Increasing Our Innovation Metabolism
Introduction
The Catalyst Leadership Trust (CLT) is a Samudra community curated to help Catalyst leaders drive the changes needed for their organizations and the world. CLT members are change agents invited for their innovative outlook, bold strategies, and proven record of business transformation and community impact, and they represent a wide range of industries and roles. This community is organized as a partnership between Samudra and Catalyst Constellations.
For our March 2023 CLT meeting, our members have asked us to explore best practices in introducing emerging technology and trends to key stakeholders. To prepare, we spoke with a range of CLT members and guests, and asked the following questions:
How do you currently introduce new technologies or trends to your stakeholders? What innovative approaches have you used? What lessons have you learned along the way?
What has been the most successful case of corporate uptake of a new idea or innovation? What accounted for that success?
How do you define success in introducing innovation to the enterprise?
What factors have the greatest impact on company acceptance or rejection of innovation?
This report is a distillation of the responses from our interviewees. This is intended as a pre-read for our meeting, and certainly not as the final word on this topic. Also, a gentle reminder, please do not share this with anyone outside of the Samudra ecosystem. Participants were generous with their insights, with the understanding that this information would be kept within this community.
Many thanks to the following interviewees -
Catalyst Leadership Trust (CLT) members: Amy Radin, Chris Cravens, Deborah Reuben, Jayshree Seth, Manoj Govindan, Melora Zanar, Tim Lyons, Tyrome Smith. As well as additional Samudra members and guests: Andi Le, Mark Maybury, and Vijay Sankaran.
How to introduce new technologies or trends to stakeholders.
Our interviewees utilized a wide range of approaches to introduce innovations to their organizations. The methods were often shaped by the goals. Some were simply trying to open other executives’ eyes and minds to new ideas and capabilities. Others were working to drive a much deeper and broader transformation, such as one member who is co-designing a multiyear effort to engage industry-wide collaboration.
However, all the interviewees took a deeply connected and engaged approach in their respective organizations. No one advocated for a ‘skunk works’ or isolated research and development organization.
As the CLT member, Chris Cravens, put it:
“The best idea does not win… but the best idea which is framed correctly and socialized with stakeholders does… you can’t skip the socialization.”
Know your audience and make it personal
In support of that approach, another common theme across all our interviews was to know your audience and make it personal. Interviewees emphasized the importance of aligning any approach with the stakeholder's appetite, interest, and ability to absorb something new. Our experts’ efforts varied by culture, company, and individual stakeholders. They advised to “meet the stakeholder where they are” and explain why they should care, how it impacts their business, the timeline for delivery, and what is needed to make anything new happen.
Following is a collection of additional insights and hard-earned wisdom from our interviewees.
Nurture an Innovative Culture
Creating a ‘culture of innovation’ is not a one-off event or one-person endeavor. This seems obvious yet many companies still consider a bi-annual hackathon sufficient. In contrast, our interviewees suggest a resource-intensive approach, including setting up a change council, engaging every layer of the organization, and having regular communications and demos.
Build an innovation ecosystem:
We discuss the application of business ecosystem strategies in our Samudra report, The Far Side of Complexity. This strategy is particularly well suited to innovation programs that are engaging a set of external parties -- partners, vendors, academics, and VCs -- alongside internal cohorts, such as a business technology council. A diversity of inputs gives you the necessary scope and scale to make an impact. CLT member Manoj Govindan at Prudential deploys this approach and advises you to establish a set of “engagement protocols” with your ecosystem participants, communicate regularly, and iterate to refine and prioritize.
Source diverse inputs but target the output:
Sourcing from a varied set of participants is key for “trend scanning” and being able to derive new insights. For example, CLT member Deb Reuben convened a council that included service providers, start-ups, C-suite executives, technologists, and others to harvest a rich set of input on emerging trends. Again, diversity of perspectives is key!
In contrast, for communicating with or educating stakeholders, it’s important to consider the target audience. For example, Reuben convened a roundtable on Blockchain which did not achieve the desired outcome. She attributed this mainly to the differing levels of technical knowledge in the audience.
