Creating Space

Welcome back to the Innovation Ecosystem. This week's post is going to be different. Rather than having a guest and having a discussion about change, and leadership, and innovation, as I've done in many of the previous episodes, I wanted, this time, to share with you some materials that I developed and gave, as part of a webinar the other day, in service of summarising many of the lessons that I've gathered over the months of running this show, and also to promote an upcoming event called the Innovation Leadership Circle, which won't be for everyone, and I'll leave the details of it to the end.

But, let me just take you through a set of materials which I pulled together, titled "Creating the Space for Innovation." In many respects, that's what we're doing with the show. We are inviting you to come out of your day-to-day life of always-on communications, with people making enormous demands of your time, and to reflect a little bit on different individuals with diverse perspectives on the subject of change, leadership, and innovation with the hope that it gives you some inspiration, some insight, some tools to actually progress your personal or organizational innovation agendas.

I really am grateful for your support for listening, for giving me some attention over the next few minutes as I take you through these materials. One of the things that I am hoping is that you're going to hear, perhaps, an example or a case study, you're going to hear something that really does resonate with you and your situation, or perhaps, you're going to see a way forward to help you better go after your vision. It's possible you might feel something that touches on your situation really profoundly that you can grab hold of and take back into the workplace.

It's also called Creating Space because the need to do this is a lesson that I relearn again and again and again. My early innovation mistakes were down to not creating this space, to not stepping back and reflecting, and not spending enough time on the questions that really do need to be addressed. In other words, not creating the environment or the conditions in my team of direct reports, or my organization for innovation to thrive. Creating space is a lesson I have to continue to learn and relearn. My intention is to use this time together to create this space.

A little bit about me, I'm an anthropologist by background, so I really do believe what Peter Drucker says that culture really does eat strategy for breakfast. I believe that the only truly sustainable source of competitive advantage comes from building a culture of innovation, and the next great new technology out of Silicon Valley, yes fine, but let's be honest, how much of that really does impact many of us in our business lives, and can be put into big use in helping grow our businesses. In many respects, there's a lot of hype there, which really doesn't actually have a huge amount of relevance for us on how we can grow our business.

I've been fortunate enough to work in some great companies over the years. For instance, Hay Group, where I was back in 1995 invited to launch the first online business in the industry, effectively, and despite the enormous amount of mistakes that I made, nonetheless, the team and the management were able to build this business out into $150 million business. When the company was sold to Korn Ferry for almost half a billion dollars, a significant proportion of the value of that transaction was embedded in that Information Business which we took on line in 1995. It really did begin back in 1995. More recently at Syngenta, where I led a $2 billion business unit, I was very fortunate to have a great team around me who came up with some, and executed some wonderful innovations, many of which are still in the market now, and actually growing significantly.

So, much of this article will draw on some of these experiences, but is supplemented by role as Chairman of a genomic software company called BC Platforms, based in Switzerland, which is very, very active in the whole ecosystem of gene sequencing, next-generation healthcare, and human longevity.

Then, most recently, I founded the Innovation Ecosystem, and I did this for three reasons. Firstly, to help build my network out after 12 years in a large organization. The larger your organization, the smaller your world. So, for me, it was really important to sort of branch out from as I left Syngenta and build out my network. Secondly, really to stay fresh and to supplement my experience with a far broader body of practical experience from a whole range of guests, some of whom you might have listened to on the show. Finally, to give something back, to make available the resources that I wish I had had access to, as well as those that I used, and that have had such a big difference in how I was able, with my team, to generate the results we have achieved over the years.

Over the last few months, we've conducted over 40 in-depth interviews with CEOs, with Heads of Innovation from world-class companies. In addition, we have many well-known experts in their fields talking about change, talking about leadership, talking about innovation.

A selection of these interviews you can see on the website, www.innovationecosystem.com. For example, we've had a polar explorer, Rob Swan, who developed a 50-year mission. A man with an extremely strong sense of purpose and mission, and with a very strong message around leadership and around diversity, and the importance of diversity, particularly in life-threatening environments where he spends a lot of his time either leading expeditions with other explorers, or with executives and business leaders to teach them his leadership lessons. Larry Cunningham, the official biographer of one of the strongest and most innovative and sustainable companies on the planet, Berkshire Hathaway, and who talked at length about the link between performance and autonomy, which is very, very important in innovation. David Allen, author of Getting Things Done, whose work is really crucial to help you create the space for innovation. And more recently, Michael Gervais, who is a high-performance coach for executives and sports stars in the U.S. and Olympic team, Olympic athletes. More recently here in Europe, he also worked with Felix Baumgartner of the Red Bull Stratos fame. And last but by no means least, Alex Osterwalder, the inventor of a key tool that many innovators use, the Business Model Canvas.

