Giant corporations need big innovations to move the needle
Entrepreneurs need big ideas to get attention
Investors need big returns to take risks
But innovation thrives in constraints.
And “Go Small” may be the biggest constraint out there.
Here are three stories about small innovations that created big value
Lollipops Reduce Violence
Closing time at the bars is never pretty. It can be downright dangerous. What starts as a few insults shouted back and forth between individuals or groups of friends can quickly devolve into brawls, assaults, and even murder.
Every year, dozens of cities and towns run experiments to find ways to decrease incidences of violence around bars and clubs:
Closing bars earlier
Keeping bars open 24/7
Training bouncers in crowd control tactics
Pre-positioning taxis
Better landscaping
And lollipops.
In 2001, various cities and towns in the UK began giving lollipops to people as they streamed out of pubs and clubs. The rationale varied:
“It’s hard to suck and fight at the same time.” – Leicester, 2001
“Research shows the sugar content helps to stabilise the behaviour of those who have consumed alcohol.” – West Oxfordshire, 2006
“[Offering food] can stop people shouting, make them less aggressive and prevent post-alcohol hunger” – Camden Town, 2010
It’s estimated that these efforts, which eventually expanded to include flip flops and cookies, cost “tens of thousands of pounds,” a drop in the bucket compared to the millions of pounds spent each year on police and medical resources to deal with the drunken behavior.
Waffle Maker Saves the Planet
Imagine throwing away 20 BILLION wax-coated bowls and plastic spoons every year.
Imagine that you could keep 12 BILLION of those out of the waste system by doing just one thing.
Giving up ice cream.
Would you do it?
Yeah, me neither.
This is why we should be very thankful to a Syrian waffle vendor at the 1904 St. Louis World’s Fair.
Even though ice cream cones were in use as early as the 19th century, it wasn’t until a chance encounter at the World’s Fair that they went mainstream. In the sweltering summer heat, ice cream was a popular treat for the 20 million people visiting the fair. So, it’s not surprising that vendors eventually ran out of serving bowls.
Luckily for us and the planet, one of those popular ice cream vendors was next to Ernest A. Hamwi and his very unpopular warm waffle stand. Seeing his fellow vendor’s plight, Ernest took one of his waffles, rolled it into a cone, and a tasty partnership was born.
Town Crier Out Shares Facebook
On Thursday, August 11, as thousands of tourists arrived in Provincetown eager to begin celebrating the Cape Cod town’s largest summer festival, the sewer system failed. Although only 356 of the town’s 1500 properties were affected, most of those affected were the restaurants, hotels, and businesses at the heart of the town’s tourist industry.
Naturally, officials took to social media to alert businesses and residents of the impact. In a Facebook post, restaurants were told to close, and residents were told they “must reduce water use, including dishwashing, laundry, showering, and only flush when absolutely necessary,”
Naturally, such restrictions created problems for businesses and residents alike. But what about the thousands of tourists just arriving who were not subscribers to Provincetown’s Facebook account?
The Town Crier
In 1864, Provincetown created the position of Town Crier as a way to spread news throughout the community quickly. Over time, as technology made spreading information easier and faster, the Town Crier became more of a tourist attraction, responsible for greeting visitors and promoting members of the Chamber of Commerce.
Until August 11, when the 22nd Town Crier was called back to duty.
“All is not well in Provincetown,” the Town Crier proclaimed as he stood in front of Town Hall dressed, as usual, in historical garb and swinging his heavy bell. As Thursday turned into Friday, the Town Crier issued updates, listing the re-opened restaurants and the areas where toilet flushing and showers were now allowed.
“Let us pray to the supreme architect of the universe that the system will have been rectified,” he pleaded. I’m sure town officials gave thanks to the supreme architect of the universe that their small investment in maintaining an old solution was, again, creating quite a lot of value for the town.
Size doesn’t matter
Innovation is something new that creates value, and, as innovators, we naturally want to create BIG value. Heck, we want to change the world!
It’s easy to forget that Small can have a big impact, whether physically small like lollipops, a small distance away like waffle and ice cream vendors, or only able to reach a small audience like the Town Crier.
So when you find yourself obsessing about size, just paraphrase Dr. Seuss, “An innovation’s an innovation, no matter how small!”
According to a 2018 survey by NPR and The Marist Poll, the most common New Year’s resolution is to exercise more. Not surprisingly, losing weight and eating a more healthy diet ranked third and further, respectively (“stop smoking” was #2, in case you’re curious).
Hitting the gym to drop weight and build muscle is a great habit to build, but don’t forget about the regular work needed to build other muscles.
