PAUL SCHUMANN
Innovation
Profiles
Results of Survey
Introduction
This report is a summary of the results of a survey
of 46 individuals who visited the Innovation Road
Map web site and chose to become participants.
Innovation
Innovation is the means by which enterprises create
wealth. Enterprises that learn how to integrate inno-
vation into strategy, and strategy into the process of
innovation, will gain a competitive advantage and
optimize the enterprise's creation of wealth.
Integration of innovation into strategy requires two
tools -- the Innovation Profile and the Innovation
Road Map. The Innovation Profile provides a way to
analyze the innovation opportunities and threats of
the market, strategy of competitors, capability of
the enterprise, and desires of the stakeholders.
The Innovation Profile is a matrix of nine different
types of innovation. The Innovation Road Map in-
cludes customers, competition, technology,
stakeholders, enterprise capability and the enter-
Business has only two basic functions:
Marketing and innovation. Marketing and
innovation produce results. All the rest are
costs.
Peter Drucker.
prise's capacity for change. This Road Map enables
the creation of multiple scenarios based on different
innovation strategies that are necessary for strategic
© 2004 The Innovation Road Map, www.theinnovationroadmap.com
wealth creation decisions.
What is Innovation?
Innovation in marketing is also essential. Therefore
business really has only one basic function -- innova-
tion. Innovation is the basis of all competitive advan-
tage. Innovation is the means by which enterprises
anticipate and fill customer needs. Innovation is the
way that enterprises utilize technology.
Innovation endows resources with a new capacity to
create wealth or creates a new resource. Innovation
results from the enterprise's way of implementing new
ideas, of turning the creative concepts of its members
into realities. It can cause change or it can exploit
change. Systematic innovation which exploits change
is generally the most effective. Strategic innovation is
the purposeful and organized search for changes, and
the systematic analysis of the opportunities and
threats such changes might offer for the creation of
wealth.
The Innovation Profile
Everyone in an enterprise must be innovative; that is
the only way that the enterprise will be able to change
fast enough to meet the demands of its customers,
stay technologically competent, effectively deal with
competition, and respond to the pressures of change
both from within and without.
To allow each person in the enterprise to be innova-
tive, the enterprise must have a broad definition of
innovation, one that encompasses all members of the
enterprise. This definition must be able to transcend
organizational structures and be useful to every func-
tion, from marketing through research to develop-
 2

ment to resents.
manufac-
l gh
ta e rou turing. Incremental innovations are those that reflect a rela-
en tiv h
em nc kt
cr isti
rea
In D Members
B Incremental
of the en-
Product terprise at Breakthrough Incremental
all levels
must be

Productivity
Distinctive
Process able to
communi-
cate effec-
tively with Incremental
Procedure
each other Distinctive
about in-
novation. These kinds of results can be accom- Time
Incremental
plished with an Innovation Profile.
tively small improvement over present products, proc-
The Innovation Profile shows nine different types of esses, and procedures. These are advances that are a
innovation. Along one axis is displayed the nature little better, a little faster, or a little cheaper. In the
of the innovation. The other axis shows the class of traditional S-curve, the relatively flat portions of the S-
the innovation. The nature of the innovation is clas- curve at its beginning and end have a high incidence of
sified into one of three categories: incremental innovations.

Product innovations involve the way things interact Distinctive innovations are those that provide signifi-
with things. Product innovations are those involving cant advances or improvements, but are not based on
the function provided to customers or the form that fundamentally new technologies or approaches. The
function takes. Examples include improvements in middle portion of the S-curve when rapid progress is
industrial machinery, consumer goods, software, made usually has a high incidence of distinctive inno-
and component parts. It can also refer to “products vation.
of the mind”.
Breakthrough innovations are those that are based on
Process innovations involve the interaction of peo- fundamentally
ple with things. Process innovations are those that Breakthrough
different tech-
involve the way a product is developed, produced, nologies and
and provided. Examples include improvements in approaches,
manufacturing, distribution, and development sys- Distinctive and that allow
tems. the perfor-
mance of func-
Procedure innovations involve the way people inter- tions that were
act with people. Procedure innovations are those previously not
that involve the way in which products and proc- possible, or
esses are integrated into the operations of the en-
Incremental the perfor-
terprise. Examples include improvements in mar- mance of pres-
keting methods, administrative methods, sales ently possible
terms and conditions, and requirements genera- functions in a
tion. manner that is strikingly superior to the old.

