Innovation is widely hailed as the key to seizing competitive advantage and sustaining profitability. Yet, most companies allocate little structured attention to cultivating this precious resource. Why, in the age of know-how, show-how, relationships, and best practices, do companies routinely overlook the critical need to manage and extract value from creativity and knowledge? Why, in a business climate demanding transparency and accountability, is there a striking lack of discipline regarding assets we can’t necessarily touch, but that are clearly driving the lion’s share of revenue for Apple, Google, IBM, 3M, Amazon, Netflix, Priceline, and countless other companies.
In HARVESTING INTANGIBLE ASSETS: Uncover Hidden Revenue in Your Company’s Intellectual Property (AMACOM; October 27, 2011; $29.95 Hardcover), Andrew J. Sherman challenges business leaders to question the popular motivational approach to fostering innovation and creativity, as well as the standard emphasis on balance sheets over home-grown processes, informal collaborations, and employee expertise. Based on his work with some of the world’s most innovative and successful companies, Sherman presents systematic methods for managing, measuring, maximizing, commercializing, and protecting the greatest sources of value—concrete, bottom-line, as well as shareholder value—in today’s information-centric, innovation-driven world.
Reaching out to leaders at all levels in companies of all kinds, from executives at Fortune 1000 corporations to start-up entrepreneurs, Sherman urges readers to strive to transform business as usual. “Innovation includes new approaches, new business models, new channels, new value propositions, new pricing, new packaging, and new marketing and branding strategies,” he makes clear. “Not all innovation is breakthrough and life changing, but it often can provide new product lines, new services, new revenue streams, and new profit centers for companies of all sizes.”
Packed with instructive examples from an array of innovative companies—Apple, Charles Schwab, Chipotle, Cisco, Dow Chemical, Dunkin’ Donuts, Google, IBM, Jiffy Lube, Procter & Gamble, Wal-Mart, and 3M among them—HARVESTING INTANGIBLE ASSETS also provides a wealth of strategic guidance and tactical action plans. While gaining a new appreciation for the untapped value of the intellectual capital within their own organizations, readers will learn how to:
- Assess their organization’s attitude, appetite, aptitude, alignment, access, allocation, and adaptability for innovation.
- Plant the seeds for fostering a culture of innovation, starting by empowering employees to let down their guards and risk failure without fear—or dire financial loss to the company
- Embrace intrapreneurship as a central part of their company’s mission, values, and branding, and set clear and consistent intrapreneurship policies, strategies, and structures.
- Master Intellectual Asset Management—a comprehensive system for creating, organizing, prioritizing, and extracting value from their company’s cultural assets (mission, values, norms, and more); relationship assets (from customer loyalty to vendor alliances to Web 2.0 branding); human assets (workforce expertise, creativity, collaboration, and more); practices assets (including communication and training systems); and intellectual property (from patents to trade secrets).
- Develop a legal strategy to protect their key intellectual and creative assets, with a firm grasp on patents, copyrights, trademarks, service marks, and trade dress.
- Excel at creating and launching new products and services without betraying their trusted brand reputation or alienating their established customer base.
- Adopt a business model to sustain innovation and leverage its financial rewards, with highlights of cooperatives, channel partners, licensing, joint ventures, and franchising.
Sherman culminates his book with a hope-filled yet highly feasible look at the future of innovation for American business. Eye-opening, thought-provoking, and focused on tangible results, HARVESTING INTANGIBLE ASSETS reveals the true business value of innovation and provides the tools today’s business leaders need to sow and reap its promise.
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ABOUT THE AUTHOR
Andrew J. Sherman is a partner in the Washington, D.C. office of Jones Day, a global law firm with nearly 2,500 attorneys worldwide, and a top-rated Adjunct Professor in the MBA and Executive MBA programs at the University of Maryland. He is also the founder of Grow Fast Grow Right, an education and training company with operations in the United States, Canada, India, and Europe. An internationally recognized authority and leading speaker on the legal and strategic aspects of business growth, he is frequently called upon by the media to share his expertise. He has been featured or quoted in The Wall Street Journal, USA Today, The New York Times, BusinessWeek, Fortune, Investor’s Business Daily, Forbes, Entrepreneur, U.S. News & World Report, and other prestigious publications. He has addressed many widely recognized business and trade groups as a keynote or featured speaker, including recent presentations for the Association for Corporate Growth, American Corporate Counsel Association, and the New York Times Summit on Small Business.
Sherman is the author of 18 books, including the recent three-part Kaplan business growth series, Grow Fast Grow Right, and three previous titles for AMACOM: Mergers & Acquisitions from A to Z, Raising Capital, and Franchising and Licensing. His approach to leveraging intellectual assets was a cover story for Inc. magazine.
