CEO Myron E. Ullman III from JC Penney – Holding back about 60% of inventory . . . far more than just the 20% held back last year.

CEO Kip Tindell from Container Store – Cut prices in his store across the board by 16% this year.

CEO Steve Sadove from Saks – Hesitant to cut prices but has done so by using different fabrics to lower costs.

CMO Barry Judge from Best Buy – extending their offerings to include things like “electric cars.”

CEO Gary Friedman from Restoration Hardware – Actually raising prices on some great new designs in furniture.

So with everything and anything going out there what do you think? What do you think retailers should do?

I. Chapter One – November 11, 2011.  Reminiscing about our beginning days in the Innovation Center that opened the year before on October 10, 2010…  What did we set out to accomplish?  What were our motivations?  What resistance did we encounter?  Who encouraged us?  What people were instrumental to our early success?  What role did networlding play? What was it about the Innovation Center concept that truly caught people’s interest and passion?  How did we leverage outside ideas and our blogosphere community to help enhance our vision and accelerate our progress?

II. Chapter Two – A day in the life of the center as it is “today” (11-11-11) – The user experience.  What are the key differentiating attributes of the user experience?  How are people using the Center?  What value are they generating/receiving?  What makes the Center so successful?  How has this changed over the last year?

III. Chapter Three – Opening Day October 10, 2010.  What did the beginning structure look like the day it opened?  Did we have all 30 kiosks in there?  What was our business and revenue model?  What initial mistakes did we make? What fortuitous events helped make it happen?  What was the initial public reaction?  What near-disasters did we finesse?

IV. Chapter Four – The first week.  What happened during that first week of the center being opened?  What did we learn?  What did we commit to fix?  How did it change our assumptions or operating models?  What would we have done differently from the beginning of only we’d known…

V. Chapter Five – The early months.  What happened within the first 90 days?  What were our first 3 major initiatives?  How were they germinated?   how did we get them to the stage of moving to engagement with design engineers from a couple of the companies in the center (check out www.inventright.com or www.edisonnation.com for examples of companies).  Who were our first corporate sponsors?  What made them decide to participate?

VI. Chapter Six – Crisis!  What unexpected event happened ~ 4-6 months later that nearly caused the Center to collapse?  (A little dramatic effect that occurs in every good story…)  How did we rescue it?  What help did we get from an entirely unexpected source?  What sacrifices were we forced to make that turned out to pay huge dividends later?  What seemingly unrelated sub-plot first mentioned in the prologue and carried along at a low level of intensity in Chapters I-V suddenly emerges as an unexpected, vital component of our success?

VII. Chapter Seven – The Center – 2nd Generation.  How did the Center emerge better, stronger and with more innovative impact as a result of the events in Chapter Five?  How did we know that the Center was now completely out of danger and would be an extraordinary success?

VIII. Chapter Eight – Events in the Center.  What kinds of things went on during that first year – especially those that could only have taken place in the unique environment of the Center?

IX. Chapter Nine – Impact of the Center.  What tangible, measurable results has the Center produced in its first year?  What additional kinds of activities are there underway that will yield even greater impacts an dividends.  Where did we create unexpected value?  What didn’t we expect that happened?

X. Chapter Ten – What’s Next?  Having spent the first nine chapters in reflection mode, now we pivot and look to the future.  Sister Centers are now in various stages of opening in San Francisco, Seattle, Boston, London, Prague and Milan.  Interest has been expressed from unexpected sources – DARPA, DOE and other leading-edge US government agencies want to develop a similar concept to help drive early-stage innovation on government projects.  NASA wants to build a Center dedicated to establishing a manned base on Mars.  The World Bank and Gates Foundation want to fund the establishment of local Innovation Centers across Africa to help foster self-help solutions to the daunting problems of Aids, energy, food and tribal feuding — from the same people that these challenges affect the most.

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So, beginning with Chapter One, what ten companies do you think should be part of the center?  Would you choose any of the companies from this list of the twenty-five most innovative companies identified most recently by Business Week? Who would be your ten and why? Please comment and get your colleagues to comment. We’ll let the majority rule and off we go! Check out Business Week’s 50 Most Innovative Company list for 2009 to help with your choices.

