A conversation with Brant Cooper, author, and advisor to startup and corporate entrepreneurs.
This is part of my series on thought leaders in the innovation space. Check out the other articles here.
Brant Cooper wishes people would stop saying innovation and start saying what they mean. He urges businesses to define what they are truly aiming for when they say this word. The definition can shift dramatically depending on the organization using it — does it mean growth, culture, new technologies, or something else entirely?
Brant is the author of the New York Times bestseller The Lean Entrepreneur and CEO of the consultancy Moves the Needle. With over two decades of expertise helping companies bring innovative products to market, he blends design thinking and lean methodology to ignite entrepreneurial action within large organizations.
Define the “why”
Let’s return to Brant’s thoughts on innovation and why the term can be problematic: “In my keynotes, I stand up and tell people to stop using the word innovation. Don’t use the word, if you’re not going to define it. Once everybody agrees on what is meant by innovation inside of an organization, use it to your heart’s content.”
“I stand up and tell people to stop using the word innovation. Don’t use the word, if you’re not going to define it.”
The reason he pushes for a concrete definition is that there are so many different ways to look at innovation: “It’s about technology, or having a good culture where young people want to come and work. Or, it could be a marketing factor, or it’s a new business model. It’s all over the map. We have to define what it means, and then we have to define how we are going to apply it in the organization to reach our strategic priorities.” When people know if they are talking about creating new products, values, or even listening to their customers more, they can set their sights on exactly what they are going to do to get there.
Innovation labs aren’t startups
One of the things that I always ask the folks I interview is about the pitfalls they identify in innovation, especially in how it happens inside large companies. Brant talked about how companies often wrongly compare themselves to startups: “I think a lot of senior management look to the startup community and say: ‘Look at the startups like Uber and Airbnb; they’re creating these billion dollar markets, why can’t we do the same thing? We need to be more entrepreneurial.’”
The result is often internal labs, accelerators, or innovation teams. However, by comparing themselves to startups, companies run into several issues. The first is the probability of success: “Number one: there are thousands of startups out there and in maybe one out of a thousand you get a unicorn. Yet companies are hoping they’re going to get the same thing by putting five teams in their lab.”
“I don’t think breakthrough innovation comes from people sitting down and saying, ‘Okay, what are going to do that’s breakthrough?’”
The second issue Brant sees is the difference between the motivations of startup founders and an innovation group. “I don’t think breakthrough innovation comes from people sitting down and saying, ‘Okay, what are going to do that’s breakthrough?’ People tend to work on ideas that they’re passionate about, or an inspiration that has come to them or they’re solving their own problems…”
Lastly, he talked about timelines: “Often, the people setting up these [innovation] labs are not given a realistic timeline. You’re not going get the return on investment in one, two, or three years if you’re trying to do breakthrough innovation. It’s not that the people inside the labs can’t. It’s just that they’re not being set up for success.”
“It’s not that the people inside the labs can’t. It’s just that they’re not being set up for success.”
Brant also talked about his distaste for businesses applying innovation to the classic three horizons of growth framework. As described by McKinsey&Company, this framework “…offers a way to concurrently manage both current and future opportunities for growth.”
Traditionally, horizon one is defined as what companies need to work on today in order to achieve growth objectives this year and next. Horizon two is what they need to work on today to lay the foundation for growth in two, three, or four years. Horizon three is what they need to be working on to ensure growth in five-plus years.
Brant said: “I’m not sure when it was decided that we should attach the level of innovation to these, whereby H1 is continuous improvement, H2 is incremental innovation, and H3 is breakthrough or disruptive innovation. You can’t lay the plans to create disruptive innovation versus incremental innovation. People are going to work on solving problems and some of them are going to take three years, some will take five years, and some are going to take seven years.”
He continued: “There are tons of things that we can’t predict. But somehow this horizon model has been co-opted by this innovation version and it doesn’t make any sense. I try to get people to reframe it back into growth because that’s what the objective is anyway. We’re not doing innovation just for innovation’s sake. We’ve got strategic priorities that we’re trying to achieve and it’s usually based upon revenue or growth.”
“By adding innovation to the horizon model, we screw up our portfolio management and how we’re going to allocate capital and resources across those time horizons.”
Stealth mode vs. open innovation
Another trope of the innovation and startup spaces that Brant questions is the idea of “stealth mode.” He talked about the birth of Silicon Valley and how it was a champion of open innovation before anybody even called it that: “The companies that were working to develop electronic warfare detection and electronic warfare equipment were working together under government contracts. But they were working together in order to come up with solutions. It wasn’t about being in stealth mode and hiding everything.”
“What you need is openness, inclusiveness, and diversity. It’s what actually leads to innovation.”
The emphasis on secrecy in today’s Silicon Valley might not allow for serendipity and discovery. It’s a lesson that’s relevant to current innovation teams. “I think we’re less likely to come across accidents and recognize those accidents because we tend to form innovation teams that are parochial and inside the building. What you need is openness, inclusiveness, and diversity. It’s what actually leads to innovation.”
Listen to the market
This idea of openness relates to one of Brant’s favorite anecdotes, which is that Steve Jobs was initially against opening up the app store to third-party developers. “I think the iPhone became breakthrough when it became a platform. And it became a platform when they opened up the app store to third-party developers. In the first year, it was not open to third-party developers because Steve Jobs wanted to maintain control. But, what made it revolutionary was when everybody could develop free and 99 cent apps. That’s what changed the industry overnight.”
Brant continued: “To Jobs’ credit, a year later he did open it up. To me, that’s more of what a visionary does. A visionary says, ‘The market is actually telling me something. I’m gonna change my tune.’”
“Listening to the market isn’t simply asking your customers what they want and doing what they say. There are all sorts of ways to listen to your market.”
The Three E’s
Brant is currently working on a new book and the concept is based on his belief that established companies must change the way they operate in order to survive.
“The very structure of our companies, in terms of the way we structure departments and hierarchies, is derived from an assembly line.”
He explained: “The very structure of our companies, in terms of the way we structure departments and hierarchies, is derived from an assembly line. It’s all based in the industrial age. I think the depression of 2007/08 marked the end of the industrial age. We’re in a new time and we’re going to find that companies have to be structured and operate differently.”
Specifically, this massive change means that: “Everybody inside a company needs to know how to act entrepreneurially, at some level. It doesn’t mean that we’re a startup. It doesn’t mean that everybody is acting like entrepreneurs all the time.”
“You have to define what it means to be an entrepreneur inside your organization, in your culture, in your market, in your industry. What does it mean to operate in this new way? Who are going to be the champions? Who are going to be the people leading the effort?”
But, it does mean that this new workforce, according to Brant, is going to have to know what he calls the Three Es of Lean Innovation — Empathy, Experiments, and Evidence-informed decision making. “Everybody needs to learn how to do those things and apply them wherever there’s uncertainty in the organization.”
I’m looking forward to reading Brant’s book when it comes out and learning more about the three E’s. In the meantime, I will be keeping up with him at his blog. I hope everyone enjoyed this preview.
Thanks for reading! If you want to read my other articles about innovation experts and practitioners, please check them all out here.