Strategic planning is an organizational strategy used in companies of all sizes, across business verticals. It provides a roadmap for a company’s future. In this post, we’ll cover what strategic planning is and when it should be utilized. Strategic planning companies are experts in the key aspects of the strategic planning process and can help organizations outline and implement strategic planning initiatives. Organizations without a strategic planning foundation and forward-thinking process are much more likely to face roadblocks or even worse, potential bankruptcy.  

What is Strategic Planning? 

Let’s review what strategic planning is and then we’ll discuss when strategic planning and the help of a strategic planning company should be utilized, 

Strategic planning, as defined by Indeed, is “a process used by organizations to identify their goals, the strategies necessary to accomplish those goals, and the internal performance management system that will be used to monitor and evaluate progress. Most organizations use a SWOT or gap analysis to identify the underlying factors driving their current performance. This, in turn, informs the selection of the most high-leverage strategies to create change. The strategic planning process culminates in the development of a strategic plan document that serves as the organization’s collective roadmap.” 

Elements and components of a strategic plan include:

• Mission and vision statements for context
• Goal setting
• Strategy implementation timelines
• Progress monitoring timelines
• Benchmarks and/or objectives that inform progress towards goals and how they support the mission and values
• Defining how and when progress will be tracked
• Outline of roles and responsibilities for each employee or team

While each company and its strategic plan will be unique, many strategic planning frameworks include some variation on the following phases:

• Initial organizational analysis or assessment
• High level strategy formulation and development
• Strategic plan documentation 
• Translation of high level plan into operational planning and action items
• Performance evaluation 
• Strategic plan review and refinement as needed

If strategic planning sounds like something that your organization or team could benefit from (spoiler alert: most companies will benefit), you may consider working with a strategic planning company to develop the plan, especially if this is your first time utilizing the framework.

5 Ideal Times to Work with a Strategic Planning Company 

1. You’re First Starting a Business

Having a strategic plan in place when you first start a business will be helpful in setting your business up for success. It will provide structure during a confusing and often chaotic time, and helps to keep everyone focused on key priorities. In a new organization’s case, a strategic plan would be one smaller piece of the larger business plan (such as financial and marketing plans). Strategic planning companies are especially useful in this scenario, as they provide the expertise and guidance that brand new organizations often lack.

2. During Turbulent or Changing Times

We all learned recently how much a pandemic changes and impacts various industries and the way we work in general. Times like these, when the market experiences significant changes, are another ideal time to adopt strategic planning and strategic planning companies for a go-forward strategy. Strategic planning can provide clarity and organization during uncertain times. In light of recent events, an effective strategic plan looks a lot different today than a few years ago, in large part due to the increasingly hybrid workplace. Your team members are probably not in the same location, or even if they are, may not all be coming into a physical office. Many organizations had to develop strategic plans when determining how to successfully work in this hybrid and virtual environment. 

Pro Tip: Lean into this new remote-first environment and ensure your team is set up for success by having the right tools and tech in place. 

3. Before Launching a New Product or Feature

Strategic planning companies can help accelerate innovation during a new product or feature launch through design sprints and innovation exercises. This will ensure your team has their best foot forward during a key business time period when stakes are high and there are many variables and moving pieces. Learn about when you should run a design sprint here and how Voltage Control can help here. 

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4. Following a Merger or Acquisition with Another Company

Mergers and acquisitions are never easy or straightforward but are a necessary and natural part of business. Having a strategic plan in place during M&A will help with team alignment, collaboration training, and team culture, even if your team is remote. A strategic planning company can help put together a strategic plan in order to make the transition time more clear and set goals and expectations accordingly. As an unbiased third party, they are removed from office politics and provide a neutral voice during a complicated experience.    

5. During a Change in Leadership

Similar to the above, a strategic plan and strategic planning company will provide clarity and an unbiased view during a change in organizational leadership, especially important when happening at the senior level. In addition to assisting with the strategic plan development, the strategic planning company can bring in an expert to help facilitate meetings and conversations. A facilitator is someone who plans, designs, and leads a key group meeting or event and can help when dealing with larger or sensitive topics. They offer a non-biased opinion and take care of logistics while making sure everyone stays on track. 

Pro Tip: Check out Facilitation Lab, our weekly virtual meetup focused on helping facilitators hone their craft to help improve the quality of meetings. Control the Room, Voltage Control’s Annual Facilitator Summit, is another resource for facilitators. The summit provides facilitators with the opportunity to deepen their knowledge on how to facilitate meetings that matter and connect with other facilitation and meeting practitioners.

Strategic planning is a necessary (and exciting!) process when an organization wants to set and identify vision and goals and determine future initiatives. Strategic planning often occurs at the onset of a new business venture or product, or during a time of change and uncertainty. Organizations considering strategic planning should also consider utilizing strategic planning companies. They, as an unbiased third party, bring expertise and guidance, promote team alignment and provide a more streamlined process.

Create your strategic plan today

Does your organization need help developing a strategic plan? Voltage Control offers training and facilitation services. Reach out to hello@voltagecontrol.com to learn more or schedule a consultation.  

