Monday, 25 July 2011

Disruption - a case of ‘when’ not ‘if’

When should we start to attack, or worry about being attacked?

A good buddy of mine helped save a life recently – you may have seen it on the news.  Dave Green is CEO of Boston based Harvard Bioscience.  They’re the guys who developed and manufactured the kit that helped create the world’s first trachea implant in a 36 year old man suffering from ‘inoperable’ and terminal tracheal cancer (he’d been given two weeks to live).  The surgery took place in July in Sweden and was led by Paulo Macchiarini.  The science in a nutshell is this: Harvest stem cells from hip, create spongy plastic replica trachea, baste with cells for 2 days while they seed, grow and merge, remove cancerous trachea and replace with new.  A few days later patient leaves hospital.  A death sentence reversed.  How mighty is innovation!  Take a look in more detail:

Dave Green taught himself the basics of regenerative medicine and drove his business from suppliers of medical testing kit to the forefront of this revolutionary technology.  That's not the only disruption – this medical procedure requires no immune-suppressors, there is no danger of organ rejection because quite simply it’s made from you!  So what about all those guys making suppressors?  Where will they be in 10 years when we’ve worked out how to build not just simple organs like tracheas but hearts, lungs and kidneys?

Not only in life is death certain but for corporations it's a near certainty too.  Market leaders will always be eaten eventually by the stripped down, low cost, fired up challenger.  We used to cite Nokia as one of the few great examples of an organisation that had successfully shed their skin, hmmm.  The issue isn’t should we disrupt our, or another’s market, it’s all about when, not if. 

It’s notoriously hard for leaders to assess where they are in their company’s life cycle.  Tell tale signs that your lunch is being eaten from under your nose are when you’re befuddled by the technology that surrounds you, when revenue is harder and harder to achieve, when customers turn the thumbscrews on costs or when your colleagues arrogantly slam competitors as cheap or unsophisticated.  Feel familiar?  So here’s our take on how to start thinking about disruption, whether you're fighting back or just about to attack:

1) Make the threat or opportunity real, frightening or exciting?

·   Find the burning platform.  You can’t go into combat without knowing what you’re fighting for – what’s the wrong you’re righting?
·   Force yourself to re-define the market.  The bloke who recently sold me an electric car told me it wasn’t a ‘car’, it was a safer bicycle!  This is disruption thinking.
·   Explore the periphery.  Are you looking in places you’ve never looked before?  Eccentrics, crusaders, weirdo’s – they don't get through market research filters but ignore them at your peril.
·   Strip out the unthinkable – be ruthless around what consumers really value.
2) Make it easy to make the right moves at the right time

·   Lower the internal barriers to promoting ideas – reduce the potential pain of sticking your neck out.  Look outwards, keep talking about where the world is going, exercise this kind of exploratory dialogue.
·   Make sure the top brass are actively involved – disruption thinking questions why investments have been made and asks whether we really need our current workforce.  It doesn't get much grittier than this, that’s why disruption thinking has to live with the CEO.
3) Make a move, but don't bet the farm 

·   Spread your bets & keep experimenting – disruption doesn’t necessarily have to be a big investment. Start small, maybe an acquisition to give you a toehold in a new market, maybe start an innovation programme internally - work iteratively, quick-test concepts and ‘fail early’ the losers.

Monday, 18 July 2011

Should the nice guys win..?

What’s more important; hard-nosed or soft-hearted?

Last night in the UK ten million people watched the final of The Apprentice.  The winner, Tom Pellereau wins £250,000 investment in a new business he will co-own with UK business guru Lord Sugar.  Pellereau, a self-styled inventor and scribbler of ideas seemed an affable chap.  He laughed at everyone’s jokes and in one episode, shock horror, he actually said to the eventual runner up that he ‘liked working for her’.  The fact he hadn’t worked out how to comb his hair or shave was kind of endearing.  He wasn't that good at anything really, his business plan was awful, he was described as an under-dog, even a nodding dog, but as a partner in innovation for Lord Sugar (read Donald Trump in the US) he was a clear and worthy winner. 

Pellereau was lined up against the most brilliantly cast bunch of alpha humans you can imagine.  With relish they told us each week how they’d cheerfully chew the heads off babies to win, that they were one in a million, representatives of an uber race destined to win.  In their desperate desire and increasingly pathetic attempts to win they proved themselves total losers.

There’s a clear parallel with the world of innovation where we need to be hard-nosed, we need to challenge projects that are going nowhere and we need to engage with colleagues who leave us under-whelmed.  Ouch – this stuff really hurts.  Innovation is a tough game, we need a thick skin.  But in large organisations super clever, super ambitious, super ego people crash and burn.   Pellereau is a good choice as winner of The Apprentice because he showed us his soft underbelly and while he did so he laughed a lot.  I think he’s the kind of guy you’d want to work with, he’d make you feel great.  You could give feedback to him, I think you could co-create a better product without fear of his ego getting in the way. 

