InnoTac/Act: Innovation Tactics/ A Bias for Action Tom Peters/InnoTac+Act.0622.06 PART ONE: INNOVATION TACTICS Tom Peters on … Innovation tactics.
Download ReportTranscript InnoTac/Act: Innovation Tactics/ A Bias for Action Tom Peters/InnoTac+Act.0622.06 PART ONE: INNOVATION TACTICS Tom Peters on … Innovation tactics.
InnoTac/Act: Innovation Tactics/ A Bias for Action Tom Peters/InnoTac+Act.0622.06 PART ONE: INNOVATION TACTICS Tom Peters on … Innovation tactics Premises I “A focus on cost-cutting and efficiency has helped many organizations weather the downturn, but this approach will ultimately Only the constant pursuit of innovation can ensure long-term success.” render them obsolete. —Daniel Muzyka, Dean, Sauder School of Business, Univ of British Columbia (FT/09.17.04) “Forbes100” from 1917 to 1987: 39 members of the Class of ’17 were alive in ’87; 18 in ’87 F100; 18 F100 “survivors” underperformed the market by 20%; just 2 (2%), GE & Kodak, outperformed the market 1917 to 1987. S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997. Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market “I am often asked by would-be entrepreneurs seeking escape from life within huge corporate structures, ‘How do I build a small firm for Buy a very large one and just wait.” myself?’ The answer seems obvious: —Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics More than $$$$ #1 R&D spending, last 25 years? GM “I am often asked by would-be entrepreneurs seeking escape from life within huge corporate structures, ‘How do I build a small firm for Buy a very large one and just wait.” myself?’ The answer seems obvious: —Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics Premises II What “We” Know “For Sure” About Innovation Big mergers [by & large] don’t work Scale is over-rated Strategic planning is the last refuge of scoundrels Focus groups are counter-productive “Built to last” is a chimera (stupid) Success kills “Forgetting” is impossible Re-imagine is a charming idea “Orderly innovation process” is an oxymoronic phrase (= Believed only by morons with ox-like brains) “Tipping points” are easy to identify … long after they will do you any good “Facts” aren’t All information making it to the top is filtered to the point of danger and hilarity “Success stories” are the illusions of egomaniacs (and “gurus”) If you believe the memoirs of CEOs you should be institutionalized “Herd behavior” (XYZ is “hot”) is ubiquitous … and amusing “Top teams” are “Dittoheads” CEOs have little effect on performance “Expert” prediction is rarely better than rolling the dice Try It “This is so simple it sounds stupid, but it is amazing you only find oil if you drill wells. how few oil people really understand that You may think you’re finding it when you’re drawing maps and studying logs, but you have to drill.” Source: The Hunters, by John Masters, Canadian O & G wildcatter (80%) “While many people big oil finds with big companies, over the years about 80 percent of the oil found in the United States has been brought in by wildcatters such as Mr Findley, says Larry Nation, spokesman for the American Association of Petroleum Geologists.” —WSJ, “Wildcat Producer Sparks Oil Boom in Montana,” 0405.2006 “We made mistakes. Most of them were omissions we didn’t think of when we initially wrote the software. We fixed them by doing it over and over, again and again. We do the same today: While our competitors are still sucking their thumbs trying to make the design perfect, we’re already on prototype version No. 5. By the time our rivals are ready with wires and screws, we are on version No. 10. It gets back to planning versus acting: We act from day one; others plan how to plan—for months.” —Bloomberg by Bloomberg “The secret of fast progress is inefficiency, fast and furious and numerous failures.” —Kevin Kelly Culture of Prototyping “Effective prototyping may be the most valuable core competence an