We’ve written before about the false promise of Innovation Theatre— getting caught up in activities that look like innovation, but don’t really add value (and soon we will tell you about its newer cousin The Fintech Petting Zoo).
We have said that the antithesis of and antidote to Innovation Theatre is to define innovation as implementing new ideas that create value. This does create a bit of a paradox though-- if we only work on new ideas that we can implement, and we only implement ideas that are sure to create value, how innovative are we really?
As Oren Harari said “The electric light did not come from the continuous improvement of candles.”
If we are going to do more than a few minor feature tweaks or product extensions— the fintech equivalent of adding a fifth blade to our “innovative” QuadBlade razor that we launched last year— we are clearly going to have to break some new ground. Breaking new ground means trying some things that might not work, and in fact, some of those things might never even see the light of day with real customers.
How do we reconcile these seemingly opposed ideas?
What we need is an empirical approach to value creation.
One that lets us try new things and break new ground, but doesn’t let us get mired in the unproductive muck. Something that allows us to test new ideas and cut our losses quickly with those that things that are not panning out, and double down quickly on those that look promising.
Welcome to FIRE™
FIRE™ stands for Fast, Iterative, Responsive Experiments.
Fast - because we want to shorten the gap between idea and results
Iterative - because we want a process of continuous improvement
Responsive - because data, not internal opinions, should drive our iteration
Experiments - because we want the process structured to maximize learning
We think of FIRE™ as an “innovation operating system” for teams. Once you install it in your organization, you can use it to create value quickly from everything from small incremental feature improvements to more disruptive or transformative approaches to new products, new markets, and new business models.
Modern Agile Business Methods
Manufacturers have Lean production methods and Six Sigma programs to improve quality and reduce costs. Software developers have Agile and Scrum programs to reduce waste and improve client responsiveness. Startups use Lean Startup and programs like Startup Weekend to build and test ideas quickly. Google Ventures uses their own Sprint process to vet concepts quickly for the companies in which they invest. Design Thinking has revolutionized everything from app design to consumer goods to industrial products.
These are all proven processes and methodologies that offer dramatic improvements in effectiveness and efficiency within their appropriate context (and you can click through the links above to learn more about each one if you are not familiar), but none of them alone are a perfect fit for financial services companies trying to innovate in a highly regulated environment.
The FIRE™ process is an empirical approach to value creation that combines the best parts of all of those modern agile business methods into an effective and repeatable process that is custom tailored to work in the highly regulated environment of financial services. Best of all, it gets results fast.
We will dig in to the FIRE™ process a little deeper in future posts with some examples, but contact us if you have any questions so far, or if you want to see how it can help you create value quickly in your own teams.