Innovation for Ukraine?

I listened to podcast today, part of the Entrepreneurial Thought Leaders series organized by the Stanford Technology Ventures program. Tom Kelley from IDEO spoke to group of students at the opening of the Global Innovation Tournament about how to form habits that preserve their creativity, stay young at heart, and be an innovator for life. He had 5 pieces of advice:

1. Keep an "international traveller's" mentality. In other words, a heightened state of alertness and awareness of your surroundings and human behavior.


2. Treat life as an experiment. Be willing to fail, and learning from your failures.


3. Have an attitude of wisdom. A healthy balance between a confidence in what you know, and distrusting what you know just enough to give you a thirst for knowledge.


4. Use your whole brain. Applying the left brain, which is what most education trains us to us, and right brain at the same time. Find time to let your "tortoise mind" work. This is the part of your mind that kind of works in the background, and which grows ideas over time, and leads you to the "aha!" moments.


5. Find your muse. Know what makes you most creative. It can be while listening to a certain kind of music, being stimulated by lots of noise or quiet, or certain times of day. Follow your passion.

Coincidentally, he mentioned a quote by Marcel Proust that I had until recently put on my Windows Messenger message: "The real act of discovery consists not in finding new lands, but in seeing with new eyes." So that grabbed my attention.

I have 2 questions that I'm hoping to get a lot of commentary about.

Is there innovation being done in Ukraine for Ukrainians?

Honestly, I haven't seen much of this although I'm sure it must be happening somewhere. In the course of daily life I tend to notice the lack of innovation, or even the effort by many companies to take advantage of past innovations. Stuff like packaging milk in a box or other sturdy container instead of a bag. Packaging plastic wrap in boxes with a serrated edge so you can tear it off without shredding it or cutting it with a knife.

Don't confuse this with creativity. I see acts of creativity and even ingenuity regularly. As usual Wikipedia offers a good explanation of what I mean:

Innovation typically involves creativity, but is not identical to it: innovation involves acting on the creative ideas to make some specific and tangible difference in the domain in which the innovation occurs. For example, Amabile et al (1996) propose:

"All innovation begins with creative ideas . . . We define innovation as the successful implementation of creative ideas within an organization. In this view, creativity by individuals and teams is a starting point for innovation; the first is necessary but not sufficient condition for the second".

For innovation to occur, something more than the generation of a creative idea or insight is required: the insight must be put into action to make a genuine difference, resulting for example in new or altered business processes within the organization, or changes in the products and services provided.

If you know there is innovation happening, what are some examples and which companies and/or individuals are leading this innovation?

The only industries I can think where innovation is taking place in Ukraine is in the IT, science and pharmaceutical industries. But, unfortunately, I think most of this innovation is being done by or for foreign companies and most Ukrainians don't feel it. I'm looking for products, services and methods that are being offered and applied in Ukraine.

I'd love to be surprised with a lot of examples. Looking forward to your comments.

Ukraine is an iceberg

A friend of mine just forwarded me The 2008 Ukraine Competitiveness Report published by the World Economic Forum. The section on Ukraine's rankings in the Networked Readiness Index gave me some good statistics. Some of the stats were in line with what I sensed here on the ground, but a couple of them surprised me. My main takeaway was not earthshattering. Basically, it's what I and any other moderately intelligent person whose lived here for any time knows: Ukraine is not living up to its potential, and it's mostly their own (read: government) fault. It's the iceberg phenomenom. Most of its potential lies hidden below the surface.

Below are a few I found most interesting:

• Ukraine's broadband Internet monthly subscription cost, as a percentage of monthly GDP per capita and monthly income ranked as "relatively affordable" among all countries, although Internet usage overall is very low. However, the cost of mobile calls ranks as being "quite high" compared to international standards.

This surprises me given the intense price competition we've experienced between the mobile operators over the past 10 years. Maybe "mobile calls" in this report refers to mobile Internet calls. That I can believe. It would also indicate that there is a lot of untapped growth potential in mobile data services, whenever the operators decide they want to encourage usage. But in the context of this report, it seems there is already a lot of people who want to use the Internet and know how to use it, but don't have a computer or Internet connection available.

• Ukraine's business readiness, or companies' preparedness to fully incorporate ICT into their operations and strategies, came in "mixed". Companies got mediocre marks for the quality of staff training the local availability of research and training services. It was also hurt by affordability of telecommunication services.

