A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here
You recognized a need or a problem and had an idea for a solution.
You started your company based on that idea.
You attracted a team and customers because your idea worked.
Now what?
Early success doesn’t always translate to long(er)-term success.
Why?
Because one-product companies don’t prosper long-term.
Extending and expanding product uses based on customer feedback will provide further growth, but for longer-term success you want additional products.
The best new products will address your current market place.
Why?
Because your current client base knows and trusts you, so they will be more willing to try a new product from you.
And this is where many founders go astray.
They assume new product ideas will come from them, another senior manager or a senior developer, instead of allowing ideas to bubble up from anybody on their staff.
Which is why they are so surprised when a lower ranking staffer resigns to do a startup that plays to their market.
Not long ago an entrepreneur with whom I work and I disagreed. He said that entrepreneurs and managers were different and that while entrepreneurs should be managers managers couldn’t be entrepreneurs.
A study using brain scans from MIT professor Maurizio Zollo seems to back him up.
…when entrepreneurs performed explorative tasks, they used both the left and right sides of the frontal parts of their brains, the entire so-called pre-frontal cortex. In comparison, managers tended to use primarily the left sides of the frontal part of their brains. This is an important difference, as the right side of the pre-frontal cortex is associated with creative functions involving high-level thinking (like poetry, arts, etc.), whereas the left side is associated with rational decision-making and logical thinking.
But I still don’t agree.
Zollo isn’t sure either, but thinks that it has to do with the willingness to take risks.
People who just reason with the rational and logical part of the brain might be a bit more risk averse.
Or perhaps that’s more Pavlov’s dog and a conditioned response.
I’d like to see the right/left brain activity of managers at companies known for innovation, such as 3M, Google, and Jeff Immelt’s GE, as opposed to Jack Welch’s.
That would be much better comparison of apples with apples instead of with oranges.
The concept of Internet-connected machines that collect data and communicate, often called the “Internet of Things,” has been around for years. Information technology companies, too, are pursuing this emerging field. I.B.M. has its “Smarter Planet” projects, while Cisco champions the “Internet of Everything.”
But it is General Electric that is really pushing the envelope in a new East Bay (extended Silicon Valley) software center where they have already hired 250 engineers in the last year and a half.
The company plans to increase that work force of computer scientists and software developers to 400, and to invest $1 billion in the center by 2015. The buildup is part of G.E’s big bet on what it calls the “industrial Internet,” bringing digital intelligence to the physical world of industry as never before.
GE believes it can leverage the breakthroughs across its product line, from jet engines to medical equipment.
GE is a much different, not to mention much smarter, company under Jeff Immelt than it was under Jack Welch.
Welch used financial engineering as GE’s engine for profit during his tenure all but abandoning and gutting the industrial R&D expertise that had sustained its profits for decades—short-term thinking vs. long-term.
Nor does GE doesn’t believe or expect to do it alone.
Now G.E. is trying to rally support for its vision from industry partners, academics, venture capitalists and start-ups. About 250 of them have been invited to a conference in San Francisco, sponsored by the company, on Thursday.
GE and its ilk are opening up new opportunities for those who love to innovate, but don’t love startups. (And that’s OK.)
And if you do have that entrepreneurial bent why not focus it on industrial or enterprise efforts, instead of yet another consumer boondoggle.
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In case you’re curious, I had a fabulous Thanksgiving and four wonderful days off (I could get used to that:) Better yet, I got everything on my to-do list done. Yea!
There’s more than money to be made by applying creativity and imagination to innovate the mundane, especially applying creativity to the communications your customers typically ignore.
Adding a liberal dose of creativity can create great buzz and in many instances that innovation goes viral and provides advertising and brand-building value well beyond anything you planned.
Innovating customer instructions may even save lives.
Seriously.
The safety and emergency procedures video shown by most airlines is a great example of something critical, yet so mundane that most passengers pay absolutely no attention to it.
Whereas Air New Zealand’s video grabs and holds passengers’ attention, proving that even the most mundane communication is a platform for creativity and open to innovation.
What do you think? Would you watch?
