Success indicators

Either great caution must be exercised to diffuse ideas, or the organizational culture must be accepting of failures or missteps. Because more people have exposure to the innovation at this stage, feedback mechanisms can provide invaluable data but may give employees a false sense of control. The innovation must be perceived by employees as inevitable and beneficial for diffusion and acceptance to occur, which will then minimize the costs of implementation. An open culture may be difficult to create. HP's strategy, discussed previously, was to involve all employees in setting priorities and goals for the organization as well as individually.

Robust organizations know how to enable change. If a change in culture is desired, the organization needs not only new archetypes for business, but the kind of gossip that will spread infectiously. Stories that emphasize the core of a business (whether that be scientists, social change or light bulbs), while simultaneously emphasizing that change and new ideas fit within the profit margins, are keys to making organizations change. Who tells the stories, and how the stories are told, changes the rate and type of change. Higgins and McAllaster suggest that stories and tangible cultural artifacts are the ways to effect cultural organizational change through easily understood, significant symbols (Higgins & McAllaster, 2002). Storytelling isn't the first step towards organizational change. First, the strategic plan, objectives, resources and hiring need to be aligned with new organizational goals (Higgins & McAllaster, 2002).

The story of 3M and Post-it[R] notes provides one example here. The employee who invented Post-it[R] notes, Arthur Fry, originally developed the sticky notes for use in his church hymnal. Market research showed no interest in this product, but Fry distributed them to secretaries until they were hooked. Eventually, Fry's innovation was developed into a new product line. In this example, diffusion was not standardized nor organizationally supported, but the process of demonstrating market value and persistence with a novel idea, despite organizational inertia, is clearly demonstrated. This story emphasizes that in 3M, buy-in and diffusion of ideas happens when innovators believe in their ideas and advocate for them. Higgins and McAllaster break this story into the values supported by 3M: perseverance; openness to ideas; advocacy for one's own ideas; rewarding of success; and the use of stories to promote corporate values (Higgins & McAllaster, 2002). The values identified in Fry's 3M story illustrate a clear value placed on unconventional innovation and long-term belief in innovation. Obviously, 3M has thousands of inventions. Any single story could have been told to demonstrate the successful innovation processes at 3M. This particular story, however, highlights and encourages a specific culture of innovation and values. Upper management at any organization would do well to consider which stories are told in their offices and how that will expedite or impede innovation diffusion. Robust organizations do this on a regular basis.

Another example of the use of stories to effect organizational change comes from Yokogawa Electric Corporation and its use of the bullet train metaphor. When a new corporate strategy was needed for the electricity corporation, its CEO used the metaphor of the new, high speed bullet trains to emphasize that a quantum leap in strategy would require new technology, new modes of thinking, and new ways of laying the groundwork. Just as a bullet train requires straight, wide tracks, a different kind of engine than a traditional train, and a new design, corporate strategy change requires that the groundwork, engine and design of the company change together.

Higgins and McAllaster emphasize that Yokogawa succeeds with this metaphor because a new 'richness' is added that 'transcends the words themselves' (Higgins & McAllaster, 2002). The image and the story told about the image provide a clear map of organizational values and the need for dramatic change. This story helps to generate buy-in and ease diffusion of innovations by creating a framework in which employees and stakeholders can understand the need for and actuality of change. Diffusion of ideas requires just such visionary calls to arms so that traditional, stable, familiar processes can be upset and uprooted. Robust organizations utilize such tools.

This internal diffusion of ideas differs dramatically from the need to market ideas to consumers. The art of marketing has been described in various literatures, and little consensus has emerged on how to properly market. The marketing of ideas also constitutes progress through the innovation process, but this final stage of executing ideas into a marketplace requires understanding the target consumer and launching another, different effort towards a further level of buy-in and innovation diffusion.

