The Rumsfeld Quadrant of Innovation

I had an interesting meeting yesterday with Unipart who have a mature innovation process called Green Shoots. When we discussed how they search for new innovation opportunities I find myself quoting my favorite amateur philosopher and innovation theorist Donald Rumsfeld, and his quote about unknown unknowns relating to the increasingly unstable situation in post-invasion Afghanistan. You can remind yourself of his genius through a youtube video of it here.

Anyway, I don't want to re-open that particular can of worms but there are some remarkable similarities with what he says and this paper from Cambridge University on how companies search for information or opportunities.

They describe the activities that an organisation should conduct to search for information and spot opportunities for innovation. I've modified it slightly (sorry Leitizia) and redrawn it in the figure below.

If we think about innovation as trying to match problems and solutions, then they can either be known to the organisation or not. In which case there are four distinct activities that ought to form part of a search or exploratory phase as per the figure below:

• CORE – Known Problems and Known Solutions – this is the core business, or business as usual. This takes up the majority of the organisations time but is not typically a driver of innovation.
• SHARE – Known Problems but Unknown Solutions – these are the issues that are important to us but we don't know how to solve them yet. This is when it's worth sharing those problems, possibly via trusted 3rd parties, to seek solutions from elsewhere/outside. This is often counterintuitive for many organisations as it can reveal your priorities to your competitors, however can unlock significant returns if managed effectively.
• MINE – Unknown Problems and Known Solutions – this is the frustrating situation common in most organisations that 'if only we knew what we know'. This is where it's worth trawling or mining for information or opportunities that already exist with the organisation. Here the trick is to create value through formalising tacit knowledge.
• SCAN – Unknown Unknowns – this is where Donald got into trouble, but this is the realm of disruptive innovation and where most organisations don't dare to tread. This is scanning other sectors or non-competitive organisations for inspiration and innovation opportunties. This is particularly important in the longer term when competitition can come from unlikely sources.

My experience based on talking with lots of companies about their approach to open innovation is that they don't 'share' or 'mine' enough and have no systematic approach to 'scan'. My intuition is that the effort of most innovation team/activities should probably be split Core 50% Share 20% Mine 20% Scan 10% but in most organisations its more like Core 90% Share 2% Mine 7% Scan 1%. I'm pleased to say Unipart were leaning more towards the former rather than the latter. What's your experience and what do you think is the optimum balance between these modes of search?