The post What is Strategic Planning and When Should You Utilize It? appeared first on Voltage Control.

This is part of my series on thought leaders in the innovation space.

Sofie Lindblom is the Managing Director and Co-Founder of ideation360, a subsidiary to Innovation360. She spends her time creating innovation strategies, providing companies with a clear and structured process for them to evaluate their success.

With a Master’s degree in Engineering and Media Technology, Sofie believes in combining the power of creativity and logic to solve complex problems. She credits her time as the Global Manager for Innovation at Spotify for teaching her about innovation success and what it takes for an organization to thrive within that balance of creativity and structure. Sofie starts many innovation conversations with an unexpected but important question: what blocks innovation?

The Intersection of Creativity and Logic

Sofie found her way into innovation by way of engineering. She was fascinated by creativity but also loved structure and logic. Engineering, she thought, would be a way to explore both fields, so she got into computer science. This satisfied her love of logic, but she said, “something was missing. I love technology, but I was not a great programmer. I’m quite restless and was missing the bigger picture.”

In pursuit of finding the bigger picture, she realized that the people using the technology and the business model behind it were missing. So Sofie pursued her Masters in Media Technology, where she went outside of her curriculum and took a course in Innovation Management. Her response to the idea of innovation was, “This is what I’ve been looking for. This is where you holistically get to take all the different components that are needed to figure out the future and drive it in the way you want.”

Her newfound love of innovation led her to a job at Spotify, where she tested models and processes that she had read about in her innovation class. Here she learned how to implement creative innovation while navigating the company structure and logic. Finding the connecting tissue between the two ends of the spectrum paved the way for her to do much of the work she does today.

“What we learned there was that there are a few components you need to have in place to succeed. The first thing is a very clear governance model with roles and responsibilities. Who owns what and who makes the decisions? And the second is the structure process. The end goal isn’t always known for innovation, so we need an innovation process to structure that exploration.”

The Why Behind Innovation

Sofie believes that knowing the “why” behind your innovation efforts is one of the top drivers in a company’s success or downfall in their innovation. It’s not just a belief, either. At Innovation360 they have assessed innovation capabilities in over 5,000 organizations in 105 countries. One of the top blockers for innovation is lack of purpose.

Lack of Purpose: Find Your Why
We all intuitively know that the “why” is essential, but what does the “why” really look like, and what happens when a “why” changes? Sofie gives us an example of a company that sells magazine subscriptions. “With the magazine industry on the decline and subscriptions not selling, what do you do if your entire purpose for being was selling magazine subscriptions?” Suddenly, the “why” for existing is disappearing.

To help an organization plot a way forward, Innovation360 creates an innovation strategy. First, they perform an internal analysis, assessing an organization’s strengths and weaknesses. They ask, “What are they good at?” to look for innovative opportunities to use those strengths in a changing business. Then they do an external analysis, looking at what factors affect the industry — figuring out where the world is going and how the company fits into that.

Once the company knows their why they can start to innovate on that idea and be sure it still fits the market (or adapt as needed).

Lack of Patience: Innovation Takes Time
Most companies work in quarterly time frames and have high expectations for results — fast. But radical innovation in a short period of time isn’t exactly how innovation works. In companies with high pressure on the short term, the vision is often lost for longer-term, innovative projects with high uncertainty or unclear return of investment.

These pressures are completely necessary, of course, but there is much more to consider than purely looking at ROI when it comes to innovation success.

In our day-to-day business, there’s an ever-increasing number of priorities and activities to keep track of, leaving us little room and patience for the long term thinking that innovation requires.

Innovation takes time, systematic exploration, and calculated risks. Sofie says people often think that Spotify was this “happy accident,” requiring no work because they are young and hip, but she stresses how untrue that is. During her time there (and she contends that even now,) Spotify invests heavily in, prioritizes, and dedicates a great deal of time to innovation.

The Tanker vs. The Speedboat

Sofie works with a lot of big organizations looking to innovate and breaks down different strategies using an analogy with a tanker and a speedboat.

There are two different strategies at play: the corporate strategy and the innovation strategy. The corporate strategy, which acts a lot like a tanker. Then there’s innovation strategy, which behaves more like a speedboat.

Tankers are big, stable, and steady when it’s windy at sea, but that also means they’re slow to turn and don’t move very fast. Innovation strategy is different. It’s more like a group of speedboats sent out in varying directions, some further than others. They’re small, agile, and active. When these boats return, they’ll have gathered learnings and data about the atmosphere and road ahead.

We can’t compare the boats in the same way because they serve vastly different purposes. The goals of the boats aren’t the same, so they’re not evaluated the same way.

Having an innovation strategy is important because things are always changing. Having those speed boats (innovation strategy) active enables you to gather information about what’s coming, giving you the ability to assess the data and respond accordingly.

Expanding Your Horizons

To take that innovation strategy analogy further, there is a useful model called the three horizons*, which can help explain how different “boats” explore and the criteria and key performance indicators of each one. These criteria help set up the right expectations and keep the boats traveling on the right timeline.

Horizon one: Return of investment in the form of money or growth. What speedboats help us grow or increase revenue?

