The MATTER Health Podcast

Disruption Proof: A Book Talk with Brant Cooper

December 14, 2021 MATTER Season 1 Episode 12
The MATTER Health Podcast
Disruption Proof: A Book Talk with Brant Cooper
Show Notes Transcript

New York Times bestselling author and founder and CEO of Moves the Needle Brant Cooper teaches leaders how to empower people and their organizations to create new value and become more resilient, aware and dynamic. Due to the rapid pace of technological innovation in the digital age, massive structural change is happening throughout society. Faced with increasing complexity and endless disruption, company organization, systems and management are still largely based on what was most efficient in the Industrial Age. Disruption Proof brings readers a refreshing new approach to navigate pervasive uncertainty.

MATTER CEO Steven Collens sat down with Brant to discuss the uncertainty that the COVID-19 pandemic has caused, accelerating corporate innovation and creating resilient organizations.

Speaker 1: (00:08)
Welcome everyone. My name is Steven Collins. I'm the CEO of matter. We are a healthcare technology incubator and an innovation hub built on a belief that collaboration between entrepreneurs and industry leaders is the best way to develop healthcare solutions. Uh, our mission is to accelerate the pace of change of healthcare, and we do three things in service of this mission. First, we incubate startups since we launched about six years ago, we've worked with more than 650 companies ranged from very early to growth stage startups. And we have a suite of services to help them at every step. Along the way, our member companies have raised more than 2 billion to fuel their growth and their solutions have benefited more than 300 million people around the world. We also work with large organizations like health systems and life sciences companies and payers to help them achieve their innovation goals. We help them source and co-develop solutions gain insights into the minds of their patients and the dynamics of the industry.

Speaker 2: (01:13)
And we have training capabilities to help them innovate better and matter is a nexus for people who are passionate about healthcare innovation. We bring people together to be inspired and learn and connect with each other. And we produce a lot of programs, including large scale events for the broader community, as well as small forums that are exclusively for our members. So in that vein, we like to produce conversations that can help companies innovate better. And I'm delighted that we have Brent Cooper with us to share some thoughts from his new book. Disruption proof BRT is a New York times bestselling author to the founder and CEO of the consultancy moves the needle. He's got 25 years of experience help com helping companies of all sizes, uh, innovate better. Um, I also, I wanna thank, uh, Barbara's bookstore for collaborating on this event with us. Barbara's is the oldest independent bookstore in Chicago with, uh, several locations in Chicago land area, including the airport, uh, Barbaras is offering a 10% discount on Bran's book for anyone who attends this event.

Speaker 2: (02:21)
Uh, and Casey, uh, just dropped a link into the zoom chat for anyone who is, uh, interested, um, as Brant. And I have our conversation please, um, submit your questions using the Q and a function. I'll weave them into the conversation, uh, as appropriate. Um, Brent, welcome. Thank you so much for, uh, joining us, uh, you know, before we start, you know, you and I met, uh, completely, um, uh, well we met randomly, uh, years ago and then reconnected, cuz you were just looking for a conference room in Chicago to meet with, uh, one of your clients, uh, Roche. And I'm not even sure at the point you knew that I was working at matter at the time, but you're, that might have been still been somewhere else and you called up and uh, turned out the client was Roche. Uh, and I walked in to say hi to you and you were there and you had a huge whiteboard just like full of ideas and innovations. And I was like, oh, this is really fascinating. And got to know, um, the per your client from, uh, Roche who we have gone on to have a fantastic relationship with, uh, and continue to do, uh, a lot of work with.

Speaker 3: (03:34)
Yeah, that's amazing. Thanks for, thanks for having me. I, you know, if you're gonna do, uh, anything startup or innovation related, you go to 1876, right. So I think that's where we

Speaker 2: (03:44)
18 70 18 71.

