Building a High Performance r&d Culture

SeptembermdashOctober 2009 210895-630809$500 copy 2009 Industrial Research Institute Inc

BUILDING A CREATIVE HIGH-PERFORMANCE RampD CULTURE

Customer insight risk tolerance entrepreneurship alignment technology excellence innovation creative collaboration and execution are the building blocks

Jerry L Newman

OVERVIEW A highly effective CREATIVE RampD culture combines C ustomer-focused R isk-tolerant E ntrepre-neurial A lignment with strategy T echnology and scientifi c excellence I nnovative V irtual organization (Collaboration) and E xecution elements to consistently drive true product innovation To generate this culture RampD leaders should examine attitudes and values and eliminate barriers that impede behaviors based on these characteristics Constructing the CREATIVE RampD culture involves a change process of building on inherent strengths and compensating for organizational gaps This starts with a foundation of leadership and executes product innovation at the juncture of customer insight technology and business alignment powered by risk tol-erance and collaboration This holistic framework has evolved from the practice of product development and has been applied successfully in various companies and industries KEY CONCEPTS RampD leadership RampD culture product innovation Innovation has nothing to do with how many RampD dol-lars you have hellip hellip itrsquos not about money Itrsquos about the people you have how yoursquore led and how much you get it mdash Steve Jobs

RampD culture can be the engine for sustained product innovationmdasha key driver of continual growth in many successful corporations Today there is a general impera-tive to generate growth through innovation ( 12 ) This is evident from all the organizations conferences consul-tants and books focused on the subject ( 134 ) Even with these resources however many organizations still struggle to generate consistent results in new product development (NPD) Finding and implementing new opportunities is diffi cult and complex yet some organi-zations excel not just once but on an on-going basis

Because innovation means many different things to peo-ple any in-depth discussion of the topic requires a defi ni-tion of the term In this case discussion will be limited to product innovation which is defi ned as commercializing products that produce customer and shareholder value through differentiated technology that is strategically aligned with the business This product innovation model is illustrated in Figure 1

Customer insight business alignment technology and execution are at the core of building an effective innova-tion initiative The RampD culture of innovation excellence is built on these elements plus risk tolerance and creative collaboration (virtual organizations) These elements form the acronym CREATIVE C ustomer-focused R isk-tolerant E ntrepreneurial A ligned with strategy T ech-nology and scientifi c excellence I nnovative V irtual organizations (or creative collaboration) E xecution (or E xcellence in project management) ( 5 )

Many RampD organizations have excelled by successfully focusing on single factors such as creativity execution or customer focus The CREATIVE RampD culture framework depicted in Figure 2 ( 6 ) has been originated and utilized by the author at various levels of RampD management in multiple industries The application of this framework has generated sustained innovation resulting most re-cently in signifi cant and sustained improvement in new-

Jerry Newman is senior director product develop-ment at STERIS Corporation St Louis Missouri His team is responsible for RampD activities for the skin care and other chemical decontamination businesses within STERIS During his career he has held a variety of RampD positions at SC Johnson amp Son Johnson amp Johnson Medical Kemin Foods and STERIS He and his teams have been responsible for the development of over 50 new infection control skin care wound care decontam-ination and dietary supplement products Newman ob-tained his PhD in biochemistry from Ohio University jerry_newmansteriscom

Research Technology Management22

product sales over a fi ve-year period What follows is a detailed explanation of each CREATIVE element and tips for how to implement the holistic framework

Customer Focus We can believe that we know where the world should go But unless wersquore in touch with our customers our model of the world can diverge from reality mdash Steve Ballmer

When RampD team members overcome isolation from customers and consumers they can gain profound insight into how their technologies can be incorporated into new products that bring value to customers Without true customer insight an invention is just thatmdashan invention not an innovation There are many examples of outstand-ing technologies that failed in the marketplace and of products that failed to even reach the marketplace due to poor relevance to customer needs Traditional RampD man-agement and organizations have tended to seclude RampD professionals away from customers and have often been reluctant to push for customer contact However unless they are encouraged to see through the eyes of customers and end-users RampD professionals are often unable to see practical applications for their technologies ( 7 )

If the customer insight side of the innovation equation is ignored in favor of the RampD organizationrsquos excitement over a new technology the department can end up with ldquoa technology in search of a marketrdquo This occurs when RampD professionals ldquofall in love withrdquo technologies for their own sake as opposed to creating and developing tech-nologies to meet customer needs This can lead to a perception that the RampD organization is out of touch with the customers and the business needs of the organization

