Aug 172010

BUSINESS is a field not of theory but of practice. The central intellectual inquiry of the science of management is simply this: What works?

That, it seems, is the best way to examine the steady rise in the practice of innovation management. A search of the database of the professional networking site LinkedIn found that more than 700 people listed their current job title as “chief innovation officer” and that nearly 25,000 had the word “innovation” in their job title. Many others may not have the word in their titles, but their job is to pursue opportunities that result in new products, services and more efficient ways of doing things.

So what does work in the innovation game? No single formula, to be sure. But some recent interviews with executives, consultants and academics can be distilled into three recommendations: think broadly, borrow from the entrepreneurial Silicon Valley model, and pay close attention to customers and to emerging user needs.

Here, then, are three innovation works in progress that include those ingredients, whether or not the efforts will ultimately prove to be winners:

Marching Into New Markets

John Tao joined Weyerhaeuser, the wood and pulp producer, two years ago as its vice president for open innovation, coming from Air Products and Chemicals. At Weyerhaeuser, Mr. Tao has led an initiative to find new markets for lignin, a chemical compound that binds cellulose fibers together in trees. Lignin is extracted during pulp-making as a black liquor, and is typically recycled as a fuel for pulp plants.

Yet lignin can also be converted to a solid and serve as a chemical feedstock for making a range of products. Mr. Tao, a Ph.D. chemical engineer, and his staff studied the market, including the curbs on carbon emissions that chemical producers will likely face in the future.

Lignin can be a nonpolluting alternative for producing goods as different as seat cushions and carbon fiber. Automakers, for example, are beginning to use carbon fiber as a lightweight but strong substitute for metal to improve fuel efficiency.

As a chemical feedstock, lignin is worth 10 to 20 times its value as a pulp-plant fuel, Mr. Tao said. Weyerhaeuser has a pilot plant in North Carolina to produce specialized lignin chemicals. Mr. Tao has met with chemical companies, carbon fiber makers and the Department of Energy to try to nurture new lignin markets. “You have to have some technical background,” he said, “but a lot of this work is market analysis, communications and networking with industry partners.”

Customized Discounts

For innovation champions, titles matter far less than their independence, breadth of knowledge and corporate clout, experts say. “Whatever you call it, there is a real need for a senior-level executive to be able to reach across a company and beyond to tap ideas, skills and resources,” said Henry Chesbrough, executive director of the Center for Open Innovation at the University of California, Berkeley. “It is this systems integration aspect that is central to innovation as a field and a discipline.”

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