Change, Innovation and Strategy

1. Change, Innovation and Strategy  Insights for Emerging Leaders Jack Jordan

2. Questions to Run on • What can you do you to encourage more innovation? • Directly • Indirectly • What does culture have to do with it and how do you foster it? • Transparency • Shared vision • Permission to act

3. Type of Organizations that Succeed • Resilient • Nimble • Evolving • Innovative • The challenge is what do you to to foster those aspects?

4. How do you Speed Change? • Know who you want to change • Know where your client is at related to change • Listen to reasons for resistance • Be patient and step thru the process

5. Prochaska’s Change Model • Pre-contemplation (Not Ready)- People are not intending to take action in the foreseeable future, and are unaware the opportunity • Contemplation (Getting Ready)- People are beginning to recognize that an opportunity exists, and start to look at the pros and cons of their continued actions • Preparation (Ready)- People are intending to take action in the immediate future, and may begin taking small steps toward change • Action – People are actively using new process or method • Maintenance – People have been able to sustain action tracking results and developing new rationalization of situation • Termination – Individuals have developed a new world view related to the topic

6. Evert Rodgers Diffusion of Innovation • Five Items Speed diffusion • Relative advantage • Compatibility • Simplicity • Trialability • Observeability

7. Taylor Strategy to Situation

8. Taylor Strategy to Situation

9. How do you Improve Innovation? • Experiment • Give Permission • Expect Experimentation (Make it risky to not try new things) • Cheerlead for Change (Praise and reward trying, Celebrate failure) • Broad Points of view • Collaborate with others • Look for people with unusual connections • Read broadly • Encourage Collaboration

10. Model for Generating Innovative Ideas Courage to innovate Behavioral skills Cognitive skill to synthesize novel inputs Questioning Observing Challenging the status quo; Taking risks Innovative business idea Associational thinking Networking Experimenting Adapted from Christensen, Clayton M.; Jeff Dyer; Hal Gregersen,The Innovator's DNA: Mastering the Five Skills of Disruptive Innovators. Harvard Business Review Press, July, 2011.

11. The Lone Innovator “What a person does on his own, without being stimulated by the thoughts and experiences of others, is even in the best of cases rather paltry and monotonous.” —Albert Einstein “Successful innovation is not a single breakthrough. It is not a sprint. It is not an event for the solo runner. Successful innovation is a team sport.” —Quyen Nguyen

12. Observe Real People in Real-life Situations “Innovation is powered by a thorough understanding , through direct observation, of what people want and need in their lives and what they like or dislike about the way particular products are made, packaged, marketed, sold, and supported.” Tim Brown, CEO of IDEO

13. Customer Research - Deming Needs Customer research Design & Redesign Customer feedback Inputs Production processes Distribution Customers Support Adapted from Figure 6, p. 58 The New Economics, 2nd Ed.

14. Customer Research “It’s not the customers’ job to be visionaries. Customers may lack the vocabulary to explain what’s wrong, or what’s missing.” - Tom Kelley, IDEO

15. Customer Research “Every company prides itself on giving customers what they ask for, but the problem with listening to customers is that when companies ask customers what they like, customers are sure to answer by naming products and services that already exist. This form of research is really just being an order taker, not an innovator.” ̶ Thomas Lockwood, Design Thinking: Integrating Innovation, Customer Experience, and Brand Value, Skyhorse Publishing, April 2013.

16. Customer Research “We have found that observers are more successful at figuring out jobs to be done and better ways to do them when they… actively watch customers to see what products they [use] to do what jobs, …” ̶ Christensen, Dyer, and Gregersen, The Innovator's DNA

17. IDEO’s Five Step Methodology for Innovation • Understand the market, the client, the technology, and perceived constraints. • Observe real people in real-life situations. • Visualize new-to-the-world concepts and the customers who will use them. • Evaluate and refine prototypes • Implement the new concept - Tom Kelley, The Art of Innovation

18. Experimenting The best way to get a good idea is to get a lot of ideas. - Linus Pauling “I haven’t failed . . . I’ve just found 10,000 ways that do not work.” —Thomas Edison

19. Experimenting “Experiments are key to innovation because they rarely turn out as you expect, and you learn so much… I encourage our employees to … experiment. If you can increase the number of experiments you try from a hundred to a thousand, you dramatically increase the number of innovations you produce.” ̶ Jeff Bezos, Amazon

20. Thank you • Special thank you to Dr. GipsieRanney for her conversations on innovation and sharing content from her InThinking Network lecture

21. “They will not let us” • Organizational myths keep people from trying things • Who is the “Boogie Man” in organizations • Transforming care at the bedside was a program to kill this myth.

