Ignore the trendy labels of knowledge transfer, open innovation or crowdsourcing  and focus on the fundamental requirements of successful business….sharing information. OK.. so a certain amount of success can come from self-sufficiency, but to scale a business you employ people, specialize in functional areas and responsibilities and …..share information.

Most businesses dont collaborate or share information and cite inadequacies in technology, knowledge management, or learning programs are at fault. Instead cultural factors have a greater impact. Beyond the fear of external competition and protecting Intellectual Property…. why do we find it hard to share information?

People, Behavior and Psychology

1. People find it easier and more satisfying to reinvent the wheel than re-use other people’s ‘stuff’
2. People only accept and internalize information that fits with their mental models and frames
3. Most modest people underestimate the value of what they know so don’t believe they have anything to share.
4. People grasp graphic information more easily than text, and understand information conveyed through stories better than information presented analytically (we learn by analogy, and images and stories are better analogies to our real-life experiences than analyses are)
5. People cannot readily differentiate useful information from useless information
6. Most people want friends and even strangers to succeed, and enemies to fail; this has a bearing on their information-sharing behavior (office politics bites back)
7. People are averse to sharing information orally, and even more averse to sharing it in written form, if they perceive any risk of it being misused (confidentiality) or misinterpreted (the better safe than sorry principle)
8. People don’t take care of shared information resources
9. People seek out like minds who entrench their own thinking
10. People don’t know what others who they meet know, that they could benefit from knowing (a variant on the old “”don’t know what we don’t know” – “we don’t know what we don’t know that they do”)
11. Experts often speak in jargon or “expert speak.” They don’t know they aren’t communicating, and non-experts are afraid to ask

Management and Organization

1. People share information generously peer-to-peer, but begrudgingly upwards (“more paperwork for the boss”), and sparingly downwards (“need to know”) in organizational hierarchy – it’s all about trust
2. Managers are generally reluctant to admit they don’t know, or don’t understand, something (leads to oversimplifying, and rash decision-making)
3. Internal competition can mitigate against information sharing (if you reward individuals for outperforming peers, they won’t share what they know with peers)
4. The people with the most valuable knowledge have the least time to share it

Technology, Process and Training

1. People know more than they can tell (some experience you just have to show) and tell more than they can write down (composing takes a lot of time)
2. People feel overwhelmed with content volume and complex tools (info overload, and poverty of imagination)
3. People will find ways to work around imposed tools, processes and other resources that they don’t like or want to use (and then deny it if they’re called to account for it)

Cost, Rewards and Incentives

1. The true cost of acquiring information (time wasted looking for it) and the cost of not knowing are greatly underestimated in most organizations
2. People value information they have paid for more highly than what they get free from their own people (thus the existence of the consulting industry).
3. Rewards for sharing knowledge don’t work for long as performance pay is generally not linked to collaboration goals.

Clearly, human behavior and psychology provides the baseline for looking at these questions.  Management’s role is to provide organizational structure, incentives, training, pay and recognition to reward the collaborative behavior it desires and needs.  Actually, management’s challenge is even greater than that since in most cases upper level managers are motivated by how they are measured; to show how clever they and not expose how much they don’t know. So the real problem in the question of collaboration within the enterprise begins at the top.  If the organization is not aware and geared to address human nature with appropriate training and rewards, it will continue to see the poor performance around collaboration.

• Measures drive behaviours
• Behaviours drive actions
• Actions drive results

Credit: Dave Pollard – How to Save the World blog

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We think we live in transformational times; but do we? Truth is we actually live at higher velocities with increasing rates of change and attrition. Transformational ideas are hard to sell….externally to your markets and internally to your business champions. Most people are reluctant to change and discard their prior investments.  In boom times innovation is risky; in times of economic uncertainty has also reduced the audience for bold, grand rhetoric even further. Innovators therefore have to ease anxieties by sounding conservative while doing something radical.