We each selected and self-dispensed our preferred caffeinated concoctions at the Einstein Espresso bar.  By popular demand, Innovation Center members had a generous number of free beverages included in their annual membership dues.  Coffees of various kinds, in particular, seemed to be especially popular with the innovator set, and they had created a whole menu of selections named after famous business and technology innovators:  Job’s Java Jolt, Moore’s Macchiato Melt, Edison’s Electrifying Ethiopian and Wozniak’s Wicked White Mocha, among others.  Melissa took a hit from her Bezos’ Brazilian Brew while I savored a sip from my Da Vinci’s Daily Double.

I mused aloud about Melissa’s choice of beverage.  “Ironic, isn’t it, how Jeff Bezos is partly responsible for our being here – in a backhanded sort of way.”

Melissa smiled, and said, “Absolutely – as the founder of Amazon.com, his singular innovation – online book sales – really accelerated the decline of the retail bookstore.  They just couldn’t compete on price – and most of them couldn’t figure out how to turn their brick-and-mortar buildings into a competitive asset, rather than a liability.  But surely if he hadn’t commercialized selling books on the Internet, someone else would have.”

“True,” I answered.  “But he got there first with the right combination of customer features.  He might not have invented the concept of online retailing, but he put all the right pieces together.  We might not have invented the concept of the innovation center, but we’ve managed to pull together the right combination of location, people, capabilities and services to launch the most successful innovation center of its kind in the country – maybe the world.”

“Well…” she began, “Before you give us too much credit, don’t forget the amazing inputs, ideas and suggestions we got from the tens of thousands of people who read our blog.  We wouldn’t be here today without them.  And hundreds of those readers are now members – and are still the main source of our new ideas.”

Breaking through the scattering of silver-lined rosy pink clouds on the horizon on this invigorating Autumn morning, the sunrise over Lake Michigan bathed downtown Chicago in a soft amber glow reflecting off the peaks of its soaring skyscrapers as they stood out against the bright blue backdrop of the firmament above.  It was early on this November morning – not even 6:35 AM, but already the streets and sidewalks were starting to fill with motivated Chicagoans and out-of-town visitors looking to get a jumpstart on their day’s activities.

Both the U.S. and general global economy were enjoying a second year of robust growth.  While the early part of the recovery, which officially began early in the 3rd quarter of 2009, had gotten off to a slow and somewhat rocky start, few back then had foreseen how strong the U.S. economy would come roaring back, and how pronounced innovation was being credited with in accelerating this economic expansion.

For those associated with the gleaming new Networlding Innovation Center in Chicago that had opened the year before in the prominent location formerly occupied by Borders bookstore on Michigan Avenue, the fact that innovation had played such a key role in reinvigorating the US economy wasn’t really all that much of a surprise.  They knew that the effective management of business and technology innovation could yield enormous benefits for virtually any company and industry.  And the unprecedented confluence of global recession, capital market lock up, stock market crashes, failure of hundreds of once iconic companies plummeting real estate values and rising unemployment had prompted a countercurrent increase in the level of effort and resources being dedicated to innovation by a growing number of government, academic and private sector leaders.  Their efforts were now paying off in a large way.

Melissa Giovagnoli and I were sitting at the Einstein Espresso bar on the 3rd floor of the Innovation Center, sharing an early morning cuppa java and reminiscing about the period of time leading up to the opening of the Center on October 10, 2010.  The last couple of years had seemed to roar by in a blur of fast-paced decisions, chance meetings, not-so-coincidental coincidences, memorable events, unexpected setbacks, and exhilarating triumphs.  Not to be overlooked was the herculean amount of hard work that had been done by an ever-expanding team of dedicated innovators who embraced the vision for this Center as their own — and had truly made it a success beyond anyone’s expectations.  And now, exactly a year, a month and a day after the formal opening of the Center, we had set aside time on this early Friday morning to reflect back on how far we’d come and recounting the sequence of events during the early conceptualization and planning phases of the Innovation Center.

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Want to start from the beginning? Go to:

Notes from the Future Prologue: http://www.networldingblog.com/innovation-center-book/

and Notes from the Future Intro: http://www.networldingblog.com/innovation-center-book/intro/