RampD professionals should avoid the ldquobuild it and they will comerdquo attitude Although no one can dispute the value of visionaries few RampD team members can afford

RampD professionals should avoid the ldquobuild it and they

will comerdquo attitude

Figure 1mdashTrue product innovation occurs when ideas at the intersection of customer insight technology and business alignment are successfully executed (6)

SeptembermdashOctober 2009 23

Highly effective RampD organizations have close ties to customers philosophically and in practice The fi rst step in creating customer focus among the RampD team is sim-ply to have RampD professionals directly observe custom-ers in their own environment This is where abstract imagined customer needs can become concrete and real for the team Observing customersrsquo actual challenges al-lows team members the opportunity to extrapolate tech-nological solutions for these problems

The RampD team is ideally suited for discovering unar-ticulated needs If the marketing department takes on the sole responsibility for gathering customer insight it can become a crutch that keeps RampD team members isolated from customers Uncovering an unarticulated need through a customer visit could lead to a fundamental change in the priority of customer needs If customers do not realize that there is a solution to one of their prob-lems they may prioritize needs differently This chal-lenge can be the basis of discontinuous innovation and breakthroughs

Various tools have been designed that provide more so-phisticated customer insight to RampD staff and all cross-functional project team members ( 81011 ) Regardless of whether the marketing group or project teams spear-head the customer insight activities it is important for key RampD representatives to be involved in order to hear the concerns problems and comments of the customers fi rst-hand This can help resolve potential confl icts in feature sets and help to prioritize product requirements early in any discovery or development process

Many organizations are described as either market (or cus-tomer) driven or technology driven The best innovation comes through a real balance of the two as suggested by the innovation model in Figure 1 Creating this balance is not an easy task when faced with some of the biases with-in some RampD organizations By building the philosophy of customer focus into the RampD organization the more balanced perspective can be established While tools are an important part of gathering effective customer input RampD leadership needs to make customer focus an impor-tant and expected part of the RampD culture Effective col-laboration with the companyrsquos marketing and sales teams

ldquoRisk rdquo means different things to

different corporate stakeholders

Figure 2mdashThe CREATIVE RampD culture starts with a foundation of leadership and executes product innovation at the intersection of customer insight technology and business alignment powered by risk tolerance and collaboration (6)

the approach of Buckminster Fuller who said ldquo I just invent then wait until man comes around to needing what Irsquove invented rdquo A search of numerous RampD management books indicates that many of them offer little discussion of the customer Writings on innovation and NPD on the other hand are fi lled with discussion of how to search for effective solutions through the eyes of the customer ( 8 ) Customer needs can be divided between articulated unarticulated ( 9 ) and future needs Figure 3 illustrates how these needs are a part of the innovation model ( 6 ) Articulated needs are those that customers can recognize and easily describe based on their current requirements and understanding of available technologies These types of insights generally result in incremental or con-tinuous innovation Unarticulated needs are sometimes referred to as latent needs RampD project team members must have unfi ltered access to customers in order to identify unarticulated needs Future needs are discerned through a deep understanding of how alternative futures create needs for new technologies Unarticulated and fu-ture needs are often the source of discontinuous innova-tions or breakthrough opportunities It is important to take a balanced approach to the evalu-ation of customer insight Excessive emphasis on articu-lated needs may tend to drive the organization toward too many incremental projects On the other hand excessive emphasis on unarticulated needs may drive the balance of projects toward too many high-risk long-term projects A balanced approach is needed to generate a diversifi ed portfolio of projects appropriate for the corporation and the market


at multiple levels will help reinforce the importance of customer insight for RampD staff

Risk Tolerance You miss 100 of the shots you never take mdash Wayne Gretzky

When RampD team members learn to effectively use in-tuition and overcome their tendency to trust only abso-lute certainty they can make decisions fast enough to keep up with the demands of the current business cli-mate and create true innovation and competitive ad-vantage The term ldquoriskrdquo is used differently by various corporate stake holders The RampD discussion of risk does not relate to personal or product safety but rather to the risk of failure that can hinder rapid decision-making For scientists and engineers this specifi cally relates to the question of whether enough data exist to make rapid decisions that can move projects more quickly to completion