Horizon two: Data used to make decisions — what type of information do the speedboats come back with?

Horizon three: Learning — which boats we shouldn’t send back out again and which ones to double down on based on promising results.

*Three Horizons Source: Adopted from Baghai, M., Coley, S., & White, D. 1999. The Alchemy of Growth: Practical Insights for Building the Enduring Enterprise. London: The Orion Publishing Group Ltd.

Splitting up these different horizons gives the innovation process, which can often feel messy and difficult to measure, a way to determine success and failure more clearly. Sofie also uses these horizons to get other people on board, “For us, it’s been a good way to motivate or at least get decision-makers to understand the difference between them. And when you get that, then you can also allow different ways of working in the different horizons.”

Innovation Leadership

In innovation, you need someone comfortable with uncertainty, able to cast vision and inspire others towards progress, despite the possibility of being wrong.

One thing that continues to be required in innovation, Sofie says, is “a generation of leaders that are challenging the status quo and thinking differently. This requires diversity in the board room.” Diversity is something Sofie is familiar with, as a woman, engineer, CEO, founder, she understands the value and challenges that come with diverse groups of people.

“This is not just about a room full of similar people coming up with new ideas, but in order to broaden perspectives and horizons, diversity is necessary.”

An essential part of innovation leadership is to make yourself a part of this change — to be a role model and to find role models in new places that you may not have looked before.

Finding the Balance

Maintaining creativity through innovation, finding the right balance between structure and creativity — it’s where the boats make a great team. “Because if you put too much structure to it, then we kind of kill creativity. But if we have no structures, it’s really hard to capture that creativity and turn it into value.”

In the end, it can be said that innovation is truly an art, a masterpiece of mixed media. Structure and creativity blended to form a picture of innovation success.

The Right Tools

The problem Sofie has often faced is that companies don’t always possess the confidence to generate ideas, or if they do, they aren’t pushing the boundaries enough. With tools, communication, and workshops you can boost an organization’s creative confidence. This hopefully encourages people and gives them the confidence to either pursue an idea further or to leave it.

At Innovation360 they have developed a framework and tool to determine what will enable an organization to perform most optimally. This tool, InnoSurvey, is an assessment used to ask why, what, and how in 92 codified questions. Within this, there are 66 capabilities broken down into 16 lenses, which are categorized in different ways based on their particular ability to produce specific outcomes.

Innovation360 is also experimenting with an AI called Sherlock that helps with the analysis of the assessment data. The goal is that Sherlock will solve complex innovation challenges with the world’s leading companies, going through all data in the databases assessing innovation performance. From there, Sherlock can provide recommendations on how to improve innovation capabilities drawn upon the learnings from all organizations in the database. This also helps companies hone in on their skills and decide what type of innovation works best for them.

I thoroughly enjoyed chatting with Sofie and hearing about the ways Innovation360 is assessing and driving innovation. I’ll end with this quote from her: “Innovation is the core of surviving and thriving in 2020 and beyond.”

If you want to read my other articles about innovation experts and practitioners, please check them all out here.

The post The Art of Innovation appeared first on Voltage Control.

Neha will be speaking at our upcoming event — Control the Room: The 1st Annual Austin Facilitator Summit! Taking place at Austin’s Capital Factory on May 23, 2019, learn more and get your tickets here.

Neha Saigal is a curious person by nature. As a child, her parents involved her in numerous extracurriculars — piano, public speaking, Russian ballet, tennis, Indian classical dance, and more. Her curiosity has driven her professional career starting with a degree in Finance and Economics followed by work as a Business Strategist and later as a creative in the advertising field.

“Eventually I started working on ad campaigns for ed tech products and wondered what it would be like to actually create products. I went back to school to study Interaction Design and have worked in product and innovation ever since.”

Looking back on her childhood, Neha’s grateful to her parents for exposing her to so many interests. She credits the experience for giving her the confidence to teach herself and an unwavering curiosity for trying new things. “This translates to my work, where I’m always experimenting with new methodologies and ways of working. That lack of fear of jumping in, experimenting, and trying things definitely comes from being thrown into a lot of uncomfortable situations as a kid.”

Innovation as experimentation

Curiosity and comfort with experimentation have given Neha a unique perspective on innovation. “Innovation is often considered to be disruptive and risky. This is diametrically opposed to a corporation’s view, which is typically risk-averse. But if you look at innovation as experimentation, you will find that it is the easiest and fastest way to reduce risk, bring clarity, and increase the probability of long-term success and value creation for an organization.”

“If you look at innovation as experimentation, you will find that it is the easiest and fastest way to reduce risk, bring clarity, and increase the probability of long term success…”

By approaching innovation more systematically through small experiments, Neha sees it as a risk mitigation strategy. “You don’t just have an idea and go build it, which a lot of people do. If you approach it with a mindset of experimenting in a simulated environment to see if something works, that goes hand-in-hand with being risk-averse.”

Neha sees innovation as a mindset. “It’s bringing the practice of experimentation to every aspect of business and adopting that mindset as organizations look at delivering new value to their customers.”