Speaker 3: (03:46)
Okay. Well I gotta get my, my years. Right. Um, uh, but so I think that's where we met and yeah, the floor to ceiling white boards for, for roast diabetes filled with, uh, filled with sort of what our shared idea was of how innovation works or can work inside of large companies beginning with really opportunity discovery, using some jobs to be done and creating personas and, and, and moving into the customer discovery phase and running experiments. And, and, uh, it was, it was fascinating how that evolved to being, uh, Roche, running their own teams, doing, you know, you can't really, you can't really predict or choose what level of innovation you're doing. Right? So one of the big fallacies in big corpses is that they can put a team off in a lab and they're gonna go do disruptive innovation or horizon three innovation. And it'll magically appear as you know, billions in revenue, uh, 5, 6, 10 years down the road.

Speaker 3: (04:49)
And, and just innovation doesn't work that way. You know, that running matter, some of these startups are gonna succeed. Some of them are gonna be failures. Some of 'em gonna be singles and doubles and maybe, maybe, you know, one will, will really, will really blow up. And, uh, and so, uh, we ended up, uh, I ended up recommending to Roche that they, they do all of their stuff internally as well, because we need to apply it to the core business. And we can talk about all that, but also here's matter that can actually help you implement those ideas the way a startup would. And, uh, and, and it, it, it could be competitive with what's going on inside the company. But again, the likelihood of that is low. Uh, what you're just getting is this diversity, it's like a, it's like a diverse portfolio, right? You're getting a diversity of attempts at solving human needs. And yet Roche will be the beneficiary, whether it's done by this startup they've invested in or, or, or they come up with something that's more incremental internally.

Speaker 2: (05:54)
Yeah. And they've been, you know, from our vantage point, the last few years, a really great example of a company that has been able to work effectively with startups and find ones that they wanna work with and partner with in different ways, everything from R and D to commercial relationships. Uh, and, and I imagine a lot of that's due to the work that you did, um, setting up their muscles and their ability to, uh, to do that.

Speaker 3: (06:19)
Yeah. Maybe it's just, they've got the right leadership, but I think that it's, uh, it's great. I just love the idea of it being a diversified portfolio. And, and, and, and, you know, again, you kind of have to build it into the business that business eventually needs to understand that they have to have this exploration mode. And even that exploration mode is the manifestation of that can be, I'm going to work with startups, I'm going to do technology scouting. I'm gonna go and, and be aware of what the heck is going out in the world, because that's actually, what's going to prevent being disrupted is not that you invent something, but that you are aware of what's coming, that will allow the needs that you address to be addressed differently.

Speaker 2: (07:03)
Um, so let's get into your book, uh, and I wanna ask you a couple things. So, um, I wanna, like, why did you write the book? And, and when you answer that, if you could also weave in, because there's some like words that are so overused, including disruption, and I, I wanna understand, um, you know, what, when you, like, what's your definition of disruption. Yeah. Uh, and, and, and then what was the inspiration for writing the book?

Speaker 3: (07:31)
Yeah, so, so, you know, I ended up writing the book in the heart of the pandemic, and I did not set out to write a pandemic related book, but I think that if you write during the pandemic, there's, it's certainly gonna be influenced by it. So over the last 10 years, as you, as, as you've mentioned over the last 10 years, I've really worked with, uh, both startups, but also large organizations teaching them sort of this exploration mode, this how to add a innovation mindset or a entrepreneurial mindset into the business. And what I eventually got to was this idea that, you know, just your innovation team is going to take care of that, that idea is wrong. It's known by, you know, the dual operating system or the ambidextrous organization. And I think all of that's wrong. And I think it's, it's, it's bad advice.

Speaker 3: (08:19)
Pedald by the innovation industry. What really is required is this exploration needs to be all throughout the business. It just ha requires a different balance of execution and exploration. So that's why I was setting out to write the book. This is based upon my 10 years, working with, you know, massive companies all over the world, um, trying to get them to be more quote, unquote, innovative, the, the term disruptive, uh, you know, most people, most people hark back to Platon Christensen's, uh, uh, innovator's dilemma and, you know, uh, and this need to do disruptive innovation. And I think that, I think that era is over. Uh, so I'm declaring it here. The era of Clayton Christensen's disruptive innovation is over. Um, and of course it's not completely over. There's lots of companies that still need to disrupt the technology, but it really was a technology story.

