My talk at IBM's ShareNet session on Project Management vs. Innovation. I explored how classical project management is ill-suited for managing innovative projects, especially Kaikaku or the Disruptive Innovation, and discussed how Lean Startup offers one such approach. Feedback welcome...

1. Project Management Vs. Innovation:
Friends or Foes?
Tathagat Varma,
Sr. Director Business Operations
Yahoo! India R&D

2. Discussion Topics
! What is The Problem?
! What is Project Management?
! What is Innovation?
! Can Innovation be Managed?
! What are we Learning?

3. What is The Problem?
! “Somewhere out there is a bullet with your
company's name on it. Somewhere out there is a
competitor, unborn and unknown, that will render
your strategy obsolete. You can't dodge the bullet –
you're going to have to shoot first. You're going to
have to out-innovate the innovators .”
- Gary Hamel

4. How is it getting compounded?

5. What does that mean?
! We live in VUCA times –
! Volatility, Uncertainty,
Complexity, Ambiguity
! Mere “delivery against plan” is not enough.
Businesses need to constantly INNOVATE!
! But…can our processes deliver innovation???

6. Today’s Business Drivers
Speed Innovation UX
• “Move fast and • “Great just • “Focus on the
break things” isn’t good user and all
• “Done is better enough” else will follow”
than perfect” • “Creativity • “Every Detail
• Minimize total from every Matters”
time through corner”
“Build-Measure- • Pivot (or
Learn” Loop Persevere)

7. Why is Innovation important?
! “Our species exists thanks to four billion years of genetic
innovation. Since time immemorial, life has been
experimenting with new genetic combinations, through sexual
recombination and random mutation. As human beings, we are
the genetic elite, the sentient, contemplating, and innovating
sum of countless genetic accidents and transcription errors.
Thank God for screw-ups. If life had adhered
to Six Sigma rules, we’d still be slime.”
– Gary Hamel, What Matters Now, 2012

8. Process vs Creativity – can I have both?

9. Do Processes really stifle Creativity?
! Process tells people what to do—the actions, the order, and the
expected results.
! If the results are not as anticipated, the process is analyzed and
altered to bring its results back to acceptable values.
! People are not rewarded for being creative with the process; in fact,
the reaction is quite the opposite.
! Process not only stifles creativity, but also innovation, passion,
imagination and creativity—as it should; otherwise, it would fail to
serve a purpose.
http://ecaminc.com/index.php/blog/59-generalblog/191-2010-03-22

10. Do Processes really stifle Creativity?
! Managing people and projects is the act of imposing process to gain
predictability. Process gives us the tool to foretell an action's outcome.
Without it, planning would fail. It gives us confidence that we will achieve a
given output. In addition, process comforts us. With it, we can manage, telling
people to follow process and we have few concerns. If something goes wrong,
either the person did not follow process or the process is wrong. Process tells
people what to do—the actions, the order, and the expected results.
! If you want open conversation, innovative thinking, and wild ideas, you drop
the level of process and allow people to wander. People try new approaches,
think outside the norm, and premier products and exemplary processes come
into being.
http://ecaminc.com/index.php/blog/59-generalblog/191-2010-03-22

11. Does Project Management help Innovate?
http://www.projectmanagement.ie/images/assets/pdf/innovation.pdf

12. So, what do we do?

13. What is a Project?
! A project is temporary in that it has a defined beginning
and end in time, and therefore defined scope and
resources.
! A project is unique in that it is not a routine operation, but a
specific set of operations designed to accomplish a singular goal. So a
project team often includes people who don’t usually work together –
sometimes from different organizations and across multiple
geographies.
! And all must be expertly managed to deliver the on-time, on-budget
results, learning and integration that organizations need
http://www.pmi.org/About-Us/About-Us-What-is-Project-Management.aspx

14. So, what is Project Management?
! A framework that articulates way of working
! to organize people and resources
! towards one-time accomplishment of a pre-defined task
! within the specified constraints of scope, cost and time
! by proactively managing risks and adapting to changes
! and exercising control commensurate to project goals
! and managing stakeholder expectations throughout the project

15. What is Operations?
! Operations are an organizational function performing the
ongoing execution of activities that produce the
same product or provide a repetitive service.
! Operations are permanent endeavors that produce
repetitive outputs, with resources assigned to do basically the
same set of tasks according to standards
institutionalized in a product lifecycle.

