FOR CEOs WHO RECOGNISE THAT INNOVATION
AND STRATEGY ARE KEY TO FUTURE PROFITS

For CEOs: Good Old Ideas and Fresh Ones

The Importance of Listening to the Customer

So in “The CEO Innovation Blueprint,” one of the things to try and get organizations to put a lot more focus in is the customer. If we’re focused on solving the customer’s problems then it’s very important to start listening to the customer.

If we go and look at our sales team, our sales team is very focused on selling the product. They’ll walk into the office and explain why it’s so important to buy our product. They’ve forgotten a very golden rule: listen to what the customer needs. Listen to what customers’ problems are. A good salesman listens first and talks second.
Your front facing staff, whether they’re on the telephones, whether they’re answering text messages, whether they’re doing SMS on the internet, or salesman, or support staff are all your front-facing people, it’s very important to train them to listen, and observe, and understand the real problems of your customers because they’re your biggest feedback.

Exploiter vs Explorer

“The CEO Innovation Blueprint” is identifying to CEOs a number of challenges that they face in trying to drive innovation in their business. The CEO’s sitting there and saying, “We’re spending a lot of time and money trying to get innovation and we’re not getting results. We’re not coming up with the ideas. When we do come up with ideas and implement them, they’re not delivering the results.”

And one of the problems is that in the organization is a mix of personalities. A very good study that came out of the United States was to actually define two personalities in the organization and that is the Explorer personality and the Exploiter personality.

And as you can imagine, the Explorer personality is a person that steps outside the pale, a person who’s more prepared to take the risk, a person that’s more prepared to ask why, they’re the person that’s going to look for new ideas, new markets, new opportunities.

The Exploiter personality, and they’re just as important in the organization, this is not a negative, are very focused on exploiting what we already have. So they’re saying, “We’ve got Product A, and we work that out to be as efficient as possible in manufacturing it, we try to get it out the door as quick as possible. We reduce the cost of making it. We maximize the amount of money that we get from the customer. We focus on maximizing the margin.” But it’s all Product A.

Now the hard part is probably over the last 20 years the business model has favored the Exploiter. We’ve had 15 years of solid strong growth before the global financial crisis. We weren’t interested in Product B. We’re just going to make the most out of Product A. So when we look to promote somebody, the Exploiter personality was promoted. When we look to hire people, the Exploiter personality was hired because it fits the business model.

That annoying person that kept—instead of doing the job—kept asking why are we doing the job were discouraged and pushed out. So we find that when you look at a company today it’s dominated by Exploiter personalities. It doesn’t have the Explorer personalities.

The difficulty is the global financial crisis has caused a right-angle turn which means that we need to think differently about how we deal with the customer. We need to come up with new ideas. We need to protect against digital disrupters, so we need people that think outside the square, who are prepared to take risks, who are prepared to challenge the status quo. And we need Explorer personalities, and we don’t have them in the organization.

So it’s very important to start thinking about how can we improve that mix. Do we employ more people that are Explorer personalities? Or do we look at what organizations are capable, who wants its innovation company who’s really full of Exploiters?

When you look at Siri, Siri is not an innovation of Apple, Siri was a product of a company that Apple bought. They are importing skills by buying other companies.

Or do you look at consulting companies and external people that you can bring in to the organization on a part-time basis just to help to challenge the organization?

But if you want to drive innovation, you really need to start looking at the personality mix of the organization.

Getting Fresh Ideas From Other Industries

The hard part is you cannot change in Exploiter and you can to some extent but it’s very much the way they’re driven and the way they think about the problem.

An Explorer is somebody that will really challenge the status quo, really think outside the square. And actually sometimes it’s really important to bring somebody fresh into the view who’s not locked into the way that you’ve done things in the past to actually challenge that status quo because they have no vested interest. They weren’t involved in introducing this product. They weren’t involved in the computer systems that went in. They weren’t involved in the planning, pricing, or any other marketing that was behind it. They’re not encumbered with anything of the past. So sometimes they’re the best people to come in and look at it.

Some organizations are actually introducing a crowdsourcing idea for ideas where I might be a mining company but I’m actually asking somebody that might be involved in retail to come up with ideas on how I could do things that are different. So we look at it as cross-industry skills. Something that I learned from the way I do business is that I’d been involved in mining industry, in shipping industry, in book retail, in manufacturing, in finance and it’s amazing that there’s some clever idea that might occur in mining that actually is a great solution to a problem in book retailing even though it sounds strange.

We were actually looking at maintenance systems for organization and the maintenance systems for shipping companies is the same as the maintenance systems for coal mining. We were talking with two types of organizations structures where they were remote from suppliers, that they had issues of safety, and a number of things, and they were exactly the same even though they’re completely different industries.

So one of the important things is it might not be that you can change just the internal stuff of your organization, you might actually need to look at how you can bring in fresh ideas, fresh talent, and fresh personalities.

How to Deal With the Experts That Work for You

Some CEOs, and I’m trying to drive change in your organizations, and one of the biggest challenges we find in CEOs is that they’re relying on experts beneath them. As we all know, a good CEO employs good people. Problem is, they also relying on or depending on them for the skills that they bring to the table.

So I’m sitting there, with responsibility to the board to drive growth, and drive profit, and bring innovations to the table. And we have a great idea and the expert that I’ve employed comes up and says, “No, I don’t think that’s a good idea.”

Now, that’s over regret, what do you do? How do you over-rule the expert that you’ve employed in the organization? That might be a legal expert, a finance expert, or marketing expert, they’re the ones that are supposed to have the expertise and they’ve just thrown a landmine in front of the innovation idea. So how do you deal with them? Do you take the risk of overruling the expert? And do you tell them that; “You are wrong?”

So you have to learn the mind games of how to bring the experts along the journey. One of the challenges that we try and explain with experts is that experts are experts in a status quo. Their whole expertise was built on the way that things were done in the past. So it’s part of challenging the executive to think outside the status quo. And when they come up and say, “We don’t think this is a good idea,” to challenge them and say, “Do you think that’s not a good idea because that’s outside your normal expertise? Or is there really a valid reason behind it?”

So there are a number of challenges and ways of doing it but it’s really important not to allow experts to derail projects.

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