We all want breakthroughs; it’s just that we can’t know exactly which of the bold new ideas will break through. For every flip phone, there’s a flop. (Apple’s track record — iPod, iTunes, iPhone — is extraordinary but  far from typical.) It’s hard to get traction for ideas that are so far ahead of their times that the infrastructure or human habits do not yet support them. The iPod was an improvement on the MP3 player, Google was just a better search algorithm than other search engines.

As many technology companies have seen to their peril, you can leap much too far into the future by seeking revolution, not evolution, leaving potential users in the dust (Remember the Apple Newton?). Instead steady progress — step by single step — can win internal support and the external race for share of market or share of mind. Especially if you take each step quickly.

Consider Woody Allen’s comedy routine about the first landing of UFOs on Earth and our first contact with an advanced civilization (AKA advanced competitor). Allen wrote that most worries about planetary takeovers involve aliens that are light years away and centuries ahead of us in technology, bringing devices we can’t understand or communicate with, which enables them to control everything. Not to worry, Allen said. If we can’t understand or communicate with their systems, we’ll just ignore them, doing our work the way we always do until they leave in frustration.

Instead, he argued, the advanced civilization that we should really worry about is one that is just 15 minutes ahead. That way they’d always be first in line for the movies, they’d never miss a meeting with the boss… and they’d always be first in every race.

Call this the “15 minute competitive advantage”: changing in short fast bursts rather than waiting for the breakthrough that transforms everything. If every proverbial 15 minutes, you learn something and incorporate it into the next speedy step, you’ll continue to be ahead. And a few time periods later, transformation will be underway.

The point is this, design your revolution as a fast paced evolution. Stay a little ahead of the competition while close enough to what customers can understand and incorporate, and the innovation idea is easier to sell…internally too. Here are some characteristics most likely to rally support behind your innovation:

Triable: The idea or product can be demonstrated on a pilot basis. Customers can see it in action first and incorporate it on a small scale before committing to replace everything.

Palatable: It can be adopted in bite sized pieces, segments or phases. Users can ease into it, a step at a time. They can even use it in parallel with current solutions.

Tangible: It offers concrete results that can be seen to make a tangible difference in something that users need and value.

Valuable: The idea builds on “sunk costs” or actions already taken, so it looks like not much change is involved.

Understandable: It feels like things that people already understand, so it is not jarring to use. It is consistent with other experiences, especially successful ones.

Directable: It is in line with where things are heading anyway. It doesn’t require people to rethink their priorities or pathways, even though of course it changes things.

Positive publicity value: It will make everyone look good.

These principles leave plenty of room to promote revolutionary ideas under cover of evolutionary change. But to find and grow a market for anything — whether green products or new health delivery plans — means staying close to what users can adopt easily and then leading them to the next iteration.

Innovators who take risks must reduce the perceived risk for others. Think long-term trends but short-term steps —15 minutes at a time.

Adapted from an article in HBR – 15 minute competitive advantage

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Operations….

• generates today’s value
• relies on order.
• likes forecasts to come out as planned.
• is an established process driven by existing knowledge
• managers are often judged on how much order they produce.

Whereas Innovation…

• creates tomorrow’s opportunities
• is often disorderly.
• is a learning process, the product of which is new applied knowledge
• does not turn out as planned and
• should have failure as part of the culture
• produces tension between managers and innovation

Managers & Innovators

• Managers succeed by following the rules….
• Innovators succeed by breaking the rules

Managing innovation is quite different from managing operations as:

• you always have less information available to make choices than you’d like
• innovation has not a single goal, but multiple and unclear goals, and
• each of these goals can be reached through multiple routes.

Innovation eludes planning, prediction and containment. However it can be embedded in a business by ensuring creativity and routine are intertwined throughout the process using tools such as S.I.T. The routine tasks have little value by themselves however; their purpose is to support the knowledge discovery process.

Uncertainty and Ambiguity

The primary difference between operations and innovation is uncertainty.

