8. Research & Development
The last core product and service function is R&D. Along with a few folks in top leadership, R&D staff are usually considered the technology foresight professionals in any organization.
As ICT expands the level of collaboration among the firm’s stakeholders and prospective customers, the new domain of innovation management, and the CINO (chief innovation officer) have become exciting frontiers for innovation-related foresight work. One new trend in innovation management, mentioned earlier, are ideation platforms provided by firms like BrightIdea and others. These firms are pioneers in software-as-a-service innovation management. Their systems work on top of the firm’s internal social networks and CRM systems, and they incentivize firm-wide problem identification, idea generation and evaluation of employee and customer provided solutions, crudely assessing submitted ideas for their potential ROI for the firm, and offering project management tools for ideas that are turned into projects by employees or leadership.
Henry Chesbrough’s concept of open innovation, where the best firms use both internal and external innovation sources (i.e. ideas and IP from customers, rival companies, universities, and the global public), is a model that seems increasingly attractive for top firms in coming years. Kickstarter and Indiegogo are just two leaders in a plethora of crowdfunding companies that are capitalizing (often up to the ten million dollar range, and still climbing) and demand-testing all kinds of new events, projects, and products. Quirky and Assembly are among the world’s first crowdfounding companies, in which inventors and anyone else online who adds value to business ideas can work together to innovate and launch a new product or service, and receive equity or shares based on their inputs (i.e., with Quirky, 10% equity goes to the idea provider, another 5% to others who offer marketing, technical, or other value, and the rest to Quirky).
We can expect more of these kinds of companies in the next decade, as the second half of President Obama’s JOBS Act becomes law, and small investors are allowed to directly invest in and receive equity from startups. Today, only accredited investors (folks with $1M or greater personal assets beyond their primary residence) can join angel investing syndicates, a law puts small business innovation at a systematic disadvantage, at present. Democratizing small business equity investing via the JOBS Act will be a boon to startups, and seems likely to also grow jobs. Small businesses have been greatly advantaged in the last few years by crowdfunding sites, though they still aren’t legally allowed to offer any equity at all, yet. Crowdfunding grew 81% in 2012, and hit $2.7B worldwide.
Clayton Christensen et al. in The Innovator’s DNA (2011) describe five behavioral skills that are key to innovation: Association (of information, to create ideas), Questioning (to highlight problems, define unknowns, challenge assumptions), Observing (seeing clearly what presently works and what doesn’t), Networking (connecting to others with diverse inputs), and Experimentation (a culture tolerant of quick, fast, and frequent failure during learning). This is not a definitive list, as other innovation-aiding skills have been proposed (e.g. design thinking). But it seems a solid start. For foresighted R&D managers today, providing greater employee freedom and incentive to innovate, doing better recruitment and global sourcing of technical innovators, enabling firm-wide or open innovation via software platforms, and aligning firm values, Learning & Development efforts, and culture with innovation goals are some of the frontiers.
To recap, the R&D department commonly has responsibility for two of our top twenty foresight functions: Innovation Management, all the ways firms develop and launch successful new products and services; and Design, improving and varying the aesthetic, functional, and economic, and sociopolitical aspects of our products, services, and processes.