Zane Safrit

Would your customers form a kickstarter community with you?

Consider a project like our DIY Spectrometry Kit, which was conceived of just after the Deepwater Horizon oil spill to attempt to identify petroleum contamination. In the summer of 2012, just a few dozen people had ever built one of our designs, let alone uploaded and shared their work. As the device's design matured to the point that anyone could easily build a basic version for less than $40, we set out to reach a much larger audience while identifying new design ideas, use cases, and contributors, through a Kickstarter project. Our theory was that many more people would get involved if we offered a simple set of parts in a box, with clear instructions for assembly and use.

By October 2012, more than 1,600 people had backed the project, raising over $110,000 -- and by the end of December, more than half of them had received a spectrometer kit. Many were up and running shortly after the holidays, and we began to see regular submissions of open spectral data at http://spectralworkbench.org, as well as new faces and strong opinions on Public Lab's spectrometry mailing list.

via MediaShift Idea Lab. How Public Lab Turned Kickstarter Crowdfunders Into a Community

What if you put a new idea or product or tool or resource you're considering for your company where DIY Spectrometry Kit is and you replaced Deepwater Horizon oil spill with the mistake of a major competitor.

And you put that idea out on Kickstarter.

Would 1,600 of your customers or employees...back the project with donations of time and money? 

You're rolling your eyes and thinking that's a crazy idea.

You're right. And that crazy idea just inspired 1600 people to cough up about $60-65 a piece to help make it real. So, the next time you need funding for a crazy idea...ask yourself if it's crazy enough to inspire people and are you crazy enough to ask.

Interview w/ @MethodMan and @Adam_Lowry, Founders of Method - Part 3

Eric Ryan and Adam Lowry, co-authors of The Method Method: 7 Obsessions that Helped Our Scrappy Start-Up Turn an Industry Upside Down and co-founders of Method home products joined the show recently.

You can listen here.

You can read Part One here.

You can read Part Two here.

I'm an avid reader. I read 1 or 2 business books a week. And I found this book one of the best written, most useful, best-organized, most entertaining, imminently doable books I've read in a long time.

How good is it? I haven't finished it yet. Almost every paragraph inspires, ignites, aggravates me to keep writing notes, scribbling them in a notepad or typing them in Evernote.

If you're in a startup, a small company, a mid-sized company, if you're in a department within a big company getting ready to launch something new...you should read this. And make sure you have a notepad handy. Seriously. Even if you just like good writing...you should read this.

You talk about the different types of reasoning and its role in your decision-making process. Two types of reasoning, I’m kind of familiar with, inductive and deductive, I use occasionally in my business. You describe a 3rd. Abductive. And I looked it up on Wikipedia and it describes it as guessing. But I think it’s a bit more than that.

Both: Laughing.

Eric: Awesome. I never looked it up in Wikipedia.

Adam: What counts is that we’re smarter than guessing.

Eric: You blew my entire cover of what everybody thinks I do around here. I have a vision, inspire what can be versus what is...and it turns out all the time I was guessing.

Yeah, this comes from bringing together great business thinking and great design thinking. My career was I grew up working with creatives. And a lot of it rubbed off on me over time and it’s about most people look at something and they’ll explain to you what is. And they’ll have a really hard time what can be. And that is the core skill of a designer or a creative is creating something that hasn’t been. I would argue it’s also the core skill of an entrepreneur who has the ability to like we did, in a wall of sameness in cleaning products and be able to imagine what possibly could be in that place that was there today.

Adam: Otherwise known as guessing.

To be honest, I just looked it up as we were talking and I’d ever heard of it and I thought:

Wait a minute. That is a form of reasoning. And the first sentence in Wikipedia is that sentence.

Why is it so rare, why are you guys so fortunate to have such an active skillset with abductive reasoning. Or why is it so rare in other businesses?

Eric: Because most businesses as they mature and grow, people who naturally get promoted to the top tend to be the best managers who have a really rigorous approach. They’re analytical. They have the ability to create predictability, right - the person who ultimately can deliver predictable results time and time again.

Who gets squeezed out, ultimately, are the individuals who are much more the creators. They’re not going to be the managers. And so, what we try to do is balance that at a leadership team level, that design thinking and business thinking where we have an industrial designer who sits there as a peer to a CFO.

And, it’s rare. But it’s getting much less rare. Apple’s probably the best example where a designer or a creative sits there at the same level as the operations.

We talked a little bit before the show about failure. You guys have failed a number of times. In fact, you devote a section at the end of each chapter to a failure and what you learned from it.

I say this with a big smile...but given the number of your failures, big and small, you guys should be consider big failures. I say that with the utmost respect. But you kept right on failing until you were successful and you had the guts to share many of those failures in your book.

Adam: Well, it starts off with the belief, and I mentioned it before, Eric and I we’re not really into trite things like “striving for perfection” or “striving for excellence” sorta vacuous statements like that.

Instead of focusing on being the best, we’re focused on being the best at getting better. It’s interesting that we’ve learned from stories like the space shuttle disaster. You know that classic NASA story about the fear of bringing the O-ring forward to superiors within that organization and the disaster that occurred there in that organization.

What’s really important is not that you come up with the perfect strategy that can’t fail. It’s much more important to have a strategy that’s just ok and execute it really well. And then learn what didn’t work. And adjust that strategy and execute well again. If you do that, in a couple of iterations you’re going to be by far the best. And that will get you there much more quickly than trying to sit around and think about the perfect solution.

We’d rather get towards doing, learn what works and what doesn’t, and then just keep doing. And it’s sorta painfully simple. But it works.

And what it does is that it means you got to have a company culture that says:

“It’s ok to fail but we gotta learn from it.”

Now that you’re over 10 years old and your quarterly revenues are meaningful, how do you keep that willingness to fail and that openness to it alive and well in your culture?

Adam: I think it’s important to note we’re still a tiny company in the grand scheme of our competitive set. We have competitors that are a 1000 times our size. We’re still really little, even though we’re bigger. But we do believe that small is a state of mind. And it’s about a way of doing things where people remain scrappy and resourceful and focused around making the best of the resources we have.

Eric: Yeah, I think that fear of failure starts at the top and setting examples. When Adam and I screw up, we admit those mistakes. It’s modeling that behavior that’s probably the most important thing you can do as a leader.

You list 3 mistakes, 3 learning experiences with your Bloq product line. Which one proved the most valuable?

Eric: That line taught us a lot of mistakes that we were able to carry forward. I would argue probably the one that is:

“Lack of Alignment”

There were some really simple decisions we made really late in the game that if we had not done that we would be ultimately...none of this would have happened. So, it’s something we push really really hard on...we’ve got complete alignment before we move forward on new decisions.

Early on in our conversation we talked about your principle to aim small and over serve. That sounds so clear for a small startup company. But your muse, Andy, also reminds you that the bigger you get, the smaller you need to act. Now, you're a big company. A bigger company. When did you catch yourself acting like a big company?

Eric: I think probably one of the best examples was when we launched the brand. If you read the copy on the back of the label, you probably would have just laughed out loud. We would go on to make ridiculous claims, like our cucumber dish soap claim, we would say:

“We own the right to the cucumber in all countries except Guam.”

Things would just come out of left field. And couldn’t really be explained but it would be very entertaining. And it would also bring a little bit of fun to the dish soap. I was amazed at the all the letters we would get, some of them arguing with us:

“Guam is not a country, it’s a territory.”

And wanting to keep dialogue going.

And as we got bigger that voice got squeezed out more and more. We started sounding a bit more serious and taking ourselves a bit more serious.

And that’s a lot of what Andy means. The bigger you get the more real you need to be in order to lot lose your connection with those human emotions.

We worked hard with the more recent things we’ve done. If you look at the bottom of our bottles now we’ve started embossing them with little sayings that, for the consumer to discover. Just those little winks, those little quirks, that you don’t typically get from big brands.

Nice. Nice answer.

You sprinkle your book with quick profiles of your favorite muses. Andy Spade, Tony Hsieh, Dan Germain, and others. Was there one muse you left out?

Eric: Yeah, we had a lot of muses we could have done. I would give a couple for me.

Chip Connelly, who’s the well-known hotelier here in San Francisco. His ability to create experiences and elevate those experiences is amazing.

Blake Mycoskie who founded Tom’s Shoes. His ability to create inspire advocates and his leverage of social media for his one-to-one model is just world-class and somebody who I continue to get inspired by.

Adam: Yeah, there are some people who were inspirational to us that we mentioned in the book, not as muses but who served that role. People like Yvon Chouinard founder of Patagonia who’s created a business model unlike any other as it relates to sustainability. People like Michael Braungart and Bill McDonough behind the cradle-to-cradle model of business which we very much build into things.

Those are great inspirations and muses for us. I think there are some very personal ones for both Eric and I. Both of us look to our parents and grand-parents as great inspirations and the reasons why we’ve ended up doing what we’re doing.

We've reached the imagination moment in our show. Let's imagine that President Obama is calling your assistant right now. In fact, they are waving at you and mouthing the words...President Obama, as we talk. You’re laughing and she drops him into your voicemail. He says:

Guys, love what you're doing. You and your company turned an industry upside down. Right now, we've got an economy that remains upside down. I need to hear your ideas on how we can turn it upside down one more time, bring it right side up and start growing, generating jobs. Would you come to the white house, bring some product to keep me and the first lady happy, and talk about 3 things we can do now to bring this economy right side up.

What would you tell him?

Adam: I’m not politician, but since you gave me the liberty to answer when you brought it up I’ll go ahead and jump into it.

The first is I think we really need to invest in the green economy. I don’t know why in political discourse there’s still this weird belief that if we do something good for the environment it will be bad for the economy. That’s just plainly false. In fact, the reverse is true. By making investments in the green economy we can create, by making investments in green things we can make growth happen.

I’m a big believer in that.

The 2nd is education. Education is always something that is critically important for the development of a nation. I think we need to do that at a lot of different levels.

The last one is a little bit political. I believe the issue of campaign finance reform is a critical issue in the United States. I think it’s an apex issue. One of the reasons it’s so hard to invest in the green economy and one of the reasons the deck is stacked against companies like Method that integrate social and environmental considerations into their business model is that our politicians are really run by the people that fund them. And the the people that fund them are big entrenched businesses whose interests are to keep things the way they are. As long as the big corporations, who don’t want things to change, are funding the politicians then we’re not going to get the level of change we seek.

Eric: I guess I would just tell him, like, stop calling me and continue to let me work, so I can make more soap and hire more people.

Readers are leaders. Jim Rohn says that, I just quote him. What are you reading these days in all your free time?

Eric: You know, I’m a magazine junkie. I find it hard to find the time to get into a new book. I had a flight this morning that left at 5:30 AM and in hand I had the Economist, Business Week and Fast Company. But, I’m also, I spend a lot of time on digital media and blogs but I’m still magazine junkie at heart.

Adam: I’m reading two books right now. One’s called The Ripple Effect by Alex Prudhomme and it’s about fresh water and the fate of fresh water in the world going forward. I read a lot of non-fiction, stuff like that, instead of a lot of business books.

The other book I’m reading, Redesigning Leadership (Simplicity: Design, Technology, Business, Life)  is by John Maeda  from Rhode Island School of Design.

Both great books about different topics. One’s critical if business is going to provide more leadership in the world.

Fantastic.

This has been a fantastic conversation. You start your book talking about the importance of a company's culture. And you end your book talking about culture, too. In this case, it's the personal culture. Share with us your conclusion.

Adam: Um, I’m not sure I understand what you mean.

Well, as I’m reading aloud, I’m not sure the question was very clear. I apologize.

Adam: I’m sure it was at the time.

You start the last chapter with a great conclusion:

Sitting down to write this conclusion, we couldn’t help but think,

Shouldn’t you be drawing your own conclusions from the book?

We’ve spent over two hundred pages giving you all of the wit and wisdom we have to offer, and you want more? ...

Really, if there is one thing we want you to take away from this book it’s...buy our soap. Lots of it!...

Ok, if there are two things you take away from this book, here’s the second: Find your own obsessions.

Eric: Success only comes from really understanding and articulating what drives you. And taking that up to a higher purpose in your career and life. It’s such a cliche’, but it’s a true one. It’s hard for most people. We’re very lucky to find early in our careers what really drove us and to be able to lean into it in a big way.

Adam: I’m glad that Eric remembered what we wrote in the conclusion. I remembered it in more general terms in that when we were sitting down to write the conclusion we thought usually a conclusion ties a bow around the end of the book. For us, the conclusion was another introduction into the next step into the thinking of the reader.

We’ve shared this open-sourced business model with people as a way to say:

“Hey, we’ve had some success; we’ve had some failures. We’re certainly not doing it perfectly. But some of this stuff is working. Why don’t you read this? Why don’t you take it and apply it to whatever you do, hopefully for your own personal success, but more importantly to build on a business model to help us create some really positive effect for the world.”

Beautiful. It’s a beautiful way to end the show. I would love to keep on talking but you guys have a tone of things going on. I appreciate you taking the time out to spend an hour talking about your book and what’s driven you to success and helping others.

So, I’m always terrible at ending a show.

I’ll just say Thanks!

Oh, where do we find you on the web?

Adam: I’m Adam_Lowry.

Eric: I am MethodGuy.

Great! Where can we find you on the web?

Eric: Method Home dot com.

I’d say good luck, but it sounds like you have everything under control. And if it’s not under control in the future, you’ll get it. Congrats on your success!

Adam: Thanks for having us!

Eric: Thanks. It’s been great talking with you.

Interview with Eric Ryan and Adam Lowry, Founders of Method - Part 1

Eric Ryan and Adam Lowry, co-authors of The Method Method: 7 Obsessions that Helped Our Scrappy Start-Up Turn an Industry Upside Down and co-founders of Method home products joined the show recently. You can listen here.

With the flood of business books organized around numbered lists, I find it an overworked publishing theme. That being said...this is an awesome book.

I'm an avid reader. I read 1 or 2 business books a week. And I found this book one of the best written, most useful, best-organized, most entertaining, imminently doable books I've read in a long time.

How good is it? I haven't finished it yet. Almost every paragraph inspires, ignites, aggravates me to keep writing notes, scribbling them in a notepad or typing them in Evernote.

How good is it? I won't write notes in the margin, nor will I turn down a corner of a page to mark something. That would touch on sacrilegious. That's almost over the top, but it's not. This is a great book.

If you're in a startup, a small company, a mid-sized company, if you're in a department within a big company getting ready to launch something new...you should read this. And make sure you have a notepad handy. Seriously. Even if you just like good writing...you should read this.

Guys. Adam and Eric. Thanks for your time and writing a great book.

Adam: Thanks for having us, Zane.

Eric: Glad to be here.

Your book cover includes many testimonials. My two favorites were one from Tony Hsieh, bestselling author of Delivering Happiness and CEO of Zappos, one of my favorite companies. And the other was a joint testimonial from Pam Ryan, Pat Lowry. How did you convince your moms to give you a testimonial for your book, other than the obvious that it's a great book?

Eric: It was not easy, particularly since my mom spent a lot of years probably pestering me to do my grammar homework, so, uh, despite that we finally proved to our moms that we were worthy of their endorsement.

Who were you writing for as you put this together? Describe the reader you had in mind, what do they do, what are they facing, where do they sit in an organization?

Adam: Yeah, Zane, we really wrote this book for anyone who is trying to change the way business is getting done - both as someone running a business or somebody within a business, ie, any entrepreneur or any intrapreneur.

We also wrote it as a way for any business to create positive social change in the world. The book is really, it’s our open-sourced business model, written and provided for people to examine and hopefully use the best of, learn from our mistakes and build something better.

Perfect. What's in it for them, why should they care about these 7 obsessions and your method method?

Eric: What is very unique about our business and it’s pretty typical for an entrepreneur to take on a goliath...we’re basically foolish enough to take on multiple goliaths in our space. The soap industry has been dominated by the same players for the last 100-plus years. And, so, coming into these categories we had to change the game, not just one level but on multiple levels. And the way that we tapped into what we call our obsessions which essentially is our competitive advantages we strongly feel are relevant to any business today because they are all grounded in macro-trends.

Who would MacGyver have written this book for? How would he have organized it? Did you ever get stuck and have to ask yourself "What would MacGyver do?

Adam: Well, Zane, as you read in the book MacGyver is a big value at Method and it’s about being scrappy and resourceful when you need to. We have to do that in order to compete against the big companies we compete against in the household cleaning space.

For us, there were many MacGyver moments in the writing of this book because Eric and I are busy every day with our jobs, our day jobs. We’re not authors by profession. So, there are a lot of times when we were trying to figure out how to get this done and there are a lot of times when we examined:

“What are the ways we’re going to MacGyver this book to be the most useful to those intrapreneurs and entrepreneurs I just mentioned.”

One of the most interesting ways we did that that I think was interesting as well was sharing our mistakes. And, the error-autopsies. And as you read in the book, each chapter ends with an error-autopsy which is an examination, a case-study we made that others can learn from and try to avoid.

What we’re trying to do has never been done before. And if you’re going to do that you’ve got to learn from your mistakes.

I think that’s one of the many reasons I loved your book was you were so forthcoming with your mistakes and their value in helping you grow.

Eric: Absolutely. We really do feel that Richard Dean Anderson would write a killer business book if he would just decide to do so.

My friend, Erika Andersen, wrote a great book titled Being Strategic. She asks the reader to define their reasonable aspiration or hoped-for future. What was yours, what was your reasonable aspiration or hoped-for future, when you wrote this book?

Adam: For us, it was about making it clear for people that business is the largest and most powerful institution on the planet has the opportunity and we believe the onus to create positive change in the world.

That’s a very lofty aspiration. But the way that you get that done is the everyday tactical things and learning from your mistakes.