innovative organization can hope to have.” Michael Schrage Think about It!? Innovation = Reaction to the Prototype Michael Schrage “We are in a brawl with no rules.” —Paul Allaire S.A.V. Screw Around Vigorously Screw It Up “Fail faster. Succeed sooner.” David Kelley/IDEO Fail. Forward. Fast. –High-tech Exec/PA “FAIL, FAIL AGAIN. FAIL BETTER.” —Samuel Beckett “Reward excellent failures. Punish mediocre successes.” Phil Daniels, Sydney exec Read This! Richard Farson & Ralph Keyes: Whoever Makes the Most Mistakes Wins: The Paradox of Innovation Sam’s Secret #1! “Tom, very simple. Sam was not afraid to fail.” —David Glass to TP, on the occasion of Sam’s induction into The Sales & Marketing Hall of Fame Plan B "I think it is very important for you to do two things: act on your temporary conviction as if it was a real conviction; and when you realize that you are wrong, correct course very quickly.” —Andy Grove “The most successful people are those who are good at plan B.” —James Yorke, mathematician, on chaos theory in The New Scientist Parallel Universe Build a “School on top of a school” (The Parallel Universe Strategy) B.School Innovation Strategies: Exec Ed/Continuing Ed (fewer restraints). Web (fewer restraints). “Parallel Universe” approach (JKC/Bob S)! Recruit “weird” (in places you can get away with it—eg, students, continuing ed faculty lesser admin jobs)! Message: LOOK FOR/EXPLOIT THE “WEAK” (Unregulated) SPOTS! Jill Ker Conway/Smith 1. Scour for renegades; wine & dine. 2. Go outside for funds. Change? Ha! Try: End Run! Build Your Own! Period! “We’re never going to persuade the conservatives to accept [our view]. We need to build our own institutions.” —anon. Parallel Universe/ Venture Fund “Venture” fund (E.g. Gerstner/Amex, Dow/Marriott, Grove/Intel, Bedbury/Starbucks) 2/50* *Scott Bedbury/Starbucks/<1%/<4 of 400/ grabbed best/all wanted to be there/2%-50% Shell “Game Changer” 10% of technical budget “set aside and used to fund promising but nontraditional ideas through a staged funding process similar to that used by venture capitalists” Source: Financial Times/08.2003 We Are What We Eat We become who we hang out with! Measure “Strangeness”/Portfolio Quality Staff Consultants Vendors Out-sourcing Partners (#, Quality) Innovation Alliance Partners Customers Competitors (who we “benchmark” against) Strategic Initiatives Product Portfolio (LineEx v. Leap) IS/IT Projects HQ Location Lunch Mates Language Board Requirement: Discomfort “I’m not comfortable unless I’m uncomfortable.” —Jay Chiat Find ’em “Some people look for things that went wrong and try to fix them. I look for things that went right, and try to build off them.” —Bob Stone (Mr ReGo) “Somewhere in your organization, groups of people are already doing things differently and better. To create lasting change, find these areas of positive deviance and fan the flames.” —Richard Tanner Pascale & Jerry Sternin, “Your Company’s Secret Change Agents,” HBR Sing Them Demos! Heroes! Stories! REAL Org Change: Demos & Models (“Model Installations,” “ReGo Labs”)/ Heroes (mostly extant: “burned to reinvent gov’t”)/ Stories & Storytellers (Props!)/ Chroniclers (Writers, Videographers, Pamphleteers, Etc.)/ Cheerleaders & Recognition (Pos>>Neg, Volume)/ New Language (Hot/Emotional/WOW)/ Seekers (networking mania)/ Protectors/ Support Groups/ End Runs—“Pull Strategy” (weird alliances, weird customers, weird suppliers, weird alumnae-JKC)/ Field “Real People” Focus (3 COs) (long way away)/ Speed (O.O.D.A. Loops—act before the “bad guys” can react) C.f., Bob Stone, Lessons from an Uncivil Servant Stories … Paint me a picture … Story “infrastructure” … Demos … Quick prototypes … Experiments … Heroes … Renegades … Skunkworks … Demo Funds … V.C. … G.M. … Roster … Portfolio … Stone’s Rules … JKC’s Rules “My mission is that of a mole— my existence only to be known by upheavals.” —Jan Morris, Fisher’s Face, Or, Getting to Know the Admiral Org