The second dimension of the classification struc- Breakthrough innovations result in a significant num-
ture -- the class of innovation -- indicates how great ber of distinctive innovations, and these, in turn, result
a change from present practice the innovation rep- in a flood of incremental innovations. Breakthrough in-
 3

novations cause changes from one S-curve to an- the resources of the organization and the organiza-
other. tion's enablers of innovation.

Breakthrough innovation results in the creation of a This same type of innovation profile can be used to
new industry or class of technologies -- the creation depict the results of strategic market analysis show-
of a new set or clusters of subsequent, less signifi- ing both the present and future innovation profiles
cant distinctive innovations. A distinctive innovation required.
is the creation of a new member in the set initiated
by a breakthrough innovation. Incremental innova- The innovation profile is another tool that can be
tions result in changes to distinctive innovations. used to describe competition. And, it can be used to
describe the history and potential future of an indus-
At the societal level, the development of the incan- try.
descent light was a breakthrough innovation. The
changes from carbon filaments to metal filaments Results of Survey
and from evacuated bulbs to gas-filled bulbs were The determination of the innovation profile is based
distinctive innovations. The development of new on a selection of ten priorities (or values) in each of
metals and glasses that are more reliable and less two categories – vitality and quality. These are:
expensive were incremental innovations.
Vitality
When these two dimensions of innovation are com- • Self development
bined into a matrix, a powerful innovation tool re- • Communication
sults: The Innovation Profile. • Environmental awareness
• Multiple skills
Everyone within an enterprise can and should inno- • Teamwork
vate in one or more areas in this map. The Innova- • Vision
tion Profile is a very useful tool for discussions with • Leadership
individuals and groups about innovations and their • Creativity
goals; it can also be used as a creativity enhance- • Innovativeness
ment tool. • Knowledge

Other Applications Quality

• Achievement
If the innovation profile is sharply focused on a few • Effectiveness
types of innovation, the organization is likely to be • Appropriate technology
efficient. If that profile is focused on the require- • Service
ments of its market, the organization is likely to be • Productivity
effective. If the innovation profile is very broad, the • Efficiency
organization is likely to be inefficient. • Control
• Pioneering progress
The priorities you scored can also be used to write a • Community
scenario for the organization, describing how the • Self actualization
organization works. They can also be used to de-
velop the equivalent of an “engine” describing how The definition of these values are given in the appen-
the organization reaches its innovation goals. dix.

If the innovation profile is not the one desired, the
profile desired can be determined via the survey and
a target profile developed. Once this is done, a road
map can be constructed for the organization that
outlines the path the organization can take to reach
the desired profile. This is developed by focusing on
Each person taking the survey was asked to answer
some demographic questions and then determine
the importance of each of the 20 values in their or-
ganization. From the priorities selected, an innova-
tion profile was calculated. Examples of the individ-
ual profiles are given in the appendix.
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may be trying to differentiate themselves from their

As expected, taken as an aggregate, the importance
of each of the 20 values was almost he same. How-
ever, a few of the values stood out:
Achievement (65%), Effectiveness (58%) and Effi-
ciency (47%) got the highest very important or
competitors in the ways in which they deal with their
clients.
Note that the two information technology companies
have almost the same profile. A result like this could

be an indication of the “strategy decay” discussed by

critically important scores among the quality values. Hamel in Leading the Revolution.
Control (18%) was substantially lower.

Leadership (54%), Teamwork (54%) and Knowledge

(48%) got the highest scores among the vitality val-
ues.
The innovation profile resulting from these values
indicates a strong focus on distinctive product inno-
vations (for the organizations participating in the
survey).

I expected to see sharp differences between organi-

zations in different industries and some similarities
between organizations within an industry. This
turned out to be true as shown in the appendix.

