I interviewed Steven Schumaker who was tasked with streamlining the entire innovation process for a company that makes fresh food, Steven Shumaker's first task was to bring 21 departments to the table. After facilitating the discovery process, it became clear that working within silos prevented individual groups from understanding how their actions effected other groups involved in bringing new products to the marketplace. Creating a top-level process flow and putting stopgaps in place to reduce financial risk by tracking progress proved to be the answer.
How would you bring 21 individual departments -- each playing separate roles in the innovation process -- together as one cohesive group focused on cost effective new product development? Steven Shumaker began with a "current state event" designed to give everyone a top-level view of processes and help them understand why operating within silos can be inefficient and risky.
In 2009, Steven Shumaker was involved in mapping the entire innovation process for a company that makes fresh food for the United Kingdom and Ireland. With 21 departments, each playing separate roles in bringing new products to the marketplace, it was quite an eye-opener. In supply chain alone, Steven said, there were four departments that impacted the process, including supply chain procurement and packaging, supply chain ingredients, supply chain planning, and supply chain logistics.
The project had three goals in mind. First, to reduce the risk of doing something wrong and wasting the investment in new product introduction. Second, to streamline the process with an eye toward making the new product introduction process more efficient and pushing more innovation through in a more timely manner. Third, to gain an understanding of the company's capability to innovate from a capacity perspective. In other words, Steven said, "Asking ourselves if we have enough resources, and whether we are putting the company at risk of not being able to produce current products because we're innovating too much?"
The process began with discovery, or what Steven referred to as a "current state event." Typical of the discovery stage, it took a great deal of time, because each department operated within a silo, which meant people didn't have an understanding, or clear view, of the entire process. From a facilitator's perspective, discovery can be a nightmare if allowed to drift on forever without specific exercises in place to keep it moving forward and keep people engaged. Steven said he was fortunate enough to have the support of the CEO, which no doubt went a long way toward keeping people on task.
It took approximately four weeks to arrive at a top-level process flow that encompassed all departments, and for everyone to understand each phase of the innovation process. Among the many things Steven Shumaker discovered was the fact that there were no real gauges for determining whether or not the development of a new product was going well, if it warranted further investment, or for tracking progress, including whether some departments were moving faster than others -- an issue that could have the effect of creating work that has to be reworked along the way.
Without giving away too much intellectual capital, Steven said those problems were resolved by creating four gates that every innovation project must pass through to bring each of the 21 departments to a point where a company executive could make an educated decision regarding whether a project should go forward.
The first stage of innovation, Steven said, was the alignment of tasks. For example, procurement might have to buy a new line, the flavoring department might have to develop a new formula, the packaging department would likely have to develop a new design, which in turn, might trigger the need for adjusting a high-speed packaging machine to facilitate the project. No commitments were made at this point, but at the end of the phase, if everything was in alignment and contracted out with a supplier, it would trigger the next round of investment into the project.
Moving forward with a new food product, there are always legal hurdles to clear as well, including protecting intellectual properties, such as formulas, and proper word of all product descriptions.
Until the company went through complete discovery to arrive at a process flow, people were working within silos, not pulling together and sharing information vital to cost effectively bring new products to the marketplace. In the end, Steven said, everyone was a lot smarter, but the true test was pulling everything together and transforming the company in such a way that everyone was inspired to follow the regimen.
In this instance, the company developed an innovation process manual that doubled as a training tool. The idea was that each page, or step, had to be signed off on by the individual responsible for that task. The manual and sign-off procedure, Steven explained, was not intended to be used for each new project, but rather as a temporary tool that helped everyone follow the prescribed methodology until it was ingrained in the company's innovation culture.
Streamlining the innovation process, Steven said, leads to several questions, including "Who controls the innovation process? Does one group or entity serves as gatekeepers and control the process all the way through?" In the example Steven shared with us, the marketing department was adamant about controlling the entire process, although he also identified other opportunities that might be better suited for other companies with other types of products. Grooming the next C-level individual, for example, has potential in that the individual could be totally immersed in the innovation process resulting in complete understanding of how all the parts work together before taking the CEO reins. Steven also said there is a case to be made for a "hand-off" plan. "The marketing department might be responsible for the first phase of innovation, and then maybe it flexes over to manufacturing, depending on the type of innovation, and then finally it goes to supply chain, so depending on the company, and what they need to do, there are several options for controlling the innovation process," he explained.
Personally, Steven Shumaker says he is very keen on having the highest-level person control the innovation process, and on grooming the next person in line for CEO, such as the head of the project management office, as an individual focused on keeping innovation and continuous improvement alive and healthy. From a financial perspective, companies must innovate to survive in the marketplace. A CEO, or top-level executive with project management experience, already understands how much innovation the company can take on in terms of capacity, and how to get the most innovation out of the company at the lowest possible cost. Executive-level individuals are also department-neutral. In other words, not overly pro-marketing, pro-manufacturing or pro-supply chain. Instead, their interest is in making sure all the pieces fit together.
Finally, and perhaps most importantly, Steven Shumaker believes leaders operating within silos need time to do pure strategic thinking, and while he says he is not overly enthusiastic about mapping, he believes mapping is an excellent tool for giving leaders a bird's eye view of an organization's scope. Also, having a view of end-to-end processes makes it easier to spot areas that can be improved, and whether or not the right high-level metrics are in place, which allow for rapid analysis and more informed decisions surrounding outsourcing, transportation and other costs.
In closing, Steven Shumaker says the biggest barrier to innovation and staying one step ahead of the competition is that many companies are currently operating in survival mode, which keeps them focused on the tactical and execution side.