Assess your limitations:
Resource constraints may be obvious, but other points of friction, such as culture, may not be. For example, in technology and engineering cultures there might be unrealistic expectations to drive change quickly. This might require even more expectation calibration, communication, and handholding.
Engagement Strategy
Define the problem:
“What problem are you solving?” or “WPAYS” for short. This advice is echoed by interviewees who advocate for a “return to first principles” approach where you start by identifying the impact on the customer. Also, lean on data to turn “I think” into “I know,” advises CLT member Ty Smith.
Identify “Authentic Demand”:
CLT member Manoj Govindan has been running innovation programs for decades. He has been honing his strategy by defining and refining what he terms “authentic demand”
First, define demand from the business or, “what our markets, regulators, and customers want.”
Once you have this demand, refine it by making it more informed. “Educate [stakeholders] on external, contextual, technical,” and other factors. Then, ”close the information gap” and make demand more authentic in the context of what is happening.
Finally, iterate, test, inform and repeat. “It’s a circular process,” he advises.
As an example, Manoj recalls a successful exercise of this approach at one of the largest banks, where he worked in the early 2000s. The business was asking for a 360-degree view of the customer. The key blockers were identified as outdated infrastructure and a historical approach to analytics that relied on sampling data and extrapolation. This translated to “authentic demand” for a move to cloud computing to update the infrastructure as well as a rehaul of their data strategy to allow for data analysis at scale.
Plant seeds and tell stories:
CLT members Jayshree Seth and Melora Zaner both look for topics that are grounded in their business and have a long-term impact. On sourcing topics, Melora advises:
First ask, will it matter? What values and beliefs are driving the trend and what is the human connection?
Next ask, why will it matter? Does it fill a gap, open an opportunity, or solve a problem?
Finally, identify the context. Get data and then show how you can go on the journey.
Both Jayshree and Melora tout the importance of storytelling when communicating the potential of new technologies.
Craft your pilots carefully:
CLT Advisor Amy Radin, the author of The Change Maker’s Playbook, draws on her experience as Chief Innovation Officer at Citi and eTrade, and head of marketing at AXA. “Find the believers and early adopters to partner with on a pilot,” and then make sure the pilot:
Has a high probability of success
Addresses an important need but not a large one
Is supported by relevant data and analytics to measure and report outcomes
Finally, make sure you credit your partners for the wins!
Pitfalls to Avoid
Set the context:
We repeatedly heard about the criticality of establishing context ahead of any stakeholder engagement. One stark example was an organization that wanted to drive wholesale culture change, following the protests sparked by the murder of George Floyd, by engaging in discussions about race relations with employees. However, there was no context set for the purpose or desired outcome of these discussions. Adding to the confusion, there was no ‘safe space’ to engage, so no one felt comfortable speaking up.
Engage before, during, and after:
Many disconnects occur before or after stakeholder engagement. Think about the preparation ahead of any engagement, the desired experience for participants, and the follow-up actions that will take place.
Give stakeholders agency:
One interviewee offered this example of a failure with an effort to have employees teach themselves basic coding skills. This flatlined for several reasons, including: (1) participants did not consider themselves coders nor technologists, and could not connect with the goal; (2) they also feared losing their jobs as their work was ‘automated’ away. Another member cautions, “you can’t tell people what’s cool,” you need them to discover why it’s cool for themselves.
Examples of successful corporate uptake of new ideas and innovations
Build and Leverage a Venture Studio
CLT member Manoj Govindan shared the story of how a “venture studio” generated the seeds of the successful digital payment platform, Zelle. It is a rare example where direct competitors worked together, shared IP, and launched an independent business. Today, Zelle is owned and operated by a third-party entity that is co-owned by seven of the largest U.S. banks.
Manoj credits this success to turning conventional start-up wisdom on its head. In this case, they started by talking to peers and competitors. They defined the market need; pulled in domain expertise from three large competitors (Wells Fargo, JP Morgan Chase, and Bank of America); and then worked back into product fit, testing, and iteration, all before building the platform.