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Established companies often lust after amateur web sites in which they see commercial value, but looks can be deceiving and due diligence is mandatory.
One thing due diligence should always keep in mind is the old saying, “if it sounds too good to be true it probably is.”
Obviously, Internet Brands forgot that when it purchased Wikitravel in 2005 with an eye to turning it into a paying proposition via ads.
There were some catches, however, that made for an unusual business proposition, starting with the fact that Internet Brands had not bought the exclusive right to the material on the site. The articles are governed by a Creative Commons license, which means they can be copied and republished by anyone as long as a mention is included of where the material came from.
Another catch: workers who do not expect a paycheck may find it easier to leave.
“Forking,” which refers to appropriating content licensed under Creative Content rules, is completely legal, but it’s a two-way street.
This idea paraphrases another old saying that applies, “what is legal for you to do is legal for others to do to you.”
Which is what happened a year later when the Italian and German contingents ‘forked’ the applicable content and created their own site.
Now the volunteers are in revolt, Wikimedia is involved and suites have been filed.
I’m no lawyer, but based on the article I’m not sure what legs Internet Brands has to stand on.
Lila I. Bailey, a former legal counsel for Creative Commons, the nonprofit organization that created the open copyright licenses employed by Wikitravel, said Internet Brands was in a tough spot.
Ms. Bailey, a teaching fellow at the University of California, Berkeley, law school, read both complaints and said Internet Brands faced “a community management problem” and had few options because the people involved were volunteers.
There’s a lesson here for all and it’s best said using another old adage: what’s sauce for the goose is sauce for the gander, too.
“The Information Technology Innovation Foundation ranked the U.S. last of 40 countries in terms of improved innovation capacity over the past decade.”
What if you asked business leaders? More than two-thirds would give their organizations high marks for innovation.
But what happens when you ask the working stiffs in those same organizations? You’d find innovation marks well below half.
Some 78% of leaders said yes; just 43% of employees agreed. Does the leader “urge employees to continually expand their understanding of business trends and emerging issues”? Leaders 77%; employees 51%. Does he or she “guide employees who fail or make mistakes to reframe the experiences as learning opportunities”? Leaders 77%; employees 47%. And does he or she “champion the merits of employee-initiated ideas to senior management”? Leaders 75%; employees 42%.
Those questions were asked of “513 leaders and 514 non-leader employees.”
I found grim amusement in the recommended fixes.
Senior Management Sets the Pace
Choose the Right Leaders
Develop Innovation Leaders
Build a Business Process for Innovation.
I thought senior management were the leaders, but obviously not since they are supposed to choose the “right leaders” and develop “innovation leaders.”
The idea that innovation thinking and support can be delegated by senior management to specialists at lower levels is just plain ludicrous.
Increasing innovation is on every CEO’s mind these days no matter how hot their current product/service, because innovation is what’s necessary to ensure their company’s future success.
But is there such a thing as too much innovation?
Ever hear the phrase ‘too much of a good thing’?
Innovation is good, but too much can kill as quickly as too little.
For proof, consider the story of Lego, which, after 56 years of growth almost bankrupted itself by developing a total ‘culture of innovation’ based on expert thought and best practices.
Kirk Christiansen [CEO] and his leadership team adhered to nearly every one of the major principles that are widely prescribed by experts in launching its spate of innovation in 2000 (…) “LEGO followed all the advice of the experts and yet it almost went bankrupt.” –David Robertson, Wharton practice professor of operations and information management, who studied the company and has a new book documenting what happened.
In turning itself around Lego did not pull back from innovation, rather it organized and channeled it.
Management gave everyone from the sales force to the headquarters staff the capability to create and suggest new avenues for growth. But their ideas were put to the test: Any innovation had to prove to be consistent with the company goal of LEGO being recognized as the best company for family products.
Did the new approach work?
Consider the numbers over the last three years and you decide,
sales have gone up an average of 24% annually;
profits have grown 41%;
third largest manufacturer of play materials; and
is in more than 130 countries.
Lego is positive proof that best practices work only when managed and tailored for each individual situation—even though they are usually billed as “one size fits all.”