The most effective way to deal with uncertainty inherent in innovation is to have a learning process that “systematically confronts the unknown with new hypotheses, tests them, and eventually creates a new knowledge”.

When innovating, you cannot figure it all out and ahead of time and stick to one plan;

All said and done it is critical to realize that it’s not a choice between either/or, for at some time you will need to be good at both and as such understand the ambiguity between the two disciplines.

so, don’t wait – just go for it, learn and adjust as you go. That’s why “successful innovators get used to moving forward, backing up, going sidewise, chasing parallel paths for a while, consolidating, and then going forward again”.

Credit: 1000 Ventures

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Creative Commons give everyone from individual creators to large companies and institutions a simple, standardized way to grant copyright permissions to their creative work. The Creative Commons licenses enable people to easily change their copyright terms from the default of “all rights reserved” to “some rights reserved.”

But..

Before you think this is for you there are a few things to consider first; such as..

• Make sure your work is copyrightable
• Make sure you have the rights
• Make sure you understand how the licence operates
• Be specific about what you are licensing

So

What are the License types?

Attribution

This license lets others distribute, remix, tweak, and build upon your work, even commercially, as long as they credit you for the original creation. This is the most accommodating of licenses offered, in terms of what others can do with your works licensed under Attribution. More info here

Attribution Share Alike

This license lets others remix, tweak, and build upon your work even for commercial reasons, as long as they credit you and license their new creations under the identical terms. This license is often compared to open source software licenses. All new works based on yours will carry the same license, so any derivatives will also allow commercial use. More info here

Attribution No Derivatives

This license allows for redistribution, commercial and non-commercial, as long as it is passed along unchanged and in whole, with credit to you. More info here

Attribution Non-Commercial

This license lets others remix, tweak, and build upon your work non-commercially, and although their new works must also acknowledge you and be non-commercial, they don’t have to license their derivative works on the same terms. More info here

Attribution Non-Commercial Share Alike

This license lets others remix, tweak, and build upon your work non-commercially, as long as they credit you and license their new creations under the identical terms. Others can download and redistribute your work just like the by-nc-nd license, but they can also translate, make remixes, and produce new stories based on your work. All new work based on yours will carry the same license, so any derivatives will also be non-commercial in nature. More info here

Attribution Non-Commercial No Derivatives

This license is the most restrictive of our six main licenses, allowing redistribution. This license is often called the “free advertising” license because it allows others to download your works and share them with others as long as they mention you and link back to you, but they can’t change them in any way or use them commercially. More info here

In summary…

Need Help choosing a License?

There is a tool to guide you through the process

For further info check out Wikipedia for a more rounded view

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How do you price your software? Is it art, science or magic?

Software always been difficult to determine value; especially when there is so much good stuff available Free. However there is a usefully short book will help you get the theory, practical advice and case studies you need to stop you just ‘rolling the dice’.

Oh yes….its Free!!…….What else!!

If don’t have time to read the book here are the takeaways.

Its not just about the product

You might think that your software product is just the bits and bytes that your customers download (or access online), but you’d be wrong.  What customers are actually paying you for is the entire experience of doing business with you.  Everything from how you market and sell the product, to how you help people use it and how you maintain it going forward.  All of it.  Your pricing should be based on this reality.

Perceived value is real value

It doesn’t matter how much “real” (objective) value you associate with your product. If your customers don’t perceive that value, they are not going to pay as much for it.  Hopefully, their perceived value is a function, to some degree, of the objective value.  If not, you’re screwing something up.

Community matters

The group that your customers belong to, or want to belong to will impact the price they’re willing to pay.  For example, some people buy hybrid cars not just because of the environmental benefit or the higher mileage but because they want to be part of that community.  The same reason some people buy a BMW.  Determine what kind of community you can build (or tap into) around your offering.  Help people belong to the community they want to belong to.