The venture studio is a unique model worth examining. It contrasts with an accelerator or incubator where the starting point is a founder or a team that brings an idea in need of funding. In contrast, venture studios are typically composed of a group of investors or a large enterprise. The venture studio considers various ideas from different sources and then funds, market tests, and, once the idea has momentum, pulls in the necessary talent and teams to build and launch the final product.
[Source: HBR December 2022]
Scan the Horizon for New Ideas
Our CLT member Jayshree Seth is a corporate scientist at 3M, an iconic company known for its innovation mindset. The company provides fertile ground for curious minds; Jayshree is an avid cultivator.
She wanted to address what she viewed as an unstructured and non-programmatic way of surfacing new trends, so she approached the CTO for support of a formal program to present new technology trends, quarterly, to the technology committee. “We will always have organic uptake of new ideas,” she acknowledged, and business leaders will continue to surface new ideas, but we needed something consistent, and which looked beyond immediate needs. Her group meets every six weeks to discuss topics and choose which ones to advance thinking on and present to the technology council.
Keys to success for Jayshree:
Keep it grounded in the business.
Look for ideas with long-term impact and broad scope. Jayshree cited CRISPR as an example she surfaced when it was emergent. There was no obvious tie to 3M but she urged executives to consider, “if we can edit out certain genes, what products might people no longer need?”
Source topics from a diverse set of thinkers. However, she notes, her sources are carefully screened: All of them are “plugged in and have a natural curiosity and thirst for knowledge.” She reasons that they are already constantly scanning horizons, and she can harness their efforts!
Light a fire or just plant a seed. She will scan competitive press to get executive attention on topics she thinks they should be aware of. But if it’s far out on the horizon, “I’ll just plant a seed.”
Like her fellow members, Jayshree employs multiple approaches to engagement. For example, she organizes lightning rounds called “5 in 5” -- five new terms in five minutes. She might facilitate a deep dive on a key topic, such as Blockchain, or run a longer workshop to address a specific need or solve an identified challenge.
Build a Community to Continually Source and Test New Ideas
Four years ago, the CEO of an equipment financing company asked our CLT member Deb Reuben to help his executive team see “what was coming and how it might impact their industry.” Her suggestion was to create an industry council of diverse participants, including service providers, start-ups, industry executives, and others to provide diverse thought leadership.
Deb was formally engaged to facilitate the resulting Equipment Leasing & Finance Foundation’s Industry Future Council. She designed and ran this program “to introduce executives to exponential technologies and their implications and opportunities for the future of the industry.” She kicked off the undertaking with a strategy session to build rapport, followed by monthly “trend scanning” for four years straight where she asked participants what new technology or industry trends they were seeing, how it impacted them, and what implications existed for the finance industry. She also used quarterly, virtual roundtables to facilitate peer-to-peer discussions, introduce invited experts, and provide experiential learning opportunities.
What worked well:
As with all community building, start by establishing trust and a shared purpose. Make room and time to set the context and create a safe space. When you do this, “a natural shift takes place where members will deeply listen to each other and get their concerns out - it opens them to new ideas.”
Bring in the right experts with a deep knowledge but also moderate the exchange tightly. Think about the experience first so it’s not intimidating or off-putting.
Offer a variety of opportunities to engage and incorporate different modes of interaction. For example, one session had attendees wear Oculus headsets for a metaverse experience.
Ultimately, Deb believes that a culture of innovation requires behavior change. “You need to allow questions, allow wild ideas to fly… and not just during a one-day hackathon.” After all, what is culture other than a collection of our behaviors at work?
Navigate the Transformation Journey
Our members cautioned that there is no resource-light version of driving wholesale transformation successfully. However, to help us navigate, we glean the following insights from Chris Cravens, who drove significant transformation efforts during the high growth phases at companies like Zynga and Uber.
“Get to failure fast, and never launch a project without a defined endpoint.”