The show has received lots of attention on media platforms, such as Inc. Magazine, which talked about us being one of the top podcasts for leaders in innovation, and on the front page of the Psychology Today website. I've been invited to speak a number of events, like The Lean Startup Conference, at London Business School, and at the Intrapreneurship Conference. I wonder why we had all this attention, because this has all come towards us, and I think it's really because this is an enduring topic for leaders. Innovation is increasingly challenging. The word has been bandied around for many, many years, but what's different now is that the traditional sources of innovation are no longer working in many established companies, and they're looking for alternative ways of tapping into the ecosystem for innovation. A recent series of articles in Harvard Business Review confronts that very issue head-on.

In terms of how I think about innovation, I've got some core principles, if you'd like, that have evolved over time. But really, what I'm looking for, firstly, is what I call "foundational knowledge", the lead domino as Tim Ferriss describes it. So, what are the couple of things that you can do, and if you get them right, then everything else flows from that. If you get X right, then Y and Z, and A, and B, and C follow.

One example here, I think, is the Getting Things Done Methodology, which I discovered in 2002, brought it into Syngenta in 2010. My boss referred to it as providing the greatest return on investment of any training program he'd ever seen, and I was lucky enough to interview David Allen on the show earlier this year. If you've listened to the show, you'll have heard his dog snoring in the background, which was a little bit unfortunate, but didn't detract from the message, the power of the message, the strength of the message. I remain constantly amazed at how frequently his work appears, or referred to by my guests. So, a lead domino, foundational knowledge if you like.

Secondly, learning from other people's experience and other people's mistakes. Learning can be painful. I'd rather learn from others. I don’t have an MBA. I prefer to learn in the trenches. I have a strong belief that mindset and psychology does 80% of the lifting, and strategy and tactics the remaining 20%. I'm always looking for tools that help develop new habits and practices, and that are proven to work. You know, I believe that success does leave clues, and often, there is a tool there hidden in the case study as you unpack that success that has created the practice, and understanding those tools and figuring out how to use them is, in many respects, often the best way to create a new habit, or indeed, to unlearn an old habit to accelerate your journey towards results.

I suspect that many of you reading can relate to this approach. Having read this far, you're clearly interested in acquiring foundational knowledge, and to learn from me and my guests both the good and the bad. I suspect you're interested in the topic of mindset and tools. Hopefully, this is all relevant stuff for you.

There are basically four levels of innovation when I think about the whole space that we're commenting on and working in. My preference is that it starts right in the middle at the individual with me and you, and from there we build out from the self into you as a team leader, you as someone responsible for marshaling resources to get something to happen, to make something happen.

A key question here is whether you take up space, as many leaders do, or whether you actually create space, and I'll come back to that in a minute. Then, beyond the leader of a team into the leader of an organization. You know, how can you shape the culture, which is a central element of the long-term sustainable innovation engine of a company. Go back to the reference I made earlier on about Larry Cunningham, his work in Berkshire Hathaway, the culture created by Warren Buffet, the founder of Berkshire Hathaway goes a long, long way to explain the success of that company. Your role in shaping that organizational culture is fundamental for the long-term viability of your organization.

Then, finally, the next frontier, if you'd like, beyond matrix management into ecosystem management, and I'm going to come back to that in a minute. But, those are the four levels, the four ways that we look at innovation. So, let's start with the individual as the unit of analysis, and a great place to begin, I think, is looking at the work of Whitney Johnson. Whitney worked alongside Clayton Christensen, who was, in many respects, the pioneer of innovation management thinking, and she worked alongside him, investing in his fund in disruptive companies before writing a book called "Disrupt Yourself".

Many of us are working in companies that are at risk of disruption, and companies facing new entrants, facing changes in the regulatory environment, facing evolving customer tastes, and also perhaps, many of us are in jobs that are at-risk of disruption as well, be it through changes in the workforce of millennials, artificial intelligence, automation, well-educated emerging leaders from places like China or India. And in a world where, hopefully, we get to live longer, but without the traditional 6 to 8 percent growth rate in our portfolio, 401(k), pensions, or stocks and shares, it's really important to figure out how to future-proof ourselves, as well as our businesses, and have a strategy for dealing with this disruption.