Structure Core Mechanism: “Game-changing Solutions” PSF (Professional Service Firm “model”/The Organizing Principle) + Brand You (“Distinct” or “Extinct”/The Talent) + Wow! Projects (“Different” vs “Better”/The Work) Band of Brothers (& Sisters!) “Never doubt that a small group of committed people can change the world. Indeed it is the only thing that ever has.” —Margaret Mead Hard is soft. Soft is hard. First-level Scientific Success The smartest guy in the room wins” Or … First-level Scientific Success Fanaticism Persistence-Dogged Tenacity Patience (long haul/decades)-Impatience (in a hurry/”do it yesterday”) Passion Energy Relentlessness (Grant-ian) Enthusiasm Driven (nuts!) (Brutal?) Competitiveness Entrepreneurial Pragmatic (R.F!A.) Scrounge (“gets” the logistics-infrastructure bit) Master of Politics (internal-external) Tactical Genius Pursuit of (Oceanic) Excellence! High EQ/Skillful in Attracting + Keeping Talent/Magnetic Prolific (“ground up more pig brains”) Egocentric Sense of History-Destiny Futuristic-In the Moment Mono-dimensional (“Work-life balance”? Ha!) Exceptionally Intelligent Exceptionally Clever (methodological shortcuts/methodological genius) Luck Hard is soft. Soft is hard. “Most important, upped the energy level at he Motorola.” —Fortune on Ed Zander/08.05 4/40 De-central-iza-tion! Ex-ecu-tion! Ac-counta-bil-ity! 6:15A.M. Inno64: Innovation Strategies & Tactics Parallel universe /Exec Ed v res MBA End run regnant powers/JKC Find done deals-practicing mavericks/Stone-ReGo Bell curves2016 in 2006 Non-industry benchmarking Everything = Portfolio V.C.s all! Hot language/Wow-Astonish me-Insanely greatimmortal-Make something great Lead customers/PW-Embraer Lead suppliers /Top decile R&D Weird alliances Mottos/Paul Arden (“Whatever You Think Think the Opposite”) Hire freaks/Enough weird people? Weird Boards!!! CEO track record of Innovation (nobody starts at 45!) System/GE-Immelt “Strategic thrust overlay” Calendar Big Delta easier than Small MBWA with freaks-weirdos/JKC MBWA/Boonies’ labs V.C.-formal/Intel Acquire weird Children’s crusade Old farts crusade Go Global at any size Stop listening to customers Talent!/Unusual sources-Hire innovators-V.C.s Eschew giant mergers Remember: scale economies max out early Assisted suicide! (“Built to last” = Chimerasnare-delusion) Burn your press clippings “Forgetting” “strategy” Fire all strategic planners Tempo! Final product bears little relation to starting notion Design! Design! Design! (“culture,” not program) All innovation: Pissed-off people Gut feel rules! Focus groups suck Weird focus groups okay Be-Do philosophy Celebrations Culture-little as well as big Inno (“everyonean-innovator”) Life = Wow Projects Acknowledge messiness-pursue serendipity (Blitzkrieg-Containers-Science-Jim Utterback) R.F.A. Culture of execution 4/40: decentralization, execution, accountability, 615AM EVP (S.O.U.B.)/Systems-process “un-design” Diversity for diversity’s sake Women-Women-Women/customers (they “are the market,” not a “segment”)-leaders Boomers-Geezers (“all the money”) CRO (Chief Revenue Officer) “culture”/topline obsessed CIO (Chief INNOVATION Officer) Laughter Facility-space configuration Experiments-prototypes “Reward excellent failures. Punish mediocre successes.” Bizarrely high incentives (& penalties) We are what we eat/We are who we hang out with (E.g.: Staff-Consultants-Vendors-Out-sourcing Partners/#, Quality-Innovation Alliance PartnersCustomers-Competitors/who we “benchmark” against -Strategic Initiatives -Product Portfolio/LineEx v. LeapIS/IT Projects-HQ Location-Lunch Mates-LanguageBoard) PART TWO: A BIAS FOR ACTION “too much talk, too little do” TP/BW/circa 1982 on BigCo Sin #1: “too much talk, too little do” TP circa 2006 on BigCo Sin #1: Excellence1982: The Bedrock “Eight Basics” 1. 2. 3. 4. 5. 6. 7. 