The mission that lies at the core of the Edison Awards is inspiring and fostering innovation by highlighting the achievements of revolutionary innovators worldwide. But what is innovation? How is it defined, and how should it be approached? Steering Committee member and former Global Director of Innovation at Caterpillar Inc. Ken Gray offers his unique and insightful perspective on the elements one should consider while focusing on innovation. He also explores how the size of an organization redefines the appropriate approach to innovation, informed by an extensive career working with companies from large corporations to nonprofits and startups.
In Ken’s eyes, while the nature of innovation might vary from company to company, it has three primary elements at its core: “people, culture, and vision.” In the personnel arena, teams who aim at innovating should be consistent with a diverse set of people with a wide range of experience and education. Individuals with unique domain experience are indispensable, especially when designing a product for a particular specialized field. As an example, Ken recalls hiring an anthropologist to work on a product development team at Caterpillar “because she brought a completely different perspective to the work than anyone else in the room had.” As he explains, her unique perspective contributed significantly to the team’s definition of what successful innovation looks like for a project. Such diversity in viewpoints can lead concepts and projects in new directions that may have been impossible otherwise.
Second, a culture of mutual trust and respect among everyone involved with a project should be built and maintained. Beyond being important to the function of any collaborative team, this is particularly important in regards to the people funding the endeavor, whether it be a corporation or individual investors. Attempting innovation means experimentation, risk-taking, and often mistakes or failures. With this being the case, those that have money tied into the process must be engaged and reassured that their money is in safe hands. With a mutual sense of trust established on both sides, the team will be free to take the risks necessary to true innovation without fear of losing funding. This is particularly important in the nonprofit world, where Ken comments he found it more difficult to acquire funding for projects due to the high emotional content that surrounds those projects.
The third core element is having an inspiring vision or overarching narrative for your product. This means moving past the simple details of what it does and how it does it to explain what those things mean in the grand scheme of things. In Ken’s words, “You have to have a reason for existing.” As an example, he cites the hybrid excavator he worked on at Caterpillar. While it did produce significantly lower carbon emissions than other equipment, it was not enough to simply state that fact. The key to making it a true innovation was illustrating why those lower emissions mattered in the grand scheme. And this vision must not only apply when the product is already created; it is important from the beginning of the process. People should be able to take this vision and build upon it, experiment with it, and influence it, something that Ken cites as a critical part of success. This is one arena which he states smaller companies should pay special attention to. In the case of a startup or nonprofit organization, having an inspiring and well-developed vision is often the deciding factor in swaying investors to support a project. In fact, Ken suggests that the corporate world has learned much about this core element from the entrepreneurial world.
Beyond these three core values, another important element to innovation discussed by Ken is breaking down biases held by those involved with development as well as the distributors and customers the product is being marketed to. According to him, this is especially important in the case of business-to-business or B2B companies whose internal marketing team engages with the distribution arm rather than with the end-customer— “Everybody in that chain has preconceived notions or biases about what is needed.” Destroying these biases is crucial at every step, even down to getting a project or idea off the ground. This plays into the three core elements of innovation, as having a diverse team, strong culture, and inspiring vision will help you subvert ideas. He also cites the potential for your project to make money as an important part of innovation. In his view, if it cannot or does not make money for your customer and/or your business, it is not a true innovation. In support of this, he quotes Thomas Edison himself: “Anything that won’t sell, I don’t want to invent. Its sale is proof of utility, and utility is a success.”
When considering how to approach innovation, Ken states that he utilizes the types of innovation defined by consultant company Doblin, a Deloitte business, which consists of three types: core, which is the primary business; adjacent, consisting of extensions to the current primary business; and transformational, which is anything entirely outside the scope of the current primary business. In Ken’s view, “no more than 70%” of work should be towards core innovation. Meanwhile, adjacent innovation should account for 20% of efforts, with the remaining 10% allocated towards transformational innovation. However, while this model applies effortlessly to the work done at large corporations, the definitions of “core” and “transformational” can become muddied when attempting to put it into action at a startup or nonprofit. Entrepreneurs operating in these arenas should pay close attention to understanding how these categories apply to their work, how they may be ill-fitting, and what adjustments can be made to better suit their business model.
Since retiring from Caterpillar, Ken has worked primarily with the nonprofit Central Illinois Center for the Blind and Visually Impaired where he was a member of the board for several years and recently was awarded the honorary title of Director Emeritus. He has also taken up passion projects related to the cause, such as an app designed to detect cone-specific retinal disorders without any of the traditional invasive testing, the success of which points to that important element of vision. His work, both at Caterpillar and outside of his career there, exemplifies how innovation can be successfully approached and executed. Continuing to serve on the Edison Awards Steering Committee, Ken continues to encourage progress and inspire innovators of the future.
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