This is basically the value of the tool that Whitney Johnson introduces, the S-curve of disruption, and this is a tool that many of you might be familiar with as a way to think about how disruptive ideas and products spread through cultures. She applies this to you as an individual leading innovation in your workplace, as well as innovating with your career, and it's key here to understand where exactly you are on this curve to take full advantage of the exponential forces that operate on the S-curve. These could be exponential learning opportunities as well as exponential market adoption opportunities. So, its well worth understanding this S-curve and what does it mean, where are you on it, and what does it mean for you as you think about innovating yourself and innovating your business. I think this is a fundamental piece of foundational knowledge.

Another one is questioning. How do you create the space to ask the right questions? And I think asking the right questions at the right time is fundamental. In Syngenta, we used to call this "breakthrough questions", and these are questions that combine a huge ambition with an embedded constraint. An example is how do you double the size of your business with no additional product development. IKEA is really good at this, and they've built their whole business and their whole organization, basically, on asking breakthrough questions. The founder and CEO, Ingvar Kamprad, founded the business by asking the breakthrough question, "How can you take all of the off-cuts from saw mills," in his country of origin, "and convert them into low-cost furniture?" Fifty years later, he can still be found in China negotiating to take away the feathers from chicken farmers and use them as a low-cost source for stuffing for his soft furnishings.

The concept of a breakthrough question, of this hugely ambitious goal with an embedded constraint, is one that is very, very valuable for all of us as we're thinking about disruption, as we think about innovation. By the way, Apple does this really well too: these are business strategies that are initiated by a strong breakthrough question.

Now, a really good example comes from one of my guests, Adam Grant. The breakthrough question for him and his business partner, the co-author of the book, "A Beautiful Constraint", was "How to sell 5,000 books in the book launch without a single dollar of marketing budget." For those of you who have ever written a book, you'll know that selling 5,000 books is a huge ask anyway. But, with zero marketing budget, in a two-week period as well, very, very challenging. A very strong breakthrough question that culminated in them launching it across 14 cities in the U.S. working with partners in their ecosystem, that enabled them to achieve their sales targets in line with budget of $0.

The point here is it's not a question of resources. It's a question of resourcefulness. This is a really very important distinction to make as you think about -- I very rarely met a corporate innovator who's got sufficient resources. We are always struggling with lack of resources, so to be able to turn that around, turn that constraint into a source of energy, a source of resource, if you'd like, to enable us to accelerate our agenda is a really important foundational skill, and one that is something that would make an enormous difference when you're able to master that.

Let's move to the team piece. Now, a really important question, which I just asked earlier on is do you, as a leader, take up space, or do you create space? This is not an easy question to answer if we're honest as leaders. In my first senior leadership role, I felt I really needed to have all the answers and to provide really clear direction to my team to help them focus on short-term performance and to develop and drive tight, ambitious meeting agendas. In short, I took up space, and my belief is that the number one job of a leader is to create the space for your team, and this was a huge learning for me.

In many companies, we have matrix management. I sometimes see "Noah's Ark Management" where you might actually have two or more people doing exactly the same thing, and this is hugely challenging to manage. So, I think the number one job, as I said, is to create the space, and this is made possible by leveraging some tools that a previous guest, Lisa Bodell, is now launching as part of her new book, "Why Simple Wins". With these tools, it enables you to create some more space for organizations, for individuals to do their work, and just to be clear, this isn't so that people can go home early, but this is far more around helping people have the right conversation with customers, for example.

In Syngenta, we developed the concept of curiosity conversations, and we trained our frontline staff to do this. You can read more about it here. The results were phenomenal. Here's one of the programs that we developed, and which turned into a hundred million dollar business opportunity. it was written up by Goldman Sachs as a great example of how to innovate in a mature, commoditized marketplace, and this really came through developing capabilities in our sales staff to have what we call curiosity conversations where you are opening up the space to explore new opportunities with customers.

This sounds hugely sensible and straightforward and obvious, but you'd be amazed about the challenges that we have to get frontline staff to think differently. These are people who have been trained and have been very, very successful in one way of doing business, one way of interacting with their customers and getting them to shift, and to pause, and to ask questions without jumping to the answer or without trying to sell them something. It's really hard work and it's subtle and it's difficult, but it's important. If you get it right, the results are, or can be, extraordinarily powerful.