During the diffusion and implementation process, robust organizations are likely to turn back to the social networks developed during earlier phases of innovation. For instance, during earlier stages of the innovation process, companies may involve business partners, academia, customers and suppliers. Within each of those groups, robust organizations have strong social networks that can help to diffuse new ideas throughout other organizations. If customers share ideas with friends and family, for instance, marketing campaigns may be greatly enhanced. Some companies, such as Personiva, are built around this idea. Personiva lets consumers create personalized advertisements so they can star in their own commercials. The personalized ads can then be emailed to friends and family. Organizations like Hewlett-Packard and Levi's have already chosen to work with Personiva to harness the marketing power of social networks.

Robust organizations are also likely to have already established customer segmentation policies that helped drive the earlier screening and prototyping stages. Strong relationships with lead users and key customer segments are present in robust organizations, and are leveraged during the marketing process. For example, lead users may be beta testers who spread the word about successful products; at the same time, the company benefits from the patches, behaviors, and repairs of lead users. Google Labs releases early versions of products in the prototyping and experimentation phases, and then allows lead users to promote successful innovations simply by discussing them with friends, co-workers and family.

Robust organizations use technologies to enable the diffusion and implementation process. There is a growing interest in the concept of edge technologies, which help organizations connect with customers and drive innovations in the organization, for the purposes of implementing and diffusing innovations (Mui, 2006). For example, General Motors (GM) sends a monthly report to its customers via OnStar, which allows GM to monitor the performance, status, and locations of vehicles using sensors on the vehicles and cellular connections. The monthly reports contain information such as the condition of vehicles, possible problems, and reminders of maintenance checks. The report is generated based on the analysis of more than 1,000 problem records. Traditionally, GM interacted with customers only before purchase, via mass advertisement, and at purchase. Now GM maintains the relationship with customers even after purchase by being helpful to consumers.

Edge technologies have brought tremendous benefits to GM. First, they have improved GM's customer relationships. The OnStar system has received 15,000 emergency service calls, 23,000 roadside-assistance calls, 29,000 diagnostic calls, and 380,000 direction requests. Second, the real-time observations of vehicles in various conditions provide knowledge to GM for improving vehicle designs. Third, the technologies provide GM with new income sources. For example, GMAC Insurance offers different services for customers based on car mileage. Customers who have lower-mileage vehicles can qualify for lower premiums.

Edge technologies promise benefits to an organization; however, there are drawbacks, too. First, they may increase the problem of information overload. Nowadays, organizations have more data than they can analyze. Appropriately analyzing data and applying it to the right situations is important for the successful implementation of edge technologies.

Amazon.com has a successful platform that records all transactions and product-evaluation histories of active customers. Amazon analyzes the data and improves customer's shopping experiences through sophisticated data mining technologies. As a result, Amazon maintains a record of high customer satisfaction. Hartford Financial Services also has a platform that records all telephone calls between customers and service representatives. Details of conversations, such as talk time, hold time, outcome, and snapshots, are recorded and are available for learning exercises by service representatives and supervisors.

Implementing edge technologies requires big changes in an organization. CIOs must design information systems architecture that can appreciate emergent knowledge. The change must occur at the organizational level, not at an application or a departmental or functional level. Implementing edge technologies at an application level can lead to disasters, such as inconsistent data and incompatibility of different systems. To use IT as an edge technology, CIOs must be aware of the following five trends. First, organizations must connect themselves with their external entities, such as customers, business partners, competitors, and suppliers. Second, the connectivity must be established not only by infrastructure, such as networks, but also by software, such as Web services. Third, to reach customers, pervasive devices such as PDAs, mobile technologies, cameras, handsets, and electronic wallets are important. Fourth, data mining capabilities need to be further developed in terms of storage expenses and intelligence analysis. Fifth, deriving knowledge from the collected data is important, since such knowledge, which includes customer identity, location, preference, health, and evaluations of the quality of service, was previously unavailable in decision making. However, this knowledge needs to be treated carefully, since issues of privacy and security are involved.

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