8. A Bias for Action Close to the Customer Autonomy and Entrepreneurship Productivity Through People Hands On, Value-Driven Stick to the Knitting Simple Form, Lean Staff Simultaneous Loose-Tight Properties” Tom Peters on … A Bias for Action CONTEXT “It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change.” —Charles Darwin “Ninety percent of what we call ‘management’ consists of making it difficult for people to get things done.” – Peter Drucker “Forbes100” from 1917 to 1987: 39 members of the Class of ’17 were alive in ’87; 18 in ’87 F100; 18 F100 “survivors” underperformed the market by 20%; just 2 (2%), GE & Kodak, outperformed the market 1917 to 1987. S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997. Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market “I am often asked by would-be entrepreneurs seeking escape from life within huge corporate structures, ‘How do I build a small firm for Buy a very large one and just wait.” myself?’ The answer seems obvious: —Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics A BIAS FOR ACTION Excellence1982: The Bedrock “Eight Basics” 1. 2. 3. 4. 5. 6. 7. 8. A Bias for Action Close to the Customer Autonomy and Entrepreneurship Productivity Through People Hands On, Value-Driven Stick to the Knitting Simple Form, Lean Staff Simultaneous Loose-Tight Properties” “Never forget implementation boys. In our work it’s what I call the ‘missing 98 percent’ of the client puzzle.” —Al McDonald/McKinsey “We have a ‘strategic plan.’ It’s called doing things.” — Herb Kelleher “This is so simple it sounds stupid, but it is amazing you only find oil if you drill wells. how few oil people really understand that You may think you’re finding it when you’re drawing maps and studying logs, but you have to drill.” Source: The Hunters, by John Masters, Canadian O & G wildcatter (80%) “We made mistakes. Most of them were omissions we didn’t think of when we initially wrote the software. We fixed them by doing it over and over, again and again. We do the same today: While our competitors are still sucking their thumbs trying to make the design perfect, we’re already on prototype version No. 5. By the time our rivals are ready with wires and screws, we are on version No. 10. It gets back to planning versus acting: We act from day one; others plan how to plan—for months.” —Bloomberg by Bloomberg "I think it is very important for you to do two things: act on your temporary conviction as if it was a real conviction; and when you realize that you are wrong, correct course very quickly.” —Andy Grove S.A.V. Screw Around Vigorously Sam’s Secret #1! “Fail faster. Succeed sooner.” David Kelley/IDEO Fail. Forward. Fast. –High-tech Exec/PA “Reward excellent failures. Punish mediocre successes.” Phil Daniels, Sydney exec Boyd on TEMPO “The most successful people are those who are good at plan B.” —James Yorke, mathematician, on chaos theory in The New Scientist He who has the quickest O.O.D.A. Loops* wins! *Observe. Orient. Decide. Act./Col. John Boyd OODA Loop/Boyd Cycle “Unraveling the competition” Quick Transients/Quick Tempo (NOT JUST SPEED!) Agility “So quick it is disconcerting” [adversary over-reacts or under-reacts] “Winners used tactics that caused the enemy to unravel before the fight” (NEVER HEAD TO HEAD) BOYD: The Fighter Pilot Who Changed the Art of War (Robert Coram) “The stuff has got to be implicit. If it is explicit, you can’t do it fast enough.” —John Boyd BOYD: The Fighter Pilot Who Changed the Art of War (Robert Coram) Tempo!* 70-10 *Boyd/O.O.D.A. Loops/Mike Leach/Texas Tech 70-10/Nebraska/Unk QB 643 yards K.State/ Linemen spread wide/All legals go out for pass/Defenders confused & tire (Boyd/Tempo is not speed/“Re-arrange the mind of the enemy”—T.E. “By changing the geometry of the game, and pushing the limits of space and time on the gridiron, Mike Leach is taking Texas Tech to some far out places.” —Michael Lewis (NY Times Lawrence)/ Magazine, 12.04.05, on Mike Leach/Texas Tech) “In war, delay is fatal.” —Napoleon “The only way to whip an army is to go out and fight it.” —Grant “ … demonstrating the tactic that would become his hallmark: the immediate move to seek out the enemy and attack him” —John Mosier, on Grant “A good plan executed right now is far preferable to a ‘perfect’ plan executed next week.” —Patton Relentless!