And that’s really what we hope people get out of this book. You can take on really big industries and succeed and in the process do something meaningful and purposeful.

Love that answer! Having founded a successful consumer goods company, I know metrics are important to you. But let's talk about the metrics for this book. What metrics are you using to measure your progress towards that hoped-for future with your book?

Adam: Most of them are soft metrics. As I mentioned before, Eric and I are not professional authors. We’re not writing this book to try to maximize the number of copies sold the way an author might.

Really, what we’re trying to do, we’re going to measure this with how effective was this book in changing people’s minds about the role that entrepreneurs play in creating positive change in the world and to a lesser degree how is this book increasing people’s understanding of the real mission behind Method. This business is very deep in its commitment to social change and that might not be something, when you’re shopping grocery store shelves, is immediately obvious to you.

We hope that a lot of people, by reading this book, understand the deeper story behind Method.

We've all heard about the 7 sins and the 7 virtues. You guys, on the other hand, have 7 obsessions. We could spend an hour on each of them, I'm sure, but let's run through them. What are those 7 obsessions?

Eric: Yeah, just to set this up with this is not something we put together to write a book. This is the way we operate our business. And they were part of the business plan from very early on. Writing the book was fairly easy when we were just reporting on what we have done already.

Number one: Create a Culture Club. At Method everything starts with culture. And we really believe in culture as a competitive advantage and this idea that you build a brand from the inside out.

Obsession Two: Inspire Advocates. We just don’t want to have customers. We want to create advocates who help us build a brand.

Three: Be a Green Giant and really personalize sustainability to inspire change on a grand scale as Adam just talked about.

Four: Kick Ass at Fast. If you’re not going to be the biggest, you better be the fastest.

Obsession Five: Relation Retail. Today, it’s no longer enough to have a shallow relationship with a lot of retailers. You need to have deep relationships with fewer.

Six is Win on Product Experience. At Method, we’re very much a product centric organization that is focused on delivering amazing and remarkable product experiences.

Obsession Number 7 is Design Driven and really building design leadership into your DNA.

Fantastic.

I ask the next question with the usual disclaimers and caveats.

Let's say God likes sins and virtues, but not obsessions. Still, he likes you guys, so he’s willing to compromise. You can have one obsession. Consider this an exercise in detachment and pick one obsession and let the others go... Which one do you hold on to? Why?

Eric: For me, I would hold on to Design Driven because I am so passionate about design. Its a big part of why I jump out of bed every morning to use design to make the world a more enjoyable place.

Adam: Yeah, and I’ll not surprisingly pick Be a Green giant. That’s my half of the founding vision.

I think it goes without saying that it is a slightly unfair question that it is a slightly unfair question. I think what Eric and I each brought to this business was multiplied many times by the other. So, individually they are a lot less interesting than they are put together.

Absolutely. You’re right about it being an unfair question. But I wanted to see which one was a personal favorite.

Adam: Yes, And those are the reasons we put the business together.

Of these 7 which is the one most companies lack?

Eric: I would argue that it’s culture. It’s one of those intangible things that is hard for companies to get their arms around. And, it’s about human behavior. It’s how we treat each other. And it’s so hard to name companies that you know that have great cultures.

True. Very true. I don’t know any that come to mind.

Eric: Yeah, and in the book we always pick out a muse. A muse is someone who does something better than us. And our muse for culture is Tony Hsieh, the CEO of Zappos. We definitely consider ourselves to be a very weird, unique, human place. And then I go to Zappos and I go:

“Oh, my god. We are so corporate.”

They do a great job with it.

How can customers or prospects, even employees, tell a company lacks this important obsession? I mean in some respects so few companies have a culture worth championing. We’ve become number to it. Maybe we should ask if a company has good culture?

Adam: I think there’s one easy way to measure our culture. And that’s:

“Is there any different way that people are at work and the way they are at home?”

If people are exactly the way they are at work as they are at home, you’ve pretty much got it right.

That’s an excellent answer. I was not expecting you to describe it like that. It’s a great way.

One of the first ways I knew your list of seven was going to be excellent was when I saw you made Culture your number one obsession. We’ve already spoken about it a few times. But I think it’s so important that we talk a bit more about it. Why is culture so important, especially since it’s ignored so much?

Eric: I think so much of a culture is the emotional aspects of it. Again, we’re dealing with human behaviors. There are absolutely ways to measure in an analytical way, a rational way, to understand a culture whether it’s working or it’s not working.

But, it’s one of those things that it’s really hard for companies to understand and measure because it’s based in emotions.

That’s that squishy stuff that businesses like to avoid.

Eric: Absolutely. You typically see the values of an organization’s mission. It’s usually put on an ugly walnut plaque in the wall. They tend to be such watered-down meaningless words, you can tell their words by committee. You know great cultures are about language and having a point-of-view that is unique and that everybody can rally behind. That’s hard to do as a group It takes a real kind of leadership and vision.

Adam: Yeah, think about the word “culture” outside of business context. It’s really about a shared set of values, a shared set of traditions. Things like that. If you then think about culture in a business context, you realize that there’s very little done in most businesses to actively cultivate culture as a shared set of things, values, that people subscribe to.

Now, is this attitude, this lack of attention to culture a relic of our manufacturing, economies of scale, mass produced business environment?

Adam: You know, I’m not really sure. I think it’s probably a function of not enough attention and recognition that with the right culture as the underpinning of a business and you can actually make a business far more productive and innovative.

Perhaps, it’s a luxury that we’ve had at Method in having to innovate in order to survive. We’ve realized that we can’t innovate unless we have a culture that allows us to collaborate, clash and resolve tension, all in a productive and creative way so that we can produce stuff that’s unique and different.

If we don’t do that, we’re nothing. So, for us, culture is very important, obviously a critical piece of our success.

Maybe, businesses have been around so long and been analyzed so hard that people in the name of efficiency or whatever just decide it’s not that important. I think you lose something really important when you do that.

You wrote and I’m quoting:

You've got Procter & Gamble ..which spent $2.4 billion on advertising in the US alone. Unilever spent another 1.3 billion. It's safe to assume these guys have a toilet-paper budget that's bigger than our entire marketing budget...Method didn't have a dollar to spend at launch.

Right there, coupled with your success, is The Big Shift as you call it. And it' a huge shift, a huge opportunity for small businesses. What is The Big Shift?

Eric: So, what we call The Big Shift is the transition away from interruptive media. The brands in our space, these are the first multinationals, the Lever Brothers, Proctor & Gamble. these companies were built from the rise of mass media. They were the first ones to do a great job of positioning themselves for that entire shift towards interruptive media, which is you’re watching TV and you’re interrupted for a 30-second spot.

And, of course, The Big Shift is getting us away from that because it’s getting easier and easier to avoid these interruptions as we’re shifting towards social media and media that you choose to participate in. And along that shift is an opportunity for a new brand to be born and an old brand to die.

Baseball is a great example of how sports even shifted as the different mediums have changed. Baseball was America’s favorite past-time as the radio was the biggest medium. And it’s a beautiful sport for the radio. And as television took center stage we saw the rise of football.

For entrepreneurs these shifts are wonderful opportunities to exploit to your advantage as all the rules start changing.

Now, if you don’t mind, I want to drill into this Big Shift present such a significant opportunity for startups and disruptors and small businesses? How do these take advantage of this transition away from interruptive media to earned media?

Eric: Well, obviously the rise of online in itself, which is a whole different topic, from Facebook to Twitter, completely... businesses have been born on that rise.

But, if you get away from technology, I think the opportunity for the entrepreneur is that it puts greater emphasis on good content and good products. We now live in a world where a good product can easily get discovered and get shared among peers through social media in ways where you needed that muscle to be able to buy the advertising to interrupt somebody to get that message out there on a mass scale.

For me, that’s the real opportunity is that we can focus on putting a truly better product or service or better content out there and having a better chance of succeeding than somebody who is doing a very efficient but mediocre way.

Excellent. Excellent answer.

**********

Parts Two and Three of this interview will be posted on Thursday, November 3 and Friday, November 4 Saturday, November 5.

President Obama: 3 Ways Open Innovation Returns Us To #1 Innovator

Jeffrey Phillips joined the show recently. You can listen to our conversation here. You can read parts one, two and three of our interview.

Jeffrey is VP of Marketing and a lead consultant with OVO Innovation. Jeffrey’s led innovation projects for Fortune 5000 firms, academic institutions and non-profits all based on OVO Innovation’s trademarked Innovate on Purpose method.

He was one of the 34 innovation experts who contributed a chapter for the excellent book A Guide to Open Innovation and Crowd-Sourcing: Advice from Leading Experts. Jeffrey’s chapter is Open Innovation Typology.

And after reading Jeffrey's chapter it's clear there is a type of innovation that can fit any organization, for-profit or not, global giant or mom-and-pop brick-and-mortar and as importantly a type that fits anyone's budget.

It made sense to ask him how Open Innovation and the right type of Open Innovation would help us with this pressing problem of innovation, our economy and jobs.

I asked him:

We've reached the imagination moment in our show. Let's imagine President Obama had a few moments this week. He finds your book, reads your chapter. And calls you.

Jeffrey, he says because he's the President. At this point in our declining ratings as a nation of innovators any type of open innovation will work. The challenge for us is to find one and move forward.

What if you came up to the White House and met with myself and Vice-President Biden. We want to hear your thoughts, maybe 3 things that we as a nation can do to identify the type of open innovation that can return us to being number one, generate some new businesses with new jobs.

What do you tell him?

And, he answered:

Let say the first thing, I didn’t know you were going to ask me this question specifically. I write a blog called Innovate on Purpose. Yesterday, I wrote a blog post called Innovate Anywhere and I riffed off the poem of The Ancient Mariner. You know:

Water, water, everywhere and not a drop to drink.

We live in a society and a time when we are literally awash in a time of ideas. And the interesting thing is our government is really dead-locked. And it seems stagnant. At a time when there are so many good ideas out there it seems it’s really more about having the political will to change perspectives and adopt or at least ask people for their ideas as opposed to trying the same tired solutoins over and over again.

I’ll direct your listeners to my blog.

But I think there would be three things.

First, the government can’t just be willing to listen to these ideas. They have to be willing to adopt those ideas and to demonstrate that:

“We listened and here’s the results from that action.”

So, the first one I would suggest are philanthropic contests. Can we create a contest much like BP had with the oil spill. What’s one thing you would change in the Department of Commerce. And if you recommended it how would, what would it change and how would it change people’s every day lives in creating jobs. And I use the Department of Commerce as an example. It could be any of the departments.

But, what we should be able to do is suggest very specific ideas that might drive jobs or help the government spend more money effectively or ways to cut costs or abuse and those kinds of things. And be very specific about ways with each agency of allowing people to make ideas.

The government has already started this with Challenge.Gov. But it needs to go a lot further. And it needs to demonstrate it through lots of small experiments. So, as we get these ideas we start kicking off very small experiments.

2nd idea you asked about was If President Obama asked me...was clearly here in the US we’re pretty smart. But we don’t have a lock on the best ideas. Are there places in other countries, other companies, other non-profits, where a problem we’re facing is solved better some place else. This would allow other people, other organizations, other countries, other companies, to submit ideas to the government:

“We see you have this problem. We think we have a better solution than you have.”

That would mean we would have to open up our minds and our political processes to be willing to listen and look at other ideas and accept those ideas.

The 3rd thing I would tell from an open-innovation perspective would be to merely opening up to new voices. I think that our government may be just a bit locked into 535 members of Congress and maybe I don’t know 15 or 20,000 lobbyists on Capitol Hill. That means those are the voices that get heard. There’s 300 million of the rest of us whose voices aren’t getting heard. Are their ways we can begin to compound our voices and get behind specific initiatives and ideas that can then be communicated to our government agencies.

What we’re really talking about is true democracy is true open innovation. If you think about it, it’s people with great ideas trying to press their will on the majority that eventually hopefully many in the majority will accept and it becomes a law.

I think we’ve lost a little bit of our democratic process in allowing ideas to bubble up. And it would be interesting to see if there were different ways to allow open innovation platforms or purely democratic platforms, democratic with a small d, to allow us to bubble ideas back up, bubble legislation, as well into the federal government.

So, those are 3 things. All those are pie-in-the-sky. We’re in the imagination phase as you said. I can be a bit imaginative and hope for the best.

Want more from Jeffrey Phillips?

Follow him on Twitter at OVOInnovation

Read his blog: Innovate on Purpose.

**********

Some may say this is inappropriate.

This is politics! And you never discuss politics at Thanksgiving Dinners, backyard barbecues and on a business radio show.

I disagree. As long as only politicians can discuss solutions for our country then those solutions and their interested audiences will remain off-limits, political, for those who make this brand, our country, run. And only politicians, these days that's only career politicians, can discuss those ideas and spoon-feed solutions to the public.

I see our times as an all hands-on-deck opportunity and not a crisis.That opportunity is for each of us to lend our hands, our conversations, our ideas to find and share solutions. In our absence those challenges are left to ideologues, vested interests and politicians of all stripes and partisan persuasion. We...are the only ones with vested interests. And now we have, with social media and the urgency of today, the opportunity to reclaim our place at this table and discuss our ideas to solve our challenges. At the very least, we can listen to a discussion until we are ready to speak up.

President Obama: 3 Tips to Move from One Idea to Its Impact, Again and Again

Dr. Hal Gregersen, co-author of The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators, was a guest on my radio show recently. You can listen here.

I published notes from our conversation in three parts:

• Part One here

• Part Two here

• Part Three here

The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators was the result of an 8-year study to uncover the origins of innovative—and often disruptive— business ideas. They interviewed nearly a hundred inventors of revolutionary products and services, as well as founders and CEOs of game-changing companies built on innovative business ideas. In the process they identified five discovery skills that distinguish innovative entrepreneurs and executives from ordinary managers:

• Associating
• Questioning
• Observing
• Networking
• Experimenting

We, as a nation, seem to have challenges moving from one idea to its impact, again and again. You know? Innovating on a sustainable basis.

I asked Dr. Gregersen:

We've reached the imagination moment in our show. Let's imagine President Obama has a few moments this week. He finds your book. . He picks up his Blackberry and calls you.

Hal, he says. He gets all personal because he is the President. We're facing some disruption these days. But, we're not finding a way to move progressively from one idea to its impact. Again and again.

What if you and your two co-authors join up with myself and Vice-President Biden. We want to hear your thoughts, maybe 3 things that we as a nation can do to move progressively from one idea to its impact. Again and again.

What would those three things be?

And he answered with all the clarity and precision you would expect:

I would tell you the following if I was talking to him.

I would say:

“Look. When we look at innovative companies it starts at the top. Every one of these companies who create sustainable ideas that make a difference they are led by CEOs and senior managers who actually innovate themselves. They engage these skills in an every day way. And so, if I were to look at a country it would be the same thing.

Here’s the challenge. But, let me step back for just a moment to me being a teenager again. When I was a teenager I wanted to be the President. I pursued it enough that I actually ended up working later in college, I worked a couple of times in Washington DC for two senators. What I learned working on the staffs of those two senators was when you work in Washington D.C. and you live within the Beltway you end up living within those buildings that are around the capital and the White House. And what then happens is it becomes extremely easy not have a silo built in your world and your way of working with the world that is not extremely incestuous. And that comes from talking to people who look like you and think like you even if they are on the other side of the political spectrum. They still are politicians.

My suggestion is I would get every single policy make out of their offices and into the field where people are facing these challenges. I don’t mean promotional opportunity to get votes for the next election.

I wonder how many people who are stuck in this budgetary grid-lock, how many of them have spent two days not pitching their views or their party, but how many of them have spent two days maybe living with a family that is struggling with the burdens of living in this economy for the past two years? I would be hard pressed to find even a handful of politicians making these policy decisions who have a good grip on what it’s like right now for people that they are making the decisions for.

It’s easy for me to step back and say this. I don’t have the answer but. But I look back to the financial crisis in 2009 and wonder how many of the CEOs and executives of the major banks in the world ever took the time to get out of their offices to walk down to their home loan making office and just watch the process of how these loans were being made?

I bet if they had they would have sniffed something ugly really fast. And they would have done something.

For me, the first recommendation is get policy-makers out of their offices and into the real world and using these observational and other skills of being an innovator to generate some better solutions.

2nd policy suggestion? Do everything we possibly can to invest in the next generation of innovation leaders. These are the kids and the young people who are growing up who are not just going to solve today’s problems but they are going to be the solvers of tomorrow’s problems that will probably be bigger than the ones we’re facing today.

And what I mean by investing in them is on one level creating educational learning experiences that foster these skills. And another investment and again I would ask those policy-makers to pay attention to the world around them. Look in your neighborhood, identify some families that you will foster their innovation skills so that some day they might be the next president and they might be better at solving the problems we face tomorrow.

Want More from Dr. Gregersen?

• Visit the book's website 

• Follow him on Twitter

• Buy the book: The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators

**********

Some may say this is inappropriate.

This is politics! And you never discuss politics at Thanksgiving Dinners, backyard barbecues and on a business radio show.

I disagree. As long as only politicians can discuss solutions for our country then those solutions and their interested audiences will remain off-limits, political, for those who make this brand, our country, run. And only politicians, these days that's only career politicians, can discuss those ideas and spoon-feed solutions to the public.

I see our times as an all hands-on-deck opportunity and not a crisis. That opportunity is for each of us to lend our hands, our conversations, our ideas to find and share solutions. In our absence those challenges are left to ideologues, vested interests and politicians of all stripes and partisan persuasion. We...are the only ones with vested interests. And now we have, with social media and the urgency of today, the opportunity to reclaim our place at this table and discuss our ideas to solve our challenges. At the very least, we can listen to a discussion until we are ready to speak up.

