If “40 years, 20 million ideas” is an in-depth narration of how one of the best idea systems in the world (Toyota) evolved over close to half a century, then “Ideas are free” by Alan Robinson and Dean Schroeder is an in-breadth study of over 150 idea systems across 13 sectors in 17 countries. What do Alan and Dean believe to be the characteristics of a good idea management system? Let’s see it with an example articulated in the book, that of Boardroom, Inc.
Boardroom, Inc is a
Each week every employee is expected to come up with two ideas – no matter how small – and bring them to the department meeting. During the meeting, everyone (including the manager) presents his or her ideas in turn. After each one is explained, the group discusses it and, if possible, improves on it. If members of the group decide that the idea can be used, they decide who will be responsible for implementation (usually the person who came up with it). If the proposal needs further consideration or review at the higher level, someone will be assigned to follow through. The average meeting involves 8 to 10 people, lasts 45 minutes and in addition to taking care of normal departmental business, processes some 20 ideas. Quarterly bonus, which may be on average several thousand dollars based on corporate performance, is given to only those employees who have offered at least 26 ideas in that quarter.
According to Alan and Dean, this simple process has most of the characteristics of an effective idea system. Let’s summarize them below:
- Ideas are part of everyone’s normal work
- It is easy to submit ideas
- Ideas are reviewed and discussed by people who have direct knowledge of the situation at hand and who can build on or help modify it so that it will work better
- Decision making is rapid, effective and efficient
- Feedback to the suggestor is quick and complete
- Whenever possible, ideas are implemented almost immediately, often before higher-level managers even become aware of them
- People are recognized and success is celebrated
- The system is actively managed and constantly improved.
Alan & Dean identify three core metrics to track how the system is working and where it can be improved further.
- Quantity of ideas: measured typically in ideas per person per year (sometimes, per week, month, quarter etc)
- Source of ideas: participation rate is one metric which tells how many employees across different functions – production, sales, customer support are giving ideas. Source may involve external parties like customers or partners.
- Velocity of ideas: This metric tracks company’s responsiveness to ideas. It tells us about questions like: How long does it take to make decisions about them? How fast are people getting feedback about their suggestions? How quickly are ideas implemented?