Specifically, your innovation muscles.
Innovation mindsets, skills, and behaviors can be learned but if you don’t continuously use them, like muscles, they can weaken and atrophy. That’s why it’s important to create opportunities to flex them.
One of the tools I use with clients who are committed to building innovation as a capability, rather than scheduling it as an event, is QMWD – the Quarterly-Monthly-Weekly-Daily practices required to build and sustain innovation as a habit.
QUARTERLY
Leave the office and talk to at least 3 of your customers
It’s tempting to rely on survey results, research reports, and listening in on customer service calls as a means to understand what your customers truly think and feel. But there’s incredible (and unintended) bias in those results.
Take, for example, this story from former P&G CEO AG Lafley:
One very quick story; I will never forget this. We used to do annual research in the laundry detergent business, and every year consumers would rate the Tide powder cardboard package as excellent; excellent to shop; excellent for opening; excellent in use–on, on, on.
So, probably 27 or 30 years ago, I’m in basements in Tennessee, in Kentucky, doing loads of laundry with women, and after three or four or five of these one-on-one sessions, I’ve realized that not a single woman has opened a box of Tide with her hand. Why not? You’ll break your fingernails!
So, how did they open the box? They had nail files; they had screwdrivers; they had all kinds of things sitting down on the shelf over their washing machine, and yet they thought our package was excellent. And we thought our package was excellent because they were telling us our package was excellent. We had to see it and experience it.
Here’s the problem–consumers cannot really tell us what they want. They can tell you why they like it or why they don’t like it, but they cannot tell you what they want.
Schedule a day each quarter to get out of the office and meet your customers. Ask them what they like and what they don’t. More importantly, watch them use your products and then share what you heard and saw with your colleagues.
MONTHLY
Share with your team a mistake you made and what you learned from it
Silicon Valley mantras like “fail fast” and “fail often” make for great office décor but, let’s be honest, no one likes to fail and very few companies reward it.
Instead of repeating these slogans, reframe them to “learn fast and learn often” and role model the behavior by sharing what you learned from things you did that didn’t go as expected. You’ll build a culture of psychological safety, make smart risks acceptable, and increase your team’s resilience. All things required to innovate in a sustainable, repeatable, and predictable manner.
Do 1 thing just for the fun of it.
In the research that fed into their book, The Innovator’s DNA, professors Jeff Dyer, Hal Gregersen, and Clayton Christensen, found that the most common characteristic amongst the great innovators of our time was their ability to associate – “to make surprising connections across areas of knowledge, industries, even geographies” (page 41). Importantly, their associative thinking skills were fed by one or more “Discovery Skills” – questioning (asking “why,” “why not,” and “what if”), observing, experimenting, and networking.
Fuel your associative thinking ability by doing something NOT related to your job or other obligations. Do something simply because it interests you. You might be surprised where it takes you. After all, Steve Jobs studied calligraphy, meditation, and car design and used all of those experiences in his “day job.”
WEEKLY
Make 1 small change for 1 day
Innovation requires change and, if you’re an innovator, that’s the exciting part. But most people struggle with change, a fact that can be frustrating for change agents.
In order to lead people through change, you need to empathize with them and their struggles which is why you need to create regular moments of change in your work and life. One day each week, make a conscious change – sit on the other side of the conference room table, take a different route to the bathroom, use a black pen instead of a blue one. Even small changes like this can be a bit annoying and they’ll remind you that change isn’t always the fun adventure you think it is.
DAILY
Ask “How can we do this better?”
Innovation is something different that creates value. Which is good news because that means that all it takes to be an Innovator is to DO something DIFFERENT and create VALUE. The easiest way to do that is to find opportunities for improvement.
The next time you’re frustrated with or confused by a process, ask “how can we do this better?” Better can be more simply, faster, cheaper, or even in a way that is more enjoyable but, whatever it means, the answer will point the way to creating value for you, your team, and maybe even your company.
In closing…
Block time on your calendar for these quarterly, monthly, weekly, and daily habits. After all, the best reflection of your priorities are the things in your calendar. And, if you stick with this, you’ll be among the 8% who achieve their New Year’s goals.
Originally published on December 5, 2019 on Forbes.com
Companies love to invest in idea generation – challenges, hackathons, software platforms to collect and sort submissions.
Companies do not love the ROI of these investments because they require a lot of money and time and the ideas rarely become real and create value.
But one company is doing it right and they are loving the early results.