Create Marketplace Disruption: A Review

Adam Hartung’s Create Marketplace Disruption: How to Stay Ahead of The Competition is a clarion call-to-arms for a select group of businesses: those who want to survive, first, and then thrive for the long-term. If you are not one of those companies then stop here.

He calls business leaders to first wake up and then look. Look up and look around. Look at your business. And keep looking. Look around you at what survives, who thrives and what dies. And ask why.

Create Marketplace Disruption will help you interpret what you see and do it faster. And afterwards you will want solutions. Adam offers those, too.

Old-school business orthodoxy is marked by rigidity, routines and rules of the that how who we’ve always done it kind. This is the ideology of dying brands, industries and markets. Adam shares a few obituaries of these companies, many of them brands we once knew, with a case study of their shared journey down the path of the safe, the familiar, the status quo protectors. Like all obituaries it is one we write ourselves with the publishing left to others.

Oh, that safe path marked by rigidity, routines and rules. Over the past few years it has grown from a path to into a freeway, a high-speed rail line of inevitability. Its sound is the sound of the inevitable we see today: job cuts, jobs outsourced, fewer jobs created, growth markets elsewhere, a growing number of companies who choose to compete with discounts and more discounts. That means lower margins and lower margins, cost-cutting and more cost-cutting. And that leaves companies without the resources to create, innovate and disrupt.

(And that business model appears near its own zenith. And why?

"...there are way too many deals companies competing for the same merchants.

" ...a lot of these merchants are also getting dealed out because they realize that the margins on these things aren't what they thought." )

Cash is not the missing resource.

• Corporations have compiled record amounts of cash. One report showed public companies with nearly 2 trillion in cash on their balance sheets.
• Business credit terms are easing. Credit is available for companies without that cash on their balance sheet, unless your company is considered small.
• Interest rates continue to remain low.

Some may say certainty is missing. But opportunities abound in uncertainty.

The resource missing is the human resource: intellectual capital, creative capital, leadership capital. Maybe all that is there; it is just kept locked in a box.

Whatever. That resource delivers the means to create marketplace disruption. That starts with disrupting your marketplace and the marketplace of others.

Not sure about that? Most companies and their leaders are not. Right now. If your company is not a leader then the tendency is to want to hold on, cut costs, and survive. Be safe, in other words. Your tombstone now will read:  

Here lies a company who chose the seemingly safe path of rote repetition while citing the mantra of this is how we’ve always done only to find that the safey was an illusion and instead they raced down the highway to their demise.

If your company is a leader ...well, who wants to disrupt that? Life is good, right? For now.

Adam shares data-driven paradigm shifts that serve as gentle slaps to our forehead. Wake up! This is not your father’s Oldsmobile, he says. At one time, Oldsmobiles were the mark of distinction. Markets are changing. If markets change, so will your position of imminence.

You need to change and here’s how. Here is what you can do to make sure your company is disrupting markets before markets disrupt you. Or you can write your own obituary. Just cut and paste from your competition's tombstone.

The global marketplace creates enormous pressures on businesses of all sizes now to change, to create, to innovate...to disrupt our business models and those of the marketplace in order to....survive.

And Adam shows the examples and the steps of companies who have found the successful ways to disrupt what you have done always done and instead relentlessly pursue what you can do better, what you can do that no one else can, where you can compete where no one else can follow. And keep doing that again and again.

Adam gives a blueprint, not a map. His blueprint offers an inspiring, teaching, annoying, and even frightening vision. That's like the experience in business in today's global marketplace. But Adam's is a blueprint that shows the reader how both to build and, well, to tear down what works. How to create, sustain and disrupt. Again and again.

You bring the resources. And the passion. And the willingness to learn. Adam's book gives you the blueprint.

But only if you are willing to listen. And read. And disrupt.

Sure. it is hard. It is scary. Knees will be scabbed.

But to those willing, the rewards can be a company that not only survives but thrives. A community that grows in quality of life as jobs are added, jobs with meaning and purpose. An economy that rebounds and allows us to resume being the leader among nations for innovations and solutions.

Adam Hartung write the excellent Phoenix Principle blog. He brings a track record of results from 20 years of practical experience in developing and implementing strategies to take advantage of emerging technologies and new business models. Today, he is a Forbes blogger, CIO Magazine columnist and contributing editor for International Journal of Innovation Science and consults and speaks worldwide.

Follow him on Twitter.

Adam was a guest on my radio show.

• You can listen here.

• You can read notes from our conversation here.

 

Pt. 3: Interview with @OVOInnovation, Co-Author of A Guide to Open Innovation and Crowd-Sourcing

Jeffrey Phillips, aka, OVOInnovation on Twitter, joined the show Wednesday.

• You can listen to our conversation here.
• You can read Part 1 of this interview here.
• You can read Part 2 of this interview here.

Jeffrey is VP of Marketing and a lead consultant with OVO Innovation. Jeffrey’s led innovation projects for Fortune 5000 firms, academic institutions and non-profits all based on OVO Innovation’s trademarked Innovate on Purpose method.

He was one of the 34 innovation experts who contributed a chapter for the excellent book A Guide to Open Innovation and Crowd-Sourcing: Advice from Leading Experts. Jeffrey’s chapter is Open Innovation Typology.

Your company is OVO Innovation. You’re one of the founders. How does OVO Innovation and your trademarked Innovate on Purpose methodology help your clients overcome some of these obstacles, particularly in the cultural arena?

Well, the tagline we chose was kinda tongue-in-cheek at one point. And we think over time it has become more and more prevalent which was Innovate on Purpose. We think that in a lot of organizations innovations are serendipitous or happy accidents.

And that’s great but that’s nothing to stake your future on. If you’ll take the assumption we work from which is:

“Innovation isn’t a nice to have thing any more but it’s becoming a core competence, then I need to innovate purposely and repeatably and sustainably.”

So, what we try to focus on with our customers, whether you’re doing open innovation or closed innovation, whether you’re doing innovation with specific tools or whether you’re doing it with everyone in the organization or just a small group of people, is that you do it in a disciplined way with a purposeful approach that you have defined processes that can help you sustain it and do it effectively. And all of that’s driven by your attitude and your processes and your culture.

Frankly, we like to say that:

Culture eats all the rest of that for breakfast.

If I can engage a culture and get people thinking about the possibilities for innovation and overcome the issues of Not-Invented-Here and the issues of efficiency over innovation. Because today most companies are focused on efficiencies and right-sizing and cost-cutting far more than they are on innovation.

We really have two challenges.

1. One is to move away from while still embracing efficiency, we need to add the concept of innovation back into our cultures.
   
2. And the 2nd is to become much more open to what is happening on the outside. And that is a cultural barrier as well. Traditionally, we’ve said we know what’s best and we’re going to do what’s best for us.

Interestingly, I have a friend who talks about being best at what you do best and outsourcing the rest. And when he talks about that he doesn’t mean just outsourcing manufacturing. Maybe it’s outsourcing legal or outsourcing finance. But the idea here is where are the best ideas I can leverage and the best ideas I can bring into my organization. And is the organization prepared to capitalize on those ideas and move very quickly to then get value out of those ideas.

And that’s really a cultural issue in many cases that has to be addressed first. And we address it through specific methodologies and specific training and cultural shifts in terms of how you compensate and how you reward, and what the management team emphasizes as part of its vision and strategy.

Now before the show we talked about what you did with OVO Innovation and some of the tools you used. You mentioned you used 2nd life at some point in some of your relationships with your clients.

Can you tell us a little bit about that? I thought it was fascinating.

Well, sure.

2nd Life is an immersive experience. Basically, you can log on and enter a virtual world and you have an avatar. An avatar is just a little character that represents you in that virtual world. You can walk around that world and interact with other people and so forth.

And one of those things we had been exploring is the fact that this kind of concept this kind of virtual world is a perfect metaphor for innovation. Because you can craft an environment in 2nd Life that aligns to the needs you want to have. So, you can create that new product and show it to people in a virtual world. You can create a new house and show people the new house and the new features and the new benefits. And they can walk through that house and give you feedback.

So, from an idea-generation perspective, from a role-playing perspective, from a scenario-building perspective, you can bring people into that environment that can interact with your ideas in that environment. They can give you feedback on your ideas and you can manipulate your ideas in real-time to say:

“ Oh. I heard that you said you needed this. Does this product or service or environment, does this meet your needs? “

So, it’s a very interesting rapid-prototyping environment. It’s a great place for idea-generation. And it’s virtual.

So, instead of having to fly team members from around the country to one location to meet in a stuffy conference room...we can meet in a really interesting place, we can interact with almost the same level of interactivity and we can test ideas in an environment that is specific to the opportunity or need we’re trying to generate.

So, we found that 2nd Life has been a really powerful platform for innovation, for idea-generation, for scenario-planning, for rapid-prototyping, and we plan to continue to use it as part of our arsenals with the community and partners who are really excited about the possibilities of using 2nd Life.

I have a question here in on my list about 2nd Life and how you used it with a specific client to generate these results. Is that possible to talk about?

I can talk about it generally because we’re under a NDA for the company name and specific functions. But we have written a white-paper about it and you can find that white paper on innovationmanagement.se.

The project we were working on was for a retail establishment. One of the questions was as the web grows and people buy more and more from the internet and do more of their transaction on the internet...what is the need, what is the opportunity, what is the benefit of a retail establishment and what should the retail establishment look like? What sort of products and services and features and experiences should it offer such that it remains a compelling alternative to remaining online.

What we did was we built a number of different alternative kinds of retail establishments or retail footprints and we walked people through those asking them if these features were here how would you interact with them and would you find them beneficial.

And what it allowed us to do was to break the concept down into 3 or 4 different areas. First, there’s a lot of factors around experience in retail. Although, you may buy some of your clothing online, sometimes just the mere experience of going into a store and touching and feeling interacting with the clothing really matters. So, retail experience needs to change. It needs to be more compelling. It needs to be more of an event or more of a destination, if you will.

Another thing we talked about are destination spaces. Sometimes there’s too much empty spaces, so you don’t know where to go. Or it’s too jam-packed. And so we need to give people better cues when they come to our retail location. Here are the spaces within the locations and the different things you can accomplish in those spaces.

And the 3rd thing we talked about were people. And the ability to solve problems on the spot and to be technically savvy enough so that if a customer walks in and says:

“Hey. I’ve got this issue and here’s my laptop or my tablet and can you help me.”

And the people in that retail establishment can interact with the technology in such a way that it blends the virtual world, the technology world and the retail world into one big solution for the customer.

So, using 2nd Life and walking through some of these retail establishments we were able to investigate a lot of these issues and make recommendations about what we felt were going to be really compelling physical structures; but not just the structures but the people, the spaces and the interactions that would happen inside those structures.

That’s fantastic. That’s excellent!

We've reached the imagination moment in our show. Let's imagine President Obama had a few moments this week. He finds your book, reads your chapter. And calls you.

Jeffrey, he says because he's the President. At this point in our declining ratings as a nation of innovators any type of open innovation will work. The challenge for us is to find one and move forward.

What if you came up to the White House and met with myself and Vice- President Biden. We want to hear your thoughts, maybe 3 things that we as a nation can do to identify the type of open innovation that can return us to being number one, generate some new businesses with new jobs.

What do you tell him?

Let say the first thing, I didn’t know you were going to ask me this question specifically.

I write a blog called Innovate on Purpose. Yesterday, I wrote a blog post called Failing to Innovate While Surrounded by Ideas and I riffed off the poem of The Rime of The Ancient Mariner. You know:

Water, water, everywhere and not a drop to drink.

We live in a society and a time when we are literally awash in a time of ideas. And the interesting thing is our government is really dead-locked. And it seems stagnant. At a time when there are so many good ideas out there it seems it’s really more about having the political will to change perspectives and adopt or at least ask people for their ideas as opposed to trying the same tired solutions over and over again.

I’ll direct your listeners to my blog.

But I think there would be three things.

First, the government can’t just be willing to listen to these ideas. They have to be willing to adopt those ideas and to demonstrate that:

“We listened and here’s the results from that action.”

So, the first one I would suggest are philanthropic contests. Can we create a contest much like BP had with the oil spill. What’s one thing you would change in the Department of Commerce. And if you recommended it how would, what would it change and how would it change people’s every day lives in creating jobs. And I use the Department of Commerce as an example. It could be any of the departments.

But, what we should be able to do is suggest very specific ideas that might drive jobs or help the government spend more money effectively or ways to cut costs or abuse and those kinds of things. And be very specific about ways with each agency of allowing people to make ideas.

The government has already started this with Challenge.Gov. But it needs to go a lot further. And it needs to demonstrate it through lots of small experiments. So, as we get these ideas we start kicking off very small experiments.

2nd idea you asked about was if President Obama asked me...was clearly here in the US we’re pretty smart. But we don’t have a lock on the best ideas. Are there places in other countries, other companies, other non-profits, where a problem we’re facing is solved better some place else. This would allow other people, other organizations, other countries, other companies, to submit ideas to the government:

“We see you have this problem. We think we have a better solution than you have.”

That would mean we would have to open up our minds and our political processes to be willing to listen and look at other ideas and accept those ideas.

The 3rd thing I would tell from an open-innovation perspective would be to merely opening up to new voices. I think that our government may be just a bit locked into 535 members of Congress and maybe I don’t know 15 or 20,000 lobbyists on Capitol Hill. That means those are the voices that get heard. There’s 300 million of the rest of us whose voices aren’t getting heard. Are their ways we can begin to compound our voices and get behind specific initiatives and ideas that can then be communicated to our government agencies.

What we’re really talking about is true democracy is true open innovation. If you think about it, it’s people with great ideas trying to press their will on the majority that eventually hopefully many in the majority will accept and it becomes a law.

I think we’ve lost a little bit of our democratic process in allowing ideas to bubble up. And it would be interesting to see if there were different ways to allow open innovation platforms or purely democratic platforms, democratic with a small d, to allow us to bubble ideas back up, bubble legislation, as well into the federal government.

So, those are 3 things. All those are pie-in-the-sky. We’re in the imagination phase as you said. I can be a bit imaginative and hope for the best.

Let’s talk about Social media and Crowd-Sourcing types. I see Twitter as more Suggested/invitational and Google + as more Directed/Invitational with its Circles. I don't see Facebook as an innovation resource. What am I missing?

Well, I think you’re right about social media if you’re meaning to categorize these products.

I think you left one out which I like which is LinkedIn which is probably the closest to Directed and Invitational. You can decide who you want to partner with and you can ask very specific questions.

Twitter allows anyone to submit any idea about any topic or really talk to anyone about any topic.

I can’t say that I’m a huge Facebook user either. But, I suspect Facebook is probably a pretty good innovation resource for groups that need to form wholistically or not-for-profits. You don’t see many businesses actively using Facebook, so it’s probably less of a business resource. Although I think Facebook could be good for innovation use for organizations who are trying to organize around a cause. But probably not so much for a business resource.

Leaders are readers. Jim Rohn says that. I openly incorporate that quote into my shows. You're a leader. What are you reading?

I’ve just finished reading a book called The Innovator’s DNA and I’m going to be writing a book review shortly. The Innovator’s DNA describes 5 attributes or 5 skills that good innovators have. It’s a good quick read.

I’ve also been reading a book called Little Bets: How Breakthrough Ideas Emerge from Small Discoveries. Little bets is a concept we talked about the government should be doing which is kicking off lots of small experiments. Too often we talk about innovation and we kick off 1 or 2 large projects when perhaps we should kick off 5 or 10 small experiments. I think that’s important.

Another book that’s on my desk that I’m reading for Harvard Business Review is a book called The Progress Principle: Using Small Wins to Ignite Joy. The idea behind it is really about employee engagement. If you think about innovation, whether it’s internal or external, how engaged your employees are in the processes, the concepts and the strategies and the ideas is really important. Ultimately, your innovation is inhibited or enabled by your corporate culture. If you have an engaged culture, you’re much more likely to have innovation as an outcome.

So, those are three books I’m actively reading now.

This has been a great show. I thoroughly appreciate it.

Can you leave us with a quote on the Typology of Open Innovation.

One quote on the typology of innovation....

I would say that regardless of the size of business you are in, regardless of the kinds of business you are in, regardless if you are public or private, for-profit or not-for-profit, there is a type of open innovation that will work for you.

But understand that open innovation is a generic term. And underneath that umbrella are many different types or approaches to open innovation.

What you need to do first is establish what your goals, your strategies and your desired outcomes are. Then use those filters to find the open innovation approach or type that is most applicable to your business. So, you could use a P & G model if that small directed innovation approach is right for you. Or you could use method that is more similar to what Dell is using if a very open, very engaging, open innovation model is right for you.

But understand the implications for their use are fairly profound.

Thank you Jeffrey!

Interview with @OVOInnovation, Co-Author of A Guide to Open Innovation and Crowd-Sourcing - Pt. 2

Jeffrey Phillips, aka, OVOInnovation on Twitter, joined the show Wednesday. You can listen to our conversation here. You can read Part 1 of this interview here.

Jeffrey is VP of Marketing and a lead consultant with OVO Innovation. Jeffrey’s led innovation projects for Fortune 5000 firms, academic institutions and non-profits all based on OVO Innovation’s trademarked Innovate on Purpose method.

He was one of the 34 innovation experts who contributed a chapter for the excellent book A Guide to Open Innovation and Crowd-Sourcing: Advice from Leading Experts. Jeffrey’s chapter is Open Innovation Typology.

You talked about the two, the x and y axis for open innovation. That’s the who and why, then the what instructions. And you broke it down into 4 types of open innovation. What are those 4 possible types?

If you think about that first axis, we tend to to label that axis as “Who’s invited”. And so, we would say you could have a model that is participative, in other words anyone can participate or it’s invitational that I only invite certain people or certain organizations or certain groups.