Some of his leading insights include:
Know your dartboard. Chris lays out his “concentric circles of trust.’ Who are your supporters, who do you need to interact with, and who are your sponsors. He lays out his “bullseye map” and works from the center out. “I will share rough ideas only with my bullseye group, and expand outward as I workshop and test more refined concepts. Finally, I work into the largest (and most political) zone where the goal is to show how the new idea raises all boats.”
Stack the deck! Chris advocates that any transformation effort needs to touch every layer of the organization. However, this is not a democratic exercise. "I want to pull in 80% supporters of the change and 20% neutral or maybe against,” on a change council. In addition, “I want to seed it with folks who have done this kind of change in the past.” Finally, “if I can’t turn them or soften them, at least I want to understand why they think it won’t work and what would be better.”
Communicate often and in multiple formats. Chris leans into demos, workshops, “vision presentations,” and previewing value. He tries to reach the entire organization. Also, look back to show what was delivered, how it made an impact, and give credit. ‘Ultimately you want to show how your efforts contribute to overall success.’
Make Effective Improvements
Another member shared a case study of successful innovation improving go-to-market efficiency at a growth-stage software company. In practice, it dealt with changing the sales team’s workflow around the Salesforce platform.
What made it a success:
They made it faster, consolidating a workflow of twenty pages to one.
Faster was good but the force-multiplier was making the workflow more effective. They enabled value-selling tools, taking an existing value calculator and integrating it with Salesforce. “This took off and went from no attached value to 150 million really quickly. And field sales did its own training,” mainly because it was a tool they had already been using on the side.
Iterate and add. “We showed you what you wanted; do you want more of it?” They iterated on this success by finding other tools to integrate, They also expanded the impact zone by supporting additional functions such as the Customer Success team. For example, they added a tool to display the lifetime value of a customer.
Sailing into Uncharted Waters
Our intrepid CLT member Ty Smith convinced a government product team to deploy the “Blue Ocean” strategy in rethinking its data environment. “I believe it’s the only documented instance of the use of Blue Ocean in the Federal Government to make organization change,” mused Ty.
A brief aside, per the authors' Chan Kim and Renée Mauborgne, who wrote the book on this methodology:
Guide a Collective Learning Journey
Longevity is one good metric for success. Our CLT member Tim Lyons can point to ongoing innovation programs he launched twenty years ago at Morgan Stanley and Bank America. His initial goal was to “provide capabilities to help them learn and experiment.” And he found “magic in the collective experience” of bringing leaders out to Silicon Valley to “turn on their brains” and encourage them to work together.
The program’s success required a lot of prep and structure - this was not a spontaneous road trip!
Prep matters: Six months ahead of the trip, they would ask leaders ‘what are they solving for?’ “We would start with, what are we trying to accomplish?”
Get everyone engaged: Participants would vote on who they would visit on the trip, so “everyone was highly involved.”
Follow-up is action-oriented: “We used these events to help create and refine strategy.” They would look for alignment of new technologies and trends with our strategy, only then would they engage with start-ups or test new technologies.
“Blue Ocean Strategy is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. It is about creating and capturing uncontested market space, thereby making the competition irrelevant. It is based on the view that market boundaries and industry structure are not a given and can be reconstructed by the actions and beliefs of industry players.”
Why this succeeded:
They were addressing an acute problem. In this case, it was the devastating 2010 earthquake in Haiti. “Existing processes could not deliver or change in time to provide relief.”
They had a bold leader who was willing to provide top cover and who would throw out the playbook.
They had buy-in across the organization. The leader was widely respected and senior enough to gain broad-based support.
Defining and measuring success when introducing innovation to the enterprise
Form follows function or, in this case, metrics match the mission. There was no single definition of success but our interviewees offered several pragmatic metrics, both qualitative and quantitative.
There was no consensus on targeting horizons one, two, or three. Some interviewees strongly discouraged consideration of long-horizon trends as they know their stakeholders will not engage without a clear connection to business needs. Others directly aim to seed curiosity and “rally around the art of the possible” with the aid of storytelling and thoughtful context-setting.
For an “accelerator” program, one interviewee is tracking how many ‘vision statements’ are generated, because “innovation is a numbers game!” where the more you have, the more likely that one will succeed. She also wants to track the number of prototypes and experiments generated.