This morning I chatted with a graduate of the Intrapreneurship Academy that I teach in partnership with The Cable Center. It was the kind of life-affirming call that consultants rarely get to enjoy, one that is evidence that the work you do matters to both people and businesses.
During the program, he focused on solving a problem related to surfacing ideas within the organization, rather than relying on management to come up with new ideas and initiatives. As he worked through the innovation process, he found other passionate intrapreneurs and champions within his organization willing to lend their time, energy, and political clout to developing a solution.
In May, the idea generation solution went live.
A mere 6 months later:
20% of the organization submitted ideas
2 ideas, on average, were submitted by each person
60% of submitted ideas were presented to senior leadership
~20% of the ideas submitted were approved for further development
10% of ideas submitted are in the process of being launched
10% of ideas received funding and are being launched!
VCs would kill for that kind of success rate.
Ahh, but what about ROI? Launches do not equal market success. Value creation, specifically financial returns, are evidence of market success.
This was all done with $0 investment.
The team used internal resources for everything – existing software platforms and programs, design and marketing talent, and passionate staff and leaders to promote and participate in the program.
3 lessons learned on the path to success
Like all good innovators, the team prioritized moving quickly with “good enough” solutions and learning and adjusting rapidly based on feedback. Here are three of their top insights:
1. It’s all about People. People define organizations. People create ideas. People motivate and inspire other people. So, if you want to succeed, focus on people.
For example, every person who submits an idea receives personalized feedback about what worked or didn’t and how, if possible, they could make their idea more attractive to the business. Originally, this feedback was given by email because let’s be honest, it’s a lot more efficient. But people felt that the feedback was “cold” and felt discouraged and demotivated after reading it. Now, all feedback is delivered in a quick conversation that feels more personal and leaves people feeling heard and motivated
2. Build a Habit, not an Event. Early in the design process, the team spoke with a group in another region that was also creating an idea generation program. The difference was that they were designing it as an annual event (and spending hundreds of thousands of dollars to buy and implement an idea management software platform).
But people don’t have ideas just once a year. They have ideas all the time. And the business needs new ideas for revenue generation and cost savings constantly, not just once a year.
So this team designed their program to be on-going – people can submit ideas at any time for feedback, senior management meets once every 1-2 months to review and approve ideas, and teams are started (and ended) based on data, not the calendar.
3. Imperfect Action is more important than Perfect Inaction – “Frameworks are great and really helpful, but….” As my former student’s voice trailed off, I couldn’t help but laugh. He was trying so hard to be polite, after all, I’m the person who taught him the frameworks, but we both knew that the end of that sentence was, “…you need to actually do things in the real world to know what works.”
Yes, frameworks, theories, templates, best practices, are all useful AS STARTING POINTS. They reflect what has worked in the past for other companies so, while they can help you avoid common mistakes or accelerate decision-making, they’re not perfect reflections of the current reality of your company and innovation. To know what will work for your idea, in your company, in your market, in your geography, with your team, and your customers, you need to get off the page and into the real world.
The next challenge – how to scale
With such clear early success, there’s huge demand to expand the program rapidly within the region. But premature scaling is the death-knell of many innovations.
So, the question facing the team is when and how to expand?
Should they expand laterally, rolling their country’s program out to other countries in the region, or should they expand vertically, moving the program up to be managed at the regional level?
Should they seek to increase participation in their current program, or should they expand their program’s offering to include trainings and challenges?
When should all of this expansion happen? What should happen first?
The fact that these questions are being asked is a clear sign of success. While there are no obvious answers, I do not doubt that the team will find them.
In the past two days, three people in two different companies across two different industries said these exact words to me.
If Step #1 in solving a problem is admitting that you have one, then my clients should feel pretty good about making progress.
But what’s Step #2?
“Killing the project” is an obvious and fundamentally unhelpful answer. But before we get to the less obvious and helpfully actionable answer, we need to acknowledge a fact about humans
We decide with our hearts, justify with our heads, and require guts to act.
As much as we would like to believe that we, as humans, are logical and fact-driven, we’re not. If we were, we would not be swayed by brands and we would all agree on the best restaurant, music, and political candidate.
Beliefs, values, emotions, and connections (our heart) drive our behavior. We choose things that help us feel a certain way, create a certain perception, or signal our belonging to a certain group. As Clay Christensen would say, we choose things that solve emotional and social Jobs to be Done.
We then find or seek out facts and evidence that justify the decisions our hearts have made. We want to be logical and rational, to make “the best choice,” and to be able to sway people with our arguments. We use our heads to justify our hearts.