On the other hand, you could have suggestive and then anyone can participate and suggest any idea regardless if it’s relevant to you or not. And on the other end of that spectrum you could have directed. That means the company says to its open innovation participants:

“We want to direct your thinking to this problem, this technology or this market.”

We talked about P & G’s Connect and Develop program as invitational, not everyone is invited, and it’s directional: these are the challenges that we want to address.

If I was to look at something that was 180 degrees different model then I would look at Dell’s IdeaStorm. Dell’s IdeaStorm is for the most part is publicly-facing and is suggested. Because Dell basically says:

“Any idea you have is welcome.”

And it’s a very participative model because they don’t say who can participate and who can’t. If you have web browser, you can go to Dell’s IdeaStorm site and you can suggest ideas to Dell about, basically, anything you want to suggest.

Now, they do ask you to help them categorize it. But they don’t dictate that it has to be just about Linux or just about laptops. It’s a very open model; it allows you to suggest any ideas that come to you.

As opposed to the Connect and Develop program that was invitational and directed, Dell’s model is very much suggested. Anyone can participate. And anyone who does participate can suggest any kind of idea. Dell doesn’t begin to try to tell you what kind of idea or what kind of technology or what kind of opportunity to frame your idea around.

Now. Thinking on the fly here and that’s always kinda dangerous in my non-sequitur type of thinking. Dell seemed to have a directed-invitational model when they allow their customers to design their own computers. They invited only prospects and customers and directed them in certain ways to tell them what kind of computer they wanted.

I want a laptop with a big screen and fast processor and x number of USB ports, etc, like that.

Would that be within the realm of reasonable?

Yeah, that’s heading in the direction. The one difference I had in that case is they are inviting certain people and they are giving them certain direction. But, what they’re doing is having them choose from a list.

But if they said “Choose from a list and also give us 3 new things that don’t exist” then I would say that would be excellent. So, if I could design my own computer and also add 2 features that Dell had never thought of then I would say that is the perfect example of directed and invitational.

Now, they jumped into this IdeaStorm which is basically open the doors and embrace the world. And I’m thinking a company like Dell had to be pushed into that IdeaStorm. Maybe, motivated is a more positive term.

What do you think motivated them to take a public, open, high-risk, open innovation crowd-sourcing project?

I honestly think that Dell got into it in a proactive way as opposed to being pushed into it. I think that proactively they recognized they needed better interactivity with their customers. Dell really did a great job of innovation around the business model and really radically changed the PC model.

But, I think they got a little stagnant and I think they saw this idea of open innovation as an idea to re-ignite innovation in a big way and to really become much closer to customers and integrate with customers. They were also an early pioneer with the use of social media. So, I suspect these kinds of things were hand-in-glove for them: both the social media aspects of it and the getting closer to customers to it.

Just in case you haven’t done any research on it, the feedback has been tremendous. I don’t have the specific numbers in front of me. But I think over a 4 or 5 year time horizon they have received something on the order of 15,000 ideas. And I think they have implemented 4-500 of them. They have been engaged. They’ve had a large customer body present ideas to them. And it’s really helped them engage customers in a very different way than other PC manufacturers.

I haven’t. I’m peripherally aware of Dell. I’m a MAC guy. So, I need to go and look closer at it. What you describe sounds fascinating.

Do you have any idea what metrics they have used to measure their success?

The interesting thing is I think Dell did this for two reasons. One is the sort of overt reason of:

“Can we gather more ideas from our customers and if so can we implement them more effectively?”

I think they’ve proven they are pretty adept at it.

The other reason is Dell’s Open to Listening Post for its customers. Based on this open innovation model, the IdeaStorm model, they are able to listen to customers, spot trends and identify lead users. So, they get a lot of innovation insight that is qualitative in nature, a little harder to measure. But it’s equally as valid as the more quantitative measures around:

how many people would participate and how many ideas would they receive and how many ideas would they implement.

Excellent.

Now maybe the other end of the spectrum from Dell’s IdeaStorm would be the Directed Invitational type of open innovation. The difference seems intuitively obvious in just their names: directed vs suggested, invitational vs participative.

Functionally, we talked about the differences particularly in how you profiled P&G’s Connect & Develop program.

But, both of these examples are from big companies. Dell and P & G. Do you have an example from a smaller company?

Well, we can talk about several different kinds of companies. Traditionally, not just companies but the federal government and not-for-profits as well. There are a number of not-for-profits that are running what we would consider to be a Directed-Participative model which is I direct people to solve a particular problem. But I’m not so defined as to the type of solution you create.

And when you and I talked before one of the ideas we threw around was this idea of an innovation contest. And this contest was a great example with I know the Rockefeller Foundation uses this kind of model. The recent oil spill, the BP oil spill, used this kind of thing. The federal government uses this kind of model. I think the website is Challenge.gov.

What it is is an innovation challenge. So it’s Directed. The non-profit or the government agency or the small business may say:

This is the problem we’re trying to solve.

But they don’t necessarily limit who can respond. The BP oil spill site is a great example of that. After the oil spill in the gulf last summer, the federal government and BP put up a website that allowed anyone to suggest ideas but around a specific topic: how do we get oil out of the sea water.

I know the Rockefeller Foundation has used systems around this. I’ve seen other not-for-profits use something like this. And some smaller companies, and the distinction here is that when you talk about smaller companies the infrastructural issues become more magnified. If I ask others for their ideas then it becomes even more important for me to manage those ideas effectively.

What you’ll find in an open innovation model, especially for smaller companies, is that they are very interested in becoming part of those networks like the P&G Developer Network; they’d like to be a trusted partner. There are some smaller companies using the traditional open model like the IdeaStorm. But I have to admit I don’t have any off the top of my head. But what I will do is do some research and include that with your transcripts.

You’re talking about smaller companies and the greater challenge in the infrastructural area. I think that smaller companies might assume that the Suggestive-Participative type of open innovation might be very enticing. With all these different resources that are often free, you can with very little upfront costs, you can begin a very open, participative model. The management costs would be very low.

You write that they would be very wrong with that assumption. What happens when companies assume that and don’t manage these conversations?

Well, what happens with open innovation whether it’s a large or small company is that you tremendously magnify the number of ideas that you have coming in. And behind every one of those ideas is an individual or team or business that is really fascinated by the idea and want to see it progress.

So, instead of you as an organization working with 5 or 10 ideas and everyone that sponsors that idea is within the organization and it is very easy for you to talk to them and you can put your arms around.

When you start opening up to ideas from other places, you have the responsibility to accept the idea, vet the idea to make sure it’s valuable for you and also to vet the idea for the intellectual property associated with it. That means you have to research does this idea have any provenance in any other places:

• Does it belong to anyone else?

• Does the intellectual property belong to someone else?

Not only that but you have the responsibility to give feedback back to the idea. And as we know from a social media market, if you’re not actively responding to the people who are trying to talk to you, if you become a one-way street, if you only accept information without sending information back out, then you create a level of cynicism very quickly within the people who are submitting ideas. Then that faucet will get turned off very quickly. What will happen is people will see their ideas going into a black box and never getting any feedback back on

• Hey, this idea is being promoted.

• This idea isn’t useful for these reasons.

So, while many organizations think it’s cheaper and easier to obtain the idea...on the surface they are probably correct. But what they are missing is the ongoing maintenance and care and feeding of that community. And that investment around vetting that idea, making sure there are no intellectual property issues around the idea. And then further, very few organizations have an excellent innovation process.

In other words, there might be very good at generating ideas internally or finding ideas externally, but that’s really just the first step in ultimately commercializing the idea. Because you have to manage the idea, you have to evaluate it, you have to make selections as to which idea to invest in. And then, I have to convert that idea into some sort of physical concept as a product or service or new business model.

So, if you don’t have a good innovation process underway for the ideas you spawn internally that problem will become magnified as you have more ideas from the external sources that have to get pushed through an already inadequate process. So, while on the surface open innovation may look a little less expensive on the idea generation point of view it actually will end up magnifying the issues within the organization from an innovation point of view from a commercialization and intellectual property and just the ability to manage the ideas effectively from the community at large.

The last thing you want to do is open up innovation to an external community and fail to interact with them effectively. You’ll run into that old issue of:

“If I please one person they may tell another. But if I anger another person they’ll tell 7.”

So, if you do open up innovation to the community ineffectively then that will spread like wildfire.

There’s a good example with Campbell Soup. Campbell Soup asked the people for new ideas for recipes. But on the website told people they wouldn’t respond to them for 60 to 90 days. And this has created quite a hubub within the community because many members feel they have been let down. They don’t know how their ideas are being implemented or if their ideas are being implemented at all.

I just laugh. What a mixed message.

Please share with us your ideas; we’re excited to hear them. But we’re not really that interested in communicating with you. We’ll get back to you in 60 to 90 days.

It’s weird. You and I have talked about this previously in this call. The further you go in open innovation, the further you’re penetrating traditional social media. And social media demands a two-way interaction and not a one-way interaction.

I’ve written less articulately than you just spoke that the communication you have with your customers is a reflection of the communication you have within your company. If it’s engaged, open, passionate and trusting then that will the communication you’ll have with the public.

Bringing in an open innovation model and trying to impose it on an very protected, hierarchical, infrastructure is just going to expose these problems and let everyone see what a difficult company this is to work with.

Yeah. You’re addressing a lot of issues we think are important from an infrastructural and cultural angle. I used to work with a company years ago. And our joke that the phrase “Not Invented Here” was invented there. Any idea from the outside was quickly rejected.

And that’s another thing you have to think about when you are doing open innovation is how will ideas from the outside be perceived. And how much engagement will there be for ideas from third parties.

Now, you’re talking about the economy and the global markets and I hate to paint the world in a black or white perspective. But it seems companies face two choices. They can innovate now; they can pay it for now as the ad says. Or, they can pay for it later.

If you think about it, we as consumers, or we as just individual, want to have relationship with brands or products that matter to us. And the more engagement I have the more involvement I think I have with the product or brand, the more likely I am to return and repurchase that brand or product or company. And the reverse, less so. If I have less involvement and they seem less willing to listen to my ideas, I may be less involved and less engaged.

Apple may be the one company that can keep me engaged because their products are so good and yet I don’t think they listen to ideas from the outside. They are the exception to the rule.

And I think what’s going to happen is that as companies, as certain companies, become better at open innovation they are creating not just communities but tribes of people that really affiliated with their brand and their product. They feel like they co-created that product, that they had stake in the development of that product or brand. And then companies that are laggards try to get into open innovation, I think that their relationships or the strength of that bond between the company that’s been practicing that open innovation is going to be harder to break.

So, companies that lag behind or drag their feet about open innovation may not just miss ideas but may also miss strengths of relationships between themselves and their customers. Its not just ideas they are missing. I think it’s also they are missing the opportunity to build a tighter relationship.

**********

Part three of this interview will be published on Saturday, August 13.

Interview with Dr. Hal Gregersen, Co-Author of The Innovator's DNA - Pt. 3

Dr. Hal Gregersen, co-author of The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators, was a guest on my radio show recently. You can listen here.

You can read part one of our interview here.

You can read part two of our interview here.

The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators was the result of an 8-year study to uncover the origins of innovative—and often disruptive— business ideas. They interviewed nearly a hundred inventors of revolutionary products and services, as well as founders and CEOs of game-changing companies built on innovative business ideas. In the process they identified five discovery skills that distinguish innovative entrepreneurs and executives from ordinary managers:

• Associating
• Questioning
• Observing
• Networking
• Experimenting

You talk about the Vuja De experience. I read a lot of books on innovation. In reading your book and planning for this show, I did not have a deja vu experience. On the other hand, I did have what I now know was a vuja de experience. You write about vuja de experiences. What are they?

What role do they play with our observational skills?

Essentially, and I’m thinking of Scott Cook who founded Intuit, and he talked about a number of observations he had made that had enabled him to create Intuit and Quicken software, to create Quickbooks, which are both the personal financial software and small business software... some of the best-selling software anywhere in the world. And when Scott Cook or when he trained his people at Intuit when either he or they would go out he asks them to think of one question. And that is either:

• “What surprised you?”

• “What was unexpected when you went out?”

And if people come back with blank answers, no surprises and nothing unexpected, it’s practically impossible to have a vuja de experience, ie., see something for the first time.

What they were doing was they were looking through all the old the lens of all the old categories and all the old judgments and they were unable to see something new.

For me, it’s a great question to ask myself and it forces me back to the place to the people to get a new idea.

Let me give you a quick example from Proctor and Gamble. You know they are systematic about sending people out to observe. Just as Colgate Palmolive does. P&G, the average marketer spends 12.5 hours per month just observing consumers buy product or use product. That’s a day and half just watching people. And they better well come back and see some surprising things.

But even a day and a half doesn’t get you some surprises. And, so, they actually have live-ins and go live with family for 2-3-4 days and figure out what’s it like to really do what they do. Many of their employees are from middle and upper income levels. And they’ve always had the luxury of walking into a kitchen or walking into a bathroom and turning the tap and have water run in. When you’ve gotta carry water from the well to where you are living and you have this thing called Tide detergent and it has 7 rinse cycles, then water gets really heavy carrying it back and forth to get soap out of the clothes.

And that observation that comes from some deep experience which for them comes from a vuja de experience...they went back, worked with the technologists, reformulated the clothes washing detergent and had a one or two rinse cycle. And all of that comes from seeing things for the first time and really seeing them from the perspective of the end-user.

You have a list of your 25 most innovative companies. And that's based in part on what you call innovation premium as reflected in their stock price. Intuitively it makes sense. Innovative companies will be the ones most likely to survive and thrive. So, investors would pay a premium. But, quantitatively how did you measure this innovation premium beyond its stock price?

In the book, and in the current issue of Forbes it has a cover article on the “innovation premium”. And they also list an explanation for what we do.

Here’s a shortened version of what we’re talking about. Investors paying a certain price for a particular stock. Let’s take the number one company on our list, SalesForce.com. And what we do is we look at the existing cash-flows that come in to that company from existing products, serivces and markets. In this case, I’ll pay you a $100 for the cash-flows for the company for what you do today. But guess what? I’ve got confidence that in the future you’ll have new products, services, and new markets that you are operating in and because I think you’re going to do something interesting in the future. And in the case of SalesForce.com it’s a $73.00 premium. 73% higher. And you add those two together and that’s what you get for the stock price. But the premium is that piece we will pay for what we think you’re going to do in the future and that’s what the premium tells us.

On this list are the usual suspects: Google, Apple, Amazon. Rightfully, so. But refreshingly your list was more global and more comprehensive than US or multinational firms. Which company impressed you the most or surprised you the most?

One the companies that was impressive and interesting and frankly was one of the companies I had never heard of them until we had created this list. We literally scoured the world for companies with market capitalization of $10 billion US or more. And much to our surprise there was a company down the list, number 23, a Japanese company called Keyence Corporation. What do they do? We had no idea.

They make sensors and measuring instruments for factory automation. And what’s unique about them and it sounds like a boring kind of company. They actually train and encourage and make highly competent sales people who go into factories and not only do demonstrations for the product but they spend a lot of time making observations about their people and their equipment, how do they do things and what are they doing here?

And then they go back to their offices and ask:

“Could we modify our product to make it perfect for their application?”

And then they go back and work with the customer to the point that they are exceptionally satisfied with these sensors that make raman noodles perfect when they come out of the machine.

And so, what we realized with a company like that is you don’t have to be...a fancy consumer products company to be an innovative company. This company sells sensors for factory automation systems. But they have realize that if they embed on one of these innovation skills deep within our people, in this case observing people, we will be able to generate value from that investment that will be multiples more than what we put into it.

We've reached the imagination moment in our show. Let's imagine President Obama has a few moments this week. He finds your book. . He picks up his Blackberry and calls you.

Hal, he says. He gets all personal because he is the President. We're facing some disruption these days. But, we're not finding a way to move progressively from one idea to its impact. Again and again.

What if you and your two co-authors join up with myself and Vice-President Biden. We want to hear your thoughts, maybe 3 things that we as a nation can do to move progressively from one idea to its impact. Again and again.

What would those three things be?

I would tell you the following if I was talking to him.

I would say:

“Look. When we look at innovative companies it starts at the top. Every one of these companies who create sustainable ideas that make a difference they are led by CEOs and senior managers who actually innovate themselves. They engage these skills in an every day way. And so, if I were to look at a country it would be the same thing.

Here’s the challenge. But, let me step back for just a moment to me being a teenager again. When I was a teenager I wanted to be the President. I pursued it enough that I actually ended up working later in college, I worked a couple of times in Washington DC for two senators. What I learned working on the staffs of those two senators was when you work in Washington D.C. and you live within the Beltway you end up living within those buildings that are around the capital and the White House. And what then happens is it becomes extremely easy not have a silo built in your world and your way of working with the world that is not extremely incestuous. And that comes from talking to people who look like you and think like you even if they are on the other side of the political spectrum. They still are politicians.

My suggestion is I would get every single policy make out of their offices and into the field where people are facing these challenges. I don’t mean promotional opportunity to get votes for the next election.

I wonder how many people who are stuck in this budgetary grid-lock, how many of them have spent two days not pitching their views or their party, but how many of them have spent two days maybe living with a family that is struggling with the burdens of living in this economy for the past two years? I would be hard pressed to find even a handful of politicians making these policy decisions who have a good grip on what it’s like right now for people that they are making the decisions for.

It’s easy for me to step back and say this. I don’t have the answer but. But I look back to the financial crisis in 2009 and wonder how many of the CEOs and executives of the major banks in the world ever took the time to get out of their offices to walk down to their home loan making office and just watch the process of how these loans were being made?