Many cite the goal of capturing business impact. Metrics being used include:
Number use cases pushed through the process
A measure of adoption of any new processes or tools
The number of programs underway
A relevant NPS score from both internal and external participants
The impact on corporate reputation, looking at press coverage, trade show participation, mentions in investor reports
Longer-term business impact measures were mentioned, including:
Productivity or revenue per employee trending year over year
Revenue obtained, if you can tie it to your program
Patents and generated IP
Competitive differentiation. One member likes to compare quarterly peer-group performance
Alignment with company priorities
Hard metrics: “Your budget is the ultimate measure of success.”; and soft: “Did I get people to ask more questions.”
But always capture data. Every pilot or experiment should have metrics for success. For example, in an effort to make employee onboarding as seamless as signing up for a new web service, one interviewee measured data errors and how many touches new employees had with the help desk. Longer-term, they tracked new hire sentiment and its impact on subsequent employee engagement scores and referrals.
Final words of wisdom on strategy, process, and what factors have the greatest impact on company acceptance/rejection of innovation.
“How do you assess an innovative culture?” We posed this question to CLT member Melora Zaner, who has led customer experience and design at various big banks and technology companies. Her answer: she doesn’t! “I like to go where it’s going to be hard...I go where innovation is needed and industries need transforming.” She then rallies the troops through the art of influence and storytelling: “Get them to ‘yes’ by showing how you are improving things!” Another member concurs that any company can be innovative, “if you get the incentives right.”
Most agree that leadership still matters. One interviewee recalls that his financial services firm would not modernize infrastructure until a new tech-savvy CEO took the reins. Another puts it bluntly, “you gotta ask yourself how much time you want to spend pushing rope…if I need to put in six months socializing a three-month project, it’s not worth it to me…especially if it’s in an environment where it’s not safe to bring up how ineffective that is.”
For more wisdom on this topic, from Catalyst Constellations, check out Tracey’s Catalyst Empowerment Summit talk and presentation “Knowing When It’s Time to Leave”
Don’t assume hybrid or remote environments will prohibit innovation. CLT member Deb Reuben led a working group tasked with solving complex, cross-functional challenges. It started meeting in person and then moved to virtual. “We used tools like Mural [a shared, virtual whiteboard], which sparked a new way of engaging and they got addicted.” Virtual allowed more people to join, new ways to work together, and more effective use of time. It can be very successful if structured and platformed correctly, says Deb. For example, the use of Mural means folks can throw ideas on the wall simultaneously, and not wait to take turns. And “everyone is the same size on zoom,” which promoted equity in input.
Counterintuitive to some, innovation requires more structure, not less, argues Ty Smith. He is a proponent of the agile team approach under the heading of BART, which stands for boundaries, authority, roles, and tasks.
*Check out Ty’s Catalyst Empowerment Summit talk and presentation “Boundaries and Change: The Interdependence Between the Group and Individual” where he explains BART in greater detail.
The Boundary, Authority, Role, and Task (BART) analysis is a tool for identifying problems and the effectiveness of processes that impact agile team performance. BART analysis helps agile teams identify and establish effective ground rules. The Agile team put the BART analysis into practice by asking the following questions:
Have role boundaries within the team been clearly defined and agreed upon?
Is authority formally defined and respected by all?
How does the team deal with the informal roles?
Are tasks of team members clear for them?
Ty believes this structure allows people to be wildly innovative without concerns about sinking the ship, wondering who is working on what, or who is responsible for results.
Finally, dive in! Several interviewees advocate for immersive experiences whenever possible. “You can’t learn to swim by reading a book,” notes Deb Ruben. Better to create a safe space, prioritize time for innovative pursuits, and reinforce engagement. Or “model it until they get it.”
We conclude with a quote from Melora: “Innovating is like writing a country song, sitting on a barstool listening to the conversation next to you. Be open, present, observe, and listen; you can learn so much!”
Summary of Lessons
Here is the combined list of lessons listed above: