Orange / Henley Business School

Equation helps manufacturing companies chase big ideas

• British manufacturing businesses are generating more ideas than ever but a low hit rate is stifling true innovation
• Academic works with Orange to create world’s first equation which outlines how top firms create consistently useful business ideas

London, UK – 8 June 2012 – Manufacturing firms in Britain are generating record numbers of business ideas (e.g. for new products or services) but a low hit rate is stunting true innovation. This new finding comes from a Henley Business School research project1, commissioned by Orange.

According to the innovation study, over three quarters of manufacturing firms in Britain (80%) are generating more business ideas2 now, compared to five years ago but over half of these ideas (45%) aren’t practical and can’t be implemented. To help businesses in the manufacturing sector generate more useful ideas Professor Dominic Swords from Henley Business School has developed the world’s first equation outlining how firms create consistently great business ideas.

The formula – the result of interviews with innovation leaders like 3M, Diageo and Bupa and an analysis of 2,000 British businesses – identifies experience, engagement, energy and diversity as the elements needed to generate useful ideas in a group environment (e.g. a brainstorm).

The formula was developed after it was found that businesses are struggling to create implementable ideas. Trying to implement these impractical ideas is leading firms up blind alleys, wasting time and impacting innovation. Business ideas are vital as they lead to innovation and innovation leads to competitive advantage.
The ideas generation equation:
IG = 3ED
Rate of Ideas Generation = (Experience + Engagement + Energy) x Diversity

IG = Rate of Ideas Generation
3E = Experience + Engagement + Energy
D = Diversity

Calculating the equation:
1. Experience – ensure those in the room have the right amount of accumulated experience in the subject matter.
2. Engagement – make sure participants understand the brief and are focused on the task.
3. Energy – raise energy levels by hosting the session off-site or incentivising employees.
4. Diversity – involve people who have experience in different markets and technologies (the level of diversity in the room is crucial as it acts as a multiplier, increasing the quality of ideas created).

To help firms implement the formula in their day-to-day operations, Professor Swords has turned it into a seven-step plan to run the optimal ideas generation session. This easy to follow plan gives techniques on picking the best participants, identifying the optimum ideas and then implementing them. The plan also highlights innovation examples from world leading firms such as inviting external guests to give first-hand insights; asking participants to pretend to be the target audience when giving feedback; using separate rooms to test ideas; and eliminating negative comments by giving yellow cards to participants who say “no, but”. To download the free guide, please visit:

Professor Dominic Swords from Henley Business School, said: “The encouraging news from this research is that manufacturing businesses are generating more ideas now than five years ago. However, many of these ideas simply can’t be implemented because they weren’t conceived in the right way. That’s a missed opportunity as it’s wasting valuable time and stifling innovation. But it doesn’t have to be this way. As some of the leading innovators have told us – from both large and small firms – putting a simple 60-minute process in place to generate ideas can have a positive impact on growth.”

“We work with thousands of businesses, supporting them in their quest for game changing ideas,” said Martin Stiven, Vice President of Business, Orange. “We’ve seen first-hand how manufacturing businesses are focusing on driving growth by creating great ideas. Clearly these ideas don’t happen by accident yet they can be encouraged to happen. If you manage the ideas generation process well and learn as a team, the effect can be transformational.

“Innovation is central to Orange’s core values. Our own ideas generation method features a range of techniques such as using social media networks like Yammer to share ideas with each other. As this research shows, the key is developing a culture of innovation so everyone in the business is constantly creating useful ideas that move the business forward.”