A former colleague once lightened up the arduous appraisal meeting presenting a critical 'up or out' evaluation as a criminal case: Did that person have the means motive and the opportunity to do what we expect?
Bigger, more disruptive ideas are expected these days.
Finding new sources of growth is a must, to close the growth gap for shareholder value, or, to survive. Depending on the life stage one is in. However, in conversation with clients we hear that their organization "just generates incremental ideas".
There is a huge gap between aspiration, and the reality.
Companies are in hyper-activity mode: Everyone wants to work with a startup and sends innovation scouts to the Silicon Valley. Corporate VCs, hackathons and start-up competitions pop-up left and right. The innovation theater in full swing. But no results. Real innovation is different. Moving forward big ideas can be irritating and confronting. Going against established policies and wide-held believes infuriates people, as did Galileo Galilei’s heliocentric models. True innovation will be questioned, even from your closest kin. It can be painful, scary, messy, full of dead ends. Should we start a riot with uncertain outcomes? No, innovation is focused and structured creativity of the kind architects apply when envisioning landmark buildings.
So, how do you create co-conspirators in your innovation coup? Give people the means motive and opportunity to act with you, for you. Here is how.
1. Hand out the tools to find unmet customer problems.
It may sound trivial, but for many companies, in B2B in particular, having a dialogue with the customer about their job to be done does not happen. To quote Theodore Levitt, “People don’t want to buy a quarter-inch drill, they want a quarter-inch hole." The right questions need to be asked (5x Why). New words are to be learned to even express what we’ve learned: Jobs. Circumstances. Hiring criteria. Workarounds. Barriers to consumption. All critical to explore the land of unsolved needs.
It was the biggest revelation from a participant during a joint session hosted by Clayton Christensen in Boston last summer. Crudely summarizing Clayton: "...In B2B, it is simple, your customer’s job is to make money. Ask him how he can make more money" The participant, a former global Key Account Manager, then revealed that the question was never asked at his company.
A structured approach to overcoming this, is the working backwards process as applied by Amazon. Employees submitting an idea need to file a one-page press release describing the customer problem and how it is solved in such a way that it is understood by ordinary people. This forces tech-savvy engineers to ask the right questions, to listen and observe and find how they can be of superior service to the unmet needs of their customers. It drives people into falling in love with the problem, not one specific solution.
2. Teach people to tell a captivating story
Start with a common innovation language. Once language is set, master the art of storytelling. Not long ago I met with engineers from one of the world’s leading oil exploration companies. They were full of brilliant ideas. The ideas rarely received management approval. Business opportunities were lost. The engineers described technically ingenious details and held lengthy presentations on all potential risks. A different tack was required. All great stories have a well-known formula: The situation outlines the environment of your plot. Enter the villain providing the complication, the customer problem to be solved. This is then resolved by the white – or black – knight, your solution. Three simple steps to build the story, done.
3. Inspire by purpose
Organizations transforming the world explicitly state their mission to do so. It is the source back in the day at NASA, where a janitor confided to John F. Kennedy “I work here Mr. President to put a man on the moon”. And would Tesla ever be shaking up the established automotive industry without the ambitious vision to “accelerate the world’s transition to sustainable energy”? And how about Dove's "inner beauty", triggering the tear-jerking Dove Beauty Sketches? A clear motive calibrates the compass needle to pull peoples’ thoughts and activities to a distant vision. It is what gets people to do the impossible. Oh, and this is not just ‘a millennial thing’
“That business purpose and business mission are so rarely given adequate thought is perhaps the most important cause of business frustration and failure” Peter Drucker, 1973
4. Guide by well-defined search fields.
Would you know where to search if your lighthouse is called “block-chain”, or “digital disruption”? This may sound trivial, but I regularly see teams struggle with this. Instead, as I observed at a chemicals manufacturer, define the sources of future growth as loosely quantified Strategic Opportunity Areas: the intersection of a large customer group, a customer problem worth solving, and a potential technology and/or business model pointing at a possible.
5. Encourage not discourage.
Build an atmosphere that honors the hard work necessary to succeed in the stony, iterative approach to real transformational ideas. The following three components build such inspiring environment:
Provide clear goals & boundaries ensuring teams work on problems and solutions that are on strategy and avoid the pursuit of fruitless paths. I once sat through a day of project reviews on which people directed their entire energy over the past six months. Half of those presented were shut down by Management for reasons that could have been clear from the get-go. Some tears, opportunity lost. Define therefore, what is desirable, what is off the table, and what can be discussed.
Promote de-risking of critical assumptions and expect setbacks that can be corrected by high-velocity decision making correcting for mistakes before they become hurtful. Jeff Bezos in his 2016 Shareholder Letter explains it all.
Show from the top that innovation is about “to keep learning and improving” as Microsoft’s Satya Nadella shared per email to his company, immediately after a AI team had to shut down an out of-control chat bot.
5. Review explicit, and implicit idea prioritization criteria active at your company.
Most managers follow a set of values, including their own incentive schemes, that result is short-term margin oriented thinking. The idea does not make it to the CEO who might have a different perspective. Thus, the present cost structure determines business cases and limits opportunities to take on exponential growth journeys. I find this a great insight in how companies operate, as vividly described in Clayton Christensen's 'The Innovator's Solution'. Also, it is safer, cheaper, and requires less efforts to just come up with incremental improvements, than game changing products. An appliances executive confined to me recently that:
“ Only troubled BUs come up with really new ideas as they have nothing to lose – all others continue to develop the next version”.
Another example: The CMO of leading Consumer Goods company mentioned that re-balancing financial, NPV driven thinking versus consumer job orientation is one of the critical challenges facing the company today.
6. Enable interaction with strangers.
The magic happens at the intersections of different, driven people searching for new endeavors. Companies pursuing strategies to become agile radically redesign their office layouts to encourage seemingly random meetings. Classic examples are Steve Job’s famous Pixar Studios, designed for people to meet spontaneously, or the Impact Hub network where entrepreneurs can co-work and sharpen their emerging business plans. GE merged these ideas and invites university staff and students alongside with entrepreneurs to visit and collaborate on inspiring ideas at GE FirstBuild.
Following these ideas, your colleagues become partners-in-crime to spark truly disruptive innovation ideas. Concluding with a quote within the theme:
“You know my methods. Apply them,” - Sherlock Holmes.