Overcoming the Hurdles to Achieving Innovation
When Innovation Changes an Organisation
One of the things we like about innovation is the ability to drive change in an organisation. When you can take an organisation turnaround, gross profitability, better employs people, and it delivers services to customers, it’s a great deal of satisfaction from that sort of environment.
We’ve gone into organisations that were struggling to survive had CEOs sort of been threatened that if the results were the same next year write yourself a check and go. And be able to go in there and actually look at what the problems are, come up with creative solutions to solving those problems and actually see a turn-around of results in 12 months is something that’s very self-satisfying.
So that’s sort of the thing, it’s also, I guess, looking at new ideas, always creating new strategies, and testing the boundaries of what we can do. They’re all very creative. It’s all very enjoyable. It’s new ideas. There’s always something different so there’s probably a lot of things there that really we find enjoyable about innovation.
When a CEO Recognises a Problem
The type of CEO that can take advantage of “The CEO Innovation Blueprint” is probably a CEO who recognises that they have a problem. And a problem recognised is a problem half-solved. We often get people saying “Well, we’ve implemented innovation very well.” When we sort of dig into it we say, “Well, you might’ve implemented a technology but have you got the results? Is it driving profit? Is it driving growth?”
And when CEOs recognise that we’ve got a problem, you know, seven years of that growth, profits really only coming in from cross-cutting, we’re having trouble defending ourselves against digital disrupter, there’s new market challenges, etc., when they recognise that they’ve got a problem then they’re open to ideas and opportunities. And this book really helps them think differently about ways of tackling those problems.
When Communication Stops Innovation
“The CEO Innovation Blueprint” highlights a major issue in the organisation in that communication stops innovation. There’s a number of factors behind it and a lot of it has to do with the way we assess people that come to us with ideas.
In the past and in the status quo sort of way, we deal with experts is somebody that deals with something that’s been done in the past and have very qualified and experienced in that knowledge. And we measure them to be an expert in that field.
Somebody’s coming up with a new idea is not an expert because you can’t be an expert in a new idea. It hasn’t been around for long enough. So how do we assess that they are qualified to talk to that idea? And that’s a real big challenge.
So we look at organisations, it’s amazing that people that are on factory lines or working in areas that don’t have skills and knowledge can come up with the greatest ideas for the business. But because they’re not qualified or seen as experts, we sometimes don’t listen to them.
So really, the difficult challenge is for somebody who’s got expertise in the field to actually take a deep breath and stop, and listen to somebody who’s not an expert in the field actually come up with some ideas that could give them a different perspective on the situation or come up with some fresh ideas that could actually totally revolutionise how you compress that idea with that process. And when you see organisations that have adopted crowdsourced idea generation where they’re actually looking at getting ideas from completely different industries just try and force a different perspective on the problem to find completely new solutions.
When Innovation Is Seen as a Risk
One of the things with innovation is it’s about risk. It’s not necessary that it’s risky but it’s actually doing something that people are uncomfortable with because it’s something different and therefore they perceive that there’s a risk around it.
One of the hard parts, if we got back to the concept we talked about beforehand about Exploiters and Explorers, Explorers are people that are more prepared to take risks, they’re more prepared to step beyond the boundaries. Exploiters are more comfortable in dealing with what they already know.
So you have a problem where you might have an executive who has an Exploiter personality being told by an Explorer personality; “What about doing this?” and there’s a communication gap about risk. The Exploiter is going to be immediately uncomfortable with the concept of there’s something different, and there’s a risk, and they feel that the Explorer personality hasn’t really considered the risk. The same time is the Explorer personality is sort of, “You old Fuddy-Duddy, you’re out of date. You don’t move with the times because you’re not prepared to look at new ideas.”
It’s actually an issue that probably requires a bit of both changing their ways. Explorer personalities need to recognise that people are concerned about risk, they have to go back to stakeholders and say; “Look here, we’re not risking your investment unnecessarily.” So as an Explorer, putting an idea forward requires that you’ve actually stopped and thought about the risks. But it’s also for the Exploiter personality to not immediately react to a new idea and say, “Oh, that’s risky.” To actually first consider is it as risky as we thought?
And it’s very interesting sort of scenario the moment that in the environment that have become very risk averse after financial global crisis is that we’re losing lots of opportunities because we just refuse to actually just even start thinking about the risk. And we shouldn’t be risk averse but actually be focused on managing risk.