Title: HARVESTING INTANGIBLE ASSETS
Uncover Hidden Revenue in Your Company’s Intellectual Property
Author: Andrew J. Sherman
Pub. Date: October 27, 2011
Price: $29.95 Hardcover
Pages: 288
ISBN: 978-0-8144-1699-0
Visit AMACOM Online at http://www.amacombooks.org
Find book covers and author photos online at http://www.amacombooks.org/go/art/
Kama Timbrell at 212-903-8315 / This email address is being protected from spambots. You need JavaScript enabled to view it.
Cultivating and Maintaining a Culture of Innovation
Proven Principles and Best Practices
It’s a universally accepted fact of business: innovation is vital to every company’s long-term success. What’s still wide open to debate is: How does an organization successfully foster, establish, and sustain a genuine culture of innovation? As Andrew J. Sherman, a noted expert on intellectual property management and business growth, shows in his new book, HARVESTING INTANGIBLE ASSETS (AMACOM; October 27, 2011), the answer can be found in the trusted principles and practices of highly successful innovative companies. They include:
- Google’s 70/20/10 rule. Each employee should spend 70 percent of his or her time working on the core business, 20 percent working on ways to extend or expand the core, and 10 percent thinking completely outside the box. At Google, the 20 percent window has been very productive, yielding many of the company’s recent innovations, including Gmail, Google News, and AdServe. In fact, nearly half of Google’s new service offerings were conceived during the 20 percent open creativity window[k1] .
- 3M’s 30 percent/4 year rule. At 3M, 30 percent of total sales must result from products introduced within the past four years, forcing innovative products to have an almost immediate impact on the top and bottom lines. This rule is supported by the 15 percent rule, which allows technical personnel to spend 15 percent of their time on projects of their own choosing without any prior approvals.
- Cast a wide net. Innovation can come from many sources—both inside and outside a company. Look to customers, vendors, and even competitors as sources for new ideas and guidance on improving existing products and service. “Do not allow your culture to suffer from NIH (not invented here) syndrome, which assumes that ideas not generated by the leaders of the organization cannot possibly be worthy of consideration,” Sherman urges.
- Stay close to customer needs. Innovation doesn’t pay unless there’s a market for it. UPM, a Finnish paper manufacturer, has established a novel practice to ensure that its R&D teams keep focused on customer needs: mandatory on-site training[k2] with value-chain players across the paper industry, from large commercial printers to paper wholesalers and retailers.
- Embrace the headless tiger. Microsoft continued to do it without Bill Gates. Apple will continue to do it without Steve Jobs. Since visionary founders and leaders don’t stay with their companies forever, the company’s culture must be prepared to innovate with or without their day-to-day presence. Team-driven innovation works to create leaders at all levels that can sustain and strengthen the founder’s vision long after he or she steps down. Maintaining a culture of innovation depends on investments in training, commitments to empowerment and delegation, and the development of meaningful succession plans.
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- Let the RATS in. An effective, ongoing innovation process requires a systematic approach and commitment to the deployment of “RATS”: Resources, including human capital, time, and supplies; Advocacy, from both internal and external advocates who will help secure resources and provide emotional support for innovative projects; Testing and evaluation to predict the financial return on the resources invested; and Sustainable demand, based on the identification of target customers, markets, channels, and potential strategic partners.
- Make it fun—and remain open minded. Fun can be functional and productive. Game playing, role playing, experimenting, exercises, retreats, and parties can all facilitate creative thinking. Fun liberates the brain, allowing people to break down barriers and look beyond what they’re expected to see. For example, consider Viagra. In the early 1990s, Pfizer began testing a compound to treat certain cardiovascular diseases. One of the observed side effects was not at all what they expected. “Needless to say,” as Sherman observes, “a little repackaging and repositioning, and the rest is history.”
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Adapted from HARVESTING INTANGIBLE ASSETS: Uncover Hidden Revenue in Your Company’s Intellectual Property by Andrew J. Sherman (AMACOM; October 27, 2011; $29.95; ISBN: 978-0-8144-1699-0).
Kama Timbrell at 212-903-8315 /This email address is being protected from spambots. You need JavaScript enabled to view it.
How to Successfully Launch a New Product or Service Line
12 Ways to Avoid Pilot Crashes
Dole extended its juice brands into fruit salads, frozen fruit bars, and packaged snacks. Crayola expanded from crayons into markers, pens, paints, and office products. Arm & Hammer broke out of the baking soda box to specialize in laundry detergent and toothpaste. And Starbucks has enticed coffee lovers to try its ice creams and liqueurs. But many line extensions and expansions have also gone awry. Aside from New! Coke, notable flops include Colgate’s attempt at branching out from toothpaste into frozen kitchen entrees, Bic’s bold leap from pens and disposable lighters to ladies underwear, and Harley Davidson’s wild ride from motorcycles to perfumes.