Infusing the experimental mindset into a team’s approach starts at the outset by acknowledging that nothing is known. “Experimentation and innovation are about figuring out what questions you need to ask. What assumptions need to be true for a business to work whether those are assumptions around the value proposition, costs, your revenue model, or how you deliver that value to your customers. It’s treating all of those facets of the business as questions that need to be answered.”

Once questions have been defined, Neha advises finding a way to prioritize them and systematically experimenting to answer them. PillPack is one company Neha notes that has embraced an assumptive approach. By setting up a pop-up shop in a mall, the PillPack team challenged assumptions about how people prefer to receive their medication. This experiment helped them learn that potential customers were interested in receiving medication delivered to their home, an approach that was adopted into their business model.

Key components for an innovation program, according to Neha, include:

1. Teams that are physically separated from the core business
2. Allowing and inviting room for failure
3. Adopting an experimentation mindset for everything including other aspects of the business like cost structure
4. Working in cross-functional squads
5. Giving autonomy to teams to drive initiatives & supporting them with coaching from leadership and guidance from corporate strategy
6. No end — only continuous experimentation

Physical separation for innovation teams is important to Neha because of the politics that come into play as company size increases. “Creating that sense of urgency, working under constraint, that sense of autonomous teams going out and experimenting becomes really hard when you’re trying to do it within the organization because the organization is set in its ways. It’s almost like gravity starts to take hold after a while.”

Neha uses the analogy of a cruise ship to further illustrate the case for physical separation: the innovation program is like a tug boat that needs to build momentum to change the direction of the ship, something it cannot do from aboard the ship. The separation allows innovation teams to function more closely to a startup working within constraints that allow creative thinking to flourish which can later be brought back into the company at large.

Neha shared that innovation doesn’t have to only be about disruptive products as it is often thought today. “If you look back in time at companies that were able to establish stronger footholds in their industry, a lot of it was getting creative with the strategies around the business model.”

To achieve this, Neha suggests expanding the idea of a cross-functional team to include people from Finance and Marketing so innovation can move beyond a feature focus to include the business model. “Rather than only focusing on the desirability component, imagine if you could structure truly cross-functional teams that are focusing on ensuring that in any venture, the viable, desirability and feasibility components are working in harmony.”

In addition to coaching, organizational leadership can support autonomous teams by providing a corporate strategy. “Having a clear strategy for how you’re going to play in the market can be so useful and powerful in leading teams in the right direction.” Too many frameworks and too much jargon can cause confusion, but a clearly-defined challenge gives teams something on which to focus their creative thinking.

“Cost leadership is not a strategy. Best consumer experience is not a strategy.”

“In the book, Good Strategy, Bad Strategy, the author Richard Rumelt talks about how most strategy that’s out in the world is absolute garbage because a strategy is really about framing a challenge. Cost leadership is not a strategy. Best consumer experience is not a strategy. A strategy is always an answer to a challenge, figuring out what is the overarching problem that we’re trying to solve, and how we’re going to go about solving that.”

Innovation is continuous

For Neha, innovation is a continuous process of identifying questions and assumptions and experimenting to learn as much as possible. Practices like design sprints, stand-ups, meetings, brainstorming sessions, though well-intentioned, are only useful if they live beyond a single event. “One of the problems is the one-and-done approach. The moment you approach it as this one special thing and forget about constantly testing your assumptions and experimenting, it’s not going to give you the desired results.”

Her advice for teams engaging in activities like design sprints is straightforward: continue. After uncovering the questions and assumptions that need to be addressed, take the experimentation beyond the design sprint or brainstorming session and continue to get clarity. She urges teams to also consider addressing multiple facets of the same question.

“Let’s say you come out of a design sprint and you have validated a direction. You’ve answered a couple of questions about desirability, which is mostly what you’ll end up answering questions about. How do you mitigate risk even further? How do you get more confidence in that direction?”

Continued experimentation allows for gradual risk mitigation. Neha learned this lesson from a failed product enhancement project of her own. After receiving customer requests for a new offering, her team took the feedback and created an MVP product, did one round of testing, and then went into four months of development. The product that was shipped ultimately didn’t solve for the right use cases and 6 months later wasn’t being used by customers.

“I think the biggest thing that I learned is that one round of testing is definitely not enough! You need to really ensure that people are going to want what you’re building and you’re solving for the right problem. Just having an idea of the problem is not enough. You need to make sure the details are worked out and ensure that you’re testing the revenue model.” That last point on testing the revenue model speaks to a more holistic approach to innovation that Neha believes is a critical factor for success.

“Helping teams I work with see every aspect of the business as something that needs to be designed excites me a lot.”

On her current project, Neha’s team is considering the question of subscription models as a way to insert recurring revenue into what might be a one time purchase as well as reconsidering costs. “You can do experimentation with costs by figuring out what costs the business needs to have that will actually lead to differentiation. Which costs are we assuming that we may need to infer, which we may not? Which costs are most closely and intrinsically linked to the value of the service?”