For example, consider the two health care organiza-

tions. The small health care organizations is a re-
search organizations and the large health care or-
ganization is a hospital. The research organization
has a focus on breakthrough products and the hos-
pital has a focus on distinctive and breakthrough
procedures.
There were three industries that had three or more
respondents – professional services, finance & insur-
ance and education.
Professional Services

Look at the four professional services companies. Finance & Insurance

Each has a focus on distinctive and breakthrough
product innovation. Two have an added focus on Professional service companies are heavily focused
procedure innovations. These two organizations on product innovations with an emphasis on distinc-
 5

tive product innovations. This may represent the Expereince <20 years >20 years
professional services industry’s continual search for Scored self actu- Higher scores on
new products to respond to the ever changing needs alization higher almost all values
of their clients and the ever present pressure of Highest score: Highest score:
competition (the need to differentiate themselves leadership achievement
from competitors). Lowest score: Lowest score: con-
control trol
Finance and insurance shows the split focus be- Biggest difference:
tween the need to develop new products like the scored creativity
professional services industry, but also new ways to and innovative-
interact with their clients through procedure innova- ness; achievement
tions. These companies seem to have a higher focus and effectiveness
higher

Service <10 years >10 years

Highest score: ef- Highest score:
fectiveness achievement
Lowest score: con- Lowest score: con-
trol trol
Biggest Difference: Biggest difference:
Ranked communi- Ranked vision, self
cation higher actualization &
community higher

Rank Professional – Director – Execu-

Manager tive
Highest score: Highest score:
service achievement
on breakthrough innovations as well. Lowest score: con- Lowest score: con-
trol & creativity trol
The education industry is like the finance & insur- Biggest difference:
scored innovative-
Number of People <125 >125 ness, creativity &
Value self develop- Value knowledge self actualization
ment higher higher higher
More procedure More product inno-
innovation vation amount of revenue) showed small differences with
respect to the values as shown below:
Revenue <$10M >$10M Three of the demographics (length of expereince,
Value leadership & Value communica- length of service with current organization and hier-
innovativeness tion and knowledge archical position within the organization) make sense
more more only to analyze with respect to the values selected.
They do show some differences.
ance industry in that there is an almost equal em-
phasis on product and procedure innovations. How- It is probably no surprise that control was at the bot-
ever, education companies are strongly focused on tom of everyone’s list. It was a surprise that creativ-
incremental and distinctive innovations with little ity was also at the bottom for professionals and man-
emphasis on breakthrough innovation. agers. Whereas, creativity and innovativenss was at
the top of the directors and executive’s list. It is in-
Education teresting to note that professionals and managers
Two of demographics (size of organization and scored service at the top of their list (to make a con-
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tribution to society) while directors and executives sponses – general management, information technol-
ranked achievement at the top (accomplishing ogy, product development and training.
something desired by the organization). This must
set up some interesting dynamics. General Management

For people with less than ten years of service with

their present organization, effectiveness was ranked
highest whereas those with more than 10 years
ranked achievement highest. Both are results ori-
ented, but the people with less than 10 years are

more interested in doing something worthwhile for
the market, whereas those with more than ten years
Information Technology
Across industries, the general managers were clear
in what they values –distinctive product followed by
incremental product and breakthrough product inno-
vations. IT mirrored GM but added more procedure
innovations, i.e. New ways of working together and
with their clients in the company. Training also mir-
rored IT’s view of the need for procedure innovation

General Managers Self development Achievement

Teamwork Effectiveness
Leadership Efficiency
Innovativeness

IT Knowledge Achievement
Leadership Self actualization
Teamwork

Product Develop- ? Effectiveness

ment Appropriate tech-
nology
want to please the organization. Service

Those people with less than 20 years of expereince Training Teamwork Achievement
scored leadership the highest, whereas those with Leadership Service
more than 20 years scored achievement highest. Community

Four of the functional areas had three or more re-

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and while their focus on product innovation was the profile for $195 at our store. Go to http://store.
same shape as the GM’s, it was greatly reduced. yahoo.com/innovationroadmap/inprsu.html.

Training

You will note the conspicuous absence of product

development. The result from product developers
was very curious. No two of the product developers
responding scored any of the vitality values higher
than a three (important) and therefore an innovation
profile could not be created. They had a better de-
veloped sense of the quality values, but even in this
category, the scores were much lower. (There were
only two 5’s – critical, among all the scores.)