Speaker 3: (09:15)
And the heart of what innovation is today is not new technology. We're still gonna have it certainly in life sciences and blockchain and AI, maybe there's some disruptive stuff that's coming down the pipe, but mostly the, the innovation is coming from applying existing technology in new ways and forming new business models based upon applying this technology in new ways. And so it means that the way we do the innovation to me is completely, is completely different. And so if the era of this disruptive innovation of technology itself, the technology disrupting ourselves every few years is over what is disrupting ourselves well in this complex world, it's interconnected. This is mesh network that we live in speed of information, speed of disinformation. It's, you know, off the charts. It's really the it's really global occurrences. It's acts of God, it's pandemics, it's supply chain. You know, it's ship getting stuck in a canal disrupting, uh, supply chain, it's ransomware attacks, you know, that took out a, uh, hospital system here in, in San Diego.

Speaker 3: (10:24)
It's E energy grid collapses. I mean, so these things that maybe at one point, would've been more isolated now ripple through our businesses and through the economy. And those are the disruptions that I think are now sort of the norm. I think we're gonna have not to the same degree, right? We're not gonna have a pandemic every couple of years, but we're, we're struggling to get out of this one. And a lot of the changes we've gone through because of this pandemic are going to stick, they're gonna be around forever. And I don't think, you know, a bunch of people are running around calling this, you know, the once in a century, uh, pandemic. And we're, you know, we're two decades into this century. This isn't the last one  and we've already had three economic col collapses in the first two decades of this century.

Speaker 3: (11:07)
Right. So that's extraordinary. And so I think that, I think this is the new normal. And so disruption proof is really using that exploration mindset, that entrepreneurial spirit that I was talking about into the core business, all across the business, in such a way that that companies will be able to respond to the changes that happen in the world, rather than, you know, suddenly at the last minute, they have to save their business because of the disruption. So it's building into the structure and the processes, this, this entrepreneurial mindset. So we learn how to balance equilibrium or establish its equilibrium between execution work that we know we have to get done and exploration in figuring out what needs to be done.

Speaker 4: (11:52)
So

Speaker 2: (11:53)
One of the things that you, uh, talk about in the book as a key to being able to do and accomplish what you just described of creating a company that is disruption proof, that's resilient, and you go into resilient and aware and, and dynamic, and you know, that they can adapt to things like pandemics and supply chain disruptions and all that other stuff is, um, is something that people have been talking about for a long time. But I, I wanna hear you talk a little bit more about it in the way that you're envisioning it. And that's really, um, it's like focusing on the customer, you talk specifically about empathy a lot and how important, um, that is. And yeah, I mean, people have been talking about this for years. Like every company you look at is, is like customer centric or customer focused or customer oriented, or they're like passionate about the CU. I mean, it it's like a cliche at this point,

Speaker 3: (12:49)
, it is it's,

Speaker 2: (12:51)
But they aren't. Right. And, and so like, why is it so hard for companies to really be in tune with their customers in a way that helps them make important discuss decisions? And that helps them actually be more resilient and aware and re and responsive to the, to the market.

Speaker 3: (13:10)
Yeah. I it's, it's, it's a fascinating time when a, when a car commercial actually is using the word empathy. So, you know, we've sort of like you realize you you've done to the point of jumping the shark, uh, when you see it in, in car commercials. Um, I, I, I, I sort of joke though, that if, even if companies are using the word and trying to at some level that's better than, than before, but so the idea is the idea of empathy is not, you don't really need to get like all woo woo. Right? You don't, it's not about like, you know, sitting down and having a good cry with your customer. It it's really more about going beyond demographics, going beyond asking them what features they want in their product. It's understanding them deeply. It's understanding what drives them, what are their obstacles? What are their aspirations and the need for it is, is pretty obvious, which I think is why companies have responded in this way.

