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How to spark fresh thinking in the water sector (and why we need to)

Are innovators born, or made? The answer is both, so it pays to cast a wide net, writes David Barbeler.

It’s not uncommon to hear people say that being innovative is not in their remit – that it’s the realm of creative types. The truth is that more than ever, innovation is making its way into a wide range of job descriptions, across a variety of functions.

Innovation can arise from the most unlikely sources, said Dr Marlene Kanga, a board member of Innovation Science Australia and Sydney Water.

“Employees, contractors and customers can be a source of great ideas. It’s best for organisations to be open to innovation and facilitate how these can be put forward and tested,” she said.

Gaining momentum

Water utilities have coasted for decades using traditional business practices, but Kanga warned the industry could find itself at a disadvantage if it’s unprepared for disruptions like those that have completely up-ended other industries.

“It’s important for the industry to be proactive and consider what these disruptions might be and then develop strategies to accommodate them,” she said.

Queensland Urban Utilities (QUU) is one water utility that’s leading the way, as acknowledged when it was listed on BRW’s Top 10 Most Innovative Companies List for 2015.

The utility is very young by industry standards – formed in July 2010 – so they had to adopt an innovative approach from the get-go in order to compete against more established players.

“All businesses need to generate a competitive edge, and it has to be from within,” said QUU’s Innovation, Research and Development Manager Colin Chapman.

“For decades the water industry has employed a traditional approach: invest strongly in assets and build things that will last 100 years. Today it’s more about maintaining affordability, and having flexible and agile options. The mindset has shifted.”

City West Water (CWW) is another utility diving into more forward-thinking approaches. The Victorian Government-owned retail water business just hired its first ever chief information officer. It’s a critically important role, said Managing Director David Ryan, and one that will help the organisation get on the front foot technologically.

“Customer expectations are changing enormously, and a way to deliver extra value is through technology. This is a field that is changing frequently, and so we wanted someone to bring in the best thinking from outside our organisation,” he said.

Technological innovation is also allowing CWW to be proactive about asset management, and even anticipating problems before they arise, said Ryan.

“It will help us understand the condition of our assets better so we can renew and replace them at the right time.”

Innovation helps organisations better manage other assets as well – namely its people. Chapman said that nurturing and encouraging talent to think differently and put their hand up helps retain staff and attract better talent.

In fact, ABS figures collected in 2012-13 show that twice the proportion of businesses that undertook some sort of innovation activity – regardless of whether those innovations were implemented within the year – reported an increase in productivity compared to those that didn’t.

A perfect match

Innovation hubs, chief innovation officers, innovation workshops … there are many ways to approach this issue, said Dr Kanga. Some are large and far-reaching; others can be small and targeted. The trick is to figure out what will work best within your organisation’s culture.

“Some organisations have regular innovation forums where ideas are presented, others have a marketplace where votes are cast for the best ideas, still others have ‘skunkworks’, where employees can work on a new project for an agreed amount of time each week,” Dr Kanga explained.

She said that although some innovations at Sydney Water are driven top-down, staff are encouraged to promote ideas to improve efficiency and customer service.

“For example, two of our systems operators devised a simple but innovative operation to improve sewer pump performance. It was initially aimed at improving safety for our staff who had to manually clean the pumps.

“However, the simple innovation of dropping levels in the pumps to allow auto-flushing of materials has improved pump performance and generated millions of dollars in savings for the utility.”

QUU is also tackling innovation from both ends of the organisational hierarchy, said Chapman.

Employees can pitch their ideas online, at meetings with management, or by seeking out the help of volunteer innovation representatives throughout the business. So far this approach has been successful – more than 200 ideas have been proposed by staff members.

Successful ones include the award-winning Beaudesert Nutrient Offsets Project, where a 500m bank of the Logan River was re-engineered to prevent 11,000 tonnes of sediment entering the waterway each year. Another project involved the introduction of floating wetland mattresses on lagoons at the Forest Hill Sewage Treatment Plant, which have cut its chemical and electricity use by 25%.

“It’s not about rigour: It’s about giving permission, space and freedom to develop campaigns that aren’t in isolation or duplication,” Chapman said.

Sticking the landing

Innovation psychologist Dr Amantha Imber makes it her business to study innovative cultures and what makes them tick. According to her, “innovation has to be very targeted. Otherwise you’ll get rubbish ideas like, ‘Let’s have three-ply toilet paper instead of two ply’.”

Imber, a best-selling author and founder of Australian innovation consultancy Inventium, uses the latest peer-reviewed scientific findings from psychology and neuroscience to help organisations gain a competitive
edge through innovation.

“We dissect what’s been scientifically proven to drive innovation and we make it really accessible for companies to use,” explained Imber, whose firm helps Fairfax compile AFR’s Most Innovative Companies list.

One problem she observes in organisations is teams running full-day idea generation sessions and making important decisions about which ideas to progress towards the end of the day.

“Decision fatigue sets in, our willpower becomes compromised and we simply take the path of least resistance, which means going for the least risky, safest option. You can’t afford to do that with innovation,” she said.

Instead, Imber recommends organisations replace full-day idea generation sessions with back-to-back half days in the mornings – when the mind is still fresh.

Trust fall

Innovation by definition involves an element of risk, yet government bodies and utilities are notoriously risk-averse. How do they overcome that mindset?

Dr Kanga said it was crucial for management to demonstrate they are open to “having a go” without letting fear of failure get in the way.

“It is also valuable to partner with innovating companies and with research institutions,” she added.

Imber agreed, saying, “Failure can no longer be seen as a dirty word”.

With the right systems in place, Imber said you don’t need to bet the house. Instead, it’s best practice to place lots of mini-bets, akin to how a financial adviser will set up a diversified portfolio.

“We teach our clients to run very fast, very cheap and very efficient experiments where they might spend one or two thousand dollars testing key hypotheses around an idea that might add value to customers,” she said.

“We can very quickly learn whether the idea has got legs and needs a bit of iteration, or whether we need to kill it.”

This not only ensures you’re casting a wide net, but also guarantees a pretty wide safety net as well.

First published as 'Sparking Fresh Thinking' in Current magazine May 2017.