A conversation with Christie Nicholson on innovation
This is part of my series on thought leaders in the innovation space. Check out the other articles here.
Something as seemingly innocuous as the four-quarter business calendar may be standing in the way of innovation. Entrepreneur and writer Christie Nicholson pondered the possibility during our recent conversation: “Maybe we should do away with the entire calendar of the business year. If you’re married to those short timeframes and you have to meet certain goals within those timeframes from a financial perspective, you’re not going to be thinking wideout.”
This frank and fresh thinking is characteristic of Christie. She is currently the Entrepreneur in Residence at Citi Ventures, a position where she coaches internal startup teams to move from concept to build to launch and leads the development of the curriculum for the program. She is also an award-winning science journalist and co-founder of the publishing startup, Publet. She is a contributing editor at Scientific America and an adjunct professor at New York University where she teaches a six-week course in startup entrepreneurship. She also sits on the advisory board for SXSW Interactive and the curatorial board for PopTech.
We had a great conversation on the phone a while back. Read on for my top takeaways.
What’s Your “Why”?
One of the first things we talked about is the importance of being very clear on strategy, which Christie calls the “Why.” Companies should always start with a solid understanding of the objectives of their innovation pipeline and the kind of innovation they want and need.
It’s a simple, but powerful idea that she feels isn’t always present in large companies. (“People aren’t doing the obvious. Common sense is not that common.”)
She says, “The why either comes last or as an afterthought or as a surprise.” The lesson for leadership here: take the time to define your why before jumping directly into the what.
Know Your Growth Gap Number
Related to the idea of planning before leaping into a new project, product, or program is a new business metric that Christie introduced to me— the growth gap number. The growth gap number is defined as: “the difference between [a company’s] growth goals and what their base businesses can deliver.” (Read this Harvard Business review article if you want to know more.)
Christie feels it is a critical number for companies who are keen on innovation; they must understand exactly how much money they need to make and, therefore, how much they can or should invest in their innovation pipeline.
The growth gap number helps companies know: “where you’re going to be falling short in terms of your leaps forward.” Without it, Christie says: “you have no idea how much you actually need to put into innovating or how many new products or new business units you need.”
“It’s kind of a sitting duck waiting to be picked up.” — Christie Nicholson
Despite its importance, companies often don’t put in the time needed to figure out this number; it’s extremely time-consuming to calculate. But it’s a powerful concept that she thinks is underutilized in the business world right now: “it’s kind of a sitting duck waiting to be picked up.”
Don’t Settle for Sustaining
Another pitfall in corporate innovation that Christie highlighted is: “when companies are complacent with sustainable innovation when what they really need is disruptive innovation.” Sustaining innovation might be defined as the type of changes that a company needs to just stay in the game (i.e. new product launches, etc). “It keeps them in the right spot and keeps the growth going a certain regular rate.”
“It’s rearranging the deck chairs on the Titanic. It’s not going to close that gap that is heading towards them at 100 miles an hour.” — Christie Nicholson
Disruptive innovation, on the other hand, is “something that really opens up a completely new market that leads to mass adoption on the consumer side. It’s something that could destroy the incumbents…” Christie shared a great analogy about sustaining innovation: “It’s rearranging the deck chairs on the Titanic. You know it’s not going to make a big difference. It’s not going to close that gap that is heading towards them at 100 miles an hour.” It’s an excellent word of warning — are you sustaining when you should be disrupting?
Making Magic
We also talked about the less measurable, more “magical” side of innovation: “I have a lot of belief in that too. When somebody is a creative person and sees connections between opposites, innovation happens.”
The power of opposing ideas is a theme that’s come up in some of my other conversations and I love the way Christie talked about it: “The magic of innovation resides in the space between two disciplines or topics that are colliding together. I think what makes for an innovative mind is this ability to deal in opposites. That’s where the creative spark and the innovative stuff really happens.”
“The magic of innovation resides in the space between two disciplines or topics that are colliding together.” — Christie Nicholson
When we look past the status quo and our assumptions: “We come up with things we never would have expected.”
Moxie Plus Preparation
If you are involved with building an innovation program in a legacy corporation, Christie offered some sage advice: jump right in, but don’t forget to over-prepare. These opposing concepts are both essential. “On one hand, you have to jump in before you know how difficult it’s going to be. Because if you had any idea how hard it was going to be to turn around the infrastructure of a legacy company, you’d probably never do it. It’s almost like if you really knew what it was like to climb Mount Everest you’d say, ‘ok forget it.’”
“If you had any idea how hard it was going to be to turn around the infrastructure of a legacy company, you’d probably never do it.” — Christie Nicholson
She went on,“You have to have a level of ignorance, naïveté, ambition, and a belief in magic to be able to go forward with it. You have to have moxie and gumption.”
Yet, preparation and planning is part of it too. She added: “You really should be more prepared than people ever seem to be.”
Inside or Out?
We discussed whether innovation can happen inside a legacy or large company or if the innovation team needs to be somehow outside of the organization. For Christie, there are many benefits to an internal innovation program:“The whole firm takes advantage of the culture change that naturally comes with an innovative pipeline or innovation strategy within a large corporate firm; the culture change is extremely powerful and valuable because your whole company is going to start thinking differently.”
Yet, she admits that it’s often very hard and slow for innovation to thrive in big companies. And frankly, it doesn’t always work or there can be a backlash: “It is like a virus and the antibodies of the company come in and say ‘No you’re disrupting too much or you’re messing with our systems, you’ve got to get out.’”
So, there is also a good rationale for innovation happening outside the confines of the larger “organism.” She shared a story that illustrates this: “In the late 1970s, engineers came to the IBM leadership and said ‘We should start working on this thing called the personal computer.’ After turning them down many times, leadership said ‘We’ll give you a shot but we’re going to send you outside of IBM to do it.’ So they send them down to the Boca Raton labs and the rest is history.”
Ultimately, Christie still sees the benefits of both approaches, but thinks more work is needed to figure out how to do it right, so that it benefits the organization and inspires the type of work they want to produce.
Your Competition Might Be Customer Behavior
When asked to share an “epic failure,” Christie cited her startup Publet, which was a platform that was supposed to replace the PDF with a flexible web based analytic driven social sharing platform. While Publet was a solution to a static format that hadn’t been changed or iterated on since the early 1990s, it didn’t take off like it might have. The companies they engaged were super excited about the concept: there was demand.
But it didn’t gain traction. What was the issue? According to Christie, customers didn’t start using it quickly enough. This points to a “competitor” that we might not always think about: “Our biggest competition was the current behavior of the customer. A lot of startups overlook that. They think about all their other competitors, but it’s actually the current behavior. The PDF was still good enough. It wasn’t urgent. Nobody was getting fired for using a PDF.”
Customer Centricity
We concluded our chat by talking about what Christie finds exciting right now: “the spread of customer centricity throughout large firms; the attempt of large firms to dramatically change their business models and culture.”
She’s seen a huge shift in the space: “The days of focus groups— I think they’re long gone and they should be. There is something so much better in the one-on-one interview, which is the format of customer development.”
“Empathy, understanding, and communication leads to better more accurate knowledge and data. It’s good for everyone.” — Christie Nicholson
This rise of customer-centricity: “is such a good day for business because it turns us into better communicators. It forces our empathy to be stretched. Empathy, understanding, and communication lead to better more accurate knowledge and data. It’s good for everyone.”
And with that sentiment, I knew it was a perfect spot to end our conversation and this article, as well.
If you want to read my other articles about innovation experts and practitioners, please check them all out here.