The product developers who responded to this sur-

vey value acceptance of what they develop in the
market, selecting or developing the best technology
to meet market needs and making a contribution to
society through their work. But, they lack clear pri-
orities on the class of innovation they are to de-
velop – incremental, distinctive or breakthrough.

Conclusions
While the innovation profile instrument has been
used successfully for years in workshop settings
within companies, this was the first time that it has
been sued across industries and in an online form
with no chance for interaction. The results have
been very promising.

The instrument appears to be discerning differences

in the innovation profiles of organizations and indus-
tries that make sense. It has also uncovered some
differences, i.e. Between general management and
product developers, that could lead to serious prob-
lems.

More expereince with the instrument is needed and

greater numbers of participants are required to pro-
duce conclusive evidence.

For More Information

For more information about the innovation profile
and its applications, contact Paul Schumann,
paul@theinnovationroadmap.com, 512.302.1935,
or visit the web site, www.theinnovationroadmap.
com. The web site contains a blog, magazine and
store for promotional and educational products re-
lated to innovation. You can also take the survey
and get for your organization and get an innovation
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Appendix – Examples of Profiles

Professional Services – Small

Finance & Insurance – Small

Finance & Insurance – Large

Professional Services – Large
 9

Energy – Large

Education – Small

Information Technology – Small

Consumer – Small
 10

Basic Materials – Large

Information Technology – Large

Health Care – Small

Nonprofit – Small Health Care – Large

Appendix – Values

Vitality Values
Self-Development: Acceptance of the responsibility
for one’s own future. The members of the organiza-
tion feel that it is their responsibility to begin a crea-
tive course of action or to act on their conscience for
self-development without external prompting.
Communication: Effective and efficient transmission
and flow of ideas and factual data within and be-
tween persons, departments, divisions and other or-
ganizations. Selection of appropriate media for the
message is implied.
Environmental Awareness: Perception and under-
standing of what is transpiring in the world and how
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it directly or indirectly affects the organization’s vi- activities that achieve externally established goals
sion, mission, goals, strategies, plans and actions. and expectations.
The environment is made up of current and future Efficiency: Thinking about and designing acts and
perspectives of customers, competition, and technol- purposes in the best possible and least wasteful
ogy within the context of social, political, economic, manner before implementing them.
scientific, and demographic driving forces for Control: Providing restraint and direction to achieve
change. methodological arrangements of persons or things
Multiple Skills: A well-rounded, broad perspective according to prescribed rules.
with expert capabilities in several key skill areas. Pioneering Progress: Originating and introducing
These areas must include life skills as well as organ- creative ideas for positive change in social organiza-
izational skills. tions and systems, and providing the framework for
Teamwork: Working effectively with and through oth- actualizing them.
ers. Working cooperatively with one another such Community: Sufficient depth of commitment to a
that the skills and qualities of one individual supple- group, its members and its purpose that both inde-
ment, support and enhance the skills and qualities of pendent creativity and interdependent cooperation
others in the group. are maximized simultaneously.
Vision: To perceive the purposes of an organization Self Actualization: The inner drive toward experienc-
and communicate that purpose to its members in ing and expressing the totality of one’s being
such a lucid manner that its members are able to through spiritual, psychological, physical, and men-
transcend their limited personal perspectives and tal activities that enhances the development of one’s
abilities. maximum potential.
Leadership: The capability to translate intention into
reality. The personal organizational or conceptual in-
fluence to motivate persons to take authority for the
process of change.
Creativity: The capacity for original thought and ex-
pression that brings new ideas and images into an
existing reality or brings forth a new reality.
Innovativeness: Ability to apply creativity. Innova-
tiveness requires an understanding of the organiza-
tion, its interaction patterns, and most importantly,
how ideas flow within the organization to become ac-
cepted.
Knowledge: The accumulation and management of
products of the mind. Examples include -- patents,
copyrights, trade marks, trade secrets, know-how,
books, reports and standards.

Quality Values
Achievement: Accomplishment of a desirable result
as defined by the organization.
Effectiveness: The production of relevant results as
defined by the market.
Appropriate Technology: Selecting the best technol-
ogy to fulfill an application while minimizing the ad-
verse effects on the surrounding systems.
Service: The motivation to make a contribution to
society (customers, community, and world) through
one’s work.
Productivity: Generating and completing tasks and