In his new book, HARVESTING INTANGIBLE ASSETS (AMACOM; October 27, 2011), internationally recognized business growth expert Andrew J. Sherman offers a dozen ways to help any company avoid the financial and psychic toll of new product or service line crashes:
- Assign a diverse pilot team with clear expectations and timetables. Make sure the pilot team has diversity in background, expertise, and perspectives. Set clear deadlines and expectations; do not authorize open-ended fishing expeditions.
- Don’t overfund or underfund. Underfunded projects never make it out of the laboratory and overfunded projects lead to waste and “false positives.” Set adequate, reasonable budgets, and hold pilot team members accountable for sticking to them.
- Focus on markets, not product bells and whistles. To paraphrase Thomas Edison, the mark of a successful invention is a willing and happy buyer, not a memorial in a museum. Commercialization objectives must trump dreams of design awards.
- Garner internal support and enthusiasm at the highest level. Pilots need momentum and on-site support to survive. Engage leadership early on, and lobby across divisional lines.
- Open the doors to collaboration. You can test, speculate, and pontificate about the likely success of a given product or service. But, at the end of the day, if the channel partners are not excited to sell it and customers are not excited to buy it, it will surely fail. Seek input for improvement, positioning, and pricing from all key stakeholders in the process.
- Close the gaps. Pilot project planning must be crisp, with all key steps identified and executed. Accountability at each step is critical. Too much “wiggle room” or “white space” between key steps leads to waste, haste, and unnecessary delay.
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- Integrate and include. Pilot project success must be an integrated and inclusive undertaking, free from silos, turf wars, and politics. While excluding key players in the process is a fatal mistake, knowing exactly when to include certain constituencies is a company-specific art and science. Start by empowering initial working teams with complete access to all of the information they need to succeed.
- Keep your head out of the sand. A pilot project team that is intractably set in its ways—unable to respond to change, evolve, or even imagine that there might be an alternative path to creating the innovation—is destined for failure.
- Evaluate risks. New projects bring new levels of risk, which must be understood and managed. Risks should be calculated and measured from a liability perspective, a brand integrity perspective, a customer loyalty perspective, and a product placement perspective.
- Develop a healthy project management culture. Excelling at managing pilot projects takes discipline, commitment, and practice. The assembly of the right team, the clear definition of expectations and rewards, the level of time commitment (measured against other responsibilities), the right mix of skill sets, access to resources, and empowerment to fail without consequence are all critical success factors.
- Mistake early and mistake often. In the creative, new product, or service development process, all the best learning comes from the biggest mistakes. Make room for making them as early in the prototype stage as you can; they get harder and more expensive to fix as the process gets further along.
- Value both the silver and the gold. Remember the classic children’s song, “Make new friends, but keep the old…One is silver and the other’s gold”? The same holds true for new and established lines. Strive to strike a balance between tending to reliable “cash crops” and planting the seeds for new ones.
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Adapted from HARVESTING INTANGIBLE ASSETS: Uncover Hidden Revenue in Your Company’s Intellectual Property by Andrew J. Sherman (AMACOM; October 27, 2011; $29.95; ISBN: 978-0-8144-1699-0).
Kama Timbrell at 212-903-8315 /This email address is being protected from spambots. You need JavaScript enabled to view it.
Suggested Questions for
ANDREW J. SHERMAN
Author of HARVESTING INTANGIBLE ASSETS
- What’s wrong with—or, at the very least, missing from—the standard business approach to innovation?
- In your new book, HARVESTING INTANGIBLE ASSETS (AMACOM; October 2011), you focus on the importance of not just supporting innovation at the individual, team, or department level, but also fostering an organizational culture of innovation. Where should business leaders begin to plant the seeds?
- What specific resources, both tangible and intangible, are essential to establishing and maintaining a genuine culture of innovation?
- Aside from innovation and knowledge, what exactly do a company’s “intangible assets” include? Would you give us a couple concrete examples?
- Why is innovation truly a collaborative discipline? Would you share a few effective ways to facilitate team-driven innovation? Why should leaders aim to partner with innovative thinkers outside the organization as well as within it?
- In HARVESTING INTANGIBLE ASSETS, you also stress the importance of intrapreneurship. Why does intrapreneurship tend to be overlooked or misunderstood in so many companies?
- For who don’t know, what is a “CIO”? Would you list a CIO’s key job responsibilities? Why do you urge most large and growing companies to create this position?
- What is Intellectual Asset Management? Does establishing such a system make sense for only high-tech companies?
- In music, publishing, and other industries, considerable controversy and confusion surround the protection of intellectual property. Would you share a few basic legal facts all business leaders need to know?
- HARVESTIG INTANGIBLE ASSETS is brimming with examples of highly innovative, highly successful companies. Would you spotlight two or three that stand out for you?
- Why are you very optimistic about the future of innovation and its profitable impact on American business?