People do buy drills (not holes)

There’s the reasonably famous adage around “people buy holes, not drills”.  The point is to focus on the benefits, not features.  However it’s useful to keep in mind that holes can be a commodity, but people still sometimes pay $400 for a drill.  Benefits are important, but the direct benefiit is not the only one that customers value.

Differentiate or die

This one should be obvious.  If you have a product that’s about the same as all of your competitors, then you don’t really set your price — the market does.  Of course, nobody thinks of themselves as being identical to their competition (especially software companies).  Its difficult to differentiate but if your not different, you need to better, if not better you better be cheaper…actually you need to be Free.

Consider the competition

Just because it doesn’t make economic sense for a competitor to get in to a price war with you, it doesn’t mean they won’t do it.  Particularly if they’re big or well-funded. If you’re thinking about competing on price, keep that in mind.  Better yet, don’t do it at all.

Remember to be fair

Just because you can keep customers from doing certain kinds of things (unless they pay up), doesn’t necessarily mean it’s the right (optimal) thing to do.  In the long term, it could actually hurt.  Try to put yourself in the customer’s shoes and envision if they think the way you price things is fair.

Taken from ‘Don’t just roll the Dice – A usefully short guide to software pricing‘

However…

There is a correlation between retention and your organisation’s net promoter score, which measures how likely a customer is to recommend the organization to someone else.

It turns out that if customers like your products or services enough to recommend them to others, then you can raise prices, even in a down economy, without losing any of your customers. But …

If you downgrade the customer experience, then not even lower prices would prevent your customers from leaving.

What’s true for organizations is true for people as well. Understand your unique value, leverage it to fill a need, and you can write your own ticket.

On the other hand, neglect your value, or don’t develop it, and your customers (and bosses) will go elsewhere.

What are the gotta-have factors for a successful VC pitch?….but wait…

One important question to ask before you begin pitching: Are you really ready?

Venture investors will have an equity stake in your business, have representatives on your board and influence company direction. VC investors also look to the ‘exit’ and drive the company toward either a sale or initial public offering by year 5 (typically).

Bearing that in mind, and you’re happy with the expectations, then you’d better understand what VC investors look for.

1. An Experienced Team

Experience counts for a lot. VCs consider a successful track record with at least one previous startup essential. If you have no entrepreneurial experience, consider recruiting an executive to your team who would lend you some startup credibility. Good judgment in business comes from experience and that includes those who’ve already made their mistakes and struggled. Moreover people who can get VCs excited and have an infectious enthusiasm for what they’re doing.

2. A Problem-Solving Product or Service

Be clear about the problem your company solves;  Do you save customers money? Time? Be specific about why customers will switch from whatever they’re using now to your offering. VCs refer to this as solving a “pain point” or difficulty in the marketplace. Many people fall in love with their technology and fail to apply the ‘So What!’ principal.

3. Assets

What does your company offer an investor in return for their cash? More often VCs are looking for companies with assets of some kind. If not tangibles with an existing product, patent, manufacturing process, piece of software or service perhaps intangibles with an established customer base or a proven, high-powered management team.  Your company also knows what your assets are and can properly describe and create excitement around them. VCs don’t invest in companies that are just ideas.

4. Customers

Oh yeah!! Customers… Geez these VCs want it all Uh! Lets be honest the development of technologies is sometimes cheaper than the trials/approvals or marketing and creating awareness, so you shouldn’t need funding just to create a product prototype. VCs want to hear from happy customers…and they will call them to find out. If you don’t have customers yet, scoring funding  may be tough.

5. Metrics

VCs expect you to know the hard numbers of the business.  One of the most important figures to know: customer acquisition cost. How much does your company spend to bring in a new customer? This figure is needed because VC funding commonly is used to acquire more customers, so know the growth the investment will deliver.  VCs are also keen to understand the value proposition to the customer; how does your product or service improves customers’ return on investment.

6. A Demo

To extrapolate on an old saying, a demo can be worth a thousand words…and will beat a static PowerPoint slide any day. It also proves its not all hot-air.

