How do we decide what our innovation strategy should be? Jeffrey Phillips says that we don’t need an innovation strategy at all, we just need a strategy, and it should have innovation embedded within it. That’s pretty consistent with what I’ve said here before as well when I talked about four different ways to integrate innovation and strategy. But given that, what do we do?

A good first step is to figure out where you want to be positioned. Tom Fishburne has some very good advice in this:

I blogged a few months ago that companies can be classified either as Rule Makers, Rule Followers, or Rule Breakers. Most companies duke it out amongst themselves as Followers, trying to gain share against the market leader by playing the rules of the market leader. …

Instead of obsessing about market share, think market creation. Become “the only ones who do what you do”.

This is certainly the way to think if you’re working on radical innovations. In an interview that just came out, Roberto Verganti argues that the best way to do this is to work on innovating the meaning of your products and services:

In the blog I mentioned that companies that are focusing on stripped-down “value” products risk making the mistake of assuming consumers care more about utility and low price than meanings. In the current ‘Great Recession’ meanings are becoming even more important, and companies should not think consumers care less about the emotional and social dimensions of products.

Although it is counter-intuitive, utility is not the only thing that matters to consumers. Even when they are hard pressed financially they don’t want to feel poor.

Yes, they do care about prices and want to spend less. If you have a lot of money, who cares? If you have less money, you care a lot about how you spend the money. Every time you spend your money, it is a very emotional and symbolic act.

Another way to think of this is to find a way to do something that people really believe in, as suggested by Hugh MacLeod:

Of course, this approach can be risky. The chances of failure are non-trivial. On the other hand, the one sure way to fail at innovation is to try to avoid failing. Scott Anthony makes this point nicely in an interview that just came out:

Interview Question: A famous innovation story is about Bank of America, which mandated that 30% of ideas had to fail. Google also had a similar working line with 20% of the employee time being spent on side projects. What’s your take on such strategising?
Scott Anthony: Those are actually two different strategies, and generally I like the Bank of America one more. That metric tells people that it is acceptable to take some amount of risk. If you never tolerate failure what you eventually get are very close to the core, incremental ideas. Those are fine, but won’t produce blockbuster results.
The Google approach, which 3M has done for a long period of time, works well in particular cultures. But it works less well in organisations that are still getting their innovation legs. All things being equal I would rather have three people spending all of their time on innovation than 100 people spending 10% of their time on innovation.

Part of the issue with replicating Google’s ‘20%’ system is there aren’t many people who have an end to end approach to innovation that is like Google’s. And if you copy one piece without the surrounding elements, it just won’t work.

So we have to be prepared to fail, at least with a few ideas. The key point here is to make the failures happen as quickly and as cheaply as possible. But we have to do it, even if it’s risky. After all:

The ROI on innovation is survival
— Andrew Howlett, CEO en Rain

That all looks pretty familiar, doesn’t it? Or maybe not. All of the quotes were included in my post yesterday, but there I asked you weave your own story around them. That was the least successful post that I’ve written in over three months, at least according to views, retweets, and every other metric that I normally look at. Why?

I think it says something pretty important about the aggregate, filter and connect idea – that to create value you have to do all three things. Yesterday, I only aggregated and filtered. All of the quotes were things that came through my aggregating tools – primarily the RSS feed and twitter. I filtered through all of that, and found four items that created a theme – at least inside my head. So I put them out there to see if they’d resonate with you in the same way. It doesn’t appear as though they did.

Today’s post might not be much better, but at least there’s a coherent story in it. That’s because in addition to aggregating and filtering, I connected up the ideas. In order to create value that people are interested in, you need all three components.

This also illustrates an interesting point that is currently being discussed. It started with Robert Scoble talking about the tools that are needed for curation. I love the way that he describes curation:

This is a guide for how we can build “info molecules” that have a lot more value than the atomic world we live in now. First, what are info atoms? A tweet is an atom. A photo on Flickr is an atom. A conversation item on Google Buzz is an atom. A Facebook status message is an atom. A YouTube video is an atom.

Thousands of these atoms flow across our screens in tools like Seesmic, Google Reader, Tweetdeck, Tweetie, Simply Tweet, Twitroid, etc.

A curator is an information chemist. He or she mixes atoms together in a way to build an info-molecule. Then adds value to that molecule.

This prompted interesting responses from Joanne McNeil and Erica Glasier. They both have some issues with Scoble’s post. But I think that really, both of them are responding to the more widely-held view of what “curation” is – more of an aggregate-filter process, like yesterday’s post. I think that Scoble is pretty clearly talking about an aggregate-filter-connect process. So maybe we need a new word for what he’s talking about?

In any case, I thought it would be fun to experiment with two different approaches to compiling and presenting related information. Which do you think worked better?