I bet if they had they would have sniffed something ugly really fast. And they would have done something.

For me, the first recommendation is get policy-makers out of their offices and into the real world and using these observational and other skills of being an innovator to generate some better solutions.

2nd policy suggestion? Do everything we possibly can to invest in the next generation of innovation leaders. These are the kids and the young people who are growing up who are not just going to solve today’s problems but they are going to be the solvers of tomorrow’s problems that will probably be bigger than the ones we’re facing today.

And what I mean by investing in them is on one level creating educational learning experiences that foster these skills. And another investment and again I would ask those policy-makers to pay attention to the world around them. Look in your neighborhood, identify some families that you will foster their innovation skills so that some day they might be the next president and they might be better at solving the problems we face tomorrow.

That’s so great. Thanks for sharing that!

Let’s talk about social media. As I read your book and thought about the five skills, particularly associating, I thought about social media. I find it a great tool to feed this habit. Others think it’s fiendish devil breaking down our associations with each other.

What’s your thoughts?

Social media has the potential for innovation if we use it carefully. And it has the potential to crush innovation if we use it the it is systematically set up for us to use.

So, it’s like when we buy a book on Amazon, Amazon is smart enough to figure out what are some books that are like that book that we just bought and:

“ Might you like this one, too?”

Well, what social media does is it basically says:

“Who are some people like the people you already know that you might like?”

And we start building these networks more often than not that are like us. And when that happens, instead of becoming a mechanism for great social and positive change in the world it often becomes a mechanism for deep in-breeding and self-centered thinking that leads to catastrophes.

For me, social media has a double-edge. It could be used for something quite incredible or incredibly good. Or it could be used for something that actually is incredibly destructive.

For me, it is being conscious for what am I using it for? Am I using it in a thoughtful way? Am I using it in a way that taps into different ways of looking and seeing the world. That might be somebody from a different company, somebody from a different country, somebody from a different community or background. When I use social media to connect me to into places I normally wouldn’t connect that’s when it becomes fun and interesting. I think we could create some positive social values.

A couple examples. One is an early guest on this show: Bill Davidow who is the author of OVERCONNECTED: The Promise and Threat of the Internet. He talks about the threat of creating self-reinforcing echo chambers.

Sometimes in my frustration, I see social media and particularly Twitter as a high-school popularity contest. It’s easy to fall into it. Who doesn’t want the validation of thousands of people saying:

“Hey that’s a great thought you had.”

On the other hand, it’s a great opportunity to connect with other people around the world. I’m fascinated with the democracy movements in the Middle East and northern Africa using social media to get their story out in an environment where diversity of thought is maybe, perhaps, not encouraged. And I’m beginning to see the common thread of innovation and community and the need to connect and ask questions is as common in these democracy movements as it is here in corporations trying to find new ideas to reach out to consumers who are in effect their voters.

I’m an American. I grew up in the US. But, now I live in several countries. Part of the year I live in Paris, France; part of the year I live in Abu Dhabi and the United Arab Emirates in the middle of the Middle East. I can empathize with what you are talking about.

Many times in the Middle East the approach to innovation there is buying innovative things vs building innovative people.

One of the great by-products of the democracy movements in the middle east is that it is fostering these Innovator’s DNA skills that will help them. They have a deep need for incredibly creative people to create systems and solutions in a world that is turned upside down in the last 12 months.

When you present it like that it seems there is such fantastic potential there that awaits them. The potential for growth that is going to come from allowing all of these voices to participate in exchanging ideas that will bring change in their daily lives.

Readers are leaders. Jim Rohn says that. I’m just smart enough to quote him. You’re a leader. What are you reading these days?

I mentioned one book earlier that I am half-way through. It’s called Your Creative Brain: 7 Steps to Maximize Creativity, Productivity and Innovation in Your Life.

It’s written by Shelley Carson of Harvard Medical School. She is a medical scientist who has basically looked at every part of the brain and gives these incredibly clear explanations as to how they contribute to somebody getting a great new idea.

I find it fascinating and that’s the research I mentioned earlier about how most people find associational thinking exhausting and how can you make it fun and easy. It’s a great book. Very provocative.

Another book is from someone I mentioned earlier. It’s from John Hunt. And it’s called the Art of the Idea. In that, John basically says:

“Look. Ideas will prod and push the world forward.”

And he has some incredible one-liners and phrases in the book that really caused me to turn my head and think differently.

Your book is so rich with advice and case studies and how-to’s. I’m hesitant to ask this last question. But, can you leave our listeners with one parting thought on developing their Innovator’s DNA?

At the very core, The Innovator’s DNA tells us to act different so that we can think different and in the end make a difference. Not only for the work we do today, but for the work we might do tomorrow. And not only for our own sake but for that next generation of innovators in the world who need role models. They act differently, think differently, they make a difference in the world we want to create hopefully a much better place.

Where can we find you on the web?

The Innovator’s DNA. Great place to start.

I’m on Twitter as well as Hal Gregersen.

I’d like to put some of those ideas and ask people not only to like them but to challenge them as well.

Thank you!

Next Guest: Jeffrey Phillips

Jeffrey Phillips is one of the 34 expert contributors who created the excellent book:  A Guide to Open Innovation and Crowd-Sourcing: Advice from Leading Experts.

Jeffrey is VP - Marketing and a lead consultant for OVO Innovation. Jeffrey has led innovation projects for Fortune 5000 firms, academic institutions and not-for-profits based on OVO Innovation's Innovate on Purpose methodology. The Innovate on Purpose methodology encourages organizations to consider innovation as a sustainable, repeatable business process, rather than a discrete project.

Jeffrey contributed a chapter on Open Innovation Typology.

We will talk about his chapter, why the different types of open innovation matter, corporate examples of open innovation and their results as well as the process for creating this great book.

Wednesday, August 3 at 9:30 AM, Central. You can listen here.

Interview with Dr. Hal Gregersen, Co-Author of The Innovator's DNA - Pt. 2

 Dr. Hal Gregersen co-author of The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators was a guest on my radio show recently. You can listen here.

You can read the first part of our interview here.

The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators was the result of an 8-year study to uncover the origins of innovative—and often disruptive— business ideas. They interviewed nearly a hundred inventors of revolutionary products and services, as well as founders and CEOs of game-changing companies built on innovative business ideas. In the process they identified five discovery skills that distinguish innovative entrepreneurs and executives from ordinary managers:

• Associating
• Questioning
• Observing
• Networking
• Experimenting

Bottomline discovery? Being an innovator depends as much on our behavior as our mind. Change our behavior...change our skills as innovators. I loved this book!

I’m stuck here on the point that we need to generate better and better questions. Where in our educational system, our schools and on-the-job training is that skill developed?

Ah! Great question!

In most places, it doesn’t. That trend, that experience for most of us, started as soon as we went to school, who knows how many years ago.

We know that 4 and 5 year olds love to ask questions. They have thousands of questions they love to ask. Why this, why not that, what about this? They are constantly questioning the world.

When we go to school those questions get shut down. And a brake gets pulled on that’s like an emergency brake that gets pulled on a car. They just stop. Educational researchers have tracked when we go into school and start getting evaluated for what we’re doing in school then we care more about the answers the teachers have and the teachers care less about the questions we might have. Then we go to school, then we go to work after we’ve gone to school for who knows how many years and workplaces don’t foster active questioning.

Let me back that up to a company like Amazon where Jeff Bezos is a questioner. And they systematically train and teach and reinforce throughout the organization to ask why and why-not questions. Here’s how you do it, here’s when you do it, here’s why we need to do it; please ask questions. They simply expect that of their people.

But even if my company doesn’t systematically support me being a better questioner, I can still do it myself. What we’ve discovered is it is a simple question. First of all, innovator’s are always thinking of problems or opportunities they are figuring out a solution to. Where I would start out if I wanted to define a question, define a problem, that matters to us. Could be personal, could be professional. All of us have a problem we don’t have a solution to. Then take the next 4 weeks, take 5 minutes a day and buy a book to be your question journal. And every day, right down nothing but questions about your problem.

And I promise you in a week or two you’ll notice the questions are changing. And at some point you’ll notice a very provocative question that will change a person’s perspective on the problem and lead them to a solution they never would have thought otherwise.

That’s so excellent. I like the approach. I’m just envisioning it for some challenges I face now. Just beginning to baby-step your way to finding a solution.

Can I add just another piece? I bet you have sat in meetings like I have where we’re wrestling with a really tough issue. And we’ve been talking about it, 8 of us sitting in a room, going nowhere, hitting the wall. We can’t seem to get the right solution.

When that moment hits it’s time to step back and say:

“Time for questions. We understand the problem. We understand it as best we can.”

What we do with executive teams in these situations is we start question-storming. So it’s a version of brain-storming but it’s all questions. So, as a team you write down one after the other all the questions you can possibly imagine about the problem.

Demand at least 50 questions. It’s gonna be frustrating at first. But, push to get at least 50 questions. What we find is that people are generating new questions about a problem they care about they really can generate questions that can take them to a new place.

Another great example. Thanks so much.

Of the 5 behaviors which is the one you see as weakest among business executives?

Now, that’s a great question! Again.

I would say Associational Thinking. You know when we act differently by observing the world, posing provocative questions, networking for ideas and experimenting...all of that stuff is foundational for the final piece which is Associational Thinking - Connecting the Unconnected. You know it’s putting together things and ideas that we normally wouldn’t put together.

This is where when you get an idea like the original iTunes or iPod which was essentially connecting the unconnected: What if we put music into a store on the internet with iTunes. What if we connected many hard-drives with MP3 music and a computer with the things, we connectedthe unonnected.

That’s how these things happen. We put together things in a novel, new way.

Well, guess what? For 80% of adults, a great researcher at Harvard Medical School, her name is Shelley Carson, she basically has looked at adults doing associational thinking. What she found was 65-80% of adults find associational thinking exhausting. It’s tiring. It wears them out.

Watch people’s faces when you tell them:

“We’re going to do a brainstorming session”

That’s essentially an attempt to think associationally, to connect the unconnected. A lot of people’s eyes roll.

“Do I have to do that?”

By the time we become adults we just get exhausted trying to do this. it’s not that we don’t know, well we do know how, it’s just we have lost the capacity. As adults we just don’t do it very much. And so, when we’re asked to think creatively it’s just exhausting.

What they found in the study was that if people practice associational thinking enough then they become competent at it and confident in their ability to do it. What was once exhausting is now energizing.

“Got a brainstorming session? Pick me. That would be fun. I’d love to do it.”

They would enjoy it because they would be competent at it. There are things we can do as adults to actively build better associational thinking skills.

We have a lot of managers and entrepreneurs and people in startup businesses who listen to this show. They’re looking for solutions for their business and to create a sustainable business model. What are some of those exercises they can do now to begin to strengthen those associational thinking muscles?

A lot of it at the beginning stage is literally forcing associations.

A colleague of mine, a guy named John Hunt, has written an interesting book called The Art of the Idea. He’s the World Creatve Director for TBWA, one of the greatest advertising companies in the world. When they’re working with companies they do a fascinating thing. They drag a big box of hats and T-shirts from some of the most innovative companies in the world.

So, let’s say we’re working with Coca-Cola, one of the most innovative companies in the world and we’re trying to make them even more innovative. Well, we drag a box of hats and shirts in the room. And they shirts and hats in the box are from Apple and Virgin and Google and Pixar. And what we do is we’re talking about a problem. And what do we do to look at it differently and create some new associations? They literally ask someone to put on the Pixar hat and the Pixar t-shirt and look at the problem through Pixar eyes.

• How would they look at it?

• What would their viewpoint on it be?

• How would they fix this?

And by literally putting ourselves into this company and connecting the unconnected, I may be running a boring company, make shingles for roofs of houses. By looking at it from Pixar’s perspective I might generate a new idea.

But it’s essentially forcing myself to create new associations we wouldn’t otherwise. It might be as simple as opening a book and picking the 4th word on a page and what does my problem have to do with that?

I’m looking at a book right now. I look at the first page and the 4th word I come to. And the 4th word is virtual. What does my problem have to do with ‘virtual’. Well, take a few minutes and think of some potential associations.

I have an application on my iPhone called “Idea Generator”. And basically, you shake the iPhone and you get three random words that come up that you could potentially connect to your problem and see it differently.

So, there’s some fun ways to do this. It doesn’t have to be boring.

I think that besides being fun, it’s also an easy way to stretch that muscle, do it in a cost-effective and time-sensitive manner and do it without people getting bored or burned out from learning this new skill especially as we get older.

Again, it’s being able to collect experiences that make us different. We talked about associational thinking. The same thing could be said for Networking for New Ideas. One of the things people do for this is they talk to people very different from them in order to get new ideas.

And we know from research most people pick friends and co-workers who talk, think and believe like we do. That’s why we like them. They’re like us.

But when it comes to getting new ideas they are the worst people. We have to find the opposite. Somebody who’s a different gender; somebody from a different industry; some body from a different country of origin; somebody from a different political persuasion. If I’m 40 I talk to somebody whos 30. If I’m 30 I talk to somebody who’s 70. It’s getting new perspectives and new ideas.

Now. This is not an expensive thing to do. It might be lunch twice a month with somebody I never go to lunch with. Instead of going to lunch with the same people from the same floor I’m on, pick somebody from a different floor. I’m a programmer? They’re a marketer. Go to lunch with them. Go across to the building next door. I’m in direct sales and we’re selling consumer products and across the way is someone selling industrial motors. You know, whatever. Go to lunch with them and see how they look at the world.

These are not expensive things to do. But they help us generate more interesting ideas.

You remind me of a favorite quote of mine. It keeps coming up. It’s from Ronald Reagan back from whenever he spoke at the Berlin Wall. He said:

Tear down those walls.

I keep thinking about all those walls around those functional silos in a company.

What you’re recommending is a doable step to infiltrate through these walls and make and associate with people of different thinking.

Absolutely. And when I hear about these walls in companies...if I were to walk into those worlds where the walls are big and strong in the organization, I would bet next year’s salary for me....we have a self-assessment where people can find where they stand on these skills, I would bet within these walls of these territorial companies, these discovery skills don’t get used very much at all.

Part of what that reflects is when we build these walls in these companies, we forget why we are even there. We forget who are the customers we are really serving. What are their issues. What matters deeply to them.

I’ll never forget working with a company with the senior managers and they were talking about big issues and all of a sudden the founder of the company said

“Wait a minute. Where is the voice of the customer in this conversation? How many of you have connected and taken the time to really understand the consumer’s viewpoint on this thing? How do they look at the problem? We’re just missing the boat completely.

And so, I think a lot of those highly-silo’d-deep-thick-wall type of companies have a lot of people sitting in their offices doing their job and focusing on their little area. And what they also have is a lot of people who aren’t engaging these innovators in these skills. And they’re stuck within their space.

Thank you. Another great answer.

You write in your book about T-Shaped People and how they increase our stock of ideas? Who are these t-shaped people and how do they help us create a lot of these new ideas?

T-shaped people have, they have like a T, the line going up and down which is a deep vertical expertise in some particular area. It might be technology; it might be marketing or finance or whatever. It is a deep, deep, understanding of that domain.

Steve Jobs has a deep understanding of consumer electronics. He goes deep there. He also has breadth. That’s not the only world he lives in. you go back to the different parts of Steve Jobs’ life and you know, living in an ashram in India for awhile taught him the value of silence. Meditation in a very silent space. When they were trying to figure out the Apple II he said:

“ I am completely annoyed with those fans on these original early PCs that sounded like they were engines on airplanes. “

And it’s like:

“How could we do this differently? “

And his experience in the ashram led him to question this experience and why do we have these noisy fans that ultimately led him to a guy named Holtz who found a completely different way of generating power. they could create a computer that didn’t need a fan.

The same thing could be said for his excursion into calligraphy. Who could have guessed that calligraphy and sitting in on calligraphy classes would have led to a WYSIWYG font on a computer screen.

I could keep going. But it’s having clear depth and expertise as an expert. But it’s getting out of that by literally expanding our horizon at the top of that t by exposing ourselves to a lot of different experiences.

Who are Tata and Nano? What role did observational skills and a vuja de experience play with their success?

Ratan Tata is an Indian by birth and had lived in India for quite some time. He’d probably seen millions if not billions of families in his lifetime sitting on and riding one of these small scooters. If you have a chance to get outside the US, it’s really common to see an entire family sitting on a small motor-scooter.

He was sitting in his car on the way to work. Monsoon season is driving the rain down on the car. All of a sudden he finally saw for the first time those people. We’ve all heard of Deja Vu when we think we’ve seen something from the past. But this is Vuja De where we see something for the first time.
That’s what happened to Ratan Tata. He finally saw what we happening with these people.

• Is their lot in life to ride on these motor-scooters in the rain.

• Isn’t there something better we can do?

And he went back to his company that built different kinds of vehicles. And he said:

“We’ve got to find a solution. Let’s create some kind of vehicle that’s inexpensive enough that they can ride in a car instead of a motorcycle and be soaked.”

He scoured the world. Got all kinds of technologies together. Incredible, thousands of innovations to make the Tata Nano car which is a little over $2000 US.

Once they built it they had a problem: now they had to sell it. A low-price point car like that doesn’t get sold through typical dealerships. Most of the scooters for families riding on scooters get sold in little villages. A trucks pulls up. They’ll pull the scooters out. People will buy them and they’ll ride off.

That works fine for a scooter in India. Tata sent people out to get some astute observations about how scooters are sold and how could they sell Nanos. And what they realized was they would have to setup an entire on-site infrastructure to make it work.

When you sell a car you gotta have a driver’s license; most people didn’t. When you sell a car you gotta have insurance different from motorcycles; most people didn’t have car insurance. When you sell a car, you gotta have service and support....

