Organizational Development in Special Situations. #1 New Product Introduction

There is an constant and frankly non constructive dialogue that goes on about whether or not OD is passé. 

The answer is that OD is definitely not passé although it is not as widely commissioned as it used to be. While others have cannibalized some of what OD used to do, and people are not as valued as they used to, there are special situations where the added value of OD is outstanding.

In the next three posts, I shall outline 3 special situations where the added value of OD is overwhelming.

The first special situation is New Product Introduction.

1) Typically, a new product goes from R&D to Engineering and then to Process Engineering and Production Engineering, which are in Operations. (There can be lots of variance to this, clearly.)

2) The more complex the product  is, and the faster the organization is moving, the transition as described above is anything but smooth. Operations wants a plug and play product kit, while  R&D wants to wash their hands of the dog food and move onto the next invention, with Operations left to fill in the blanks.

Add to this that  products do not flow smoothly along; they often move one step backs and then two steps forwards etc.,  until problems are defined and solved.

3) Add complexity of different geographies and cultures, this is a perfect cess pool for OD. Smile

4) The most frequently made mistakes that managers and change managers make is to try to define the process more clearly. This attempt to `define away complexity`is what my late Dad used to call pissing into the wind. And I grew up in Quebec where the wind is mighty strong. Mais oui! There is no way that this process can be perfectly defined.

5) Another frequently made mistake is to put too much focus on Gating and Handshakes in the process. It is simply more complicated than setting up a Customs-Douane at every `station“ on the way, especially given the time to market pressure.

6) New Product Introduction is enabled by teamwork, sharing of risks and overlapping responsibility. This is a classic domain where nothing beats the effectiveness of OD. Not even outdoor training or a motivational speaker. Smile

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The inability of Israeli organizations to scale innovation

There are endless examples of Israel based companies that innovate and yet fail to leverage and scale their innovation.

As a result, these innovative companies are sold, most often to US based firms who scale the innovations and make the big bucks, leaving only R&D center in Israel, which may  become downgraded to a continuous engineering site.

This short post looks at the reason that this happens.

1) Innovative people tell customers what they need.

I cannot count the number of times I have seen real creative guys kicking themselves in the ass by explaining to the potential customer how wrong they are in what they asking for, followed by an very detailed explanation of “real needs”. Routinely these companies overplay technical presales and underplay the importance of building communication based on respect for the client.

2) Innovative people misuse creativity because they cannot follow routine

Once an innovation has been cranked out, leveraging this innovation needs lots of rigour and disciplined routine to create scalability. Often, an organization that has used its creativity to develop a breakthrough will misuse this creativity to try and “reinvent” the routine necessary to scale the innovation.

It is not unfair to say that Israeli have no problem doing the impossible but have a horrible time of carrying out routine tasks. Scalability is based on disciplined repeated routine.

3) Innovative people are often very arrogant, and very hard to deal with.

And this arrogance and lack of acceptance of the limits of the human endeavour is exactly what enables the innovative mindset. Over the years I have seen some of my brightest clients wiped off the map because they knew not only  how to invent, but they also knew how to do everyone’s job better, which clearly backfires at  the stage when innovation needs to be linked to a growth platform by leveraging on someone else’s capabilities.

4) Israelis have invented great technology, yet the type of organizations which have been created is Israel not a scalable platform to leverage success. In other word, the Israelis developed technology which can be scaled, but Israeli organizational life cannot be scaled. This topic is too elaborate for this post, so I will just illustrate briefly.

  1. Israeli organizations tend to commit aggressively, yet are overly tolerant and  non-punitive, causing frequent sudden system crashes. (The implosion of the Israeli police force and IDB are good examples.)
  2. Structure, rules and processes are ignored, and in lieu of these, a “network” of relationships serves as the motor of getting things done, very similar to Chinese organizations.
  3. Israelis talk all at once, argue all the time, and the level of apparent conflict is very high….. except it is not seen as such IF you are an insider.

Thus, it is very hard for Israeli organization to go global and all so often, even after they have moved their corporate HQ address to the States, they get acquired because while the technology can be scaled,  the organization cannot be scaled as run.

Follow me @AllonShevat

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