Measuring the outcomes of innovation

Experimentation is also where Neha looks for opportunities to measure the outcomes of innovation. “Innovation, by itself, cannot be measured. Rather an organization can measure the impact of innovation by looking at how experiments have reduced their risk for any initiative.” Seeking to measure innovation itself is not the right goal, according to Neha. “It might create the wrong motivation because you don’t want to innovate just to innovate.”

Instead, measure to what extent your experiments reduce the organization’s risk of failure. Neha recommends that teams create an experiment board to track experiments that have been run, questions that are still open, and tests that are being run to mitigate the risks. As teams learn, they track how much their confidence level increases with each experiment.

Neha admires companies that innovate by competing with their rivals on constraints rather than strengths. Neha’s favorite example of this is Southwest Airlines. The traditional airline business is difficult to break into and the market is saturated with big names offering perks like in-flight meals, airport lounges, first class, business class, etc.

What Neha loves about Southwest is that they purposely reduced a lot of the complexity. They standardized on the 737 to reduce cost on maintenance. They moved away from the main hub to secondary airports to offer more economical flights. They combined the flexibility of car transport with the speed of air travel and opened up the market to even more people. Southwest also focused on great customer service, which was unique among existing airlines.

“Innovation is often about knowing what not to focus on and looking at what’s missing in the market.”

Airbnb is another company that Neha sees as an example of going against the grain of a traditional market, in this case, hospitality, and competing on constraints. Airbnb looks at what’s missing in the existing market and constantly probes to see where they can create more value. Airbnb Trips is one addition that allows people to do local tours and adventures as well as visiting nearby cities, an adjacent market to the traditional vacation.

“I think Airbnb is doing a pretty good job. All of their teams are organized on outcomes. So you have a team that gets together to drive a particular outcome. It’s a startup within a startup, which I really like.”

If you want to read my other articles about innovation experts and practitioners, please check them all out here.

The post Experimental Innovation for Reducing Risk appeared first on Voltage Control.

This is part of my series on thought leaders in the innovation space. Check out the other articles here.

“Failure is my middle name,” says Dr. Jay Rao. That designation certainly doesn’t fit this professor from Babson’s MBA and Executive Education programs, who has consulted for companies around the world such as Medtronic, Novartis, Ocean Spray, and BAE Systems. However, Jay wears that “failure” badge as a badge of honor. By his estimation, he failed at being a naval architect, a mathematician, and at three start-ups. “I’ll probably fail again, but I’ll kick myself if I don’t try. It’s better to try and fail than not try at all. And hopefully the next time I will make fewer mistakes.”

In addition to his teaching and work with executives, Jay’s research has appeared in The Sloan Management Review, Journal of Innovative Management, The European Business Review, and others. He is the author of the book “The Discipline and Culture of Innovation” and he currently sits on the Innovation Advisory Board of Bancolombia (Colombia), and on the Flavor Advisory Board of Firmenich (Switzerland).

Lessons from Naval Architecture

Jay began by studying naval architecture in undergrad. However, he quickly decided it wasn’t the career for him after spending a summer in a sweltering shipyard, braving 100-degree temperatures with 90% humidity. While he didn’t continue down that path, his experience in engineering is linked to his current work in innovation: “I think engineering gives you a very structured way of thinking or problem-solving.” Similarly, Jay is a strong believer that innovation is about problem-solving, and not about idea generation, as is often thought.

“What I bring to innovation for companies is very structured problem-solving. It’s not about ideas.”

He also went on to expand on his definition of innovation: “Innovation has a very specific purpose. Innovation should change the dynamics of competition in the market. It should help you either capture or grab market share, or it should create some new value to society that did not exist before. Otherwise, it’s purely catching up to industry standards or the rest of the world. In which case, the word innovation is meaningless.”

To sum it up, innovation comes when there is a gap that needs to be filled in the market: “At the heart of it is, there’s a pain or an opportunity and how do I go and take advantage of that and help change the competitive nature in the market?”

Innovation is Not Magic

In addition to not being about ideas, Jay stressed that innovation is also not about magic or luck. (Perhaps something that gets forgotten in our cultural focus on a handful of start-up ‘unicorns’.) “Innovation is a discipline, like finance, like marketing. It’s a field of study, it’s a body of knowledge. People have to learn the tools and the techniques and the methodologies. So you have to approach it as a science.”

Jay works with companies and executives and brings this very thoughtful, very disciplined approach. And, it all starts with strategy for him: “Innovation always has to be in service of the strategy of a company. You can’t really separate out innovation and strategy because both of them are about growth.”

“You can’t really separate out innovation and strategy because both of them are about growth.”

Jay also talked about the need for companies to have the right processes to ensure innovation. It’s only after companies have put the right strategy and processes in place — over five to ten years — that you get an innovation culture. “Innovation culture is an outcome because you have a strategy: you approached it as a science, you put in resources, you selected projects carefully, you put in processes to scale, and you were able to measure the success of all your efforts. That’s culture.”

“Most executives approach it as: ‘I want you to be innovative, I want you to be creative, I want you to be thinking out of the box. I want it for free.’ I always tell them, if you want it for free and you want it tomorrow, go to Las Vegas.”