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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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Stepping Back and Focusing on the Customer in Business Innovation
The Kettle Problem
“The CEO Innovation Blueprint” tries to bring in CEOs back into thinking about not focusing on innovation but actually solving the customer’s problem. It’s ironic that in an age that we talk about that “We’re customer-centric, we’re customer-focused. The customer is always right,” that we actually don’t think about solving the customer’s problem when we are innovating.
A very good example of this one I’d like to use is about the kettle. People don’t want kettles, they want hot water. Business problem is: “I want to make a cup of coffee. I need hot water. And the solution I find to today is that I use a kettle.” Now when companies are thinking about that we’re solving their customer’s problem, what they’re actually thinking is that the kettle is solving the customer’s problem. They think that the customer wants a kettle. Their focus is around “We make kettles, we sell kettles.” It’s all about the kettle. And they forget about the customer.
And it’s a very good example of when you’re innovating step back and remember, it’s the customer, not the product that you’re innovating. So the problem is what’s happened is that the customer was trying to solve the problem of how to make a cup of coffee. Somebody came along with a coffeepot machine, it boiled the water, made the coffee without any need for a kettle. So the problem is that the kettle became redundant and the company that was focused on the product instead of solving the customer’s problem actually started losing market share.
So it’s very important to keep every meeting, every discussion, ask the question “How is it solving the customer’s problem?”
When the Customers Do Not Know What They Want
One of the topics we raise in “The CEO Innovation Blueprint” is we say you need to focus on what the customer wants. The challenge is that the customer doesn’t always know what they want.
Very good example is Henry Ford. Henry Ford said, “If I asked the customer what they wanted, they would’ve said, ‘A faster horse.’” They didn’t know what a car was. If you actually looked at what Steve Jobs did with Apple, did Steve Jobs go out to the customers and say, “Do you want an iPhone?” They don’t know what an iPhone was. They didn’t know if they needed an iPhone.
What Steve Job actually focused on was to ask people, “What are your problems with the mobile phone?” The screen’s too small, or can’t read the writing, or it’s difficult to use the keypad on the phone, or there are not enough right apps for it.
What Steve Jobs was actually trying to do is not ask customers what they wanted but to understand deep down what the problems were that even maybe the customers didn’t actually understand themselves. So it’s very important, not only saying “understand what the customer’s problems are” but to actually really dig deep and understand the underlying problem, not just what you see on the surface.
The other problem that we see today is a lot of discussion around big data. And a lot of companies are refocused on using big data to try and understand their customers. And there’s a lot of benefits in it. I’m not trying to discount it. But one of the problems is big data is recording what the customer does.
So if you’re a kettle company, you’re watching the customers buying kettles. How is big data telling you that a customer could see a coffeepot machine that can do the job without the need of a kettle? And it’s very important to be careful with big data to not be coned into following what the customer’s doing because they don’t know that there’s something else that they can do instead.
Another issue we talk about with “CEO Innovation Blueprint,” is to again, is to re-step back and understand what we’re trying to solve for the customer. In banking we have products like Medical Loans, or Mortgage Lending, Business Loans. The thing is the customer doesn’t wake up in the morning and says; “I want a loan.” What they want is, “I’d like a new car. The old car keeps breaking down. I need a new car,” or “I want to go into new business,” or “The family’s outgrowing the home, we need a new house.” So the problem that’s being solved is that they want to do something, they want to buy a house.
It’s very difficult for a bank whose business for the last hundred years is about providing a home loan to try and think away from the product. If the problem that we’re solving is to enable people to get a home, is a home loan the only solution? And it’s a very hard step for people to step away from when they are so invested in “This is our product. This is our service. All our computer systems are around that,” to really step back and say, “You know what? Instead of lending you money to buy a home, why don’t we lease them a home? Why don’t we change our business model to make it easier? If we’re sitting in an environment where the affordability of housing is such a problem then shouldn’t we step back and really re-think about what is our business about. Is it about lending or is it helping a customer to get a new home?”
Driving Your Executive Team to Achieve Innovation
“CEO Innovation Blueprint” is really trying to help the CEO to actually become the innovation leader of the business. Not to be the Innovative but to actually drive the organization to be creative, to be involved in continuous innovation, to challenge the status quo.
So the role that the CEO has to be to challenge their executive, to challenge the staff, to get the executive to be challenging the status quo, to get the executives in overcoming fear of staff, and overcoming their own fears. To actually make the company successful, it’s really important to really challenge the executive team to step outside of their normal boundaries.