But that alone isn’t enough. We don’t do things that we know we should (flossing, eating vegetables, maintaining long-term investments in innovation). We do what we want even though we know we shouldn’t (eat a lot of sugar, drink too much, binge watch anything that starts with “Real Housewives of”).
We need motivation and courage (guts) to translate our wants and our thoughts into action. Perhaps, even more importantly, when our heads and our hearts disagree, we need guts to make the decision and act.
Because without guts, when the head and the heart disagree, the heart always wins.
That’s why you’re not good at killing projects.
Here’s a common scenario: after working for several years on a new product you get data that shows that it won’t “work.”
Perhaps it’s clinical data indicating that the product doesn’t provide the efficacy required. Or market data showing that customers aren’t willing to buy the product at the current price or buy as much of it as expected to justify the investment. Or benchmarking data that estimates that your product will be in the bottom 5% of products ever launched by your company.
Whatever it is, it’s not good and the data and logic all dictate that the project should be killed.
Instead, you deem it to be “strategic” and keep working on it.
This is because, in your heart, you believe in the project. You were part of creating it. You nurtured it from concept to concrete, guiding it through near-death experiences, and celebrating its successes. You love this project.
Your heart says “keep going,” while your head says “make it stop.”
You need guts to make the decision.
It’s hard to decide, but Step #2 makes it easier.
If the first step is knowing in your head that the project is not viable and will not meet expectations no matter what you do, the second step is finding the guts to resist your every instinct and decide in favor of your head.
To find the guts to make the call, you need to acknowledge your heart and the feelings, emotions, and beliefs that are motivating you to try just one more thing.
(If you’re a Very Serious Business Professional and are super freaked out by the last sentence, imagine that I wrote, “you need to acknowledge your cognitive biases like the sunk cost fallacy, not invented here bias, or the IKEA effect” and keep reading)
To acknowledge your heart and empower your guts, you need to say goodbye and create closure.
How to do this effectively is determined by the culture of the team and company, but here are some examples I’ve seen and been part of:
Write the project’s eulogy
Hold a funeral (traditional, New Orleans, Irish, or Viking all qualify)
Have a “Reading of the Will” in which the project bequests mementos and silly awards to team members
Create a memorial like planting a tree or, taking a cue from Ben & Jerry’s, a graveyard
Establish an award in its name and give it out every year to a person who has shown the courage to preserve and the wisdom to know when to quit
Yes, I know this sounds silly but so does having funerals for goldfish and we do that. We do it for the same reasons we struggled to kill the project – because we love it, and we will miss it.
Just as we feel very sad but know we did the right things when we flushed the goldfish, you will feel sad but know you did the right thing when you kill the project.
And while it will never be easy, it will get easier and you will get better at killing projects (just like I did after going through 23 goldfish my senior year of college).
When I was a senior in college, I took a pottery class.
One of our assignments, before learning to throw on the wheel, was to create a functional piece using slabs of clay. I designed an Alice in Wonderland-inspired vase and built something that somewhat resembled the design.
Obviously impressed by my innate talent, the instructor offered to teach me a special glazing technique that used highly toxic chemicals to create…well…I stopped listening as soon as I heard “toxic chemicals.” It was dangerous, so I was in.
The result was a rather misshapen (not Alice in Wonderland-inspired) vase that looked like it was made out of chunks of rusted metal.
I loved it!
My roommate hated it.
She declared it the ugliest thing she ever saw and forbid me from placing it anywhere in the apartment where she might have the misfortune of laying eyes on it.
To this day, she swears it’s the ugliest thing she’s ever seen.
I display it proudly on the bookshelf in my office.
It would be easy to explain our different reactions to my work of art as simply the result of different aesthetic preferences. And while there may be some truth in it, I suspect the better explanation is the IKEA Effect.
The IKEA Effect
First identified and named in 2011 by professors from Harvard Business School, Yale, and Duke, the IKEA effect is a cognitive bias in which people place a disproportionately high value on products they partially create.
Think about it. We all have that piece of furniture, art, craft project, or home improvement effort that we assembled, designed, crafted, installed, or built that we absolutely love and refuse to part with.
No one understands why we won’t let go of that broken, worn out, dust collecting, out of style, money pit but, we believe, it’s simply because they don’t understand or see what we do and that, once they do, they too will see it for the treasure it is.
The same behavior happens in innovation. Teams invest months, even years, developing, testing, and launching new products and services, and yet, when the market doesn’t respond (i.e. there’s no demand, meaningful revenue, or potential profit), the product or service continues to be offered.
This is the IKEA Effect in action.
And the result is Zombies.