So, essentially they set up a licensing operation, an insuring operation and a teach-you-to drive-the-car operation so that people could drop into that village and get what they needed in terms of skills and certifications and drive away with the car.

It was an incredible experience not only in generating that car but using their observational skills in understanding how could we sell it to people in such a way that they could use it and walk away with it.

You can read part three of our interview.

Interview with Dr. Hal Gregersen, Co-Author of The Innovator's DNA - Pt. 1

Dr. Hal Gregersen co-author of The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators was a guest on my radio show recently. You can listen here.

Dr. Gregersen is Professor of Leadership at INSEAD where he pursues his vocation of executive teaching, coaching, consulting, and research. Before joining INSEAD, Dr. Gregersen taught at the London Business School, the Tuck School at Dartmouth, Helsinki School of Economics, Fletcher School of Law and Diplomacy—Tufts University, Brigham Young, Thunderbird, and the Turku School of Economics as a Fulbright Fellow. Dr. Gregersen has co-authored several books on leading innovation and change, such as It Starts With One: Changing Individuals Changes Organizations (Wharton, 2008), Global Explorers: The Next Generation of Leaders (Routledge, 1998).

The Innovator's DNA - Mastering the 5 Skills of Disruptive Innovators was the result of an 8-year study to uncover the origins of innovative—and often disruptive— business ideas. They interviewed nearly a hundred inventors of revolutionary products and services, as well as founders and CEOs of game-changing companies built on innovative business ideas. In the process they identified five discovery skills that distinguish innovative entrepreneurs and executives from ordinary managers:

• Associating
• Questioning
• Observing
• Networking
• Experimenting

Bottomline discovery? Being an innovator depends as much on our behavior as our mind. Change our behavior...change our skills as innovators. I loved this book!

Dr. Gregersen, thank you for being on the show and writing a great book.

Delighted to be with you! Thank you!

Now. Who are you, and your two co-authors, speaking to in this book? Describe the reader you had in mind.

The readers we had in mind were everyone at some point.

But, we’re starting at the top with senior management of companies or countries. And basically trying to influence how they behave themselves and how they can change the way they act in order to change what their companies, or countries, are doing.

My friend, Erika Andersen, coined a great phrase in her book Being Strategic. The phrase was reasonable aspiration or hoped-for future. And she asks:

What is your reasonable aspiration or hoped-for future?

What was your reasonable aspiration or hoped-for future with writing this book?

At a very fundamental level the innovation skills we write about in The Innovator’s DNA ...everyone o us had as kids. The fundamental hope is that we all get those skills re-ignited at work, at home, in our communities in order to generate better ideas.

At a very fundamental level it is thinking differently by acting differently and at the end making a real difference.

I loved that point you brought up that everyone of us has those skills lively in us as a child. Somewhere along the way we lost them. Somewhere in our conversation I hope we get into a discussion of where we lost those skills. But, I thought it was a fabulous point you brought up.

What metrics will you use to mark your progress towards that hoped-for future?

The hoped-for future, again it comes back to what we were just talking about. We were all once 4-year olds. And we knew how to do these innovation skills and get great ideas. And the oped-for progress or the metrics would be is that a higher proportion of not only Americans but anyone anywhere in the world would restart or re-ignite the use of these skills in order to generate ideas that make a difference.

In our work we notice people making a difference in their workplace. We notice these skills making a difference even in government setting, in community settings and even in home settings.

The metric is really at a personal level that a higher percentage of people will be generating new ideas for ways and products that are simply better than they have been in the past.

I loved your introduction. You had me hooked when you wrote:

A critical insight from our research is that one's ability to generate innovative ideas is not merely a function of the mind, but also a function of behaviors. ...if we change our behaviors, we can improve our creative impact.

At what point in your research did you have that insight? Describe that moment.

It became really clear, for me at least, when we started to interview these incredibly successful innovators, many of whom have disrupted entire industries in the work they do; it became clear as we heard the patterns in their stories.

Part of those patterns were not only the skills they engaged in by questioning and observing and networking for new ideas and thinking differently. But part of it is where those skills came from. And also how they essentially dealth those skills in other people.

Jeff Bezos is a perfect example. He essentially, as he was growing up, he was very committed to generating new ideas. And that partly came from having grandparents who were equally committed to helping Jeff Bezos learn how to solve new problems. So, in the summertime he would go out to their farm in Texas and essentially work with them on the farm. When the tractors broke down, they would fix them. When the animals had problems they would figure out the problem.

They didn’t call mechanics; they didn’t call veterinarians. They tried this; they tried that and after 15 different experiments they finally got something to work.

And what they realized with this or what Jeff Bezos realized was:

“If I experiment enough I can create a solution that will solve a problem.”

What crystallized for me when I heard Jeff Bezos story was it’s the same story I heard from Diane Green who founded VMWare whose parents let her sail across the Chesapeake Bay in a small dinghy exploring the world and experiencing new things.

I heard the same thing with Marc Benioff and parents and grandparents who took him to computer stores to pursue what he was doing. Flew him to work to help him understand how castles look and work so he could build computer programs around castles in the programs.

All of these people, one of the incredible insights, was they had adults around them who fostered these skills and kept them alive as they became adults. Then when they ended up getting these incredible business ideas but the really good ones got the great ideas themselves but these innovators were capable and consistent about teaching other people how to do these same things and how to create similar effects within their companies. They literally imprinted their own innovation skills deeply within their organizations that it’s made this really positive financial difference for their companies.

I love how you outline the relationships of developing, learning these skills but being able to pass on those skills to the next generation of people they can mentor.

What was the response within your group when you began to share that insight? Complete aha acceptance or....some initial skepticism?

I think some of the initial skepticism comes sometimes from wondering can you really teach these skills to someone especially adults. Sometimes people hear the stories I just told about Jeff Bezos and other folks who had the luxury of parents and grandparents who actually paid attention to their innovation skills and fostered and nurtured them as they were growing up. Some folks don’t have that luxury. They become adults and they go to work. And for the most part by the time we get through our education we have lost those skills. And we go to work and most companies we don’t engage those innovation skills and frankly we don’t care about these.

Now I’ll never forget talking about these skills recently in Cape Town, Africa. And after giving the speech, a young man in his early thirties came up and said:

“You know. I didn’t have parents who supported me in being innovative. I didn’t have grandparents who did that or neighbors, either. But about 5 years ago my boss for the first time  who asked me for my ideas. And paid attention. And listened. And cared about them. And helped me nurture them into something that made a difference for the company. "

And over the next several years this man became confident enough in his own innovation that he started an incredible new business called GetAGreatBoss.com. Here’s the fundamentals of his business. He essentially linked want-ads to get a job to 360 degree assessment of great bosses.

For instance if I wanted to get a great job in Poughkeepsie I’d look on the want-ads and I could check Get a great and look at what kind of boss I am looking for.

It’s a fantastic service. And it came from one boss who paid attention to one employee’s ideas and helped him get good at delivering results with those new ideas.

It’s such a simple idea. And it shifts the whole dynamics of that conversation and puts a lot of tools and decision-making resources into the hands of the employee.

A lot of managers may shiver at the thought of those they manage becoming more disruptive. What are they missing?

[chuckle] Those same manners are going to shiver even more because they weren’t able to foster disruptive ideas within their company.

You know, at some point every business starts to decline. The way they do business starts to decline. take for example Dell Computer. It had an incredible run for 20 years. And then it started to go downhill and decline.

So, one of the challenges is that if I shiver at the idea of my employees having disruptive ideas...at some point somebody else who’s note afraid of those disruptive ideas will start a business and build an entirely new way of doing business in our industry. And they will come back into our space and essentially knock us off the top.

That’s the story of disruptive innovation.

For those managers who are afraid of it you might as well get used to it. Either they need to learn today how to create an organization that can at least in part of that company supports and encourages and tries to create incredibly disruptive ideas. Because if they company doesn’t do that somebody else will for them.

You know as you’re talking and I’m scribbling and listening and I’m connecting with what you said about the young fellow in Cape Town...you said the motivator for him to unleash his disruptive talents was he had a manager who finally a little caring, a willingness to invest a little time to listen to his ideas and encourage him to pursue them.

And taking your point a little further, it seems managers who are afraid of disruptive ideas may be afraid of showing that they care or have the skills to show that they are willing to listen to an employee. but nature being what it is people will find someone who cares.

Am I going to far out on this limb?

To me, you’re raising a fascinating angle. These skills, these 5 skills, they’re basically the following in terms of the actions we do:

• Ask provocative questions
• Observe the world like anthropologists
• Network for ideas
• Talk to people who are very different from us
• Experiment and prototype and try new things.

If I move my lens back from innovation and instead focus on just connecting well with my employees...guess what? Those same skills are equally relevant.

If I’ve got a boss who asks me interesting questions and listens to my provocative questions, if I’ve got a boss taking the time to observe me like an anthropologist and understand who I am, what my hopes and dreams are, what my skills are, what I do well, what I could do better at, how do I get better...provides all the stuff I need to become excellent at what I do. If they’re willing to experiment and let me try a different way of doing something and build the skill. Because anything we’re trying to do better by definition we don’t know what we’re doing and me make mistakes; so we have to learn.

Oddly enough these innovation skills are the same skills that great leaders use to develop their people’s capabilities. And when that happens employees check into work instead of checkout when they come to work in the morning.

You list the 5 skills, the 5 behaviors, and we’ll go over them quickly here:

• Associating
• Listening
• Questioning
• Networking
• Experimenting

Was there any priority in their listing? Is one more important than all the others?

They are all critical in their own way. And there is a bit of a sequencing thing that happens with them. And if I was to put my finger on one of these that seems to matter the most, it’s like a beginning point, it’s starting with a great question.

The challenge is that when we’re stuck with a problem and we’re stuck with a solution that is working today and you’re trying to figure out a new solution for tomorrow, the problem is we haven’t asked the right question to change the game and move it to a new place.

And so when companies 15 years ago were running enterprise software systems for big businesses and medium businesses and a few smaller enterprises, when those companies like CISCO and SAP and so-on would sell these massively expensive packages and install them in these organizations and they weren’t thinking of another solution.

Well, you get Marc Benioff who worked at CISCO for 25 years and was trying to figure out better solutions for small and medium-sized enterprises and he steps away from that situation. He takes a year’s sabbatical; he travels the world; he talks to different people. And ultimately he asks a different question. The question is:

“ Why do we have to deliver these enterprise software ticket, big price, packages.”

And then he puts a magical association together:

“Why can’t enterprise software be like Amazon.com?”

He changes the question.

“What if we put enterprise software on the web like Amazon sells books on the web.”

And that then led to Salesforce.com, which when it started 10 years ago was laughed out of the industry. People never believed he could put enterprise software in the cloud, in cloud computing.

But, Benioff changed the question. Then he did his homework. He made some critical observations. He talked to a lot of different people. Tried some experiments and prototypes. refined the idea with people around him. And ultimately his associational thought, or connecting the unconnected enterprise software on the web instead of in a server in a company was a breakthrough idea. That put him and his company, SalesForce.com, in our listing as the most innovative company in the world.

So, I would start with the question. And to do that I have to be generating better and better questions.

Part Two of our conversation will be published here on Saturday, July 30.

Part Three will be published on Tuesday, August 2.

Review: A Guide to Open Innovation and Crowd-Sourcing

A Guide to Open Innovation and Crowdsourcing is a guide, a reference book, a how-to, manual. A small orchestra of global expert practitioners of open innovation and crowd-sourcing wrote beautiful music together to create this guide. As such, it is one of the few books on any topic that walks its title's talk or sings its title's tune.

Their work was orchestrated by Paul Sloane. He's listed as Editor. But in this open innovation, crowd-sourcing, endeavor the title Editor is misleading. Paul was an orchestra conductor. And the players in this orchestra were among the best of the best. In creating this book, they created a world-class symphony performance of innovation consultants.

Each chapter was in effect a performance solo from one of these leading experts. There are chapters on:

• What is Open Innovation - Julien Keith Loren, CEO of InnOh
• Open Innovation Trends - Jeffrey Phillips, VP of Sales and Marketing for OVO, Innovate on Purpose
• What is Crowd Sourcing? - Renee Hopkins, senior editor of Texas Enterprise and media relations manager at the McCombs School of Business
• Leadership Issues and Challenges,
  
• The Power...,
• How LG Electronics is Tranforming Itself - Christopher J. Ryu, Senior Advisor & Project Manager in the Collaborate & Innovate Team
  LG Electronics
• Bridging Open Innovation Gaps - Andrea  and Dana Myer, Partners in Working Knowledge
• Soft Skills for Open Innovation - Gail Martino, global Open Innovation R&D Manager at Unilever and John Bartolone, Director of Open Innovation for Unilever 's Skin & Hair Care division
• and more.

I have to stop right now. Otherwise I will resume reading this book and not finish this review (which really does not do justice to the book and the possibilities it opens to its readers).

What is the music from this symphony of innovation star players? Their music is the music of possibilities. It is complete with a guide and resources and examples for you to begin at least humming along. And you can start today.

Think about it.

• What would be possible if you could draw on a global community of experts whose expertise are ones you cannot justify or afford on a permanent basis.

• What would be possible if you could draw on just a few of these experts on an as-needed basis?

• What would be possible if you could have one or two more ideas....each day to pursue? And pursue it with experts who are passionate, skilled and talented?

• Or what if you these experts could help you eliminate these ideas faster so you could focus on the ones that will sustain your business?

• What if you could find inexpensive or even free resources to reach out to the global community of experts?

• What if you could contribute your ideas?

• What if you could openly discuss your challenges with a very targeted, specific group, of people who share your challenges...in business or life or relationships or health or sports or community building...?

See? That's the key first step in innovation. Asking ...what if?

But it's only the first step. And these authors nudge and push, pull and inspire, empower and enable the reader to take the next step and the next and the next.

Innovation is a journey. And on any journey of discovery you still need a guide. And these leading experts in innovation have come together to create a guide that will keep us all smiling, moving forward and humming our own song of progress.

So, buy it, read it and start moving.

Matthew May! What Are You Reading?

Matthew May joined the show recently to talk about his excellent new book: The Shibumi Strategy: A Powerful Way to Create Meaningful Change.

You can listen to our conversation here. You can read full transcripts here.

Matt's a leader. It made sense to ask him:

You’re a leader. Leaders are readers. Jim Rohn said that. What are you reading for work or play?

And he generously answered:

I just finished reading a great book by Steven Shapiro, an innovation consultant. It’s called Personality Poker and it comes with a deck of cards.

Where Good Ideas Come From by Steven Johnson...by the way I review books on a weekly basis for Open Forum.

Resonate: Present Visual Stories that Transform Audiences, by Nancy Duarte. It’s about how you craft a story for presentation. Just a great book that everyone should read because all of us have to pitch an idea sometime.

I Live in the Future & Here's How It Works, by Nick Bilton, NY Times blogger.

Those are some of the books I’ve been reading that I get inspiration from.

**********

Leaders are readers.

That is how you create a culture of learning as Gary Harpst talked about in an earlier show. That culture of learning is critical if you want to continually learn new tools and resources and skills and master more talents. That is how you discover new solutions for the new challenges that your growth will bring. That is also how you develop a culture of leaders. Learners are leaders. Reading is one way you learn. Reading what leaders read is one way you accelerate that learning, accelerate that leading for yourself and your company.

5 Guidelines, 3 Tips, for a Successful Presentation

Sam Harrison is the author of a fabulous book titled: IdeaSelling: Successfully pitch your creative ideas to bosses, clients and other decision makers. He joined the show recently. You can listen here.

I read a lot of books as part of this show. This book was one of the most compelling, best presented, best organized book that walked its talk. At first glance, I thought it may have been...light. But as I read it I found I couldn’t put it down. In fact, I found that each page triggered so many ideas and ways to apply what Sam shared on how to successfully pitch creative ideas.

Sam’s a veteran of pitching ideas: He’s has been on all sides of creative communications, marketing and branding – the agency and freelance side, the client and corporate side and, most recently, the academic and consulting side.

So, naturally, I asked him about the ideas he shared in his book on delivering great presentations.

I asked him:

You profile and shares tips and advice from a number of great presenters. Who was your favorite? What best practices did they use in their presentations? Would those work in today’s culture?

And he said:

One of the things I’m most proud about in IdeaSelling is the ideas don’t come out of my head. I relied on a lot of smart people...out in the trenches selling ideas every day.

One person, a historical figure, is Winston Churchill. He’s one of history’s greatest orators and persuaders. I used his 5 guidelines on how to make a successful presentation or speech. That would be the one person I would pick, first and foremost.

Note: He profiles a lot of smart people in his book and their ideas. By coincidence, I'm a fan of Winston Churchill and this section caught my attention even before this show.

I asked him:

What were his best practices?

Sam shared Winston Churchill's 5 tips:

He had 5 little tips.

1. Have one theme.
2. Have a strong start. Get everybody’s attention.
3. Keep it simple, not simple-minded.
4. Paint pictures. Show, don’t tell.
5. Add drama, appropriate drama, so it’s interesting and fun.

Sounds so....simple, right?

One of the reasons you’re on the show today is I liked your pitch. It was simple, direct, with a medium I used: You tweeted me if I wanted a free copy of your book. That was it.

How do presentations get so complicated?

And Sam, once again answered:

I think it’s because we’re far too focused on our selves and our ideas to be much value to others...rather than immediately knowing the wants and needs of our audience and going straight there.

What? Narcissism is only interesting to ourselves?

How do we solve that then?

What are the three most common complications in a presentation?

Sam answered:

Narrowing it down to three is tough.