The Building Blocks

Jay created a framework that he calls the Six Building Blocks of an Innovative Culture. The simple, but powerful, idea is that an innovative culture rests on a foundation of six key things: resources, processes, values, behavior, climate, and success. It’s been a very successful and oft-cited model, as Jay has found that executives can really wrap their heads around the pillars and see their organization in them.

I loved learning how Jay uses this framework in practice with companies. He doesn’t always talk about it or question around these six areas overtly, especially at first: “It has to emerge. It has to be organic. I ask things like: ‘How do you describe your company to others?’ Those are the kinds of subtle prompts I give them. Based on their responses, I organize according to these blocks without them knowing about it. Then I bring those building blocks alive. People immediately jump on it, and say, ‘Oh my god. That’s us. That is who we are!’”

How to understand company culture

Another insider tip I learned from our conversation is Jay’s tactic for getting a realistic, non-candy-coated view into a company’s culture. Especially in large companies, Jay believes in going directly to the project management office.

“When you go and talk to people in the project management office, you learn a lot about the company’s culture, because that’s how they get things done. That’s how they prioritize their opportunities for the future. It’ll tell you all the bureaucracy that’s inside the organization. It’ll tell you what metrics they’re using to evaluating people and projects. It will reveal your culture. It’s a backdoor way of understanding culture.”

This more intuitive way of understanding a particular organization’s culture is smart; people don’t always tell you how things really are when asked directly, but they will show you how things are if you observe and ask other important questions. By coming at things from an angle, Jay uncovers critical learnings about corporate culture.

Uncertainty Navigators

Jay and I talked a bit about how companies can structure successful innovation programs. As well as innovation that is deeply connected to strategy, Jay pointed to leadership as key. In particular, he talked about the need for entrepreneurial leaders, which he defined as people who are “very focused on the future, not just the current.”

“All enterprises have a scarcity of uncertainty navigators. All big corporations have an abundance of risk managers.”

“In every organization, there are risk managers and there are uncertainty navigators. Risk managers are managing the current products, current markets, current technologies, current business models. This is about current cash.”

He continued: “Uncertainty is about the future products, future customers, future business models, future technologies. You don’t have data, and you have to make investments and decisions with very minimal or limited data. That’s uncertainty. All enterprises have a scarcity of uncertainty navigators. All big corporations have an abundance of risk managers.”

Walk, Not Talk

This idea of leadership links back to culture, which, for Jay, connects with values. “Our values are not what we speak. Values are how we spend our time and money. That shows up in our behaviors, how we spend our time and money.”

Values are a matter of a company “walking the walk.” It’s about doing what they say they believe. He gave Wells Fargo as a timely example of a company not necessarily living their values: “Wells Fargo had amazing things in their value statements. But they were totally rubbish. The way they defined success was very clear: cross-selling its products.”

He continued: “You can look at Wells Fargo through the lens of the six building blocks, and you can almost predict disaster. Or you can predict Netflix, how they have a very strong way of protecting these six building blocks.”

Multiple Metrics

When you are looking to measure the success of a particular innovation program, Jay does not think there is one way to measure it. (“Does it change human behavior? Does it add significant value to a segment of society? Can it get people out of poverty?”) Instead, he believes in measuring success from multiple angles, through what he calls input, output, and process metrics.

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“R&D budget is an input metric. It’s not an output metric. An output metric would be something like what 3M has had for a long time, the new product vitality index. What percentage of our revenue is coming from products, services, and markets that did not exist three or five years ago?”

“Output methods are: how fresh are our products? How many products have we introduced in the last five years? What is our profitability linked to these new products that we are creating?

“Good companies are measuring all three: input, process, and output methods.”

He also urges companies to track process metrics. “Process metrics are: ‘How many projects are we running? What are we learning? What experiments are we doing? What new capability did we create that we didn’t have before?”

Gorillas, chimps, and monkeys

One of the courses that Jay teaches at Babson is called “Leading Innovation: Gorillas, Chimps & Monkeys.” The course title is based on a concept from Geoffrey Moore’s book Crossing the Chasm. Jay explained: “[Moore] talked about the concept of gorillas, chimpanzees, and monkeys: large companies, medium companies, and small companies. How do they approach innovation differently? They approach it very differently: your budget allocation is different, your project choices are different, your target segments are different.”

Jay sees this model as a helpful way to understand how different-sized companies tackle innovation and what mistakes they make based on their size and particular challenges.

For example, with small companies (aka “monkeys”), Jay sees that: “innovation dies because of starvation. In a large gorilla, innovation actually dies because of obesity. They throw too much money too prematurely, and if you spend too much money too early, the finance people will expect very fast returns.”

Start Small

Speaking of monkeys and small companies, Jay had some thoughts that I think are sage advice to those entering the start-up world. And, surprisingly, that advice is not to dream big.

“Everybody wants to become an Insta-billionaire, but the fact of the matter is that it took 20 years for Pixar to come up with their first movie. History is irrelevant for most people because you’re asked to dream and dream big. You have to think big. You need to go big or go home. That’s the most bullshit advice that most people give, once they’re successful.”

