Skimmers Guide to the Latest Business Books
The book: The Game-Changer: How You Can Drive Revenue and Profit Growth With Innovation. Crown Business; April 2008.
The big idea: Eureka moments are the stuff of entrepreneurial legend. But as A.G. Lafley and Ram Charan observe, you can't build a growth plan on them. Innovation -- the seed of organic growth -- is a matter of process and culture and business strategy. The real payoff comes from people getting comfortable together and sparking off one another; innovation is chiefly a product of social interaction. You've got to manage people before you can manage their ideas.
The backstory: Lafley is the chairman and CEO of new-product dynamo Procter & Gamble. Starting in 2000, he revived the fortunes and morale at this aging behemoth by systematically applying innovation techniques to product lines young and old. P&G now makes innovation the basis for budgets, compensation plans, and even risk management. Lafley's co-author, Charan, an adviser to corporate titans, adds stories from Honeywell, Nokia, and DuPont to the mix.
Intriguing subplot: Lafley starts sweating if more than 60 percent of new ideas succeed, because it means he's playing too safe. The Game-Changer even provides a chart of P&G's greatest flops. (Remember Fit Fruit & Vegetable Wash? Anyone?)
Does it scale? P&G is the Disney World of innovation, of course, with assorted in-house think tanks and labs. But Lafley describes a few humble tools that any business can afford, such as science-fair-style innovation reviews. Teams gather in a room, outline their new-product ideas on simple posters, and present them to managers who walk from station to station.
Rigor rating: 9 (1=Who Moved My Cheese?; 10=Good to Great). Lafley knows P&G and is generous with details of his career. Charan gets the skinny on other corporations straight from their leaders.
If you read nothing else: "The Customer Is Boss" (Chapter Three) sounds like a yawner. In fact, it is a powerful argument for research through immersion in customers' lives. Also worthwhile is "Integrating Innovation Into Your Routine" (Chapter Seven), which limns an innovation program as though it were a manufacturing process, from inputs to outputs and all the stages in between.