Because actions speak louder than words creating a risk-tolerant RampD organization can be a diffi cult task Reper-cussions from past failure can be traumatic and long lasting persisting even after changes in leadership have

removed the initial source of negative consequences The risk tolerance of an organization is not only the result of the personality of individuals but also of organizational behavior both past and present particularly that of mid-dle and senior management ( 12 ) Cultural attitudes to-ward risk tolerance can be diffi cult to modify and any change must start with communication of risk tolerance by RampD leadership Project-related risk also concerns the balancing of corpo-rate fi nancial risks vs speed-to-market The typical trade-offs for any activity but particularly for new product projects almost always involve timendashcostndashquality impacts ( 10 ) A discussion of risks helps determine the appropriate course of action and tradeoffs to make in particular cir-cumstances of the project framework Appropriate risk-taking may involve adjusting project cost to gain a time advantage and suggesting a value for parallel activities on high-priority projects and activities At times team members misunderstand the relative value of costs For example rapid third-party testing of prototypes may seem expensive but compared to the overall costs of potential project delays it may actually be a bargain Decision-making and cycle time reduc-tion may involve sacrifi cing perceived quality which

Figure 3mdashCustomer focus can provide insight about articulated unarticulated or future needs These can generate the basis for incremental next generation or breakthrough innovations respectively (6)


in most organizations translates to signifi cant apparent risk

Fast decision-making is more important than ever in NPD and sometimes requires decisions to be based on less information In the competitive environment of new product development the speed imperative does not al-low collection of enough information for RampD profes-sionals to always feel comfortable Thus the higher-risk environment requires many scientists and engineers to operate outside their normal comfort zone RampD leader-ship is responsible for creating the environment to en-courage this transition

RampD professionals may tend to be risk-averse when it comes to data interpretation but risk-tolerant when it comes to project selection and termination They gener-ally value a challenge when it comes to the project choice and there may be a tendency to take on projects that have high technical risk This can also result in a hesitancy to discontinue or kill projects with low practicality Engi-neers and scientists are taught perhaps unintentionally that anything is possible with enough time and money Based on a desire for challenge RampD professionals may advocate that certain projects are technically feasible when the time and cost to achieve success are not within the expectations of business partners This leads to an-other aspect of true risk avoidance failure to admit mis-takes and ldquopull the plugrdquo on projects when appropriate

Product development is full of risks and thus many proj-ects are bound to fail ( 13 ) In RampD the mantra should be that it is OK to fail but we should fail fast and learn from that failure History is full of inventors that have turned mistakes into successes ( 14 ) In fact serendipity has been the source of many great innovations ( 15 ) Itrsquos OK to make mistakes but not the same mistakes over and over Discovering dead ends faster is one of the benefi ts of understanding the positive attributes of failure for the RampD team The high-performance RampD culture learns from failures to ensure that the same mistakes are not repeated and regularly ldquoturns lemons into lemonaderdquo Nurturing this attitude can be diffi cult since it is important to communicate learning without penalizing or creating a sense that the organization is not risk tolerant

Entrepreneurial In the history of the world no one has ever washed a rented car mdash Lawrence Summers

If RampD staff members can learn to think like business owners and understand ldquothe big picturerdquo they will gain accountability for and drive greater innovation results One of the criticisms commonly heard about RampD pro-fessionals is that that they lack business perspective This criticism is perhaps another consequence of lab and

cubicle isolation It also has to do with a subtle expecta-tion that RampD professionals should be left alone to do their science or engineering In addition there is often a self-perpetuating cultural gap between scientists and en-gineers and other parts of the business This attitude comes not only from functions other than RampD but is at times reinforced by RampD management and profession-als in their desire to just do the science (or engineering) and let others make the business decisions The lack of business perspective among RampD profession-als is a generally neglected topic in management books and a subtle but defi nite stereotype exists that the typical RampD group is reluctant to dispute A common distinction is made between ldquothe business siderdquo and ldquothe RampD siderdquo This mindset can be a signifi cant barrier to generating a true CREATIVE innovation atmosphere and can subtly strengthen the attitude that innovation is solely about cre-ative ideas and novel technology Ironically while many RampD managers receive management and business train-ing there is a reluctance to offer RampD staff similar busi-ness and leadership education Although RampD team members may enjoy dealing with numbers they donrsquot always want to understand the num-bers that drive the business Perhaps this myopia is due to leaders who donrsquot make them aware of how their cur-rent RampD activities align and link to the business and its objectives By learning and using fi nancial terms par-ticularly those related to the evaluation of new product opportunities RampD professionals can earn the credibil-ity to enter the debate about business strategy and can become effective business partners strategically aligned with organizational objectives An important way to generate credibility among busi-ness partners is for RampD team members and leaders to endorse incremental innovations that support short-term business needs RampD professionals generally prefer working on the longer-term or more substantial innova-tions Entrepreneurs on the other hand are able to un-derstand the need to balance short-term needs with long-term opportunities Understanding the big picture and connecting the results with business strategies builds ownership among RampD