He continued to talk about how the media doesn’t help this “dream big” attitude; Silicon Valley is fetishized when, in fact, the possibility of making it “big” is extremely rare. “Everybody wants to be Silicon Valley. Out of the six million companies that were born in the U.S., in the last 10 years, only 14,000 of them got some kind of external funding. That’s .2% of all companies that are born in the U.S. And, there are only 4,000 publicly traded companies out of six million companies in the U.S. That’s .07%. So 99.8% of companies that are born in the U.S. don’t get funding or don’t become publicly traded.”

The lesson here is not to discourage start-ups or innovations, but how you approach it. As Jay says: “You have to start incredibly small. All great innovations start incredibly small.”

If you want to read my other articles about innovation experts and practitioners, please check them all out here.

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This is part of my series on thought leaders in the innovation space. Check out the other articles here.

Scott Kirsner has his finger on the pulse of the current state of the industry. Scott is the CEO and Editor-in-Chief of Innovation Leader and also writes a weekly column on innovation and technology for the Boston Globe. Innovation Leader is an independent media and events company that provides subscription-based, in-depth content, reports, templates, and tools that focus on how innovation happens at big organizations. Scott’s work has also appeared in Wired, Fast Company, The New York Times, BusinessWeek, Newsweek, and Variety.

Recently, I turned the tables on this reporter and interviewed Scott over the phone. Our conversation gave me insight into how innovation is happening (or not) at large companies right now. Read on for some of the top takeaways from our chat.

Technology creatively applied

We started off by talking about what attracts Scott to this space in general: “Technology for its own sake isn’t really interesting to me. I’m more interested in how [technology] gets applied in business to do new stuff and be useful to people in the company or the company’s customers. I’ve always enjoyed writing stories about technology used in really creative ways.”

He shared that one of his first big stories for Wired Magazine was about the technology infrastructure that runs Disney World: “As a kid, I grew up going to Disney World and always heard the myths about the underground level of the theme parks. It was a fun excuse to go hang out for a week and be behind the scenes and see the ancient technology infrastructure at the time that runs all the parades and rides.”

This illustrates his point that it’s not technology for technology’s sake that is compelling. It was the story that the technology told and the way it opened up new experiences that were fascinating and groundbreaking: “It was technology creatively applied to do something that nobody had ever thought to do before — all of these animatronic shows, movies, and immersive experiences.”

More than a trip to Silicon Valley

From his vantage point as a thought leader on innovation inside large corporations, I asked Scott to share what he sees as some of the right and wrong ways to go about inspiring innovation. The first thing he talked about is the mistake of thinking you can build expertise in innovation quickly or shallowly: “Probably the most wrong-headed thing is when companies fill the company plane with senior executives and send it to Silicon Valley. They spend two days visiting accelerators, co-working spaces, venture capital firms, and Google… and by the time they leave, they feel like they really have a handle on innovation.”

“Probably the most wrong-headed thing is when companies fill the company plane with senior executives and send it to Silicon Valley…and by the time they leave, they feel like they really have a handle on innovation.”

Instead, he thinks senior leadership should spend more time articulating why they are embarking on this journey in the first place: “Defining a clear strategy is a key starting point and asking questions like What are we trying to achieve? What is a reasonable time frame for achieving it? Who on staff should be involved, or who should we hire? There isn’t a one-size-fits-all structure or strategy for this.”

“It requires more than one person with ‘innovation’ in his or her title, sitting in an office, and trying to change the way a huge company operates. It also requires more than a year or two.”

Beyond that, companies need to know that: “It requires more than one person with ‘innovation’ in his or her title, sitting in an office, and trying to change the way a huge company operates. It also requires more than a year or two.” This concept of being patient and giving innovation time to take root is something we’ll come back to later.

Leave the Building

In this era when start-up offices offer Kombucha on tap and chef-made meals, I loved what Scott said when I asked him what he sees as the innovation “silver bullet”: “[It’s] getting out of your office or off your campus and participating in the ecosystem around you. So many companies fail at innovation because no one ever leaves the campus. They expect innovation to come to them.”

Today, many big companies incentivize employees to stay in the building. But, to Scott, the activities outside of your company are fundamental to inspiring new thinking and staying relevant.

Here’s his advice to those lured to stay inside with their foosball table and beanbags: “Get outside of the building and either be at meetups that are relevant to you or be out speaking at your alma mater and meeting student talent, or visit Accelerator Demo Days, or even a conference…”

Be Careful Mixing the Flavors of Innovation

Scott pointed to two fundamental types or “flavors” of innovation strategies that he sees inside companies right now. It’s a simple, but helpful way to look at things: one is about culture and the other is about product innovation.

The first he called the “cultural reinvigoration approach,” which he described as when companies focus on activities like crowd-sourcing new ideas from employees, innovation training, and working toward a better, or more modern, work environment

The other approach he referred to as “new product engine,” which is where specialized teams are charged with: “aggressively growing and innovating, whether through working with startups or having your own innovation lab.”