1. Overwhelming the audience with our research.

2. Presenting the idea in the same way that we created it. Creativity is sometimes a messy process. It takes a lot of going in different directions to create an idea. Sometimes we try to make that pitch flow in the same way. We need to make it more of a linear flow, A goes to B goes to C.

3. Not helping the audience visualize our idea and how it plays in the real world. We leave the listener with confusion or vague ideas about how our ideas can help.

Want more from Sam Harrison?

• Read more transcripts from our conversation here.

• Savor his Zingful Tenets

• Visit his Zing Zone website

• Follow him on Twitter

3 Questions to Drive Curiosity...Again and Again

I spoke with Josh Linkner recently. You can listen to our conversation here.

Josh Linkner is on a mission. His mission is to make the world more creative.

He's written a fabulous manual to do just that: Disciplined Dreaming: A Proven System to Drive Breakthrough Creativity.

Josh is the Founder, Chairman and former CEO of the largest interactive promotion agency in the world, ePrize. Josh led the firm from inception to being ranked the #1 fastest growing and #3 overall promotion agency by PROMO Magazine.

Recently, Josh launched the venture capital firm Detroit Venture Partners,actively investing in early-stage techn companies looking to rebuild the Detroit region through entrepreneurship.

During one of his great answers he talked about the 3 questions that drive curiosity again and again. He said:

The way to drive curiosity is asking these questions again and again and again:

• Why?
• What if?
• Why not?

Well, that is nice. You might think that now. Who cares about driving curiosity in a business, right?

Here is a good reason. Again, quoting Josh:

If you ask those constantly it forces you to challenge conventional wisdom.

It forces you to attack the status quo and refuse to accept things as they are on the surface. It forces you to examine the possibilities of what could be.

Aha. Now we get somewhere. What could be.

Again....why does that matter? Business deals with ...what is. Right?

Here is the home-run pitch:

And even in the most stifling bureaucracies today, they were founded on curiosity and innovation. They didn’t get on the map by being bureaucratic. They got on the map by being innovative. Unfortunately, though as most companies grow they tend to loose that heritage of innovation and curiosity. That’s what we need more than ever in today’s business world.

A heritage of innovation and curiosity. That is what is needed now than ever in today’s business world.

So, let me ask the question:  

Why? To create the ideas that need the small businesses that create the new jobs that drive our economy out of this rut.

Why not? Why not encourage companies to educate and train their stakeholders to ask these questions?

What if...all companies, and schools, encouraged their members to ask these questions?

We would create a sustainable heritage of innovation and curiosity...that's why.

Designing Curious Employees

Design thinking is a process of empathizing with the end user. Its principal guru is David Kelley, founder of IDEO and the Hasso Plattner Institute of Design at Stanford (otherwise known as the d.school), who takes a similar approach to managing people. He believes leadership is a matter of empathizing with employees. In this interview, he explains why leaders should seek understanding rather than blind obedience, why it's better to be a coach and a taskmaster and why you can't teach leadership with a PowerPoint presentation. via www.fastcompany.com

I like this post a lot.

The idea that companies can design employees to be curious....is curious. Maybe it is a semantic issue.

We are born curious. Our design hard-wired us to be curious. Whoever did that, however that was done...the bottom-line is we emerged with a heaping helping bias towards curiosity.

That is design from the inside out. All that needs to be done is:

• create a culture where curiosity can flourish

1. align curiosity with an organization's purpose.
2. offer the tools to allow our curiosity to manifest, express itself, connect with other's curiosity
3. align incentives for curiosity's expression
4. help foster communication and collaboration

There is much more to this discussion. But my point is curious employees already live and work in any organization. Just get out of their way and encourage their natural curiosity.

Investing $100,000 in Students

Early Facebook investor and Paypal cofounder Peter Thiel thinks college is overhyped. Now he's giving 24 kids a tempting alternative to higher education.

Thiel is going to pay some big-dreaming teenagers $100,000 over the course of two years to pursue their entrepreneurial dreams. via Business Insider

There is a theme here.

Jodi Glickman shared the story of Warren Buffett and his address to Columbia Business School students in 2009. She shared it in her book Great on the Job: What to Say, How to Say It. The Secrets of Getting Ahead.She wrote:

Buffett was asked the one piece of advice he'd give to new graduates. To much applause and laughter Buffett responded:

"Right now, I would pay a hundred thousand dollars for ten percent of the future earnings of any of you. If that's true, you're a million-dollar asset right now. You could improve of that, many of you, and I certainly could have when I got out just in terms of learning communication skills. "

Marrying up the two ideas to invest $100,000 in students I see a common theme beyond the amount and the target. That common theme is that the ability to conceive and communicate ideas...to gather those resources around an idea and begin to execute that idea...is the ability that determines future success and future earnings ability. Those who have this ability own the future.

So....tell me again why schools are focused on standardized test scores.

And, tell me again, why communication skills are being taught...well, nowhere in business or in our educational system.

3 Questions to Guide Quiet Reflection at Work

Matthew E. May is an internationally recognized expert on change, innovation and design strategy. He is a columnist for the American Express Small Business OPEN Forum Idea Hub.

He is the author of a fabulous book on innovation, change, disruption...leading it, benefiting from it. That book is The Shibumi Strategy: A Powerful Way to Create Meaningful Change.

He shared an hour of his time recently with me to talk about this book and its lessons on innovation, change, disruption...leading it, benefiting from it...in our personal and professional lives.

Quiet reflection is a key to benefiting from change and disruption. Given our interesting times and my wish to leave listeners with actionable takeaways from each guest along with Matt’s discussion in The Shibumi Strategy of the role of quiet reflection.

I asked him:

The act of reflection and how to execute it within a business environment. I don’t know of many companies that have time for much reflection. For critiques, for performance evaluations, for comparing real vs projected, sure. But quiet reflection? How does a company begin to incorporate time for reflection into their daily routine?

And he answered with clarity and precision:

Reflection meaning not staring off into space and considering the meaning of life, but having a purpose.

Generally speaking, here in the US we only reflect when things go bad oftentimes to place blame. But, there’s no real learning in that.

Children in Japan are taught reflection as soon as they begin school. It’s irrespective of what that outcome is.

It’s basically 3 questions:

• What did you plan to happen?

• What happened?

• Why?

And let’s stay with that metaphor and let’s say here in the US your child comes home with 1 A’s, 2 B’s 2 C’s and a D. Generally speaking we high-five on the A’s. And don’t give it much thought. But, what happened on that D, man? Why did you get that D? What’s going on there? Well, get in your room and work harder.

And good job on the C’s and B’s, work harder and maybe bump up them up to be B’s and A’s.

There’s not a lot of reflection on that outcome.

The child in Japan is taught to reflect on the A.

• Did you intend to do that?

• What did you do different?

That’s a gap.

Here in the US when we exceed an expectation we do the end-zone dance. We don’t try to unpack.

• Why did we overshoot that mark?
  
• Shouldn’t we be meeting these expectations?

A number of companies do this. BP, believe it or not, has a robust process for reflection and review. [I remain skeptical...] It’s patterned after the Armys After-Action-Review.

An after-action-review is a safe haven for learning. It’s a regular meeting that occurs after every milestone has occurred, not just at the end of a deployment. You’re just rying to answer those three questions:

• What did you plan to happen?

• What happened?

• Why?

It’s about goals and tasks. It’s not about placing blame. It’s not an outside facilitated thing. It can’t happen without everyone present. You’re just trying to answer three questions.

Want More from Matt May and The Shibumi Strategy?

• Listen to our conversation about The Shibumi Strategy at this link.

• Read transcripts of our our conversation about The Shibumi Strategy at this link.

• Follow him on Twitter at MatthewEMay.

• Buy his previous books, too. (That assumes you will buy The Shibumi Strategy )
  

The Missing Protection for Your Business Model

The only real way to grow sales and profits is to create innovative offerings with some "must have " that define new categories or subcategories for which competitors are not relevant. 12 Barriers That Keep You From Ripping Off Your Favorite Brand

Excellent post. Excellent list of 12 barriers to keep you from....ripping off your competitor's business model or yours being ripped off in turn.
The one missing protection was engaged employees.

Who creates innovative offerings with some "must have " that define new categories or subcategories for which competitors are not relevant...?

Mmmmm?

A bored, disengaged, dispirited, demotivated workforce...you know like that created and sustained at 70% of the companies worldwide?

No.

Check out those brands whose business model you may covet...and you'll find higher levels of engagement among those who spend the majority of their waking hours in service to creating that untouchable business model.

Of all the assets a company cannot duplicate nor compete with it is the engaged employee that ranks at the top.

IP, intellectual property...? Really? Whose unique insight and creativity and skills and talents created that IP?

Customer loyalty? Really? Customers are loyal to people, not brands. They are loyal to your employees and the relationships that are built.

Scale? Scale what and with whom? You're going to scale what your employees built and scale it with your employees.

Brand Networks? Excuse me. I mean really. Who makes up those brand networks of Apple App developers and organizations involved in raising babies. ( Jeez, that last term sound like some Orwellian system of franchised child-rearing institutions. Here's a clue: It's mothers. Don't ever, ever, piss them off or you will find out just how organized they are individually and collectively in raising babies, their babies.)

Brand equity? Who owns that brand equity? Your employees. If they forgo ownership you have nothing to sell.

Branded differentiators? Who created them in the first place? Yeah and who's already got them in their sights to put them out of business with a better offering. The employees of your competitors who are more engaged and less satisfied than yours.

Exemplar status. I don't even know what that is. It might be because I don't use any of the brands that are thought to exemplify this. But, then neither my self-identity nor my tribe are determined by where we buy groceries or what car we drive or phone we use, either.

Again, these are all valuable symbols and buzzwords that save time in a conversation.

But they only matter because they symbolize the engagement of those who do the work, every day, to make them matter: engaged employees.

Joan - Koerber Walker, CEO of Arizona BioIndustry Association: Notes from Our Conversation

She was a guest on this show during the time she was founder of CORE Purpose which specialized in building solutions that enable its clients to focus more of their resources and energy on what they are passionate about and best at in a way that makes financial sense

Joan has recently been appointed as the CEO of the Arizona BioIndustry Association whose purpose is promoting the growth of Arizona bioscience companies. I don't know much about that organization except they made a very smart decision when they chose her to lead them.

Her past experience includes 2 years as the CEO of ASBA (the Arizona Small Business Association), service as a member of the Board of Trustees of the National Small Business Association in Washington D.C., a member of the Executive Committee of the Industry Advisory Board for the Thomas and Joan Read Center at Texas A&M University, on the Board of Directors of the Arizona Technology Council and as Treasurer and Board Member for Ribomed Biotechnologies, Inc. in Carlsbad, California, and as an executive at Avnet, Inc, where over a 20 year span she held a wide variety of roles in sales, marketing, technology, public policy direction, and risk management solutions to business along the growth path. In 2004, she was recognized by the Stevie Awards, the "Oscar" for women entrepreneurs as one of the leading entrepreneurial women in the United States and again in 2007 as one of the nation's leading small business executives.

You can listen here.

Joan. Thanks for being on the show.

Thanks, Zane. It’s always great to be here with you.

Congratulations on this new challenge! When did you come on board with the Arizona BioIndustry Association as their CEO?

March 21 was my first day on the job. I don’t think I’ve stopped running since.

We talked about this briefly before the show and it’s not on the questions I sent you earlier, but what are you doing with CORE Purpose?

CORE Purpose, which was started in 2002, is continuing. The goal of CORE Purpose is to work with companies to address big challenges and create greater opportunities. We have wonderful team of collaborators which we work with there. And sometimes I think they’re perfectly happy for me to get out of the way so they can get some work done.

I’m curious about that. So many leaders, entrepreneurs, are unable to step out and let go, to let their members step up and pursue their passion, do their work, and get things done. Why were you so comfortable in taking that step?

The benefits that we have are that we practice what we preach. You have a clear vision and understand why you are business. You focus all your resources on that and you select great people. And, when you have great people on your team and have clear direction then you don’t have to be looking over their shoulder every day.

As Chairman of the Board I can step back, be available when they need me, but equally importantly I can let them do what they do because they do it so well. That’s always given me the flexibility. And the first time we experimented with that, 2006 to 2008, when I stepped out to lead the Arizona Small Business Administration, and this time to lead the Arizona BioIndustry Association which is crucially important to our state’s growth, it was a great opportunity and the group was very supportive of it.

I think the talk at the water-cooler was:

“Oh, good. She’s going to go let us do our thing while she goes and does hers.”

I think it’s fabulous testimony to your skills and what you would bring to your clients with CORE Purpose. You practice what you preach. You’re clear on it. You focus on it and you hire great people. Now, you stay out of the way.

The neat thing about CORE Purpose is we just hired some people. We had a collaborative team we had built of CEOs and leaders from around the country. They’re all leaders in their own right. They don’t need me to baby-sit them.

Fantastic. I’ve already started scribbling.

Tell us a little bit about the Arizona BioIndustry Association. When was it started? What's a standard member profile? Are they startups, global corporations, incubator-phase? How many members?

The Arizona BioIndustry Association was started 4-5 years ago. But, before that, it was called a ‘cluster’. And a ‘cluster’ is a group of companies in a specific industry that comes together to collaborate, to share ideas and connect.

And as the industry began to grow it needed more than that. It needed training and education and a voice in the community.

And, so, the leaders of that organization said at the time they were ready to go to the next step. And they formed the Arizona BioIndustry Association which is affiliated with BIO which is the international organization which is in DC and started to take it to the next level, putting in infrastructure, adding leadership, creating a voice and a structure so that more good work could be done in the community and the industry could really start to focus on gaining critical mass and supporting not just the companies that are members but the people that are inside those companies.

So, as the industry is really taking off, and here in Arizona we have had some really tough times. The Arizona BioIndustry Association, which spans a broad contiuum of business from agribusiness to healthcare to pharmaceuticals and medical devices and lots of other things, that industry grew jobs by 7% in the state of Arizona in 2010 where the rest of the industries in the state saw a negative job growth of 10%.

When we look at what is going to be the key driver to move our state forward and diversify the economy, then BIO’s it.

This is really an exciting opportunity at a very exciting time.

Let me repeat what you just said:

The Arizona BioIndustry grew jobs 7% in Arizona in 2010. In 2010, the Arizona BioIndustry grew jobs by 7% while the rest of the state lost jobs by 10%.

I feel like we ought to just repeat this over and over. Maybe people will hear it. Maybe we can help them with the math, you know 7% increase vs 10% decrease...What are they doing right?

But, we’ll get to that.

Now, what’s a standard member profile? Are they startups, global corporations, incubators?

The neat thing about our Arizona BioIndustry and our membership is that they span that continuum. We have fabulous incubators like BioExcel which support new technologies which are spinning out of research facilities like TGen, the Translational Genomic Research Institute and our biotechnology research institute at our Class 1 resarch organizations like Bio5 at the University of Arizona and the Bio Design Institute at Arizona State University.

When those new technologies are coming out, they need support. And an organization like BIOExcel is there to help them. And our  Arizona BioIndustry Association, AZBio, we’re there to help bio excel with the connections and resources and the things that they need to do a better job.

And on the other side we have incredible anchor organizations, corporations that are globally known. We have incredible new startups. On top of that we have fabulous medical device companies, like MedTronic who just announced the new President, Chairman and and CEO is coming over from GE Medical.

We have global giants and the next global giants spinning out of research.

This is a very exciting place to be. This is where bio works, in Arizona.

Now, the accomplishment of AZBio members to grow jobs by 7% while overall jobs dropped by 10% is an accomplishment that stands alone for most industries. Is there a success from one member that is most representative of what Arizona BioIndustry can do for members?

I think what you’re going to see is are those small companies that really take off. We’re starting to see that with our emerging companies.

The other factor is the population and demographic and the changes you will see in healthcare. But, when we look at the changes we need to understand how to serve patients better and how to deliver patient care in the most cost-effective ways. And many of the new technologies, the things that are coming out, are just that. Better patient care, higher standards relative to the drugs and resources and research and medical devices helping in that way.

A lot of the growth in the jobs come from companies just like that.

BUT, there’s more to bio than just medicine. And that’s what most people don’t understand. Most people think when you say biotech that they are either going to pop it in their mouth or strap it to my body, right? But, the reality is that bio is so much broader than that.

And so, one member company I got to visit last week that just blew me away is the Algae BioSciences Corporation. A little bit town in northern Arizona called Holbrook. It took me 4 hours to drive from Phoenix, Arizona, to Holbrook, Arizona. The most gorgeous scenery you would ever imagine.

And when I got there I got to this huge flat plot of land wth this little company right in the middle of it. And there was this company with this state of the art greenhouse. And I’m thinking:

“I’m standing in the middle of the high desert. How could they grow algae here?”

But, the reality is that there is a unique geological structure there that you can’t find any other place in the US. And that is a 1000 foot deep salt plateau. And across that salt plateau runs underground springs and rivers creating a huge pool of absolutely pure salt water. And salt water is what we grow algae in. So, they are able to grow all different forms of algae that are pure and not contaminated by what is included in our above ground bodies of salt-water.

Think about the application for algae. I know it’s high in nutrients. You can take nutrients and convert it into fuel. You can take algae and convert it into vitamins, minerals and very important added elements important to the pharmaceutical industry. Think about some of the dangerous things that have been done in food science over the years. The dyes that have been added to foods may not be safe for us. And naturally occurring in nature are different food dyes which are different forms of algae.

This new corporation is going to be able to farm pure clean uncontaminated algae sources. The potential for that company is incredible. It’s going to change the basis of the employment base in rural Arizona but also in our centers in Maricopa county.

Think of the possibilities and opportunites that the company is going to create in the next couple of years.

That’s a great profile. That’s such an inspiring story I’m ready to cut off the show and go look at Holbrook, Arizona.