IKEA Effect Zombies
As evidence mounts that the project will not achieve market success, innovation teams invest with urgency, believing that more marketing, more sales calls, and more discounts will attract the customers that are surely out there. When the increased investment doesn’t produce the desired results, resources are slowly “reallocated,” the project is “deprioritized,” and a skeleton crew is left to make it work. The project is a Zombie, the living dead incarnation of an innovation project.
Given the commonality of this behavior, you might think it would be easy to spot Zombies. You would be wrong.
While the IKEA effect is believed to contribute to both the sunk cost effect and to “not invented here” syndrome, it is a far more fundamental effect, deeply rooted in people’s emotions and identity, and likely to manifest in “logical” arguments based on carefully selected data.
This makes spotting an IKEA Effect Zombie almost as hard as killing one.
Which is why it’s important to know your Zombies:
HiPPOPs – Highest Paid Person’s Opinion Projects (HiPPOPs) are envisioned, developed, and driven by a senior executive. When data counter to the executive’s opinion surfaces, the executive finds another piece of data to support their opinion. The project lurches on for years, fed by the executive, as people throughout the organization watch it slowly rot.
Perennial Pivoter – These projects are always just one pivot away from success. Created by a team of eternal optimists, there’s no such thing as failure, there’s only learning what not to do and what to try next.
Windfall Walker – When you hear “It’s a small investment and the upside could be huge,” a Walker is not far away. Often the brainchild of a single individual, the promise of these projects is far greater than their return. But they live on because everyone silently agrees that it’s easier to live with the Zombie than kill it.
Hope Hunter – Perhaps the most dangerous and cruel of all the Zombies, these projects always offer a glimmer of hope that the hockey stick of success is just a quarter, a customer, or a PR moment away. Convinced that staying the course and investing just one more dollar, month, or customer call will bring the project back to life.
How to Deal with IKEA Effect Zombies
Just like all other adventure stories, the source of the problem is also the solution. In this case, IKEA created the effect and their stores point to the solutions.
To Kill a Zombie, Stand Your Ground.
Zombies appear when you lose focus on creating and delivering something desirable (solves a customer’s problem), feasible (can be created), and attractive (meets or exceeds key strategic and financial targets).
Because Zombies are a sign that you’re lost, you need to do the same thing you do when you get lost in IKEA – stop, pull out the map, and re-orient yourself.
Go back to your original criteria for pursuing the project. Does the project still meet the thresholds or has something, like the company’s strategy or the project’s results, changed? How does the change impact the project’s desirability, feasibility, and attractiveness? What is the right thing to do for the business based on these changes?
Try to be objective as you re-orient yourself and avoid the urge to blame others or beat yourself up. What matters most isn’t how you got here, it’s where you go from here.
To Avoid Zombies:
Focus on the Meatballs. Let’s be honest, the best part of every IKEA trip is the meatballs (and lingonberry jam) in the café after you checkout. Every distraction and double-back in the Showroom delays the gratification of eating meatballs (and lingonberry jam).
When you start an innovation project, set a clear, objective, and measurable goal at the beginning. That’s your meatball. At every project milestone, revisit the goal. Is it still a desirable goal or has something in the business fundamentally shifted, requiring the goal to change? Is it still reasonable to believe that the project will achieve that goal, or have you learned something that makes the goal improbably or even impossible?
Staying focused on the goal and objectively evaluating your odds of achieving it makes it easier to let kill a project that can’t get you to where you need to go.
Follow the Arrows. IKEA Showroom maps are often as helpful as the assembly instructions that come with their furniture. Not at all. That’s why there are arrows on the floor and signs hanging from the ceiling to guide you through the shopping experience and, ultimately, to the meatballs.
A project process with clear governance is the innovation equivalent of floor arrows and ceiling signs. Before starting an innovation project, identify the activities required, thresholds that must be met for additional resources, roles and responsibilities of team members, and decision-making criteria.
As you do the work of innovation, you’ll refine the process and governance. By your third project, it should be 80% set and by your fifth, it should be 90% set (you never want it to be 100% because innovation does need a bit of flexibility).
Creating and following a standard process and objective governance model helps to remove the emotion that drives the IKEA effect and creates Zombies.
A Zombie and IKEA Effect Free Innovation Zone
By acknowledging the Innovation Effect in your organization, identifying and killing the Zombies it creates and putting the goals, processes, and governance in place to prevent a Zombie recurrence you’re on your way to more efficient, effective, and successful innovation efforts.
I recommend celebrating with meatballs (and lingonberry jam)!