Now, at the organizational level, one of the ways into this conversation is to think about failure. This is one of the biggest challenges that organizations have. Most organizations are okay with failure so long as it's not them that's failing, but it's the competitors. Or, most executives are happy with failure as long as it's not them that's actually doing the failing. Rarely do you fail your way to the top of an organization. So, it's really important to confront this in advance. You know, some companies do this really well. Tata, the Indian conglomerate created an award called the "Dare to Try" award, which sends a great signal to the organizations that it's okay to fail. You know, I said to my children when they're skiing, and I also say to employees and the staff I'm on the board of, if you don't want to quit, at least, very regularly, then you're not trying hard enough. If you're not falling over on the piece, you're not trying hard enough. It's the same with innovation, but only very few companies will go as far as Tata.

What we often did in Syngenta is we would do a pre-mortem to identify what could go wrong, and this is one way to uncover the potential sources of failure and head them off at the pass before you get into it. This specific project that I looked after was post-patent strategy for a $900 million product that I managed, and we had a really good idea of what bad looked like. It was a competitor product that destroyed enormous value three years after the patent fell. I mean, it literally fell off a cliff. That's why they call it a patent cliff. By confronting what failure looked like, we were able to develop a strategy that created enormous value and avoided that failed outcome, and it created enormous value. We were able to grow the business significantly while maintaining price. This constituted a significant launch platform for next-generation technology. It all begins with the pre-mortem, which is a nice way of confronting failure without having to go to the extreme, which many companies will be uncomfortable with, of the Tata Dare to Try Award.

Finally, let's talk about the ecosystem, and this is, I believe, the next frontier for 21st century managers. How to access the relationships and the capabilities and the customers from the players in your ecosystem. Its increasingly unlikely that a business had access to everything it needs to innovate within its own four walls. The winners are going to be those that can actually expand and connect with, and leverage their ecosystem. The potential in terms of time and money and resources you can tap into is exponential in nature as the world becomes more and more virtual, connected, and digitized.

A nice example comes from the Brazilian-based, Nucoffee Business, that I was responsible for in Syngenta. We started by understanding not just the needs of our customers, the growers, but also their customers, the roasters, and ultimately, their customers, the consumer. In addition, we worked with others in the ecosystem like banks and credit providers as well as the certification agencies like the Rainforest Alliance, like Fair Trade to ensure they supported the program at the grower level. This led to the Financial Times article, about the product and about the business where they referred to Syngenta as the apple of agribusiness. I'm not saying that just to impress you, although it does impress me, but to impress on you how important it is to really connect with the ecosystem in order to deliver some of these step change results in innovation.

If we come back to the four-tier model, what I've done is given a helicopter trip across some of the approaches and the tools and the foundational knowledge that make a real difference in the four domains of innovation. This is just a glimpse of the resources and the insights and the tools that we are developing at the Innovation Ecosystem to help you and your organization become more innovative and entrepreneurial. This is, of course, not the only way to do this. There are lots of different approaches to innovation, but what I wanted to do here is to distill from my experience over 20 years, and also the experience of many of our guests, and to make it available to you in an absorbable way.

Innovation Leadership Circle

I would like to end with details of a new program that we are launching, called the Innovation Leadership Circle. In this article, some of you might have caught a glimpse of something that fits with your vision, or maybe you heard an example that echoes your own situation, or it could be that you feel that you now have your hands on a tool that you can use straightaway to make a difference and to move things forward.

The Innovation Leadership Circle is a program that we have designed for leaders who are curious and bold, and who want to innovate and experiment with how they innovate. It is designed to help accelerate the delivery of your innovation agenda over a hundred-day period. Relevant for directors, VPs, business units, and functional heads who have innovation at the heart of their business and functional agendas, for people who recognize that they need access to additional resources that they can learn from in a time and a cost-effective manner, and who place value on building capabilities, networks, and making a difference to their teams, their organizations, and their ecosystems.

If any of that is of interest to you, please email me at [email protected] or go onto our site, www.innovationecosystem.com, and you can find details of the program there. This is the program that I wish I had had access to when I was at Syngenta. It's based on elements of what we did, but we've significantly enhanced it, making it and outside in peer-to-peer program. Our first program is sold out, but we will run another in the next few months, so email me for more information or to go onto the waiting list.