When you go into look in business, it’s very process-oriented. The whole management structured from top to bottom is about the business process. I make widget X, I sell widget X, we manufacture widget X, we have production line issues, the computer systems fail, we’ve got to get the payroll run. It’s all process driven and it’s really difficult to step out of that and think about strategic planning, strategic growth and innovation. It’s very hard when you’re worried about we’ve got to get the payroll out and the systems failed to be thinking about how do we solve about this customer’s problem?
So it’s really important to try and drive that executive to step back, and refocus, and re-energize in thinking about the customer, in thinking about solving the customer’s problems, rather than internal business problems.
When Policies Overtake Common Sense
One of the examples that we try and talk in “CEO Innovation Blueprint” is how we’ve become so driven by the process, so driven by the policy that we’ve forgotten the customer. A very sad example, and a very poor example of what happens when policies overtake common sense, was a situation on Southwest Airlines recently.
A woman was sitting there and gets a text from her husband just as it was about time to take off. It says, “Sorry dear, I’m going to commit suicide.” The woman is in absolute distress. The steward comes along and says, “Please ma’am, can you put your phone away.”
Saying, “My husband’s going to commit suicide. Can I contact him? Please, just stop it.”
“Sorry, ma’am, you’ve got to put your phone away, we’re about to take off.” She asked, “Can we ask the pilot to contact the control tower to get the police to go to the house to stop the suicide?”
“I’m sorry, ma’am. I’m not allowed to communicate.”
The policy stated that if a passenger is in danger that the crew can talk to the pilot. The passenger wasn’t in danger, the husband was in danger. So we have a very sad situation where a passenger is in tears the whole way through, gets home to find that the husband had committed suicide.
We had all these policies in place that people follow for very valid reasons but we didn’t solve the customer’s problem and it’s a very glaring example of how we become so focused on the policy that we forgot the customer.
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What to Focus on in Business Innovation
The Need to Manage Fears in an Organisation
So one of the biggest challenges around innovation at the moment is fear. And fear is not just about fear of looking stupid but there’s a range of issues. There’s a fear of sounding like you don’t have knowledge about it. There’s a fear of people not accepting you because you’re saying things that are just outlandish to them. There’s a fear that you’re going to be held accountable for mistakes.
There’s a whole lot of fears that are driven in the organisation. And so if you want to try and get innovation and creativity going in your organisation, there needs to be a lot of focus on managing fear.
We have a problem at our education system at the moment that it’s intended to be a factory system. So you go into a classroom, and we learn this is the way we do Math, this is the way we do English, this is the way we do Science. And it’s designed because we need to be efficient. We’re dealing with thousands of kids. We’re trying to handle one teacher with multiple students. So a factory line becomes the way we do education.
When we go into the workforce we sit down, and then introduced into the organisation; so this is how we do things, this is why we do things and so on. Now one of the problems is Einstein was thrown out of school because he kept asking, “Why?” That’s what made him such a creative genius. So the hard part, we actually discourage students from asking why and that gets taken back into the workforce.
So we sit down and we are in a board meeting or in a management meeting, there’s 20 people around the table, trying to solve a—it’s very difficult for somebody to put their hand up and say, “I think we should look at doing this….” People are fearful of judgment. They fear of looking stupid. Often when you make a comment, you make a bold statement somebody’s going, “Oh, we’ve tried that. We did that ten years ago and it didn’t work.” And dismissed. See, we have an environment where fear actually stops the creativity of the organisation.
We have a situation also is that that fear stops us from stopping bad projects. A good example I’ve seen recently was a computer system in one of the government departments. This system has been going on for ten years. It’s now gone over a billion dollars and it still doesn’t work. The hard part is that everybody feels that “I’m going to get sacked if this project fails.” So the fear is if I say, “Right, it’s not working, we’re going to pull the plug,” I’ll lose my job, it’s better to cover it up.
So we see very good examples in companies where projects are going wrong and people’s fear that they’re going to be held accountable for it actually then drives them to cover it up.
So if you really look at your organisation, there are considerable issues that are holding back the business, that are causing bad projects to continue and they should’ve been stopped, stopping the creativity of ideas, stopping innovation from moving forward all driven by the prospects of fear.
Importance of Integrated Thinking
In “The CEO Innovation Blueprint” we talk about integrated thinking. And one of the challenges is that we focus on the low-hanging fruit, what was quick and easy to do to get to—to solve a problem, to produce a product, to sell, and the quickest, easiest way to sell to the customer. That’s a tangible component of business. What’s happening now is that the low-hanging fruits have been picked so we have to, as businesses, go up the next level.