This doesn't surprise me, as my impression is that Ukrainian companies have a hard time implementing a complete solution or doing something the right way. I can easily a company paying for a new technology or piece of software and not bothering to figure out how to fully utilize it or even train people how to use properly. This requires strategic thinking, an ability to analyze a process and find a more efficient one, and probably additional expense for training. I'm sure Ukrainian companies aren't unique in this area, but from my experience many are notorious for slapping things together and forgetting about them.

• Ukraine had a "rather large difference" in scores between business and individual ICT usage, with business usage scoring much higher. However, in terms of global rankings, Ukraine's individual usage ranks higher, suggesting that Ukraine's businesses are losing competitiveness against the international business community.

This is more of an outcome statistic for me, that shows how the ICT weaknesses of Ukraine's businesses are hurting the ability to compete with the rest of the world. It's causing them to lose ground. It also indicates to me the huge ICT potential of the Ukrainian population that is yet to be tapped.

• Ukrainian firms are perceived as "not very successful in absorbing technology". But Ukrainian firms' innovation capacity ranked "quite high", which bodes well for the country's future preparedness.

A general statement, but, like the above stat effective at revealing Ukraine's ICT potential.

Tail beginning to wag the dog?

Microsoft's Bill Gates and Steve Ballmer recently previewed Windows 7, which features a touch user interface. While watching the video embedded in the post, it was the first time I looked at a computer as a big mobile phone instead of the other way around. I'm sure it's because of iPhone and the touch interface. But I found it interesting that these two things converged in my mind. Maybe we are seeing the beginning of a reversal of the computer driving mobile device design?

Boosting Ukraine's market efficiency with e-commerce

A former colleague of mine at Sonopia in Ukraine, Vasily Burov, just launched a new e-commerce site called ВСЕАВТО (trans. All Cars) for people looking to buy or sell their cars. Vasily is a bright, entrepreneurial guy who earlier created and sold one of the most popular consumer websites for "everything mobile" called Мабила.

While websites like this launched in more developed markets years ago, this is something innovative for Ukraine. I've never had to buy or sell a car here, I know that overall market efficiency in Ukraine is extremely low. Unfortunately, Internet penetration is also low. No more than 10% of the population has access, let alone know what to use it for. However, Internet usage is growing rapidly as is broadband access. I'm interested to know if he plans to create a mobile version? Mobile penetration, of course, is much higher - around 70% of the population - and I'd say at least half of the mobile devices can access the Internet.

E-commerce, m-commerce and online marketing are still in their infancy in Ukraine, but the affluent and younger generation of Ukrainians are tech-hungry and tech-savvy so I think we're going to see a lot happening in these areas over the next 5 years.

Marketing in Ukraine: liars and bridges

Futurelab's Marketing & Strategy Innovation Blog recently had a thought-provoking post about the connection between customer experience and marketing. It resonated with me for a few reasons. One, it challenges marketing professionals to choose who they want to be:

"... liars spinning fabrications around inferior products and services who depend on traditional marketing to make themselves appear more appealing. Or, we can be honest, and figure how to actually make the product, service, and brand better - so marketing initiatives will become a natural extension of the experience a customer has with that brand."

I think most marketers who want to choose Door #2, they find themselves at odds with bosses, companies or clients who have either chosen Door #1 or apologetically say "that's all we have to work with right now". In Ukraine it is even more difficult because marketing is still mostly equated with advertising, PR or sales, all of which are very much seen as ways to gloss over product shortcomings. Thinking of marketing as a bridge between the product/service and driving customer satisfaction/experience is still years away for most companies in Ukraine. Generations of Ukraine's citizens have been lied to by their politicians, employers, and each other. Not just little white lies, big lies. So skepticism and mistrust is built into the society's psyche. Despite this, Ukrainians generally have high expectations for whatever they buy and are disappointed easily. Therefore, Ukrainian consumers do not give their trust to a brand easily. It is easily broken once it is broken it is extremely difficult to get it back.

To date, the only protection for brands that lie and disappoint customers has been Ukrainians' low incomes and lack of alternative. Both of these problems are improving quickly. Those companies who now truly understand their customers and are looking to meet their needs in novel and innovative ways will see their market shares grow tremendously. These are the companies who leverage the power of marketing and its strategic role in product development and communication to Ukrainian consumers. They regularly track customer satisfaction as their primary benchmark for success and use it as a driver for product and service innovation.

I'll leave you with an example from a few years ago which demonstrates the lack of marketing sophistication in this part of the world. The example is from Moscow, but the situation isn't much better in Ukraine. The photo to the left is for a company selling apartments. And based on outrageous Moscow real estate prices, they probably cost at least several hundred thousand dollars. The offer reads "Super Promotion! Buy an apartment and get a free baseball cap!" Need I say more?