Speaker 3: (14:12)
Why they're, we're they're using that language is cuz they realize that there's so much complexity in the world and that customers can change their minds overnight, that they just have to understand them at a deeper level. The reason why it's tough for them to do it is because they're still relying on their practices and structure from the middle of the industrial age. So in other words, there's a group who specializes in understanding customers and they don't they're, it's not tied to trying to do something new or to create new value for them. So they lump them into demographic groups and they try to study millions of them rather than, you know, sort of small handfuls of them in order to try to really get to know them deeper. And, and uh, and like in the business to business world, your product designers or your product engineers are not allowed to go talk to customers because the relationship is owned by the account, right?

Speaker 3: (15:06)
So it's the sales. And so you have the very structure of the company, the silos with all of these rules of engagement. That mean that most people are not allowed to talk to their customers. And, and, and certainly in the health sciences world, there's even all sorts of regulations on how you're allowed to talk to customers. And so the thing is, is that that's really what needs to be broken down. Uh, the skill in teaching and how to communicate with customers, I think is very teachable, uh, moves. The needle has taught literally thousands of people, how to do it. Some are naturally, you know, more adept at it than others. Um, but anybody can learn how to learn about their, their customers. And a matter of fact, one of the greatest design thinking or human-centered design practices is to simply just go observe your customer.

Speaker 3: (15:55)
You can learn so much just by watching them, but somehow we are, you know, the old practices, the structure, the, uh, whose responsibility it is means that customer centricity to large corporations as they sit around a conference room table, imagining they're the customer, well, what would I do if I'm the customer? And that's not what we mean, , uh, it's really getting them out there or bringing them in. And so like, you know, the story, uh, in the book is, is into it really brought that home executives had to do what, uh, they called, uh, uh, the ex, uh, CEO, chairman, uh, Brad Smith called follow me homes. And so the FollowMe homes are, you have to watch your customer, the executives of the company, the top people of the company have to watch customers use their product and not say anything, not lead them. And I just like it, it just, I sort of laugh because I just think how many of the world's problems could be solved if top executives actually sat down and watched their customers use their products. I mean, it would be, it would be extraordinary in and of itself.

Speaker 2: (17:06)
Well, I, I love that example that you put in the book from TurboTax, from, from Intuit and, and I think it is such a good example and a, like a, a clear reminder of the fact that, that the there's a human being at the, at the other end of, of this whole enterprise and your, you know, there's all these software developers and all this process and everything else. And at the end, there's an old lady that you just describe and she's doing her tax return and she gets stuck on this question of like charitable donations. And if there's two options, did you make a cash charitable donation or a non-cash charitable donation? And she's stuck cuz she wrote a check and she didn't know what to put. And it like caused this like, you know, for the executives to your point probably sat around in the conference room and thought about, and they just didn't occur to us that this is

Speaker 3: (18:09)
I, that, that moment, it even threw me for a loop when I read that, like when, or when, when, uh, Brad told me that I was like, well, what is a check ? You know? And so it's like, yeah, I, and those that's only just the most obvious, right?

Speaker 2: (18:24)
It's such a good example. And, and it is right. And, and you know, we have certainly seen you, you mentioned in life sciences and, and healthcare and that it can be a lot harder and it can cuz you have to make sure that you do this in a way that doesn't get you in hot water, but it's, it is more than possible. Uh, and companies that have been really successful in doing it. I think you see the results.

Speaker 3: (18:46)
Well, you mentioned, you mentioned Roche, right? So there's a life sciences company. They've got a, a huge compliance, uh, group, uh, that, that manages how, uh, their people are allowed to talk to, uh, customers and potential customers and, and, and all that sort of thing. And you know, we were doing, uh, an accelerator program for them and we had a hundred plus employees and, and  the first thing that we're we're doing is sending them outside to talk to people and they just fear, right? Well, we're not allowed to do this. We're not allowed to do this. And so I had, you know, the, the man in charge more itritz Hartman, I made, you know, he announced in the front of the room and it was actually a kind of a cool story. I actually mentioned this in the book, you know, that he, he says, listen, my first job was dressing up at a dinosaur outfit.