16. Project-Operations Continuum
High Disruptive
Rewards Operations Innovation
Sustaining
Projects
Innovation
Low
Rewards
Low Risk High Risk

17. Kaizen vs. Kaikaku

18. Kaikaku and Kaizen relationship
http://www.centrodecompetitividad.com/img/kaizen.jpg

19. Kaikaku 10 Commandments
by Hiroyuki Hirano, Creator of 5S, Author “5Pillars of the Visual Workplace”
! Throw out the traditional concept of manufacturing methods
! Think of how the new method will work, not how it won't work
! Don't accept excuses; totally deny the status quo
! Don't seek perfection; a 50% implementation rate is fine as long as it's done on the spot
! Correct mistakes the moment they are found
! Don't spend money on Kaikaku
! Problems give you a chance to use your brains
! Ask "Why" five times
! Ten person's ideas are better than one person's knowledge
! Kaikaku knows no limits

20. So, what is Innovation?
! Innovation is the development of new customer value through
solutions that meet new needs, unarticulated needs, or old customer
and market needs in new ways.
! Innovation differs from invention in that innovation refers to the use
of a better and, as a result, novel idea or method, whereas invention
refers more directly to the creation of the idea or method itself.
! Innovation differs from improvement in that innovation refers to the
notion of doing something different rather than doing the same
thing better
http://en.wikipedia.org/wiki/Innovation

21. How are Innovation Projects different?
! Innovation projects tend to start with loosely defined, sometimes even ambiguous
objectives that become clearer as the project proceeds. The processes used are more
experimental and exploratory and seldom follow strict linear guidelines.
! Teams need to be more diverse and have a higher level of trust as they explore new
territory where failure is a possibility.
! With failure as a built-in possibility, innovation teams are more actively involved with
risk management and need to learn to fail fast and fail smart in order to move
on to more attractive options.
! Also, innovation projects generally need to be sold to project sponsors and
funding committees, a responsibility usually not required from normal project teams.
http://www.innovationtools.com/weblog/innovationblog-detail.asp?articleid=303

22. Stage Gate Product Innovation Process
! A Stage-Gate Process is a conceptual and operational roadmap for moving a new-
product project from idea to launch.
! Stage-Gate divides the effort into distinct stages separated by management decision
gates. Cross-functional teams must successfully complete a prescribed set of related
cross-functional tasks in each stage prior to obtaining management approval to
proceed to the next stage of product development.
http://www.stage-gate.com/knowledge_pipwhat.php

23. So, can Innovation be ‘managed’?
! “Innovation is a bottoms-up,
decentralized, and unpredictable thing,
but that doesn’t mean it can’t managed. It
can, but to do so requires a new
management discipline…”
! Let’s examine one such approach…

24. The Lean Startup – Eric Ries
! The Lean Startup method
teaches you how to drive
a startup-how to steer,
when to turn, and when to
persevere-and grow a
business with maximum
acceleration.

25. Lean Startup Principles
! Entrepreneurs are everywhere
! Entrepreneurship is management
! Validated Learning
! Innovation Accounting
! Build-Measure-Learn

26. Build-Measure-
Learn Loop

27. Concept of ‘Pivot’
! Are we making sufficient progress to believe that our
original hypothesis is correct, or do we need to make a
major change? That change is called a pivot: a
structured course correction designed to test a new
fundamental hypothesis about the product, strategy, and
engine of growth.
! Pivot or Persevere

28. What are we learning?
! Old methods are ineffective in VUCA times
! We need strengths of kaizen at kaikaku scale!
! Lean Startup offers one good way to manage
innovation by bringing in principles of PDCA, Lean,
and Agile to New Product Development

29. References
! The Ten Commandments of Kaikaku,
http://www.superfactory.com/articles/featured/2004/0412-bodek-ten-commandments.html
! Project Management and Innovation,
http://wiki.nasa.gov/cm/blog/waynehalesblog/posts/post_1236033108908.html
! Project Management vs. Managing Innovation Project,
http://www.innovationtools.com/weblog/innovationblog-detail.asp?articleid=303
! Innovation and Project Management,
http://www.projectmanagement.ie/images/assets/pdf/innovation.pdf
! Apple Product Cycles, http://www.splatf.com/2011/10/apple-product-cycles/

30. Thanks
Blog: http://managewell.net
Slides: http://slideshare.net/managewell
Twitter: http://twitter.com/TathagatVarma
My Articles: http://managewell.net/?page_id=2