* *Churchill, Grant, Patton, Welch, Bossidy, Nardelli (GE execs), UPS, FedEx, Microsoft/Gates-Ballmer, Eisner, Weill, eBay, NixonKissinger, Gerstner, Rice, Jordan, Armstrong “This [adolescent] incident [of getting from point A to point B] is notable not only because it underlines Grant’s fearless horsemanship and his determination, but also it is the first known example of a very Grant had an extreme, almost phobic dislike of turning back and retracing his steps. If he set out for somewhere, he would get important peculiarity of his character: there somehow, whatever the difficulties that lay in his way. This idiosyncrasy would turn out to be one the factors that made him such a formidable general. Grant would always, always press on—turning back was not an option for him.” —Michael Korda, Ulysses Grant “METABOLIC MANAGEMENT” The Leadership11 1. Talent Management 2. Metabolic Management 3. Technology Management 4. Barrier Management 5. Forgetful Management 6. Metaphysical Management 7. Opportunity Management 8. Portfolio Management 9. Failure Management 10. Cause Management 11. Passion Management “The secret of fast progress is inefficiency, fast and furious and numerous failures.” —Kevin Kelly “Active mutators in placid times tend to die off. They are selected against. Reluctant mutators in quickly changing times are also selected against.” —Carl Sagan & Ann Druyan, Shadows of Forgotten Ancestors “How we feel about the evolving future tells us who we are as individuals and as a civilization: Do we search for stasis—a regulated, engineered world? Or do we embrace dynamism—a world of constant creation, discovery and competition? Do we value stability and control or evolution and learning? Do we think that progress requires a central blueprint, or do we see it as a decentralized, evolutionary process?? Do we see mistakes as permanent disasters, or the correctable byproducts of experimentation? Do we crave predictability or relish surprise? These two poles, stasis and dynamism, increasingly define our political, intellectual and cultural landscape.” —Virginia Postrel, The Future and Its Enemies “If things seem under control, you’re just not going fast enough.” —Mario Andretti “I’m not comfortable unless I’m uncomfortable.” —Jay Chiat “If it works, it’s obsolete.” —Marshall McLuhan Bossidy on EXECUTION “I saw that leaders placed too much emphasis on what some call highlevel strategy, on intellectualizing and philosophizing, and not enough on implementation. People would agree on a project or initiative, and then nothing would come of it.” —Larry Bossidy & Ram Charan/Execution: The Discipline of Getting Things Done “Execution is the job of the business leader.” —Larry Bossidy & Ram Charan/ Execution: The Discipline of Getting Things Done “Execution is a systematic process of rigorously discussing hows and whats, tenaciously following through, and ensuring accountability.” —Larry Bossidy & Ram Charan/ Execution: The Discipline of Getting Things Done “Realism is the heart of execution.” —Larry Bossidy & Ram Charan/Execution: The Discipline of Getting Things Done “robust dialogue” —Larry Bossidy & Ram Charan/ Execution: The Discipline of Getting Things Done “GE has set a standard of candor. … There is no puffery. … There isn’t an ounce of denial in the place.” —Kevin Sharer, CEO Amgen, on the “GE mystique” (Fortune) “The person who is a little less conceptual but is absolutely determined to succeed will usually find the right people and get them together to achieve objectives. I’m not knocking education or looking for But if you have to choose between someone with a staggering IQ and an elite education who’s