Ask RampD staff to look at decisions as if they owned the

company


lation and independence An indication of this perceived lack of alignment is the often-posed question ldquoWhy is RampD working on that project (which has little linkage to the stated business strategies of the corporation or busi-ness unit)rdquo These apparent inconsistencies create fric-tion and distrust among other corporate departments Organizational isolation often referred to as the ldquosilo ef-fectrdquo is one of the primary causes

When an RampD organization has strong links with corpo-rate and business-unit vision mission goals and strategic plans the opportunity for successful innovation increases exponentially Strategic alignment between RampD and the marketing and operations functions is particularly valuable in driving the innovation process Unfortunate-ly there is often a lack of alignment among these three groups for new product strategies

Business-unit organizations have often been formed in an attempt to overcome this lack of alignment Some marketing leaders believe that if they had control of the RampD organization they would improve new product performance But business-unit organizational structures are no guarantee of RampD alignment Although market-ing professionals might provide some general manage-ment and business information they are less likely to have the skill set to manage motivate and reward re-search and technical talent Resorting to organizational structure to achieve the goal of alignment can create bu-reaucratic and motivational problems

Organizational alignment can be accomplished either through organizational structure such as business units or by developing interdepartmental relationships While relationship-based alignment can be especially strong its success depends on the individual personalities the quality of senior management alignment and on other cultural factors RampD leadership needs to encourage the teamwork that leads to a truly effective alignment and must be willing to participate in virtually all elements listed in the model shown in Figure 4 Establishing align-ment is primarily a leadership function but these tools include both management and leadership aspects

Organizational alignment doesnrsquot mean that there is complete agreement with all RampD activities throughout

team members By generating and publicizing progress toward measurable new product goals RampD leaders can demonstrate the importance of these performance met-rics to the RampD team as well as to other parts of the corporation New product sales both in absolute num-bers and as a percentage of base business are arguably the best surrogate measure of innovation results How-ever since these are long-range measurements patience and understanding are required to evaluate the impact of the CREATIVE RampD culture Being responsible and accountable for results can be dif-fi cult for some RampD organizations It is easy to blame marketing or corporate decisions for poor new product performance By entering into the debate over project selection with credibility the RampD organization takes responsibility for its performance While some projects or activities may lack good well-disciplined marketing direction RampD innovators can take responsibility for obtaining market and customer feedback or demand that appropriate due diligence be obtained before initiation of programs An entrepreneurial approach does not al-low for lack of responsibility or accountability for new product performance Risk tolerance should not be an excuse for a lack of suitable discipline or diligence around business decisions

A valuable method for building ownership is to ask RampD staff members to look at decisions as if they owned the company Similarly RampD leaders and teams could view the department as if it needed to compete against outside suppliers of new products and technology This approach can be a good method for instilling a sense of competition and a culture of continual improvement Comparing results to those of small companies that introduce innovations rap-idly provides motivation and a model for fast cycle time

While all RampD professionals may not want to be drivers of innovation virtually all are involved with projects that bring innovation to the marketplace Without enough exposure to business needs and an understanding of the big picture RampD professionals will not support these innovations with passion Without some passion and sense of ownership the drive to perform those support functions suffers

Aligned with Strategy In the end effective execution of strategic alignment is a leaderrsquos top priority and ensures that goals are met and success achieved mdash Gerard A Abraham (Thermo Electron Corp 16)

RampD teams can gain credibility and support from other functions and drive innovation more effectively if they act in alignment with business strategies An extension of the lack of business perspective in the RampD organiza-tion is lack of alignment which is created largely by iso-

Lack of alignment is created largely by

isolation and independence


the company Innovation does require free-thinking at certain times However the RampD organization needs to be working toward the same focused business goals rather than toward undefi ned scientifi c objectives Indi-vidual maverick innovators can be tolerated when they are not overly distracting and they produce results that are aligned with overall business objectives While some freedom is desirable to allow exploration that leads to innovation it can be an excuse for lack of alignment and accountability The RampD leadership must understand this balance and must know how to best utilize the unique attributes of each RampD staff member

Technology and Science Excellence Any suffi ciently advanced technology is indistinguish-able from magic mdash Arthur C Clarke

When the RampD team individually and collectively exhib-its excellence in technology and science it can continu-ally drive differentiated and sustainable innovation Therefore technical excellence might be considered the ticket for entry to a high-performing RampD team This un-derstanding is perhaps the easiest of the success factors to establish within the RampD organization Depending on the nature of the business the RampD scientists and engineers may be expected to be world-class technical experts in their respective fi elds When they are able to apply techni-cal expertise to meaningful innovations the RampD team can build credibility within the company and within their industry potentially on a national and international scale

