Category: Innovation

I will eventually write a report about our adventures teaching an innovation class to executives and entrepreneurs in the United Arab Emirates last week, but for now, I thought I would tell you about the camel races.  Yousif AlYousif, our student and charming host (he took us out to smoke water pipes — honest,  it was just tobacco), sent me a couple pictures of camel races. Note that the "jockeys" in the top picture are actually remote controlled robots, developed because too many riders — who are just about always children (see bottom picture) — were getting injured and killed. 

Weird Ideas That Work: How to Build a Creative Company (note the new subtitle), is about to be released in paperback.  The official release date is May 15th, but I expect that Amazon will be shipping in a few days. In
going back and reading the book, and thinking about the current excitement
about innovation in many companies, two intertwined themes strike me as
especially pertinent to the times.  Much of the recent rhetoric about
innovation focuses — and I suppose rightly so — on the role of senior
management, and how leaders like A.G. Lafley at P&G and Jeffrey Immelt at
GE take bold actions that set the stage for innovation.

But
another part of the story is that innovation often happens despite rather
than because of senior management, and oddly enough, the best
leaders often realize that their very presence can sometimes stifle innovation.
Consider a classic story from 3M. Masking tape was one of the company’s first
big successes — it happened even though in 1925 then CEO William McKnight
ordered Richard  Drew to stop working on that silly project and to go back
to his work in quality control – McKnight insisted masking tape was bad idea, a
bad product with no market.  Drew ignored him and kept developing masking
tape. To McKnight’s credit, this incident led to 3M’s famous  15%
rule, that employees in technical jobs can spend up to 15% of their time
working on projects without getting permission.  Implicit in this practice
is the mindset that managers often make bad guesses about what is worth working on.  And, also, it reflects the realization that close supervision of creative
work often does more harm then good.  Indeed, this philosophy is captured
wonderfully in something that I once heard from William C. Coyne, who headed-up
R&D at 3M for over a decade.  He explained that a big part of his job
was keeping senior management away from his scientists, as they asked too many
questions too early, and started evaluating ideas too early. As he put it
"When you plant a seed in the ground, you don’t dig it up every day to see
how it is doing."

This also reminds me of my favorite HP story. Chuck House was a long-time HP
employee, and knew both Bill Hewlett and David Packard well. I have been seeing
a bit of Chuck lately, as he is the new Executive Director of Media X at Stanford.
Here is Chuck’s famous story from David Packard’s autobiographical The
HP Way: How Bill Hewlett and I Built Our Company. I love how co-founder
Packard admits, actually seems to brag, about this engineer’s defiance:

I
mentioned that sometimes management’s turn down of a new idea doesn’t
effectively kill it. Some years ago, at
an HP laboratory in Colorado Springs devoted to oscilloscope technology, one of our bright, energetic engineers,
Chuck House, was advised to abandon a display monitor he was developing. Instead he embarked on a vacation to California —stopping
along the way to show potential customers a prototype of the monitor. He wanted to find out what they thought,
specifically what they wanted the product to do and what its limitations
were. Their positive reaction spurred
him to continue with the project, even though on his return to Colorado, he found that
I, among others, had requested it be discontinued. He persuaded his R&D manager to rush the
monitor into production, and as it turned out, HP sold more than 17,000 display
monitors representing sales revenue of $35 million for the company. 

 Some years later, at a gathering of HP
engineers, I presented Chuck with a medal for “extraordinary contempt and
defiance beyond the normal call of engineering duty.” . . . “I wasn’t trying to
be defiant or obstreperous. I really
just wanted a success for HP,” Chuck said. “It never occurred to me that it might cost me my job.”

I
just checked again with Chuck to ask, again, "is this really true?"  And he answered ‘The quote is
accurate.  I’m flattered to have it “continued”.  When HP issued
their “Origins” DVD a year ago, they included that passage, and I got a quick
cameo appearance as well.’ 

The
spirit of these lovely old 3M and HP stories is that the best leadership is
sometimes no leadership at all (or leadership by getting out of the way) and
the best leaders realize that they are going to wrong a lot, and admit from –
and in the case of Packard – even celebrate their mistakes. That is why one of my Weird Ideas That Work suggests “Encourage people to ignore and
defy superiors.” And there are more than
stories behind this (and other) weird ideas. For example, Anne Cummings and Greg Oldham studied 171 employees in a
manufacturing plant, which compared those with controlling and non-controlling
supervisors. This 1997 California
Management Review article reports that employees with non-controlling
supervisors made considerably more novel and useful suggestions.

Finally,
it is important to emphasize that I don’t believe that people should always
hide from, ignore, and defy their bosses. When doing routine work where there are big differences in expertise
between the boss and others – such as flying an airplane or doing a surgical procedure
—  I am all for underlings who listen carefully
to the boss and do what the boss says; although even in those settings, I
want nurses and co-pilots to speak up when the doctor or pilot is making a
mistake!
   

