There is no doubt that businesses need to practise innovation to stay competitive in the global market. Yet, some companies like Apple and Cisco seem more adept at innovation than others. But lucky for most companies, innovation is a discipline that can be learnt.

“Many people think of innovation as being some kind of magical event that only a few geniuses can do. We profoundly disagree. Innovation is — actually, we call it a discipline. You can develop the skills to be successful,” says Curtis Carlson, president and chief executive officer of SRI International.

Carlson should know. The non-profit research institute he heads is behind inventions that include the computer mouse, robotic surgery, high-definition TV and electronic banking. Previously known as Stanford Research Institute, it is now known just as SRI since it became independent of Stanford University in 1970.

Most companies do not have a thoughtful innovation process. Businesses must innovate as the lifetime of the top 500 companies in the US, which was 100 years at the turn of the century, has now dropped to 20 years, says Carlson.

According to Carlson, a bright idea is not innovation until someone uses it and pays money for it.

“Innovation is the creation and delivery of new customer value in the marketplace with sustainable profit for those producing it,” said Carlson in an interview in July during a visit to Kuala Lumpur together with Stephen Ciesinski, SRI vice-president for strategic business development, to conduct innovation development programmes at Universiti Putra Malaysia and Universiti Tun Abdul Razak. The duo also attended meetings with companies and organisations in the region.

SRI, based in the Silicon Valley, has collaborated with universities, industries and governments in Canada, UK, Finland, Denmark, Japan, Taiwan and Singapore. In fact, during the visit to Malaysia, Carlson and Ciesinski also met senior government officials to discuss the establishment of a proposed innovation centre to co-ordinate innovation programmes in the country.

Ciesinski observed that many researchers at UPM and Unitar were doing research in interesting areas such as biotechnology, agriculture and alternative energy. But they lacked the necessary knowledge on how to commercialise their research.

“The potential projects included a polymer-based water purification process, a palm oil-based anti-ageing serum, a non-invasive Down’s Syndrome early detection system, university-industry collaboration programmes, and student coaching programmes to continue university relationships after graduation,” says Carlson.

“Very few universities teach courses on how to innovate. Most PhDs holders think about innovation as invention, not as creating value in the marketplace for clients. [But] invention means patents, or some interesting technology but much of that technology throughout the world goes nowhere, it just sits on some shelf somewhere until someone innovates on that through a business model or technique,” says Ciesinski.

During the innovation development programmes held in UPM and Unitar, Carlson shared the five disciplines of innovation which he wrote about in a 2006 book he co-authored with William Wilmot titled Innovation: The Five Disciplines for Creating What Customers Want.

The five disciplines consist of important customer and market needs, value creation, innovation champions, innovation teams and organisational alignment. They may seem simple or even “rudimentary” as Ciesinski puts it, but most companies get them wrong.

For the first discipline, companies need to work on identifying important customer needs and not just the ones they are interested in.

“So, we literally focus on next generation Internet, cyber security, infectious disease, addiction, ageing, next generation therapeutics for cancer; the big important problems in the world. Why do we do that? We do that because not only is it motivating, it’s good business,” says Carlson.

In creating value, companies need to understand the marketplace, he says. People need to connect good ideas with understanding of the market. At SRI, an acronym — NABC — is used to evaluate potential value creation.

“‘N’ is ‘what’s the need?’ ‘A’ stands for ‘what’s our approach?’ ‘B’ stands for ‘what are the benefits per cost of that approach?’ ‘Better than the competition’ is ‘C’, or the alternative,” explains Carlson.

“You really look around at what the competition is doing because there’s no reason to go after something if your product is going to be competitively inferior to what others are doing,” says Ciesinski.

To carry out the grand plans of innovation, businesses would need the third and fourth disciplines, which are champions and teams. According to Carlson, a champion is someone who has the passion and the commitment to guarantee that he’s going to make innovation happen, no excuses.

“A team is generally best composed of people who have all that different characteristics but are focused on one goal. The selection of team members is generally up to the champion. So it all goes back into working on a very important problem you’re trying to solve,” explains Ciesinski.

With a champion and team to pursue innovation, those engaged in innovation would need the support of various levels of management to achieve their goal.

“What we feel is incredibly important is that there’s alignment, not just horizontally within the team but also vertically, all the way from the board to the team. That means that the team will get support as it’s going after this important problem,” says Ciesinski.

Innovation can only happen if all the five disciplines are put into motion.

“We put a multiply sign in between them, meaning if one of those is missing, in today’s world, there would be no success. Today, innovation is the only path of growth, prosperity, environmental sustainability and security. It’s the best of times for innovation [and] it’s also a challenging time,” says Carlson.

This article appeared in Manager@Work, the monthly management pullout of The Edge Malaysia, Issue 778, Oct 26 -         Nov 1,2009.