Innovation is such an exciting management science, it’s the ultimate blend of hard-nosed, commercial judgement and mastery of basic human qualities; listening, appreciating, enthusing and many more.  I haven’t met many people who have this cocktail of skills in equal measure, but I have met teams who do.  Sticking up for our strengths and fessing up to our weaknesses is the fundamental principle behind succeeding at innovation.

Thursday, 14 July 2011

Innovation – the fight for what’s right

Forget common sense – innovation needs fire in the belly

Innovation works much better if there’s a wrong to be righted.  Most start-ups and challenger brands are fuelled by this heady thought.  Airlines around the World have been challenged by the no frills model South West Airlines pioneered decades ago in the US.  For them it just wasn't right that the average American didn't have the freedom to find work in a distant city, or to visit loved ones more frequently.  This sense of anger, or righteousness still powers the organisation today. Last week I met Emma Sayle founder of Killing Kittens, an upmarket female focused ‘Eyes Wide Shut’ party organisation.  She is fighting the fact that men control the sex industry.  All of us who have seen the Social Network get how Facebook was born out of rejection and revenge.

But what about established organisations, market incumbents?   Here innovation is a combat role, there are so many hurdles, so many knock backs that innovators need a battle-cry, something that unites them, often against their own organisation, and something that drives them forward.   Unilever’s super successful deodorant Lynx / Axe formed the ‘Republic of Lynx’.   Innovators took the Blue Pill to signify their dedication to ‘helping young men get ahead in the dating game’.  Sound nuts?  The results they got don't.  At B&Q CEO Ian Cheshire has shone a light on a wrong to be righted.  He says that every customer has money in their wallet and if spent on DIY could make their lives better – see my May blog on B&Q’s innovation system.  These large established companies have developed their own version of a crusade, they’ve got angry, got righteous and got motivated.  And they haven’t resorted to mission statements which smell of endless and ineffective wordsmithing to most innovation hungry execs.

I don't believe there is a market sector that shouldn't get angry about how well they are serving their customers.  But in some industries it might seem tougher than others.  Of course we can get angry in a start up or maybe in retail or packaged goods companies.  It’s far easier to change here than in say, banking or the pharmaceutical industry.  And yet I’ve worked with passionate, fired up and angry execs in these highly regulated industries.  The people who make a difference get out of their office and into the world in which their customers inhabit, they see for themselves how well or poorly they serve their customer’s everyday needs.  I spent a spine tingling session with a CEO of a major pharma company and one of his customers.  We ‘hung out’ for the evening, in their home, with their family, hearing their story.  After that my client reported that he was moved, fired up to do more to help.  Whether this was anger or passion isn’t the point, they key is that innovation is a battle you can’t win unless you’re fighting for what’s right.

[Scroll down for practical innovation stuff on Apple, Google, Jack Wills and more]

Monday, 4 July 2011

Innovation: Why Less Is More

Peter Williams, CEO of Jack Wills reminds me why creativity really does love constraints

I know this brand well because I’ve spent a fortune on it.  Jack Wills ‘preppy’ clothing is what my teenage kids cleverly open my wallet for.  And it seems I’m not alone, at over £100m of sales the purveyors of posh ‘university’ clobber are rapidly expanding both in the UK and the US.

I was delighted to meet Peter Williams, Founder and CEO last week in his Acton HQ.  He started the business at the ripe old age of 23 and now 10 years later is one of the UK’s most successful retailers.  But isn’t retail ‘detail’?  Something you need to put years of graft into learning your trade?  How does a 23 year old with no retail, clothing or fashion experience create what is on the cusp of becoming a global retail phenomena? 

I think the clue is in the story Peter tells of Jack Wills’ start up.  It goes something like this: Not having enough cash for a long lease, high profile launch he rents a traditional shop in quirky, charming and posh English town of Salcombe, Devon.  Not having enough cash he can’t use traditional research techniques to map out hot selling clothing lines so he learns how to use the new digital media (remember we’re in 1999) to generate ideas putting queries out like ‘my boyfriend says white jeans are cool, should I get buy him a pair’?  Not having enough cash he can hardly pay himself and works every job in the store himself. 

At the time ‘not having enough cash’ must have felt very tough but as with so many entrepreneurs the constraints Peter unwittingly worked within have shaped the business today.  Stylish  ‘country town’ stores, a cutting edge digital offer and confident in-house marketing are hallmarks of the business today.  

New businesses like new products have a seemingly endless series of options but focus is what entrepreneurs and innovators need.  The fewer options we have the more time we have to get things right.  The more we have to do ourselves the more we develop our judgment muscle, our confidence and ultimately innovation leadership.  Have you got too much money, too much time?  What would happen if you created tough, eye watering constraints?  Maybe things might just move faster and with more passion?