Because knowledge is a major driver of innovation con-tinual learning should have a high value in the high-performance RampD culture Leaders who understand the value of innovation know that technical knowledge

Risk tolerance should not become

an excuse for lack of critical thinking

Figure 4mdashThe elements of strategic alignment begin with corporate mission as foundation and utilize various layers of tools to drive toward aligned results

should be strong throughout all levels of the RampD orga-nization RampD team members should be encouraged to build their knowledge base and skills since technical in-formation changes so fast Failure to keep up with ad-vances in their fi eld can cause scientists and engineers to lose their edge and value to the organization

As long as proprietary information is not exposed writ-ing technical papers and attending technical meetings are also good ways to maintain these skills They are also benefi cial to the corporation in building credibility for their expertise and their technologies Writing ar-ticles for trade journals and customer-oriented peer-reviewed journals allows the RampD staff to translate technical differentiation into customer benefi ts

Critical thinking leads to faster better and cheaper new product development Tools such as high-throughput screening rapid prototyping and experimental design can help to provide faster answers to fundamental ques-tions involving multiple variables Using critical think-ing to plan effective experiments can help reduce the total time for projects When proper planning is sacri-fi ced in an attempt to speed up the process it can ulti-mately result in slower decision-making due to repetition of studies and incomplete or erroneous information Risk tolerance should not become an excuse for lack of critical thinking and planning

RampD leadership is responsible for identifying prioritiz-ing and developing technologies and technology plat-forms that drive innovation and growth These technology platforms typically leverage existing or sustaining tech-nologies as well as incorporating emerging disruptive technologies RampD leaders should interpret the value of technology platforms to non-technical business partners in order to translate the magic of technology into cus-tomer benefi ts ( 7 )

Innovative The best way to predict the future is to invent it mdashAlan Kay

RampD teams must understand that true innovation as modeled in Figure 1 is much more than clever inven-


tions or nifty technology ( 6 ) Great ideas are indeed the lifeblood of an RampD organization but ideas need to be successfully implemented to become new products Sus-tained innovation requires the successful combination of advanced technology customer needs the organizationrsquos strategy and effective execution In other words inno-vation is putting it all together to create value for cus-tomers and the corporation

Successful innovation is to a great extent about creat-ing the atmosphere and mechanisms for choosing the right project Although this is primarily a leadership function maintaining disciplined processes around these choices might also be perceived as a management function The choice and implementation of the right projects is a fundamental challenge of sustained inno-vation

The process of ldquoideationrdquo is generally enjoyable for many RampD staff members However a problem occurs when these professionals fall in love with creative ideas and lack the skills or passion for critical evaluation andor implementation Many RampD professionals love long-range ideas or potential radical or breakthrough innova-tions While these projects are exciting and essential it is important to have a healthy balanced portfolio of projects with different opportunities vs risk profi les and timelines This balance helps RampD leadership establish credibility with other stakeholders in the organization who are under pressure to produce short-term business results

Characteristics of an RampD innovation champion often in-clude technical competency the ability to interpret cus-tomer needs risk tolerance entrepreneurial understanding alignment skills effective networking capabilities and a propensity for driving toward implementation ( 17 ) RampD teams and staff members can become natural champions of product innovation if RampD leaders identify reward and develop those individuals who show potential

Virtual Organizations (CREATIVE Collaboration) None of us is as smart as all of us mdash Japanese Proverb

RampD teams improve their effectiveness by excelling at collaboration within the team itself across the corpora-tion and externally The spectacular results of creative collaboration have been chronicled in the book Organiz-ing Genius The Secrets of Creative Collaboration and Group Genius ( 18 ) Building effective collaborative cor-porate relationships with marketing operations and other internal functional groups can be crucial for successful innovation and is characteristic of highly effective RampD teams Unfortunately networking doesnrsquot come naturally to many RampD professionals Their personalities training or culture have often infl uenced them toward personal au-tonomy and independence Because of this mindset RampD

scientists and engineers are often afraid to let go of their egos and ask questions or seek help

Isolation and independence can lead to the well-known phenomena of NIH (not invented here) and groupthink ( 1920 ) One of the consequences of NIH can be rejec-tion of ideas from the outside without appropriate dili-gence This practice has a damaging effect on innovation and RampD credibility One tactic for discouraging NIH behavior is ldquoresearch tourismrdquo ie having researchers visit outside institutions ( 21 ) Jain and Triandis discuss other helpful activities to help reduce the NIH attitude in Management of Research and Development Organiza-tions (20) Internal and external relationships are impor-tant sources of creative energy for identifying new product opportunities and for solving problems during rapid implementation However this external research should be balanced against the desirable benefi ts of ex-tending internal competencies