gliding along, and someone with a lower IQ but who is absolutely determined to succeed, you’ll always do better with the second person.” —Larry Bossidy/ dumb people. Execution: The Discipline of Getting Things Done Duct Tape Rules! “Andrew Higgins, who built landing craft in WWII, refused to hire graduates of engineering schools. He believed that they only teach you what you can’t do in engineering school. He started off with 20 employees, and by the middle of the war had 30,000 working for him. He turned out 20,000 landing craft. D.D. Eisenhower told me, ‘Andrew Higgins won the war for us. He did it without engineers.’ ” —Stephen Ambrose/Fast Company The Leader’s Seven Essential Behaviors *Know your people and your business *Insist on realism *Set clear goals and priorities *Follow through *Reward the doers *Expand people’s capabilities *Know yourself Source: Larry Bossidy & Ram Charan, Execution: The Discipline of Getting Things Done Action8/VPMR+/Peters on Bossidy *External Focus (Competitors/Customers) *Realism/Truth-telling *Vision *Projects (Must add up to Vision) *Milestones *Commitment/Energy *RapidReview *Consequences (+/-) M+P=V TACTIC #1 Culture of Prototyping “Effective prototyping may be the most valuable core competence an innovative organization can hope to have.” Michael Schrage EXCELLENCE. 4/40. De-central-iza-tion! Ex-ecu-tion! Ac-counta-bil-ity! 6:15A.M. K.I.S.S. 450/8 “I wanted GE to operate with the speed, informality, and open communication of a corner store. Corner stores often have strategy right. With their limited resources, they have to rely on laser-like focus on doing one thing very well.” —Jack Welch/Fortune/04.05 Lee’s Rule: Run It off a Blackberry! “The art of war does not require complicated maneuvers; the simplest are the best, and common sense is fundamental. From which one might wonder how it is generals make blunders; it is because they try to be clever.” —Napoleon on Simplicity, from Napoleon on Project Management by Jerry Manas. BIAS Excellence1982: The Bedrock “Eight Basics” 1. 2. 3. 4. 5. 6. 7. 8. A Bias for Action Close to the Customer Autonomy and Entrepreneurship Productivity Through People Hands On, Value-Driven Stick to the Knitting Simple Form, Lean Staff Simultaneous Loose-Tight Properties” Importance of Success Factors by Various “Gurus”/ Estimates (Unreliable) by Tom Peters Strategy Systems Passion/ Execution Leadership Porter 45% 20 20 15 Drucker 35% 30 15 20 Bennis 20% 20 35 25 Peters 15% 20 30 35 MBWA MBWA 5,000 miles for a 5 min. meeting! Mark McCormack: “The first and greatest imperative of command is to be present in person. Those who impose risk must be seen to share it.” —John Keegan, The Mask of Command LET US MARCH A man approached JP Morgan, held up an envelope, and said, “Sir, in my hand I hold a guaranteed formula for success, which I will gladly sell you for $25,000.” “Sir,” JP Morgan replied, “I do not know what is in the envelope, however if you show me, and I like it, I give you my word as a gentleman that I will pay you what you ask.” The man agreed to the terms, and handed over the envelope. JP Morgan opened it, and extracted a single sheet of paper. He gave it one look, a mere glance, then handed the piece of paper back to the gent. And paid him the agreed-upon $25,000. 1. Every morning, write a list of the things that need to be done that day. 2. Do them. Source: Hugh MacLeod/tompeters.com/NPR Do them! “In classical times when Cicero had finished speaking, the people said, ‘How well he spoke,’ but when Demosthenes had finished speaking, they said, ‘Let march.’” us —Adlai Stevenson Let us march. “[Other] admirals more frightened of losing than anxious to win” Nelson’s secret: “A year from now you may wish You had started today.” —Karen Lamb You only find oil if you drill wells. —T he Hunters, by John Masters, Canadian O & G wildcatter “I don’t know if ‘it’ is possible.’ I do know it’s ‘necessary.’” TP/Chile: