Point: Jump in and create, don’t worry about getting it right the first time

Story: My friend Joel wanted to write a novel. He took classes. He turned in assignments. But, he just inched along because he tried to perfect each piece. Then he heard about “National Novel Writing Month.” The goal: write a 175-page novel during the month of November. Sounds intimidating — 50,000 words — but it comes down to 1666 words a day.

My first reaction was, “but would the novel make sense?” Joel pointed out that the rationale was not to have a publisher-ready novel in a month. “The point is practice,” he said, “and to have much more material to work with than you’d have otherwise.”

To meet the fast pace of the challenge, Joel had to give up his inner critic and just crank out some writing every day. Now he’s got the draft of a novel. He’s got some gems, and he’s got material to refine.

This process applies to writing business plans, marketing collateral, sketching new product ideas and other daunting tasks.

Action: The first step is to set a goal with a deadline. Then commit to making some progress every day. Rolling up your sleeves and jumping into a task creates momentum. The result is something tangible that you can refine.

Tags: goals, progress

Point: Measure innovation from a variety of lenses, not just one

Story: The Information Technology and Innovation Foundation (ITIF) conducted a 40-country study of innovation, ranking countries on competitiveness. The ITIF used 16 metrics grouped into 6 categories:

1. Human Capital
   * Higher Education Attainment
   * Science & technology Researchers
2. Innovation Capacity
   * Corporate Investment in R&D
   * Government Investment in R&D
   * Share & Quality of World’s Scientific and Technical Publications
3. Entrepreneurship
   * Venture Capital
   * New Firms
4. Information Technology Infrastructure
   * E-Government
   * Broadband Telecommunications
   * Corporate Investment in IT
5. Economic Policy Factors
   * Effective Corporate Tax Rates
   * Ease of Doing Business
6. Economic Performance
   * Trade Balance
   * Foreign Direct investment Inflows
   * GDP per Working-Age Adult
   * Productivity

Action: Translate these country-level metrics to your organization. For example, Human Capital metrics: the education level of your employees, the skills employees must have to meet customer needs; Innovation Capacity: how much do you invest in R&D or in innovation? How well do you understand your industry, technology and the specific markets where you compete? Entrepreneurship: do you encourage employees to suggest ideas? Do you have processes in place to evaluate and fund those ideas? IT Infrastructure: do you invest in IT and software to let your employees communicate and collaborate easily? Economic Policy: do you minimize barriers to innovation, like bureaucracy and silos? Economic Performance: how many innovations do you have per employee?

For more information, see the ITIF’s report The Atlantic Century: Benchmarking EU & US Innovation and Competitiveness

Tags: capacity, competitiveness, human capital, infrastructure

Point: Too much VC funding can be just as bad as too little

Story: As a small young company, ViaWest had only $34 million in funding. But it faced massive competitors with $300 million and $800 million in war chests, respectively. These big competitors used their deeper pockets to “get big fast” — acquiring other companies, buying big office buildings, and investing in lots of shiny new large datacenters. But sales didn’t materialize and the big companies went bankrupt. In many ways, the money distracted these companies — they were looking for ways to spend it rather than focusing on their core innovation and business fundamentals.
In contrast, ViaWest used its money carefully and made positive cashflow a major goal. ViaWest focused on low-cost, efficient web-based tools to help it out-innovate — not out-spend — its bigger rivals. ViaWest also watched its asset investments carefully, only adding new capacity as needed when demand appeared. After the big competitors cratered, ViaWest bought some of the competitors’ lightly-used datacenter assets for pennies on the dollar.

Action: Use Web-based tools that let you innovate much faster at less cost. Create positive cashflow sooner rather than later. Create business forecasts for investment performance and stick to them — don’t invest more if the first investments aren’t meeting targets.

Tags: assets, cashflow, focus, performance, venture capital, web-based