“To the extent that creativity is about the recombination of existing ideas, then combining ideas that haven’t been connected before creates the potential to produce something new and useful.” –Roy Chua, assistant professor in the Organizational Behavior unit at Harvard Business School.
Research finds that innovation only results when there is a high level of affective trust.
…”cognitive trust,” an intellectual appreciation of another person’s skills, abilities, and reliability; and “affective trust,” an emotional belief that another person has one’s best interests at heart.
I have no research to back this up, but I bet affective trust is just as important to people with the same cultural background, but other differences, such as gender.
Over the decades I’ve talked with thousands of people and none of them were willing to take a risk or show their vulnerabilities to someone they didn’t trust, whether boss, colleague or spouse.
Finding ways to measure and improve affective trust in your organization will provide a sound foundation for creating a culture of innovation.
As companies grow and managers build their organizations they frequently talk about “weeding out” low performing employees—Jack Welch was a ninja weeder.
If that thought has crossed your mind you might take a moment to think about James Russell Lowell’s comment, “A weed is no more than a flower in disguise.”
As with weeds, there are better ways to look at under-performing employees.
95% of the time it’s management failures that create weeds and those failures run the gamut from benign neglect to malicious abuse and everything in-between.
Weeds can come from outside your company, inter-departmental transfers and even from peers in your own backyard.
What is amazing is how quickly a weed will change with a little TLC.
“Weeds can grow quickly and flower early, producing vast numbers of genetically diverse seed.”
People grow quickly, too, and often produce innovative ideas just because someone listened instead of shutting them down.
And while trust that your attitude won’t change takes longer to build, the productivity benefits happen fairly rapidly.
So before you even think about weeding look in the mirror and be sure that the person looking back is a gardener and not a weed producer.
“I don’t want to overstate the case. I think about 40 percent of people just are not going to be good at innovating regardless of what they do. And 5 percent are born with the instinct.” — Clayton M. Christensen, professor, HBS
First they identified five primary skills: associating, observing, questioning, networking, and experimenting.
First and foremost, innovators are good at associational thinking, or simply associating. They make connections between seemingly unrelated problems and ideas and synthesize new ideas.
Innovators observe things, then question why.
Networking is a skill that innovators use to identify and develop ideas by spending time with a diverse group of people with different backgrounds and experiences.
Finally, innovators are constantly experimenting.
There’s a lot more in the article, but I want to focus on the 40%, because I can just hear all the managers and entrepreneurs saying to themselves, “Whoa; I’m not going to hire any of those 40% people,” Or words to that effect.
And that is just plain stupid.
First of all, that would make 55% of the population unemployable.
More importantly, you need both on your team to truly succeed.
But that still isn’t my point today.
Please take as a given that you need both on your team to truly succeed (if you think it through you’ll understand why).
Now pay attention, because here’s the point I want to drive home.
You cannot run your organization with 100% innovators.
There are dozens of critical jobs in every organization that need the skills of the 40%.
Those positions require a focus on what is, not what might be.
With all the focus on innovation, the 40% is getting short shift. In fact, I know many who left jobs/teams/bosses they loved, because they no longer felt valued; they knew they weren’t innovators, so they stopped believing they could contribute and left.
Only a few of those bosses ever understood they were the cause.
Entrepreneurs face difficulties that are hard for most people to imagine, let alone understand. You can find anonymous help and connections that do understand at 7 cups of tea.
Crises never end.
$10 really does make a difference and you’ll never miss it,
You recognized a need or a problem and had an idea for a solution.
Established companies often lust after amateur web sites in which they see commercial value, but looks can be deceiving and due diligence is mandatory.
If you listen to the media, especially new media, you would think the US is a hotbed of innovation.
Increasing innovation is on every CEO’s mind these days no matter how hot their current product/service, because innovation is what’s necessary to ensure their company’s future success.
As companies grow and managers build their organizations they frequently talk about “weeding out” low performing employees—Jack Welch was a ninja weeder.
“I don’t want to overstate the case. I think about 40 percent of people just are not going to be good at innovating regardless of what they do. And 5 percent are born with the instinct.” — Clayton M. Christensen, professor, HBS