Tina Seelig is the Executive Director of the Stanford Technology Ventures Program.  Tina is one of the most action-oriented and fun people at Stanford — and is always doing something new and interesting. You may recall that my last post about her talked about her startup, Floodgate.  One of Tina’s other adventures this year was — in her role at STVP — being the driving force behind the the first ever Entrepreneurship Week at Stanford, where as the Stanford Daily put it:

The series of events, which drew over one thousand students, industry
professionals, and professors,
included an entrepreneur mixer, a
technology showcase, and even a venture capitalist speed dating
session. It culminated with the Saturday judging of a competition
called the Innovation Challenge. Ninety teams had to take an everyday
object — here, a pad of one hundred 3” by 3” Post-it notes — and
attempt to create as much “value” as possible. The catch? Teams only
had four days — and no funding.

The winner of the competition was "Team Gumball," which used "their Post-its to solicit donations for a
micro-lending organization called Kiva. Canvassing the campus with
their Post-it notes, they were able to raise over three-thousand
dollars.

The Post-It challenge wasn’t just done at Stanford, it was done at the same time at a lot of other places in the world as well. The same contest was ran at many universities in the U.S. and throughout the world. Check out the Imagine It website. There is a promotional video (with many of my favorite people — including Tina Seelig), and the best part is you can see the student projects and interviews.  In particular, our friend Gus Bitindger  who did the great innovation video for my class (which I posted about last week) has a wonderful entry he did with friends that was called whatsyourpostit.com. And as Tina says, there is one about disabled kids from Thailand that can make you cry.

Once again, the range of an depth of creativity and action that came from these student groups — and in such a short time and with few resources — continues to give me great hope about the future.  The  current generation of young people continue to impress me. Under the right conditions it seems like they can do almost anything.  Thank goodness, they’ve got a lot of problems to fix!

Tina Seelig is one of the most creative and action-oriented human beings that I have ever met. Her "day job" is being Executive Director of the Stanford Technology Ventures program, which I believe — yes, I am biased — is the most successful entrepreneurship program in the world. I say that not just because faculty and students do such great research and teach such great classes, but also because they have done outreach all over the world. Tina and her colleagues — especially Academic Director Tom Byers — help faculty teach entrepreneurship in dozens of countries. It seems like Tina is always coming back from yet another country where she has ran a conference! And during the decade that Tina has been in this role, she is constantly starting new things… as one small example, STVP was first academic unit I know to get into podcasting its speeches and  seminars and as I have written before, has been #1 on iTunes for downloads in the higher education category for many months.

Tina also teaches a great creativity class… this isn’t just my opinion, she gets incredibly high ratings from students, and two years ago, our students voted her the outstanding teacher in the Department of Management Science & Engineering at Stanford.  She also has practiced creativity for years producing her line of Games for Your Brain, cards that teach scientific concepts of all kinds to kids, from bugs to the human body.

In the middle of all this, the other week  I was walking by her office, and she waved at me "Bobby, Bobby come here" (Tina calls me Bobby, I try to stop her, but can’t). She said, "guess what, I started a company!" And she did, check it out. It is a place called Open Floodgate where people publish poems, stories, essays, even books.  And it is amazing how much stuff is up there given that is just launched. Check it out. Take the tour. Sign-up and upload some stuff. Knowing Tina, Open Floodgate will be a huge success.

   

Polly LaBarre, co-author of the hot-selling and widely praised Mavericks at Work, was kind enough to stop by Stanford yesterday and teach a session of my class.   The class is called Organizational Behavior: An Evidence-Based Approach, and has about 90 students who take the class "live" and another 60 or so who "attend" the class from companies like Google, HP, Cisco, watching it on video.

Polly displayed remarkable energy, especially given that it was her third talk of the day. One of the points that she made especially well was that mavericks are so effective at inspiring innovation partly because they use authentic and compelling language, not hollow business language.  She pointed out that, in too many cases, the language used by executives in one company is completely interchangeable with the language used by another; and hollow and meaningless in every place it used. The class just cracked-up when she called this "Jargon monoxide." Now that is great language!   

Some of the worst "jargon monoxide" I can think of includes "value added," "competitive advantage," "distinctive competence,"  and "monetize."  I suspect that each of you have your least favorite phrases. Of course, this is a subject that lots of people have written about, but Polly’s phrase just cracked me up. Check out The Office Life  and  hese "bullfighter tips." 