22. Experimenting Structured Unstructured Free Form May lack rigor Varied Documentation Nimble • Focused • Rigorous • Documented • Limited

23. The Shewhart Cycle for Learning and Improvement The P D S A Cycle Act – Adopt the change, or abandon it or run through the cycle again. Plan a change or a test, aimed at improvement A P Study the results What did we learn? What went wrong? Do – Carry out the change of the test (preferably on a small scale). S D Deming, The New Economics

25. Competition within Organizations “The idea that achievement is maximized when we go at one another tooth and nail is engraved on our national psyche. But when the road to success requires making others fail, innovation gets left by the wayside. Competition infects coworkers with a desire to win rather than to solve problems and move projects forward. In the process, employees inhibit the free flow of information so vital to innovation. Those who feel their work is being judged on conventional concepts of success and failure, and who feel they're competing with coworkers for the brass ring, will want to protect information rather than share it. This is a textbook way to squelch innovation.” Richard Farson and Ralph Keyes, “The Failure Tolerant Leader,” Harvard Business Review, August 2002

26. Complicated vs. Complex Complicated Complex May have many steps and components Actors need to accomplish tasks with communication and feedback loops Results are not replicable Raising a child • May have many steps and components • Many actors may need to accomplish role in the work • Results are replicable • Building a Building etc.

27. How are the two managed differently? • Complicated problems benefit from tight definition • Complicated problems can be planned many steps in advance • Complex problems can be fundamentally changed by over definition • Complex problems require course corrections and solutions to issues emerge from observation

28. Constancy of Purpose – Test of a Leader • Deming’s first Point • “All human organizations will disappoint” – Nadia Bolz-Webber • You will have to make decisions that take you away from your core values. The test of a leader is not abandoning those values.

29. Strategy Staying a Step Ahead • Connect yourself with broad set of ideas • Read many points of view • Hire people different from yourself • Listen to those resisting you • Look for the subtle • Lead and crime / test scores • Single use zoning and sprawl • Common is not always better • Deming and batteries

30. Connections Matter • “Disruptive innovators shine best at associating when actively crossing all kinds of borders (geographic, industry, company, profession, discipline, and so on) …” • ̶ Christensen, Clayton M., Jeff Dyer, Hal Gregersen, The Innovator's DNA: Mastering the Five Skills of Disruptive Innovators, Harvard Business Review Press, July, 2012.

31. Connections Matter “Many companies rigidly separate functions such as research, design, marketing, and manufacturing, creating walls between groups that have much to teach one another.” “Build bridges from one department to another, from your company to your prospective customers, and ultimately from the present to the future.” ̶ Tom Kelley, IDEO

32. Leverage Points for Engagement and Innovation • What connects people to a larger purpose? • How do they keep tapped in to discovery? • How are they connected? • What are the implications?

33. Loss of Community “Beneath the current economic crisis lies another crisis of far greater proportions: the depreciation in companies of community – people’s sense of belonging to and caring for something larger than themselves.” Henry Mintzberg, “Rebuilding Companies as Communities,” Harvard Business Review, July-Aug, 2009.

34. Delivery versus Discovery “…large companies typically fail at disruptive innovation because the top management team is dominated by individuals who have been selected for delivery skills, not discovery skills. As a result, most executives at large organizations don’t know how to ‘think different.’” ̶ Christensen, Clayton M., Jeff Dyer, and Hal Gregersen, The Innovator's DNA: Mastering the Five Skills of Disruptive Innovators. Harvard Business Review Press, July 2012.

35. Structural Holes “… behavior, opinion, and information, broadly conceived, are more homogeneous within than between groups. People focus on activities inside their own group, which creates holes in the information flow between groups, or more simply, structural holes.” ̶ Ronald S. Burt, “Structural Holes and Good Ideas” American Journal of Sociology, September, 2004

36. Networks in Organizations • Ronald S. Burt, “Structural Holes and Good Ideas” • American Journal of Sociology, September, 2004

37. Import - Export “People with connections across structural holes [gaps in social networks] have early access to diverse, often contradictory, information and interpretations, which gives them a competitive advantage in seeing and developing good ideas. … People connected to groups beyond their own can expect to find themselves delivering valuable ideas, seeming to be gifted with creativity. This is not creativity born of genius; it is creativity as an import-export business. An idea mundane in one group can be a valuable insight in another.” ̶ Ronald S. Burt, “Structural Holes and Good Ideas” American Journal of Sociology, September, 2004

38. Networks in Organizations

39. What Education Does an Emerging Leader Need? • System of Profound Knowledge (Deming ~1990) • Understanding Variation • Psychology • Appreciation for a System • Theory of Knowledge

40. Discussion • What did you hear that is actionable? • What challenges do you have to change and innovation? • What can you do you have to do experience more innovation? • Directly • Indirectly