Any corporate perception of an NIH attitude from the RampD group can lead to frustration and eventually to an undervalued RampD organization When that happens other departments may seek alternate sources of innova-tion and the RampD organization may be cut out of a ma-jor part of the innovation process The RampD team needs to maintain an open collaborative attitude and seek ap-propriate outside interactions before these detrimental consequences occur

The spectrum of innovation processes ranges from to-tally internal development to entirely external product or asset acquisition ldquoOpen innovationrdquo is the popular term for the external side of the continuum Fully internal development uses totally vertically integrated opera-tions and this rarely occurs today The practical reality is that most NPD projects fall somewhere in the middle of this spectrum One way to combine the benefi ts of larger and smaller companies is to become a system integrator and use sub-contractors to coordinate the complex elements In this case RampD innovators need to build effective partnerships with appropriate outside organizations Again this may not come naturally so leadership needs to fi nd ways to encourage such partner-ships

True innovation is much more than

clever inventions or nifty technology


Execution or Excellence in Project Management Real artists ship mdash Steve Jobs

The RampD organization should consistently excel at com-mercializing innovations to gain and maintain a reputa-tion as a high-performing team There has been a great deal of attention provided to improving cycle time or speed-to-market in many companies and industries and countless books and papers are available on the topic While there are many reasons for excessively long product development cycles a major source of frustra-tion can come from ineffi cient project prioritization procedures that span RampD and other corporate func-tions involved in the NPD process

Much has been written about the benefi ts and disadvan-tages of phased product development and about project management as it relates to new product development The best processes balance discipline with lack of excessive bureaucracy Although RampD teams should participate and be profi cient in these overall corporate processes they must also master internal RampD process-es and activities Great ideas and strategic alignment mean little without the results of effi cient execution Champions of innovation within the RampD organization need to be profi cient at cross-functional project manage-ment Lack of profi ciency can result in revenue loss and missed opportunities ( 22 )

Effective disciplined corporate processes have been well described by Cooper and by Wheelwright and Clark ( 4 23 ) These process tools include the establishment of phases and decision gates resource allocation and port-folio mapping They help the corporation manage risk and eliminate projects that should be discontinued due to lack of marketing or technical feasibility While such processes are valuable they need to be monitored to en-sure that they do not become overly bureaucratic Fur-thermore these tools work best when they are accepted throughout the corporation

Execution is the element most related to RampD manage-ment Some leaders may view this discipline as micro-management but leaders are ultimately accountable for results It has been said that ldquomanagement without lead-ership is bureaucracy but leadership without manage-ment is chaosrdquo It is the RampD leaderrsquos job to set the expectation for discipline and accountability for new product results Many RampD managers donrsquot feel the full weight of this responsibility because progression to se-nior levels has often been based on technical competen-cy rather than managerial or leadership skills ( 24 ) Once they are promoted managers often miss appropriate training and coaching on the skills related to manage-ment and leadership

Execution does not always come easily to RampD scien-tists and engineers who tend to seek perfection before

commercializing products The desire to tweak new products often leads to numerous delays Credibility of the RampD organization is often lost when timelines are not maintained ldquoParalysis by analysisrdquo can become a problem for RampD professionals and managers but inter-nal credibility can be gained or reestablished by meeting project milestones in scope on budget and on time RampD leaders should strive to develop credibility for their organization within the company by consistently meeting its commitments High credibility will provide greater resources and freedom for the RampD organization to advance longer-term objectives

When progressing toward a high-performance RampD team the change can begin with focus on execution Many times even smaller projects or ideas fl ounder due to a lack of attention on execution These projects may represent only small incremental innovations but change is often accomplished through small early wins and the celebration of these milestones When there is a history of poor performance cross-functional relationships fal-ter and RampD credibility suffers Even small commer-cialization successes can restore teamwork confi dence and credibility

It may be diffi cult for many RampD staff members to deal with the political complexity of the product inno-vation process especially in large organizations There-fore the innovatorchampion must be adept at initiating projects and maintaining progress Professional project managers can be valuable but should not become a crutch for RampD innovation champions Individual con-tributors need to be involved in project planning and execution

Implementing the CREATIVE Culture Lead follow or get out of the way mdashThomas Paine