P.S. Also check out the Maverick’s blog

Recent Stanford grad Min Liu — who I wrote about a few weeks ago when she talked about her d.school experiences, especially the Wal-Mart project — has joined with folks including d.school veterans Julio Vasconcellos and Matt Wyndowe to develop iinnovate, " a podcast about innovation and entrepreneurship."  They have some great interviews posted. The latest is with Ed Catmull, Co-Founder and President of Pixar Animation.  And there is lots of other great stuff, including interviews with former HP EVP Debra Dunn (and now Associate Consulting Professor at the d.school), marketing guru Geoffrey Moore, and a pile of other interesting folks. I especially like to see this site develop because it is an example of cooperation between an engineering student (Min just graduated and is now at Google) and Stanford MBAs —  that is how a lot of great things have been started in Silicon Valley, including Sun Microsystems and Intuit. Check it out and download some good interviews.

The Pope is in Turkey. So is Anderson Cooper.  And I had a tiny touch of Turkey this week too. About 18 months ago, I gave a talk in Istanbul on my book Weird Ideas That Work: 11.5 Practices for Promoting, Managing, and Sustaining Innovation.  I was hosted by the Eczacibasi company, which is owned by a gracious and charming family. And they have given much back to their country, including the first modern art museum in their country.  When I gave my speech there, they printed about 2000 copies of a special edition to give to people who attended the conference, but the general edition just came out. It is called ISE YARAYAN CILGIN FIKIRLER — which they tell means weird ideas that work "just about exactly."  And I think that they did a fantastic job with the cover.

I
just finished reading Mavericks
at Work, by Fast Company veterans
William C. Taylor and Polly LaBarre. It is a great book, filled with stories and ideas,
and somehow conveys the excitement of Fast
Company when it was in its prime without the excessive breathless hype (of
course, that wasn’t just at Fast Company,
such hysteria was everywhere during the boom). They make fantastic use of mavericks from Howard Stern to HBO to Cirque
du Soleil, and cover everything from strategy, to open source approaches to
innovation, to managing people, to leadership. I love the book, and I guess my only complaint is that – as much as I
believe that mavericks, deviants, rebels, revolutionaries, or whatever you want
to call people who go against grain –- are essential to innovation, I think
that Taylor and LaBarre should have talked a bit more about the risks and
downsides of challenging the status quo.

It
turns out that failure is the fate of most mavericks; for every success story
that we hear about, there many more deviants or revolutionaries who have been
shunned, fired, or ran their organizations into the ground. As James
March, Stanford’s renowned organizational theorist, put it: “Most deviants
end up on the scrap pile of failed mutations, not as heroes of organizational
transformation.” And identifying which
few mavericks are likely to win has proven to be difficult for researchers and
investors –- after all, most new companies and products fail. Again, I turn to Jim March:

Unfortunately, the difference between
visionary genius and delusional madness is much clearer in history books than
in experience. … Only a tiny proportion of our heretics will ever be canonized,
and we cannot identify the saints ahead of time.

Although
being a maverick is risky, I agree with Taylor and LaBarre that they are
essential to innovation. My favorite
maverick – and yes, another success story – is Annette Kyle, the only case that
I used in both The Knowing-Doing Gap
and Weird Ideas That Work. Annette
led a little revolution in early 1996 among the 55 employees at the Bayport
Terminal in Seabrook, Texas  — –- which was part of was part of the chemical group of Hoechst Celanese Corporation. The terminal loaded about three billion pounds of chemicals per year
from rail cars onto trucks, barges, and ships. As I wrote in Weird Ideas:

When Kyle took
over in 1994, she discovered most practices had not changed since it had opened
in 1974, even though the volume handled had tripled. The operation was deeply inefficient as a
result. For example, when a ship arrived
to be loaded and had to wait because operators were running late, Celanese was
charged waiting fees called “demurrage charges,” often $10,000 per hour. In 1994, the terminal paid about $2.5 million
in these charges. It also took operators
an average of three hours to load a truck, even though the industry average was
under an hour. The terminal had a traditional
structure where supervisors closely oversaw the operators who loaded the
chemicals. The supervisors clung to old
ways, even though it hampered the speed and quality of the work.

After
devoting herself to learning about how the terminal worked –- not just talking
to people, but putting overalls and working alongside her people as the did
their jobs –- Kyle tried a series of small changes to improve the efficiency.
All failed as people quickly reverted to her their old ways. So she planned and implemented a revolution
in early 1996. As I wrote in Weird
Ideas:

On the morning
of January 3, 1996, the terminal was closed and all employees attended a
meeting. Kyle announced and immediately
implemented sweeping changes. Operators were now self-managing and worked
without immediate bosses; supervisors were now “marine planners,” responsible
for planning the flow of materials; and schedules, and information about how
well goals were being met were displayed on a large board that everyone could
check at any time. Kyle also brought in
a coffin where she put various items to symbolize that the past was dead, like
a “Ships Happen” sign from the
supervisors’ office, which reflected the destructive old attitude that
preparing in advance to load a ship wasn’t always possible.