Speaker 3: (19:34)
Like this man is like a huge man he's he is a dinosaur. Um, but he was joking about how his first job was actually, he had to dress up in a dinosaur, a costume and go out and talk to customers. And so he was encouraging people that they can do it, but he also was giving them permission to do it, but it still took, I don't know, another several weeks before people felt comfortable from a compliance perspective and what the compliance group did was released updated requirements that allowed, that gave permission to people to operate, uh, out in the wild with real customers, as long as they followed these specific rules. So rather than having your people seek permission every time they want to do it, it's follow these guidelines and you are good to go. And, uh, and, and to be honest, there were still people that said, no, we're not allowed to do it.

Speaker 3: (20:27)
Even when given the compliance document. And then that's a different hurdle, right? They're using that as an excuse at that point. Um, but so there's a role to play for these compliance groups and, and you and I were talking before, uh, that you, you have to involve those people, right? You don't wait for them to come in and shut it down. You involve them in the get go. And they understand that what you're, the work that you're doing is, is furthering the viability of the company, which is, you know, part of their responsibility and they have a role to play in the success of the, the future of the company.

Speaker 2: (21:02)
Yeah. So let, I mean, so let's talk more about that. The, the, the, um, you know, you use the term corporate antibodies, uh, we've got, uh, one, one of the big companies, one of the executives we work with calls them the barrier layer. Like it's, it's the, you know, it's finance it, legal regulatory, HR, it's, it's these functions that aren't, you know, they're the way their jobs are constructed, you know, part, a big part of their mission. And their job is to protect the company from sort of bad things that could potentially happen. And, and, um, you know, this a, it's a, this common problem that they don't, uh, that the business people are innovating and they're developing new concepts and they're testing things, and then they either get watered bound or killed by these antibodies or these barrier layers. And, and talk more about how you, um, you know, how do you engage? How do you actually engage them? How do you get them interested in allocating some of their time to doing things differently? You know, how do you get them involved in these processes?

Speaker 3: (22:11)
Yeah, I think that, so, so part of the problem gets back to the, again, that this idea that the innovation group is this siloed group, right? So that what require, what happens then is that this small under-resourced siloed group has to go to all of these different entities inside the core business, including the business units themselves, but also all of these departments. And they're, they're asking for permission to do all of these things and the easiest thing for all of those business, it's new is go like, uh, no, it's just to say no. Right. And so the number one thing is that we have to, we have to break down the, the, we have to eliminate this idea that the, the, the way to act innovative belongs to this particular group, the mindset belongs everywhere inside the company. And so one of the examples I give in, I think I, I mentioned this in the book is, is my interaction with a huge European bank.

Speaker 3: (23:07)
And this bank has got this, you know, innovation department, and they've got floors of their building dedicated to all of the amazing things that they're doing reinventing banking. And they give tours to people, you know, so this is classic innovation theater where it's like the sexiest part of the building. And, uh, and yet I interacted as a B2B client with them, uh, through this portal, uh, they were doing this service for us. And, uh, and the portal was like, had to be from the first, you know, the two thousands. I mean, it was just horrible. It was just like old technology and you couldn't find what you needed to do. And I think that like, buttons must have only appeared if you had the right permissions. And so we didn't have the right permissions. So we couldn't upload this stuff. And the process was that I needed to go get this wet signature from JP Morgan chase, like who is JP Morgan chase is gonna sign something for me.

Speaker 3: (24:01)
And then I would have to mail it back to them. And it was like weeks into the process. And I finally just canceled it. And so to me, there's an example of who is that that's probably it, maybe some finance people, uh, and even some core business people, cuz they're the ones that were offering this service to small businesses. And yet none of that had been updated with new processes, with new technology, with digital signing. None of that had used any of the new technology advances that we've had in the last 10 or 15 years. So here we go, okay, we're gonna go reinvent banking right in this innovation theater. And yet we're not going to apply any of this new technology to the core processes of the business. And so the, again, it's just an example of the mindset that the core business itself needs to change.