Establishing the CREATIVE RampD culture is a challeng-ing long-term task and is not achieved through a single seminar tool or program There are no simple techniques that can create this culture and make changes in intrinsic values RampD leaders must examine attitudes and behav-iors and eliminate barriers that impede customer focus

RampD teams improve their effectiveness

by excelling at collaboration


risk tolerance entrepreneurial approaches alignment technology excellence innovation collaboration and execution Isolation is a major barrier to these changes Although the RampD team may benefi t from some insula-tion RampD leaders need to look for signs of isolation and determine the underlying reasons

It is a happy coincidence that the CREATIVE acronym be-gins with the customer and ends with execution These elements can be referred to as the bookends of the frame-work from a conceptual standpoint but the starting point for building the culture actually depends on the current status of the RampD organization And of course there is no end point since the high-performance RampD culture is built on continual improvement

John Kotter has said that ldquomost organizations are over-managed and under-ledrdquo ( 25 ) This observation seems particularly true for RampD organizations It is diffi cult to develop leadership skills in what may be the most tech-nical function of the corporation Although managers are responsible for project implementation and process improvement it is a leaderrsquos role to establish the overall high-performance culture The CREATIVE framework provides guidance for building and maintaining such a culture

A culture is defi ned through behaviors that represent individual management and leadership characteristics This is a holistic approach to new product development

within the RampD organization a culture that encourages not just doing projects right but also doing the right projects Rapid effective sustained innovation can be the result Individual contributors are the force behind innovation Great RampD managers and leaders under-stand the attributes of individual innovators and can help establish the innovation culture Their leadership provides direction toward choosing projects and estab-lishing the right environment for identifying and imple-menting innovation and their management ensures that the execution process delivers new products to the mar-ketplace

To initiate the change process RampD leaders must fi rst communicate their vision for establishing a high-perfor-mance culture Next baseline qualitative and quantita-

Establishing the CREATIVE RampD culture

is a challenging long-term task

Figure 5mdashA high-performance RampD culture is built though a number of potential steps depicted as performance vs time


tive assessments should be completed to provide a thorough understanding of the relative strengths and weaknesses of the organization and its people This can be followed by a CREATIVE 360 evaluation of the management team which can lead to organizational alignment within the team to support the model ( 5 )

Leaders should also communicate expected behaviors broadly throughout the RampD organization ( 5 ) Leaders of poorly performing organizations may want to focus on executing incremental but signifi cant innovations to produce small early wins Figure 5 depicts a possible outline of a plan for RampD culture development While the plan will depend upon the results of assessments and early achievements it is important to develop and com-municate an overall plan for the organization as well

Fortunately the CREATIVE RampD culture is not merely a theory This authorrsquos use of the model has been proven through successful application of the framework most recently producing an increase of greater than 70-fold in the percentage of new product sales over a fi ve-year pe-riod It has been used successfully to create high-perfor-mance RampD teams in several industries with teams of varying maturity This model is not the result of aca-demic study or a concept from non-practicing consultants but rather has evolved from the analysis and use of suc-cess factors from actual business experience Of course as the disclaimer says ldquoindividual results may varyrdquo But it is unlikely that the disciplined use of a validated suc-cessful RampD approach will not yield positive results

References 1 Carlson Curtis R and William W Wilmot 2006 Innovation the fi ve disciplines for creating what customers want New York Crown Business 2 Christensen Clayton M and Michael E Raynor 2003 The innovatorrsquos solution creating and sustaining successful growth Boston Harvard Business School Publishing Corporation McGregor Jena 2007 25 Most innovative companies BusinessWeek May 14 2007 pp 52ndash60 Sakkab Nabil Y 2007 Growing through innovation Research-Technology Management 50 (6) pp 59ndash64 Leifer Richard et al 2000 Radical innovation How mature companies can outsmart upstarts Boston Harvard Business School Press 3 Christensen Clayton M 2000 The innovatorrsquos dilemma New York HarperCollins Publishers Inc Wheelwright Steven C and Kim B Clark 1995 Leading product development New York The Free Press 4 Cooper Robert G 1999 Product leadership creating and launching superior new products New York Perseus Books 5 Newman Jerry L 2007 The CREATIVE model of NPD excellence wwwcreativeNPDcom 6 Newman Jerry L 2007 The CREATIVE RampD culture wwwcreativeNPDcom 7 Brook John and Phillip Brewster 1999 Putting the C in RampD - customer focus for technologists International Journal of Technology Management 17 (6) pp 639ndash645 8 Belliveau Paul Abbie Griffi n and Stephen Somermeyer eds 2002 The PDMA toolbook for new product development New York John Wiley amp Sons Inc 2004 The PDMA toolbook 2 for new product development Hoboken NJ John Wiley amp Sons Inc 9 InnovationPoint Customer insight as a driver of strategic innovation wwwinnovation-pointcom