The positive effects of Kyle’s revolution were evident almost immediately. Demurrage fees dropped from over $1,000,000
in the first half of 1995 to less than $10,000 in the first half of 1996. More than 90% of the trucks were loaded
within an hour of their arrival. Supervisors and operators were shocked at first, but soon developed
positive reactions to the new ways. An
evaluation by independent researchers from the University of Southern  California indicated that employees were
satisfied with and motivated by the changes.

As
I said, predicting why one maverick succeeds and another fails is risky
business. But there are some hints about why Annette succeeded in this case:

1. The
people at the terminal were ready for change, they knew there were serious
performance problems – people are more likely to change when they are
dissatisfied with the status quo.

2. Annette
didn’t just ride in on her white horse and start changing things, she spent a
long time learning how the operation worked and gaining trust before she started
changing things.

3.  Annette had “cover” from her immediate boss –
senior management was not asked for prior approval, she just did it – so she
didn’t ask for permission in advance and wasn’t burdened by corporate red tape.

4. The
Bayport terminal was a long way from the main plant, so other people in the
company who might have stopped or slowed the change didn’t know what was going
on.  The closer you are to the “main”
part of an organization, the harder it is to do something new or different.

5. Annette
was willing to take a risk because she was planning on taking a leave and, as
she told me, was willing to risk being fired as well – although she didn’t believe
that would happen because she doing what was best for her people and the
company.

It
has been several years since I talked with Annette. The last time I did, she
was focusing on raising her kids and working on making big changes in the
science curriculum in their schools. She also told me that there were fears that the Bayport operation would
be outsourced and all the people she worked with fired; I don’t know what
happened, and if anyone does know, I would be curious to find out. Of course,
one dramatic change isn’t enough to save an organization forever. But
regardless of what happened since then, Annette is my favorite maverick because
she had so much courage and skill, and loved her people and cared so deeply
about making things better.

P.S. Check out the Mavericks blog.

As I wrote in my earlier post about about Joi Ito, I am fascinated about the prospect of using online worlds as arenas to develop prototypes and do experiments to learn about "real" organizations. Increasingly, however, I realize that drawing a dividing line between real and virtual worlds can be a half-truth or even downright wrong.  Check out Diego’s current post on the real press conference that Ross of Socialtext is holding "at" World of Warcraft.

As I’ve written about before, Diego Rodriguez and I taught a class at the Stanford d.school last spring on Creating Infectious Action. One of the student projects, perhaps the most successful, focused on spreading the use of Firefox, the open source web browser.  I learned from that experience that,  as an engineering professor who lives in Silicon Valley, I sometimes make assumptions things that people know about the web and technology that turn out to me dead wrong.  The students in the class taught me that there are many experienced web users who don’t know what Firefox is, or in fact, that there different kinds of browsers.  As a result, when I talk to audiences about the project, I now ask them "how many of you have heard of the Firefox web browser." And the answers surprise me. A few weeks ago, I asked this question to an audience in Des Moines Iowa composed of about 100 of the top senior executives  of Principal Financial.  I was giving a speech on evidence-based management.  I was surprised when only about 5 people raised their hands. NOW before you get judgmental about ignorance of the web (an instinct I have, but have learned is dangerous), you should also know that this company has splendid financial performance as well as some of the most progressive HR practices I know, they were persistently friendly and very smart, and are on Fortune’s list of the best 100 places to work –and unlike many employers — the HR people are  developing ever more progressive programs, like on site childcare. In my mind, any company that achieves these two "bottom lines" is doing something right.

Then about 10 days later I was giving an innovation talk in Frankfurt, Germany to the clients of Lupus alpha, an asset management firm. There were perhaps 300 people in the audience, and I asked them "how many of you have heard of the Firefox web browser?" I was amazed when over 75% of them raised their hands. I am not sure of the reasons for this, but the difference was striking, as I didn’t expect institutional investors to know so much about the web given my experience in Des Moines in the prior week — I am not sure of the reason for this awareness, but one of my students told me that Firefox has been in Germany a long time and is widely used.

The lesson, as we tell our students in the d.school, is to keep testing your assumptions. Indeed, in a related vein, I recently realized that many people in an audience of executives that I was teaching did not quite understand what it meant to do an experiment. If evidence-based management is going to spread, this is something people need to understand —  I won’t go into the answer here, but if you want to see the answer, go to Wikipedia does a splendid job of defining and explaining experiments  and check out  the Campbell  Collaboration for  an impressive array of information on experiments and  related methods.

P.S.  I am sure that I biased the crowd with my connection to the d.school, but quite a few Germans told me that SAP founder Hasso Plattner (who donated 35 million to the school, and it is named after him) was the known as the most innovative German executive.  And one German told me that he believed that Hasso and Arnold Schwarzenegger were two of the most admired people in the country.