Speaker 3: (24:47)
The core business itself needs to be able to adopt new technology and new processes and new systems as we evolve or your business is gonna fail. So the riskiest thing to do for these core corporate antibodies is to do nothing. I mean, literally they're destroying their companies. And so again, it's kind of a mindset change there. And the way to engage them is to allow them to be innovative. And, and maybe you don't use the word because the, in to me, the buzzword innovation that everybody goes, well, that's not my job. But if you, if you, if you think, if you teach them how to be in this exploration mode where their customers are internal clients, and so they have to go and develop that same thing that we talked about before they have to go and develop empathy for their internal customers. And then they get to brainstorm, well, how can we actually better serve those internal customers?

Speaker 3: (25:42)
And they can run experiments. Well, what if we did this? And what if we did that and you teach them this process, then they can update their own systems and their processes. They can now go to that innovation team and supply those, those guardrails because they're offering a new service to their internal clients. And so it's really not in, in a lot of ways. It's not that difficult. It's just, it's just the recogni recognition of the need to do it. And then these people are just like everybody else inside the business, they wanna exercise their creativity. They wanna be inspired. They wanna help the business. They wanna help the business succeed. That is their job. And so we actually don't put them in a position to succeed. We only put them in a position to say no, as opposed to putting them in a position that they can actually add additional products and services to their internal customers.

Speaker 3: (26:32)
And that same thing applies to finances, to legal as to it. And so I think it's, it's a shift. And so I think that, you know, if you're running or in an innovation group inside your company, you know, you need to start some sort of start off mindset or innovation mindset or entrepreneurial spirit, happy hour, run a meetup once a month, do it virtual if need be and invite people from all over the company. Uh, and, and let them sort of start engaging with that sort of creativity and problem solving. That's all it really is. Right. It's creativity and problem solving.

Speaker 2: (27:10)
Yeah, I think it's, it's really, I mean, I worked in a large company and, and, uh, that, that, where I felt it all the time where we would wanna do things and we'd go in front of these people who weren't, you know, we, we, this was a long time ago. I like to think I would do it differently today, but you know, they weren't involved in anything. Like we, they were, it was the very last step of the process and we would bring them in to look at something or review a concept. And they're like, no, you can't do that. And we're like, but we've already spent all this money and we've done all this things and we've gone through this whole process and this is what is gonna be, and they're like, wow, there's too much risk there. You, you can't do that. And you know, I, I think there's, there's a side to it that the people who were in the position, you know, years ago that I was in like, need to have going back to your point about empathy, they need to have more empathy for like who these people are, who are in these, these jobs and what their roles are.

Speaker 2: (28:06)
I

Speaker 3: (28:06)
Think that's right. Yeah.

Speaker 2: (28:08)
And I think that is really important that people just sort of lose sight of. Um, and then I think, you know, you offer, I think like, uh, trainings for legal and, and regulatory and those kinds of functions. And I think that is just an incredible idea. If you can empower those people to be, you know, to feel more empowered, to act in ways that drive the business more holistically, cuz they wanna do that rather than

Speaker 3: (28:34)
I think you're right. I think they wanna do it. I think that's so important is that they wanna do it. I, I, I, I, so there was a it's also, you know, just, it, it becomes so embedded in the culture that people just fear it, that they don't even ask. There was one group that we worked with, uh, where one of the team members was really gung ho to run sort of a radical experiment. And another person was like, no, no, we can't do it. Legal will never let us do it. And I go, you know, go ask them, oh no, no, no, they're too busy. They want like, no, you know, you gotta schedule it. And I go, go knock on the door. And so they go knock on the door and their corporate account just goes, oh, like we'll make this little change and you're good to go.

Speaker 3: (29:13)
And it took like five minutes and, and the legal person was like, no, no, no, that's fine.  so, so part of it is, is, is, uh, yeah. Part of it is, is getting over your own, your own. Is it your really there? Are they the obstacle or is it your own heart? That's the obstacle cuz of your own fear. And then the other part of it, it really is just to get those people involved in the process, make them part of the quote unquote innovation, um, put 'em on a team, put a team member, put a, put a marketing person on your team, put a brand marketing person on your team. If they're the obstacle, put a compliance person on the team. I mean, a lot of the thing is that they're just sitting in their office offices imagining what it is that you're doing.