7. A Plan

Shock-horror but you do have to present a clear plan outlining what they would do with the money you’re seeking. It doesn’t inspire confidence if you have only a fuzzy idea of how they would use more money to build the business.

Adapted from an article in Entrepreneur magazine.

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Can you really build your business on Free?

Not really…but you can get bloody close. Here are some of the ways you can save your pennies on productivity tools when starting out.

Security

Of course you are never fully protected unless you pay. However plenty of free entry level options including AVG. Ive been running AVG free anti-virus for ages without any problems.

Enterprise Software

Microsoft Office to you and me. Pick between Google Docs and OpenOffice. No it isn’t the same, but 90% of the time I dont need the full capabilities of Office. Google Docs has the added benefit of being hosted on Google and is accessible from any computer and creates pdfs when you print.

Presentations

A tricky one this..Ive an aversion to using Powerpoint but sometimes its easy and convenient and does the job…but you need a professional look..so don’t use the Microsoft templates. Try Templatewise or Presentation Load for some really cool designs.

Alternatively bin Powerpoint and go for Prezi a non-linear dynamic presentation tool; good for turning into flash and popping on your site,

Website

When its DIY and  involves investment of your time it isn’t really free…but it can be fun and you will certainly learn more about the most important aspect of marketing your business should you decide to commission a developer at a later date. Try WiX.

e-Marketing

Campaign Monitor is hands down the most comprehensive e-marketing tool. Customisable html pages and built-in analytics..just like Big Brother. $5 setup and 1¢/mail..not Free but so good you’ll want to pay for it.

Project Management

Loads of ‘cheaper than MS Project’ options however GanttProject is Free and easily accessible. Gantt & PERT charts and resources

Communications

diMdiM is a free web conferencing service where you can share your desktop, show slides, collaborate, chat, talk and conduct a session via webcam. For more straight forward conference calling try Pow Wow Now

CRM

Any sales led organisation needs to manage its customer related information. OK, so open-source isn’t Free…but this is great value for a growing organisation

Image Editor

In the same way MS Office has become cumbersome, expensive and frustrating in its attempts to be clever. As most us would never use half of what Photoshop has to offer, Pixlr & Gimp are essentially stripped down simplified versions. Gimp even has an animation package.

Blogging & Social Media

If becoming a respected resource for your market is a key part of your strategy then blogging will be a needed tool. Typepad and WordPress are free along with Twitter, a great microblogging tool.

Footnote

As with all things ‘Free’ there are limitations, and when you want to get more sophisticated, you have to open your wallet. So with all this power and information and none of it has to sit on your PC…so bin the servers and a £250 netbook will do nicely thank you.

Catch lots of other cool and free stuff on our Cool Tools post

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Here are some principles to ensure you start to get different results

1. Its a process…..not a gift!

Don’t let innovation be thought of as some special, innate talent that only certain people have. It takes roughly 2 years to learn a new language. Innovating is a skill just like any other technical discipline.  When perceived as a gift or the sole reserve of the company ‘chosen-ones’ it creates an artificial barrier that prevents people from trying to be innovative. Innovating is a skill, and it can be learned by anyone, even those who are not creative in the traditional sense.

2. De-emphasize patents

For some reason, engineers and scientists are fascinated with patents. They tend to see patents as the ultimate reward of innovation. Patents do not equate to successful innovation; rather, they equate to getting legal status regarding an invention. However if your technical people invent something that has already been invented, this is a huge success because it shows an ability to create novel ideas that have a track record of success. The message: if you can invent something that is already shown to be successful, you can definitely be the first to invent something new and useful….and commercially successful

3. Apply innovation across a wide variety of situations

It is not just for inventing new products. Teach you staff to apply innovation methods to many other situations.

4. Distinguish between innovation and problem solving skills

Both are useful, but are often confused as the same. They are related, but different. Help them see problem solving as what to use when the problem is very well defined and must be solved. Help your staff see innovating as the set of tools to use when new approaches are needed for an existing task.