And this is where integrated thinking is really important because now when you have to deal with the intangible things. When you really look at it, it’s like the Iceberg Principle. An iceberg 2/3 of the iceberg is hidden below the surface and that is the biggest risk to shipping, it’s what’s below the surface, not what you can see above the surface.
And when you actually look at businesses, that’s the same problem, the tangible component that we see, that’s obvious to us, we’ve already solved, we’ve already dealt with, tangible issues with customers were already dealt with. What we haven’t dealt with is the intangible stuff—that’s the complicated, under-the-surface components.
An intangible is not this one big issue that we can solve. It’s a sum of lots of small issues. So integrated thinking is about how I can pull lots of separate components together and solve them as one process to actually get the value for the company and to get the value for the customer rather than just I’ve got one big issue to solve which is what we’ve done in the past.
Focus of Innovation Should Be About Profit
“The CEO Innovation Blueprint” actually talks about an issue of really the focus of innovation really should be about profit. That’s the whole point of business. And strange as it may seem is that a lot of innovations don’t focus on growth or profit for the business.
The issues that we see, an example, is the banking sector where a lot of innovation is to try and keep up with what the competitors are doing. So when we look at internet banking products or smartphone apps a lot of those are; “Well, the competitor’s got a smartphone app, we need to have a smartphone app.” And whilst that may be important to keep your customer base, it’s not actually contributing to growth and profit. When you think about a bank, its key profit line is lending. And then you look at the smartphone app, and there’s nothing about lending on the smartphone app. Then how is that smartphone app helping the bank contribute to its profits?
It’s often that we are driven by the excitement of the technology. I always like the story from a long time ago, it’s not exactly true but it’s a good story. NASA spent a million dollars trying to design a pen that works in space. Because basically, pens rely on gravity, there’s no gravity in space, how does the ink run down to the nib? The Russians took a pencil. It solved the problem. So a very good example, sometimes we get caught up with the technology to solve the problem when there’s actually a simpler solution.
So again, it’s very important to be focusing on profit not on the best looking technology, not trying to keep up with the competitors, it’s all about trying to make sure that when I invest money in this innovation, how will it drive profit? And how will it drive growth?
Profit as Strategy for Innovation
In “The CEO Innovation Blueprint” is the focus on profit as a strategy for innovation. And a very good example was in early ‘90s we had the .com boom and bust. And basically, in the organisation that put the word “e” in front of it like e-commerce became popular and it was getting caught up with the technology. We tried very hard to talk with our clients to step back from technology and really focus on the business model.
Those companies that survived the ‘90s .com crash, organisations like Amazon actually had a very strong business model. Those that didn’t have a good business model were just playing around with the technology failed very quickly.
So it’s very important, if you’re trying to compete with other companies, is to actually focus first on the business model, second is, what is the problem that we’re solving for the customer? And then look at the innovations and technologies that will work for us.
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Having the Courage to Challenge the Status Quo
Challenging the status quo is a big challenge for any CEO. There are a number of areas we try to explain to CEOs. It’s not just about challenging the status quo but challenging it in a big way. We often think in terms of modifying a widget on the factory line. We need to be thinking about is, “Do we actually have a factory line?” We really need to step back and say, “If I’m starting from scratch, what would I do?”
It’s a real challenge. Take Microsoft. Microsoft has Microsoft Office; it’s a flagship product. It brings in billions of dollars of revenue. Imagine a scenario where the CEO comes in to the board and says, “We’re going to cannibalize our flagship product. We’re going to have an internet-based office.” It is not going to pull in the same revenue but they had to do it because organizations like Google are bringing in internet-based office products. So they had to cannibalize their own business. That is big, tough decision making that you have to do.
The Boiling Frog Syndrome
Another problem companies have is what we call the boiling frog syndrome. This is where a problem arises, everybody red flags it and everybody’s focused on solving that problem. Sadly the situation is that a big problem is actually a series of smaller problems. It’s called the boiling frog syndrome because basically if you drop a frog into boiling water it jumps out but if you leave the frog in the water and slowly heats it up, by the time it realizes the danger, it’s too late. That’s where a lot of companies find themselves.
A very good example of this is Kodak. A lot of people don’t realize Kodak invented the digital camera. It was an unusual product for its day, but it was the first digital camera. The irony is Kodak went out of business because of the digital camera. Kodak thought it had time to react to the digital camera industry, but were too slow in changing and responding to the market, and their competitors overtook them.
There are a number of areas about challenging the status quo that CEOs really need to step back and really look at and not just think about fiddling around the edges. We’re talking wholesale significant change about what the business is that you’re reacting to. What is going on with the competitors? How your customers are changing?