Scott’s cautioned against trying to do both approaches at the same time — i.e. having designers innovate around new products and training employees in new methods. “It gets muddy when you ask a killer product group that’s full of entrepreneurs and designers and people who come from outside the company to be the culture change group.”

“It gets muddy when you ask a killer product group…to be the culture change group.”

Patience is a virtue

In addition to Disney, another of Scott’s favorite examples of admirable, innovative companies is Fidelity Investments. To him, they’ve been very consistent in how they explore technology to evolve their business, hiring smart people, building and testing prototypes, and “beating the competition when it comes to doing the important things first.”

He talked about one of the qualities he thinks makes Fidelity successful: “They’re really patient. They’re a private company and it’s run by the third generation of the family that founded it. You have a culture that is willing to be patient and invest over time; it generally yields better results.“ As well as patience, their flexibility is also important. He’s seen that, despite being a large organization, Fidelity isn’t afraid to do new, “more start-up like things.” This blend of patience and flexibility is a winning combo.

“You have a culture that is willing to be patient and invest over time; it generally yields better results.“

Impatient Retail

On the other end of the spectrum, Scott pointed to the retail sector when I asked him about failures he sees today. “I think there are a lot of epic failures in retail these days. It’s a really tough sector. Whether you are talking about Toys R Us or Target or Macy’s, I don’t see anyone innovating intelligently, or investing in innovation in a consistent and patient way.”

He’s seen companies try interesting experiments, but then shut them down after a bad sales quarter. “No one gives up their startup after two years,” he says. But big companies do it all the time: “We haven’t seen ROI, we haven’t seen concrete results after two years, so we’re done.”

“Big companies often say, ‘If we don’t understand how this is going to become a billion dollar business, we’ll kill it.’”

In this instance, there is a lot that larger companies, retail or otherwise, can learn from entrepreneurs. “Most entrepreneurs would tell you, ‘It might be three or four years before you have real product-market fit, and it’s still a really small business and getting to a million dollars of revenue might take you a while.’ And the entrepreneur’s happy to keep putting in the time just as long as they see something growing.” On the other hand: “Big companies often say, ‘If we don’t understand how this is going to become a billion dollar business, we’ll kill it.’”

Spectrum of urgency

Yet, Scott went on to say that there is likely a “spectrum of urgency” that the two industries we just discussed — retail and financial services — face. And this might be why they are approaching how they respond to the rapidly changing business world differently.

“I do think different industries are threatened in different ways or maybe they feel a different degree of innovation urgency.” In retail, for example, people’s buying habits are changing rapidly: “Amazon, Wayfair and Casper and all these companies are coming in to chew away at different retail chains. They’re at a pretty high end of innovation urgency. Maybe it’s so high that they just don’t even know what to do…and they don’t have the time or money to invest and be patient.”

In contrast, companies like Fidelity might not be as under the gun: “At a different end of urgency, I think you have financial services companies.There are some startups in that space, but we are not gonna put our retirement savings into this new retirement app that just launched on the Android store that has no ratings and no reviews, right?”

He went on: “In financial services, there’s the regulations, there’s the trust issues, and so I think you see a little bit less urgency and disruption happening there.” This has ramifications for the time frame that companies like Fidelity have to keep up: “That means that companies are willing to invest and have a little bit more time to figure out what their strategy is going to be. They’re not running around with their hair on fire.”

Innovation in media

One of the last things we talked about was what Scott is most excited about right now, and that’s innovation in media: “How do you get people’s attention when we spend all day in front of screens, and there’s just so much content?”

Scott has had front seat tickets to watching as big shifts have taken place in media — i.e. people leaving print for digital and people leaving subscription-based media (magazines, newspapers or paid TV) for those that are free or ad-supported. This moment has also opened up an opportunity for deeper, richer content. Which is why his Innovation Leader content is available through a subscription fee model.

“It makes us very focused on only writing about stuff that no one else is covering and that is unique to us.”

In this age of widely available, quick-to-consume content, there is real value in the type of high-quality content that Innovation Leader produces. Subscribers get content that they can’t get anywhere else and, for them, it’s worth it: “It makes us very focused on only writing about stuff that no one else is covering and that is unique to us.”

It was great to add a leader reporter on the innovation “beat” to my list of interviewees. I hope you enjoyed reading highlights from our conversation!

If you want to read my other articles about innovation experts and practitioners, please check them all out here.

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Dave Angelow is a strategist at Voltage Control and an adjunct Professor in the McCoy School of Business at Texas State University leading classes on Enterprise Information Systems, Analytics and Project/Program Management.

Dave started his career in operations management in the high-tech industry, was recruited by Deloitte Consulting to grow it’s IT and Strategy practice where he worked on some of the firm’s most critical accounts. He also held leadership positions in operations, marketing and business development with several other organizations (Motorola, Applied Materials, Dell, Fiskars Brands, Ernst & Young, JDA/i2 Technologies).

He is recognized for his expertise in strategy, innovation and customer experience management. Having worked in a variety of industries and business functions. Dave is experienced with a variety of tools and methodologies to drive organizational improvement.

Dave earned his undergraduate degree from the University of Northern Iowa and his MBA from the University of Wisconsin.

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