10 Meyer Christopher 1993 Fast cycle time How to align purpose strategy and structure for speed New York The Free Press 11 Mello Sheila 2002 Customer-centric product defi nition the key to great product development Boston PDC Professional Publishing 12 Hillson David and Ruth Murray-Webster 2005 Understanding and managing risk attitude Aldershot England Gower Publishing Limited 13 Roosen Peter Paul and Tatsuya Nakagawa 2007 Inventoritis exposed Building a sold bridge between marketing and engineering wwwatomicacreativecom 14 McGregor Jena 2006 How failure breeds success BusinessWeek July 10 pp 42ndash52 McCormick Blaine 2001 At work with Thomas Edison 10 business lessons from Americarsquos greatest innovator Irvine California Entrepreneur Press 15 Roberts Royston M 1989 Serendipity Accidental discoveries in science New York John Wiley amp Sons Inc 16 Abraham Gerard A Successful Organizational Leadership Effective Execution through Strategic Alignment httpwwwselfgrowthcomarticlesAbraham4html 17 Pinchot Gifford and Ron Pellman 1999 Intrapreneuring in action A handbook for business innovation San Francisco Berrett-Koehler Publishers Inc Pinchot Gifford 1986 Intrapreneuring why you donrsquot have to leave the corporation to become an entrepreneur New York Harper amp Row Publishers Inc 18 Bennis Warren G and Patricia Ward Biederman 1997 Organizing genius The secret of creative collaboration Boston Addison-Wesley Sawyer R Keith 2007 Group genius The creative power of collaboration New York Basic Books 19 Katz Ralph and Thomas J Allen 1982 Investigating the Not Invented Here (NIH) syndrome A look at the performance tenure and communication patterns of 50 RampD project group RampD Management 12 (1) pp 7ndash19 20 Jain R K and H C Triandis 1997 Management of research and development organizations Managing the unmanageable 2nd ed Wiley series in engineering and technology management New York John Wiley amp Sons Inc 21 Zettlemeyer Florian and John R Hauser 1997 Metrics to evaluate RDampE Research-Technology Management 40 (4) pp 28ndash32 22 Smith Preston G and Donald G Reinertsen 1998 Developing products in half the time New York John Wiley amp Sons Inc 23 Wheelwright Steven C and Kim B Clark 1992 Revolutionizing product development Quantum leaps in speed New York The Free Press 24 Maccoby Michael 2007 Mobilizing the minds of researchtechnology managers Research-Technology Management 50 (6) pp 65ndash67 25 Kotter John P 1990 A force for change How leadership differs from management New York The Free Press

Great RampD managers and leaders

understand individual innovators and help

to establish the innovation culture


product sales over a fi ve-year period What follows is a detailed explanation of each CREATIVE element and tips for how to implement the holistic framework

Customer Focus We can believe that we know where the world should go But unless wersquore in touch with our customers our model of the world can diverge from reality mdash Steve Ballmer

When RampD team members overcome isolation from customers and consumers they can gain profound insight into how their technologies can be incorporated into new products that bring value to customers Without true customer insight an invention is just thatmdashan invention not an innovation There are many examples of outstand-ing technologies that failed in the marketplace and of products that failed to even reach the marketplace due to poor relevance to customer needs Traditional RampD man-agement and organizations have tended to seclude RampD professionals away from customers and have often been reluctant to push for customer contact However unless they are encouraged to see through the eyes of customers and end-users RampD professionals are often unable to see practical applications for their technologies ( 7 )

If the customer insight side of the innovation equation is ignored in favor of the RampD organizationrsquos excitement over a new technology the department can end up with ldquoa technology in search of a marketrdquo This occurs when RampD professionals ldquofall in love withrdquo technologies for their own sake as opposed to creating and developing tech-nologies to meet customer needs This can lead to a perception that the RampD organization is out of touch with the customers and the business needs of the organization

RampD professionals should avoid the ldquobuild it and they will comerdquo attitude Although no one can dispute the value of visionaries few RampD team members can afford

RampD professionals should avoid the ldquobuild it and they

will comerdquo attitude

Figure 1mdashTrue product innovation occurs when ideas at the intersection of customer insight technology and business alignment are successfully executed (6)


























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Documents

Building a High Performance r&d Culture