Editor’s Note: In this Q & A, ebizQ’s Peter Schooff speaks with BPM thought leader Peter Fingar about BPM, cloud computing, innovation and related topics. Fingar, executive partner in the Meghan-Kiffer Research business strategy firm, is author or co-author of several books, most recently Business Innovation in the Cloud: Executing on Innovation with Cloud Computing (Meghan-Kiffer Press, 2012). This interview, excerpted from a significantly longer podcast, was edited for clarity, length and editorial style.

ebizQ: In your book, you referenced “extreme competition.” I think that term makes every businessperson’s ears perk up. Could you elaborate on that a little bit?

Fingar:
Six years ago, I wrote a book called Extreme Competition [(Meghan-Kiffer Press, 2006)]. At the time, I was really interested not in just our perspective here in the U.S., [but worldwide]. I reached out to 12 colleagues from around the globe--from China, India, Australia, the Middle East and so forth--and that was a learning experience. We talked about everything from extreme customers, now that the value has gone to customers, [to] extreme innovation, extreme individuals. So the idea of extreme competition has been on my mind for a number of years. But what Jim Stikeleather, my co-author, and I wanted to do [this time] was to tease out and explore the variables that would be used to calculate the future because we all know there's all kinds of extreme change going on right now.

And in my talks, I bring up a picture of a lady named Besse Cooper [at this writing, at age 115, the world’s oldest living person]. She lives in Georgia and she was eight years old when the Wright brothers took off [in 1903]. Look at the change she's seen in her lifetime.

But the kinds of change we've seen so far have been episodic. If you look at the mathematics of exponential growth, that's the era we’re entering into in terms of the number of Internet connections, in terms of the number of genes sequenced, the “Internet of things,” the human population, which just topped seven billion.

So right now, there's huge change. Change itself is changing. That was one of the big motivations behind writing [Business Innovation in the Cloud]: to investigate some of these variables to see what would lay the context, because business can no longer do strategic planning, as we did throughout the Industrial Age.

ebizQ: Let’s talk about innovation. How do you make innovation a systematic and repeatable process?

Fingar:
Well, that's a very good question because a lot of people think of innovation as some kind of magic, or some gurus thrown into a room for a week who come out with some kind of Gestalt.

The idea, as far as bringing some kind of repeatable structure to innovation, is looking in three key areas. One is looking at customer needs; that brings innovation from the outside in. You’ve got to get so close to your customers that you can anticipate their needs even before they do. Next, you’ve got to go out and look at competitive patterns. You’d better keep a close eye on how competition is changing, because you can never rest on your laurels.

So taking those two perspectives, and then looking deeply inside your company’s own capabilities, you can start building a systematic business process for innovation. GE has such a process; it’s called Sencore. The Mayo Clinic has one called Spark.

There are many individual processes, but they all follow the same pattern. At PwC, they talk about the discovery phase, incubating, accelerating and then scaling. If you look at Gartner, they’ve got “generate ideas, evaluate and select, develop and implement.” All these are generic commonsense approaches, but one key to this new approach is that new approach to strategic planning, because the keyword is going to be not just the word “innovation,” but “agility,” because the outside world is changing.

There's a fellow named John Boyd, who was a fighter-pilot trainer in the Air Force. He developed a mathematical theory on energy maneuverability that then became what we call “OODA loops”: observe, orient, decide and act—and repeat it--because when you act, it changes. So you repeat again: observe, orient, decide and act. The whole notion of the math theory behind that was behind the design of the F-16 fighter pilot, which doesn't have the power, the range, the height, or the capacity or the payload of a typical MIG. But an F-16 wins every time because it was Boyd’s theories of energy maneuverability that allows that plane to be the most agile plane in the world’s force of fighter craft.

Companies are just now starting to learn those formulas and applying John Boyd's theories of energy maneuverability into this whole notion of making innovation a systematic repeatable business process.

ebizQ: What role would you say that framework plays in all of this?

Fingar:
It goes back to building some kind of structure: What is a framework?

The way we talk about is: To take and build a framework for process, for innovation processes, you’ve got to have foresight. That’s where you’re going out looking at the trends, using listening posts and all sorts of ways of seeing what really the big trends are.

Then you’ve got to use insight. In insight, basically, you start looking at best practices, your own intellectual properties, your capabilities and your competition, and you bring those together into a framework that also applies reference architectures. [For example,] in telecommunications, there’s eTOM [the enhanced Telecom Operations Map BPM framework]. In supply chain, there’s SCOR [the Supply Chain Operations Reference model].

So frameworks, then, lay out what the key major variables are to manage. That all comes into what I call the new agile extended enterprise architecture. We’re not throwing away IT. We’re still going to have transaction and back office. But the new pillars are going to be social networks, demand-supply chain business networks. You’re going to have distributed rules management. You’re going to have next-generation analytics--not the old BI, but the predictive analytics and capability management to balance the other columns, which is innovation management. Innovation can't just be given off to R&D. It’s got to become a standard management practice. Just like managers and executives have certain practices in finance and operations, innovation itself must become a standard management practice.

So a framework can give you the context for putting all these components and elements together to make sense as far as an overall business architecture.

ebizQ: What do you see for the future of cloud and innovation?

Fingar:
People hate change. You ain’t gonna change until you feel the pain. One of the better books out of Harvard on managing change was all about how once you've been the least bit successful, you’ve got to create a crisis. Well, guess what: We’re nowhere short of crisis these days, as we know just looking at the outside world.

Think about it: water, food, energy, healthcare, education and even things like freedom. Look what the cloud did; it created the Arab Spring [the wave of pro-democracy demonstrations sweeping the Middle East and North Africa]. Now there's talk about a “Management Spring,” because our top-down command-and-control types of management no longer apply.

So all of this ties together. We have serious challenges in the world. The population is seven billion now, shooting to nine to ten billion by 2050. We've reached the limit of the physical resources. We have to have innovation and we’re not going to do it in some back-office R&D lab. The cloud is where innovation is going to take place.

READER FEEDBACK: Have you used the cloud to improve your BPM initiatives and foster innovation? If so, ebizQ editors would like to hear about your experience. Contact Site Editor Anne Stuart at editor@ebizq.net.



About the Author

Peter Schooff is a former contributing editor for ebizQ, where he also managed the ebizQ Forum for several years. Previously, Peter managed the database operations for a major cigar company, served as writer/editor of an early Internet entertainment site and developed a computer accounting system for several retail stores. Peter can be reached at pschooff@techtarget.com.

More by Peter Schooff

About ebizQ

ebizQ is the insider’s guide to next-generation business process management. We offer a growing collection of independent editorial articles on BPM trends, issues, challenges and solutions, all targeted to business and IT BPM professionals.

We cover BPM standards, governance, technology and continuous process improvement, as well as process discovery, modeling, simulation and optimization, among many other areas. We follow case management, decision management, business rules management, operational intelligence, complex event processing and other related topics. We closely track important trends such as the rise of social BPM, mobile BPM and BPM in the cloud. We also explore BPM’s use in functional areas, such as supply chain and customer management, and in key verticals, such as financial services, health care, insurance and government.

ebizQ's other BPM-oriented content includes podcasts, webcasts, webinars, white papers, a variety of expert blogs, a lively online forum and much more.

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