at the University of Auckland, and teaches on the Masters of Commercialisation and Entrepreneurship programme.