Innovation is the Driver for Manufacturing Growth

Last updated on May 13th, 2019 at 02:35 pm

Just short of 100 years ago, there were more than 1,000 companies making automobiles in the United States. Few of those manufacturers survived into the 1920s.

As with our current age, the world, America, business and manufacturing were undergoing unprecedented technology-induced change. Most of those 1,000-plus automotive pioneers had been buggy makers that transformed their horse carriages into horseless carriages.

When the world changed, they innovated. They responded positively and creatively to the industrial age’s shifting demands by bolting internal combustion engines onto their buckboards. But the scope of their innovations proved to not be great enough to sustain them through the larger societal shifts of the industrial age.

They either missed or were unable to confront those issues – issues addressed by Henry Ford and others who went on to own the industry.

The big question being asked by most businesses today is, "How can we grow?" It is being driven by the realization that there is a limit to how much growth can be induced through cost cutting and quality improvement. For many, the answer to growth – from Hewlett Packard to GE – is innovation.

Innovation appears to be the "silver bullet" of business, but as the buggy makers discovered, not all innovation is the same.

Simply put, innovation comes in two basic flavors, incremental and breakthrough.

Incremental innovation is characterized by linear processes based on analyzing the situation, identifying the gap between what is and what should be and then developing solutions to close the gap.

Breakthrough innovation does not appear to follow a process, but rather leaps of faith. Breakthrough solutions just seem to appear or to be the venue of particular individuals in the company to whom few would entrust the organization’s future.

Neither type of innovation is intrinsically better or worse than the other.

The key to developing an organization’s capacity for innovation is in developing high levels of competency in both processes, much like the best problem solvers have figured out how to effectively use both sides of their brain.

However, for a specific situation, problem, or challenge, applying the appropriate innovation process is critical. Incremental approaches work well in stable environments, but in times of great change – and we are living in a time of great change – breakthrough innovation is often required to survive the chaos.

And that creates a paradox for most manufacturers. The majority of manufacturing personnel, engineers and operations mangers are biased or wired to favor incremental innovation. They prefer stability, standardization, predictability, calculated risks and control.

But when the organization is under stress, the more likely it is to approach problems with an even more robust incremental approach – more research, more analysis, and more control when exactly the opposite is needed. It is impossible to move from incremental to breakthrough innovation by just pushing harder or doing more.

The two processes do not lie on a continuum. They require radically different approaches.

Increasing an organization’s capacity for breakthrough innovation is determined more by what an organization does not do than by what it does. Without being glib, the way to increase an organization’s capacity for innovation is to remove the individual behavior, policies and practices that inhibit innovation – to break some very ingrained personal and organizational habits.

It is similar to making coldness. It is impossible to make coldness by trying to make coldness. The way to make coldness is to remove heat. The way to make innovation is to remove "un-innovation".

Although there are a number of highly sophisticated tools to help break inhibiting habits, mastering a single "blocking and tackling" technique can dramatically improve an organization’s capacity for innovation. That technique is to always challenge assumptions. Every organization and every person makes decisions based on sets of assumptions, many of which they are not even aware of.

Most of these assumptions are historic assumptions that were valid at one point in time but no longer are because the conditions surrounding them have dramatically changed.

Examples: "We are a manufacturing company; our customers value our quality above all else." "That customer would never leave us." "They are not our competitor." "This is the way you do it."

These are common unspoken assumptions that can block an organization’s capacity for real innovation.

The following techniques are ways to help organizations challenge their assumptions.

Make the assumptions explicit. When developing a plan, solving a problem or designing a solution, consider making the assumptions explicit and documenting them. Then have a diverse team challenge each one of them to determine whether they are valid or just "ancestor worship." Continue to validate the assumptions as the project progresses.

Explore worlds that make you uncomfortable. Few breakthroughs happen within a department, company or industry. Most happen because someone ventured outside of their area of expertise and became exposed to an entirely new concept. The vein structure of a water lily was the stimulus for Joseph Paxton’s revolutionary Crystal Palace. By venturing into marine biology and studying the contours of the Ostracion cubicus, a fish native to the Indo Pacific coral reefs, engineers at Mercedes have achieved breakthrough levels of automobile aerodynamics. Attend a conference outside of your industry. Subscribe to an off-the wall magazine. Take a different route to work.

Seek to hear the advice of the people whose advice you are least likely to seek. There is a tendency for people with a problem to lock onto the first opportunity they find that could represent its solution. If that person is in a position of authority or has a dominating personality the "solution" is likely to become a fait accompli regardless of whether it is good, bad or ugly. Voices that raise objections or recommend alternatives are quickly squashed, sending the message that others should go along. Insure that important decisions consider the view points of the most diverse set of perspectives possible. Convert meetings from "supporting in harmony," or "the lowest lobbyist wins" to healthy confrontation directed at genuine learning. The meetings will take longer, but they won’t be a waste of time, the implementation will go faster and results will be more likely to succeed.

Times of high change require organizations to do more than improve processes and quality. They require asking and responding to the really difficult questions – the ones most have intentionally avoided for years. These questions may include: Do we even need the process we are improving? What business are we in? Are we trying to get our customers to want what we make or are we trying to make what our customers want?

Last month, I overheard some interesting comments. The first was, "We are a manufacturer; my boss is a manufacturer; his father and his father’s father were manufacturers. We just like to make things."

The second went something like, "My owner truly believes we are in a service business and that we just happen to be manufacturers."

Not surprisingly the latter company has been much more successful in these turbulent times. They have grown, diversified and opened up new markets in a declining industry. They have learned how to challenge their assumptions and ask the difficult questions to innovate appropriately.

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