You know what? Bring your sleeping bag and we’ll go camping along the river up there. It has some of the most incredible vistas in the world.

You got it.

Now, you recently write a great post at your blog titled The Best Support is Bi-Directional. You wrote:

I need the help and support of others to get the job done. This week, at one of my many meetings, a fellow board member shared a thought that has really stayed with me. “We need to provide value BEFORE we ask for support.” As I have continued through my week, that message kept coming back to me.

What value will you provide your members or why should a bioscience company in Arizona join the Arizona BioIndustry Association?

The reason our members join AZBio is they understand what all of us learned along the way which is:

“You can’t do it alone.”

No one can do it all. No one can have access to every resource. When we come together to share resources and skills and ideas we grow faster.

And, faster is a theme is what our members hear from me as I talk to our members, our our communities, our state and our world. We need to move forward faster.

AZBio is putting the programs into place to enable that activity. What I mean by that is:

You need to have an environment where you can move forward faster. that means the right support from your government. So, we monitor, educate and inform in a bi-directional way. We’re talking to our members and we’re letting them know what’s happening in Washington and our state capital, Phoenix.
 

Equally important, we’re talking to our representatives on the local, national stage and helping them understand the importance of bio in our community and what that means if we’re going to grow. If we foster growth, growth fosters jobs, jobs grow the tax base and we dig our way out of this hole that we’re in. And as we go forward, it’s very important that there’s two-way communication. So, advocacy is one of our key value add propositions.

Another one is connection. Zane, you and I have run startups. It’s so easy. whether you’re in a big corporation and a small one to get so focused in on the big pile of stuff on your desk that you never move outside your office. And if you’re not outside your office, you’re not connecting.

One of the things that we’re doing in northern Arizona, central Arizona and southern Arizona is a series of educational workshops that we’ll be able to roll out so that members can come out and connect with each and get great education and take back to their businesses so that they can move forward.

That’s another reason why you want to be involved and engaged.

Sometimes you want to kick back and have a little fun. And, as you know, my great-great-grandfather, my grandfather and my father all used to be brewers. And so, I found that in Northern Arizona they held an event called Beer and Bio. I thought “Cool!” So, now we’re scheduling Beer and Bio events around the state, so that once a month, we can kick back maybe at a member’s location so that we can get a little tour or at a local establishment where we can connect together on a social setting. And when we do that we start to have conversations.

And when we do that I say to you:

“Hey, Zane. What’s up?”

And you tell me something cool then I can spread that to the next person and the next person. Who knows you might hear your story on BlogTalk Radio.

So, as we go forward, having these opportunities for members to connect either socially or from an educational perspective then the next thing we’re looking at is how to engage the community. I don’t have 2-300 employees. I have a very, very, small team. We need to multiplex our resources. The way we have done that is we’re establishing both committees, who roll up their sleeves and get things done, and councils who share ideas.

So, our committees are our marketing and events and government affairs committees. These are all groups of members who are coming together to help build a vision, then the plan and then execute on it.

On the other side of it, we need to have councils where we can go deeper into an organization and help them with the things they need internally to grow their businesses. Those are things like human resources, supply-chain, and benefits and other things that we use to build our businesses and investments. You can’t grow without capital.

Our HR Council, our Supply-Chain Council and our Investors Councils are really going to be focused on those facets of business where the purchasing person or the HR person or the finance person can get together with their peers and find the things for growing their businesses and moving forward faster.

With all that can you afford not to be involved with AZBio?

I love it. I love that last line: Can you afford not to be involved with AZBio? You’re a closer!

I am the closer! I’m the CEO.

With all the points you brought up that’s a great way to end that conversation.

My friend, Erika Andersen, coined a phrase and question in her book Being Strategic, I use in nearly all my interviews. The phrase is reasonable aspiration or hoped-for future. And her question is:

What is your reasonable aspiration or hoped-for future?

What is the reasonable aspiration or hoped-for future with the Arizona BioIndustry Association?

I think a very reasonable aspiration for AZBio is that we do a better job of unifying internal organization which is our state but also connecting to outside the state.

Bio is not real estate, ok? If you’re doing real estate, you’re really focused on that plot of land. If you’re doing a bio site, you’re ocused on the world because the world is yourcustomer.

Our reasonable aspiration is we form a unified group inside the state of arizona that allows us to take the message of what’s happening in Arizona to the rest of the world. We’re taking the first step in the last week of June. I’m going to be in DC at the BioIndustry Convention and by partnering with our Arizona Commerce Commission we have a beautiful 600 square foot pavillion which is showcasing what’s great with Arizona and Arizona Bioscience. So, that’s how we partner and collaborate internally to take our message externally.

It’s fulfilling our mission which is to be best in-class at home and spreading the word around the world.

Being the excellent CEO, leader and innovator that you are, this next question should be easy to answer. What are the metrics you'll use to measure your progress towards this goal?

Ok. So, when we look at our internal metrics and external metrics, one of the things we often forget is that you have to run a great organization internally before you can support others externally.

We have two sets of metrics. One set is internal metrics and that’s specifically looking at what are our membership numbers, what is our financial strengths, what are our retention numbers not just what we’re attracting but what we’re keeping.

When we look externally we’re looking at who are the companies that we help to grow. What are their metrics? What is the job growth? What is their installed base? How are we helping them reach critical mass. What new companies are we working with to help attract economic developers to bring here and keep here?

So, it’s a two-pronged thing.

1. How do I run my company?
   
2. What is the impact my company has on the world around us?

We measure it from both perspectives.

What is the biggest challenge facing the Arizona BioIndustry Association? As a non-profit, it's likely funding. But beyond that, what's the biggest challenge you face now?

I think the biggest challenge we have in our association is the same in many organizations. It’s trust.

And, when you look at a state like Arizona where we have a very large land mass it’s very different in northern Arizona than it is in central Arizona then it is in southern Arizona. So, there’s always that concern that one area is going to get more resources than another.

One of the things that we have to very sensitive to is we have to support all of our members. wherever they are in the state, equally, to make sure they’re getting all they need to move forward faster. We need to demonstrate that we can deliver that quality of service so that they can trust us.

Trust is not something people give you; it’s something that you earn. So, we have to earn the trust of our members because they’re trusting us with being their voice, their dollars and the investment of their time. Every hour that they spend with me is an hour they are not spending the lab or talking to a customer. So, that’s a really big investment and they need to trust us that there will be a return on that investment.

And, yes absolutely, money is always an issue. If we’re going to grow and offer more and more resources that’s going to take more and more money or more and more people. We have to figure out what we can do to earn that money in the same way that we earn that trust.

The days when industry associations or charities or business could go to an investor or sponsors or supporters....call them investors....the days when you could go to an invest or and say “Hey, I’ve got a great new idea; give me some money.” are over.

What we need to do is ask questions and listen to the answers.

• What is it that our partners need?
• Do they need help with their economic development efforts?
• Do they need help with working with the legislature?
• Do they need help in spreading the word that Arizona is a great place to locate, fast-start and grow your bioindustry company.

So, if that’s the case, then how can we provide services that we can get paid for that will allow us to number one grow what we offer these communities, but more important, fill a gap that that other partner or organization might need.

So, as we move forward, we really have to focus in that way.

That’s a great description and it’s surprising and illuminating to me that trust is your number one issue. But, as you’ve described it it’s clear why trust is so important.

The way you’ve outlined it is so clear in your presentation and how you will achieve it for all of your members is very nice.

I have what I think is a naive bias in favor of bioscience companies. It’s only reinforced when I hear that statistic:

• 7% job growth in a state with an overall job growth of negative 10% in the year 2010.

I hear that term and I think lots of smart and motivated people, gleaming offices, lots of cash, each company a bubbling font of ideas. Is that naive?

Oh yeah. Don’t get me wrong. Some of our global leaders have these beautiful facilities and fabulous resources. I encourage your listeners to Google the term BioDesign at Arizona State University and Bio5 at University of Arizona.

For most of us, Bio is an industry. And an industry is where you knuckle down and do hard work. Whether you’re toiling in a lab or working in a manufacturing facility or building the next healthcare services, in some of our leading research universities. Like you see on TV, it’s nuts all the time.

Yes, there are exciting breakthroughs all the time. But it takes investment and it takes talent and a community that understands how to attract that talent and keep it. That job growth is going to be continuing because there’s a demand for the products, services and technologies that are being developed by our bioscience innovators in multiple industries.

But at the same time it is hard work and if our investors aren’t paying attention and if we don’t attract global investment to supplement what our global investors can do the industry will not move forward as fast as we need to.

I want to respect your commitment to your member's confidentiality. On the other hand, I am incurably curious. Are their challenges for innovation, sustainable innovation, visibly different than their peers in say the manufacturing industry?

Now, remember there is manufacturing in bio.

When we look at taking an idea or a discovery out of a lab and moving it to commercialization, creating a product and then to innovation which is where it is globally accepted, the biggest challenge that bio faces is that it is a heavily regulated industry. As we are moving those things out, there are multiple stages of clinical trials and multiple approvals you have to get.

There are longer lead times with certain bio-science innovations than you might find if you’re launching the next Twitter. You don’t have the FDA breathing down your neck.

From that perspective, yes, there are more challenges. There’s a longer investment cycle. But it can have an incredibly large return.

There is a large educational process to understanding what it takes to move from discovery to commercialization to innovation. Part of our job is to help people understand that process and recognize the milestones along the way and celebrate each time they pass a milestone.

We’re starting to see certain things fast-tracked because of their global needs.

But there will always be a higher standard of quality that is applied, especially in those biosciences that effect human beings. There is going be a higher quality of care because of the importance of what it does. And, quite frankly, if I’m the person taking the drug or having the artificial knee or an artificial heart put in, when we look at those things it is very frustrating to have to jump through all these hoops. But we want to make sure these products are safe and secure and well-tested before we start applying them to human beings.

It may be too soon for this next question. But asking untimely questions has never been a fear of mine. I see the members of Arizona BioIndustry Association being like star performers. Extremely talented, accomplished, driven, demanding. That’s a huge asset.

But it presents a different challenge for you as the newly arrived CEO. Your job title might be more like a symphony conductor where the players are talented, expressive, and...demanding they be heard.

How will you turn the sweet sounds of those voices into a chorus of success both for them and the association?

I tend to look at it more as an amplifier. They’re already an incredibly chorus. AZBio already amplifies what they are doing.

My job is not to direct what they are doing. My job is to take what they are creating and make it available for a wider audience. As they tell us what they are doing, as they tell us what they need, as they share with us how they need to work with other people and collaborate or how they want to help...then our job is to take the wonderful thing that they are doing and amplify it.

Our job at AZBio is about them. Our job is to make sure more people know what they are doing and want to get involved.

That’s a great answer. Amplify it. They are lucky to have you!

Now, anytime anyone mentions innovation and leadership, they usually follow with a lament on our educational system. We're not teaching the students the right skills to think, to communicate, to collaborate all being the skills needed for tomorrow's companies. In fact, IBM's CEO was quoted as saying that in the next 10 years that 50% of their revenues will come from sources that don't exist now.

Do you agree about the disconnect between what's taught today and what's needed tomorrow?

Yes.

First of all, I want to say that our educators and teachers work so hard. And they truly do want to make a difference and they’re not in it for the money.

When we look at our emphasis on STEM today and STEM stands for Science, Technology, Engineering and Math. Those are obviously when we talk about them at AZBio, we are focused on designing new products and discovering new things. Science, math, statistics, engineering, forecasting, economics. All of those things are critically important. We need to develop that.

But we need to make sure we do not overlook the other things that are equally important. The ability to share and communicate. The ability to put your ideas down in writing. The ability to solve problems creatively. These are not necessarily going to be solely in a STEM curriculum.

So, we need to find needs to be a balance not just to be able to discover but to be able to tell people you discovered it and then find a creative way to move from step 1 to step 2 to step 3 so you are truly innovating.

Part of it is that we need to as an organization, a community, a state and as a country we need to understand at the school level teach those foundations: critical thinking, communications. Yes science, technology, engineering and mathematics are critically important. But just as parents, we’re wrong if we abdicate learning to the educational system, we have to be involved too.

If you look at an industry the same thing applies. We have to create internship programs, have mentoring programs. We have to go into those schools and be part of the educational systems. Have a place where students can come meet the companies and get inspired. You can’t expect a teacher to do all of that.

Coming up in 2012, we have a pretty big party that we’re throwing in Arizona. On Valentine’s Day, 2012, Arizona is going to celebrate it’s 100 years of statehood. One of the things already in the works is listed on our website. There is going to be a big exposition that is working with our educational community talking about those fabulous things that are happening in our scientific community.

That’s fantastic.

We've reached the imagination moment in our show. Let's imagine President Obama has been listening. And he's calling you right now during the show.

Joan, he says on your answering machine.  May I call you Joan? Look, you and I both know our country needs some help in innovation. I'm locked inside the Beltway and I need to hear directly from innovation experts like you. What if you came up to the White House, met with Joe Biden and I, and talked about innovation. We'd like to hear your thoughts on three things our country can do right now to reverse this slide in our global innovation rankings. Could you do that?

What would you tell him?

If I was going to look at the three things we could do on a national or global level, as a country I would say that:

1. Let industry and the community be the focus for innovation and for the government to get out of the way. As we start looking for new opportunities we need a way to create clear pathways. Government needs to enable, not do. Just as a leader I need to enable, not do. The way government enables is to fully fund and support organizations like the national institute of health, the national cancer institute, the department of energy, who are taking dollars and allowing them to be applied into commercial and research applications so that the industry can move that forward. The industry is going to be able to do that much more effectively.

2. We have got to focus on protecting the innovations that we are creating. that means that the work that is being done at the USPTO, the US Patent and Trademark Office, needs to continue to be best-in-class organization on a global basis. Part of it is to stop raiding the coffers at the USPTO and putting their funds into the general funds. What happens is if we keep pulling resources out of the USPTO, then we don’t have the resources to move those patents forward faster. And if we’re not moving them forward faster then it is harder for those companies to get investment dollars. 47:40

3. Continue to focus on the key national resources we have that will inspire the next generation of innovators. You look at NASA. NASA is one of our crown jewels. There is a tremendous amount of work going on, not just in the biosciences, but in engineering and multiple areas that is happening at NASA. Taking the focus of science and technology and spreading that further around the world and to our young people, just to inspire them, as when I was a little girl. I grew up when we were in a race to put a man on the moon and bring him back safely by the end of that decade. We need another challenge like that. And that’s something that President Obama might want to think about issuing. And then fully funding it.

Leaders are readers. Jim Rohn says that. I just like it and use it here on this show. You're a leader, have been for over 20 years. What are you reading for fun or work?

What am I reading for fun and work?

These days I’m reading a lot online. I’m reading a number of blogs. I get up, as you know, Zane, every morning at 4 AM. And I have my Financial Times, my LA Times, my NY Times, my Arizona Republic, my business journal...all those are at my computer so that when I get up at 4 AM I can see what’s happening in my community, my state, my country and my world.

I’m reading a lot of motivation stuff, right now, as well as all of those medical journals and all of the other things that I need to really focus on.

Unfortunately, my book pile is starting to pile up right now.

As we move forward there are some great books on my bookshelf right now. I’m going to be pulling them out. Ken Blanchard’s books on Leadership. And Posner’s book on leadership. There’s a new one out by Steven Covey specifically on building trust in the organization that I need to pick up and read.

As we move forward I am always going to investigate to stay up on current events.

Right now, I’m really focusing on those areas and if you’re on top of it then you’re one step ahead of the competition.

Let’s say we talk in a year and I expect we will, maybe even in less than a year, what’s the one big thing you’re going to talk about with Arizona BioIndustry Assocation. One huge moment you expect to see.

Probably the huge moment that I expect to see when we’re having this conversation next year is we’re going to be talking more about growth and critical mass. As our industry continues to grow, it becomes a magnet. Like attracts like.

I’m looking forward to seeing our members and our state and our economy move forward faster. I think that’s what we’ll be talking about next year, just how far we’ve gone.

Love it. That is excellent. I’m really looking forward to seeing the progress you’ll have with the Arizona BioIndustry Association. I think it’s fabulous they chose you. I’m interested to see how you’ll lead it, amplify their voices and it sounds like a great opportunity for everyone.

If you can amplify 7% job growth then that will be fantastic.

From ’02 to ’09 our aggregate growth rate was 32%. It’s just that one year in 10 where it was 7%.

I hope the leaders in Arizona are listening. Here’s an industry that drives growth. Here’s a vehicle that drives growth in jobs, drives a tax base, that is sustainable for over a decade during some of the toughest economic times the world has seen. They’ve been able to sustain it. They’re at the edge o the springboard getting ready to launch another round of success.

Thank you. You know, the thing is, it all starts with conversations. Whether they reach out to me on Twitter at AZBioCEO or email me at JKW at azbio.org or call me with the number on the website, then thing that’s really, really important is that it all starts with a conversation. It’s not pushing information. It’s having that conversation. It’s asking questions and listening to the answers and figuring out how you can provide value around the answer you hear.

We all have that opportunity in our business whether you’re running a bioindustry association or a startup business or a Fortune 500 company. Hopefully, this conversation today will spark some new conversations and somebody that’s listening just might be part of that job growth in 2011.

Let’s go through all those sites where people can connect with you.

Probably, the easiest thing to do to connect with me is you’re trying to reach me at AZBio.

If you’re looking for me on Twitter I have lots of profiles. They focus on the things I do.

JoanKW
JKWinnovation
JKWGrowth
Leadership
COREpurpose

All along the way, if you Google Joan-Koerber Walker, you can come back to this radio show to find the correct spelling.

Thank you! I’m really looking forward to hearing your success this year and we get a chance to talk this time next year or sooner!

Thanks, Joan.