Successful companies don’t have smart innovations; they’re smart about how they innovate. This is the big challenge; it’s not about my competitors rushed out and introduced this new product so we’ve got to duplicate them.
Innovation, Not Replication
As CEOs pointed out the problem of always following is that you can’t drive price because by the time you’ve caught up, you’re basically and remarkably everybody else is copying that same innovation. Your other problem is your competitor is driving your business plan.
It’s very important that, yes, you recognize that innovations keep changing. But don’t focus on following. Think about how you can leapfrog.
The big issue that’s probably difficult for a lot of people to think about is you don’t innovate one product. You have to create an environment where you’re constantly replacing innovation.
If you look at Apple coming up with the iPod and iTunes model, it’s a great idea. How many years did it take to get replaced by technology like Spotify? And now it’s being leapfrogged again.
The problem is you can’t have an innovation and expect you’re going to live on it for the next 50 years. Within 3-to-4 years that technology is going to be replaced. That innovation is going to be replaced.
If you’re going to spend three years innovating, think about how you could get a jump on your competitors rather than spending that three years trying to copy your innovators. Competitors, sorry.
If you’re going to spend the next three years innovating, think about how you can get a jump on or leapfrog your competitors with that three years rather than actually spending that three years just trying to be the same as them.
One of things that I would like to be part of the innovation mindset is when we think about the customer. When we’re thinking about all this technology and innovation we often have a complicated scenario. It’s really important to shift our thinking and simplify, to really understand what the problem is that you’re trying to solve.
Stuck in a Maze
A very good example was a university competition for robotic students. The competition was to rebuild a robot that could never get through a maze. It’s really an exercise on how to work out why the robot had gone down this wrong path and how that was unsuccessful, so we don’t want to go that path again. They worked out all this logic.
Then this group came along. They created a robot that got through the maze. All it did was to follow the wall of the maze. If you follow the wall of the maze, all the way around, you’ll eventually come out. It might be a long way of doing it but you’ll eventually come out of the maze. And they won the competition.
Everybody cried foul, saying that it wasn’t fair. But it was simplicity. It’s really important with innovation, to keep it simple, really work on what are you doing to solve the problem. It was a very good example to get people to actually step back and really think about, “Hang on a second, we’re over complicating it.”
The Falling Baby
Another example is a scenario that I raised before of a baby falling out of a 20-story building. How did it survive? As soon as I asked that and said there was a 20-story building, everybody thinks straight away that it fell from the 20th floor. The actual way I’ve said it was to take you to that path. When you look at people like mind readers, that’s their whole skill: To actually lead you down a path of thinking that will get you to think of a number by suggesting words, etc., to lead you to it. It’s a trap of human nature.
When I said how did it survive a fall out of a 20-story building, the baby fell out of the ground floor. But as soon as I said that, people are stuck on the idea it fell out of the 20th floor and then we’re trying to solve that problem in that way.
This is where lateral thinking is very important because lateral thinking is about trying to break that vertical process where I’m following a path than actually just shifting sideways to look at things from an angle; look at things from different perspective.
So that’s very important and that’s what the CEO Blueprint is trying to challenge at the moment. It’s to try and get people to step back and see how we can do it in a different way.
Integration Is the Future…And the Present
One of the problems that we’ve seen since the global financial crisis is that before it happened, people were very focused on the 80/20 rule – the 20 percent of work to deliver 80 percent of the revenue. Focus on the lower hanging fruit.
After the global financial crisis, really the scenario is that the low hanging fruit has been picked. So how do I create business now? It’s all about integration. It’s about dealing with the complexity. We don’t have a situation of solving this specific scenario for our customer. We need to look at the whole flow, form point A to point B.
Integrated thinking is not just trying to understand a problem beyond just the simple situation, it’s look at what the whole overall scenario is.
Integration is trying to look at things from a more complex scenario, so don’t look at that low hanging fruit and say we can solve that simple problem. It’s actually looking at a whole scenario.
One of the companies that is coming out as a competitor is Uber, helping taxi industry looking at the whole payment process, ordering the taxi, getting the payments sorted out before the taxis arrive. It’s about dealing with a whole range of scenarios. If you look at what’s happening at the moment, the taxi industry is only focused on “booking” a taxi and Uber is more focused on maybe “ordering” a taxi.
So, these are all the issues where we’re starting to say we actually got to look at a little bit more complexity of the problem that we’re solving for the customer. It’s not just one component. It could be two, three, four or five components.