Speaker 3: (29:55)
And they're probably not imagining the, you know, the, the, the best story out there. So, uh, yeah, I, we did this workshop once for a design group that was completely, uh, out of touch with the manufacturing group. And they had invested all of this money in this new digital fabrication technology. And none of they'd seen none of the ROI because the way the people worked was still analog. It was still the way they did it before. Uh, and really just within a couple days with those people doing all the work, we just guide them that they completely reinvented the way they worked together. Uh, and it's just taking the time and, and the space and providing them the skillset to learn how to do it. And then these people can do it.

Speaker 2: (30:44)
So, um, go back to something you said, um, you used the term innovation theater, um, which, uh, what is the difference between actual innovation and innovation theater as you see it in companies?

Speaker 3: (31:00)
Well, I think that the, the innovation theater really is the, is, is sort of the showing off of how innovative they are with actually without actually producing any results. Um, and, and I think it's an artifact of, Hey, we're gonna invest all of this money. Maybe it's a way to recruit young talent or engineering talent. Um, and so you're, you're sort of bringing in the artifacts of what they imagine a Silicon valley startup to be, um, but not really getting towards the desired outcomes. Um, and so, uh, you know, I, I just, I think that the, the, the whole startup world is really sexy to corporate America and, uh, what they don't really realize that it, you know, it takes a thousand startups to make, get one or two maybe, uh, unicorns. And then you get, you know, a bunch of singles and doubles, maybe not even a bunch, a few.

Speaker 3: (32:05)
And so that's what the corporations are, are competing against with their, with their lab that they stick out there in, in Silicon valley, right. I mean that, like they've got two or three teams working away at reinventing the industry and they're competing against literally around the world, thousands of startups. And, and, and so the likelihood of it appearing in that lab, that's going to create this growth or this re replace this revenue. It's just, it's a pipe dream. It's not gonna happen. And I don't know of any evidence that it does happen. And so the, again, the, the innovation industry sort of pedals the same four or five stories about disruption. Um, most of those stories are mythology anyway, but it's the blockbuster story. It's the Kodak story. It's, you know, uh, there's a lot of BS in those stories. Uh, and, um, and yet that there's the same stories decade after decade . And where are all the examples of these companies that are able to do like disruptive innovation out of their, their lab of two or three PE, you know, again, I think technology companies still will need to invent, and that includes life sciences. Uh, you have to invent, but the vast majority of companies don't have to invent anything.

Speaker 2: (33:23)
So, um, I tell one of, tell the one of those like Kodak story. I mean, I I've, I mean, I've heard all these same stories over and over and over and over and over again, I've been in, um, you know, plenty of, of rooms of corporate presentations, where some of the leaders are presenting these same things, blockbuster and Netflix comes along and , and the digital camera. And they're saying to all the people in the room, you know, you're gonna be disrupted if, uh, you know, unless you've changed the way that you think. And, and then, you know, I'm pretty sure everybody goes back to their jobs when it's all over. Um, but it is just like tell the code, like what actually happened with, with Kodak.

Speaker 3: (34:04)
Well, so Kodak, you know, most people know that Kodak did invent a digital camera and they had a digital camera, and that's usually kind of where the story ends is that they decide they didn't go to business because they wanted to protect their film revenue, but they did go into business. They actually were selling digital cameras and they were competing at the time against Fuji that also had a digital camera and Fuji still has been, you know, successful, I guess, I don't know. Uh, but the, the, so Kodak did invest in the digitalization. They just chose the wrong business model. And so I, I think that it, if, if, if the story about Kodak was they didn't run a bunch of different experiments to try to figure out the right business model.