5. Be a Leader

Most importantly people will struggle  unless you demonstrate those skills themselves. Whether it is table manners, proper grammar, or how to treat other people, as a leader you must set an example or “walk the talk.” Innovation is no different.

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I came across a resource from those clever people at Xplane some while ago, and thought I’d share my experiences to the series of challenges as portrayed in ‘Selling to Big Co’; so…

Welcome to BigCo, land of the complex sale, where each meeting could be your last. Each step in the sales process can move you forward or torpedo the business for good.

All along the way, the people of BigCo will have numerous conversations about your product; with each other, with their leaders and managers, with consultants – even with your competitors.

HOW CAN YOU BE SURE YOUR SOLUTION WILL BE FULLY AND COMPLETELY UNDERSTOOD, EVEN WHEN YOU CAN’T BE THERE YOURSELF?

Here are some of the challenges you will need to be prepared for….

• Your well-meaning but bumbling champion miscommunicated your value proposition.

You invested at considerable risk to your business in an idea you all think is a winner. Will the value be so obvious to the customer you wont need to sell it?; ‘if we build it – they will come’. If the answer is no (and it will be!) then why put it into the hands of someone who is not prepared, or does not have a stake in its success? Sound outrageous? Its done every day with distributors and agents, sales people with improper incentives and/or the wrong tools.

• Frontline managers and workers couldn’t see how your solution would help them to do their jobs better.

Consider this.. on the whole people don’t like change, especially if they don’t have to, so what would persuade them to change vendor or adopt a supposedly better solution. Whats in it for me!!

In order to address this, sell benefits..not features. How does your offering make your customers job easier, faster, better, cheaper, more productive etc etc? OK then prove it…show me the data, demonstrate it.. here…now!!

• A competitor used technical jargon as a ‘smokescreen’ to confuse buyers about your solution.

You know who your competitors are (I hope), put yourself in their shoes and think about how they would claim a superior proposition or attempt to expose your weaknesses where they have strengths. Be prepared for such a rebuttal have data, facts and evidence as per the last point.

• A consultant who has ties to your competitor recommended against you, and nobody knew enough to disagree.

Technical businesses will work with academics or leaders in their field of chosen work. They often perform private consultancy and therefore have allegiances to companies they have worked with in the past. Who are influencers in your field? Who do they work with? Consider trade association, societies, conference organising commitees, speakers and chairs, researchers. Make sure you get the opportunity to sell the merits of your solution. Work with your own sectoral gurus and develop them into advocates.

• The VP of NO, who must approve all purchases over £100k didn’t understand your solution.

A Power player can make the decisions about how dollars are spent. Period. Sometimes referred to as the “VP of No,” they don’t have to ask permission, and they care primarily about results.

By the time you talk to a Power Player, you’d better understand the company and the problem and you’d better have a solution to offer ideally advocated by other organisation members, but mmost importantly demonstrating a results based benefit. Power players make their decisions and move on quickly, so be prepared to move fast if this person says yes.

• The gatekeeper didn’t understand how you were different, so you never got to meet the commercial people

And don’t underestimate Gatekeepers like Secretaries, PAs and potentially anyone else meant to be organise and control. Their job is to manage the traffic moving in and out of the organization. They are responsible for keeping the “wrong” people out and letting the “right” people in. A Gatekeeper can be a powerful ally who can put you in front of the buyer — or, if alienated, they can be a powerful foe.

• The buyer skimmed your proposal, but didn’t understand the key differentiator you had worked so hard to establish.

By this time, you have hopefully many advocates and developed a tailored argument specific to the benefits your product will bring. However you must be able to communicate all all levels and prevent creating your own smokescreen with jargon. Dont forget the buyer is concerned with Quality, Cost and Delivery. How do you stack up, this might be a differentiator if your competition fails to deliver on-time and has unreliable product; even if they are cheaper.

Know your stuff, know your customer, know your competition and be prepared.

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