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We??e getting a ton of comment both online and in print on the cover story of the latest Inside Innovation: 3M, A Struggle Between Efficiency and Creativity. The black belt Six Sigma folks are steaming that they were cast as ??nti-innovation?and are providing lots of examples of how they can be creative. At the same time, we are getting lots of examples of how Six Sigma rooted out creativity in company after company. One letter came in from a top NBC exec describing how the network lost it when GE applied Six Sigma to programming, took out all the variation in local news, and sent ratings plummeting.
The truth, of course, is that you can get all kinds of great incremental innovation from Six Sigma. But you’re not likely to get any breakthrough, paradigm-changing innovation from a process-focussed system that reduces variability and risk.
The best way for big companies to get what they need is through parallel pathing (I like that term). Jeneanne Rae discusses this in her essay in Inside Innovation on “ambidextrous” corporations. Bank of America, Starwood and other companies do this very well. Put Six Sigma and innovation on two parallel tracks organizationally and then meld them.
Both tracks have separate needs so keep them separate. Finance both adequately (don’t stint on innovation as many companies do). Appoint an ambidextrous manager to oversee the two tracks. When the innovation track generates a scalable breakthrough concept or product, shift it to the larger process-oriented track for implementation.
Just remember that the return on breakthrough innovation projects is far higher than the return on incremental innovation. According to the Blue Ocean folks, only 14% of all projects in companies can be considered “radical” innovation but they generate 38% of revenue and 64% of profits.
Parallel pathing is hard to do. Finding ambidextrous managers is hard to do. It’s all hard to do—but the payoff is enormous. Just think of what the iPhone is about to bring to Apple—and how it is going to change the world of cell phones for Verizon, Nokia, and other players.