Speaker 3: (34:52)
That's fine, right? I mean, that's a valid, that's a valid criticism, but to say that they suffered from the innovator's dilemma because they had all of this technology first and they didn't invest in building that out. That's a false story. They did, they chose the wrong business model and they lost businesses are gonna lose if they choose one business model and, and try that. That's, it's, again, that's, it's the likelihood that they're gonna beat out is, is, is, is wrong. But the, but the, so there is valid criticism there, but it's not the criticism that everybody says they did take it to market. They chose the wrong business model. It would've been better if they had used some of the entrepreneurial spirit to run experiments and to understand bigger changes that were happening. And they perhaps could have stumbled along the right way. But it's also quite possible that even if they had done all of that, they still would've lost in the marketplace.

Speaker 3: (35:53)
Right. So just seeing that something is company and investing in it doesn't guarantee the success of what, what actually is coming next. In a matter of fact, to me, something that is as disruptive of that. And there's a couple of examples in the book, and it's actually, it speaks to, to your, your company matter when a new technology is emerging like that, why not sit back and invest rather than pretend that you are the one that have to go figure it out. So like in the, in the book, Cargill, everybody sees that alternative proteins are coming. And so instead of them just diving in and funding, you know, an internal St startup because they are, uh, they're not suffering from innovator's dilemma. They sat back and they watched, and as they were, they, they let the market start to take shape before they were jumping in.

Speaker 3: (36:53)
And then they could evaluate based upon their expertise, what's the best way for them to get into the market. And so they have this huge distribution advantage. And so then they start partnering with startups and they're investing and their, and their understanding what's coming down the pipe. And then they enter using really a brilliant cross functional team inside the company, right. It's not a innovation silo. They actually take the different parts of the business unit and, uh, different areas of the company. And they assemble this team that actually is, is creating their go to market strategy. Um, so it's not done by the silo, um, and the business units are investing in it. So they're from the get go. They are they're, they've got skin in the game and they wanna see succeed. So they're applying resources and you're always gonna have the battle over the resources being applied to the execution work versus the exploration.

Speaker 3: (37:50)
Um, but eventually they, they successfully then ran pilots. And so they're running experiments and trying to figure out how they leverage their expertise in this emerging market. And so to me, that's like, well, why not do it that way? That's, that's, uh, that's taking the awareness of the change and it's using their internal, uh, capabilities in order to take advantage of what the emerging market would look like. And so I thought that was a brilliant example of being rad, resilient, aware, and dynamic. Um, and, and that's way more likely to succeed in my opinion than, than, uh, you know, than then an innovation group. That's supposed to go from soup to nuts and reinvent, you know, a, a product.

Speaker 2: (38:34)
Yeah. I mean, the companies that we, uh, have the most success helping are companies that have internalized a point of view that all the smart people in the world don't work for the company and that there are lots of really interesting ideas out there. And if they can find them and work with 'em at different stages and different points of development and bring them in, in different configurations that, that can really accelerate, kickstart, you know, change the nature of their business in positive ways.

Speaker 3: (39:07)
Yeah. It's just, it's, uh, again, it kind of gets back to the idea of a diversified portfolio and, uh, and you know, the hardest part, well, I don't know, there's so many hard parts to a startup, but if you're a startup and you actually succeed in a small market, that growth stage is pretty difficult. And so that's, that's where a relationship with a larger company that sort of has the distribution figured out, can be advantageous to the startup as well.

Speaker 2: (39:32)
So you, when you were talking about that difference between sort of Kodak's mythology and Kodak, what actually happened and going back to what you declared at the beginning, that the, uh, innovator's dilemma and the Clayton Christensen, you know, version of that that's over, uh, and that we're in a different phase now. And, and I think I want you to elaborate on that a little bit and, and, you know, you're the, the, what you describe in the book is, is that an established firm is, is sort of continually reinventing itself from within, and it's learning and evolving. And you use this analogy at one point that I really liked about a snake, um, which putting aside I happen to like snakes, but putting aside, you know, a lot of people don't like snakes at all, but put that aside, um, you know, the snake doesn't eat itself. It doesn't disrupt itself. Um, it's growing, it's evolving, it's shedding its old skin it's emerging as kind of a more vigorous version of itself. Um, it's just talk, talk more about that, you know, not necessarily just mistakes, but in terms of, you know, companies like, like Cargill that you talked about or Kodak, why that didn't work. And, uh,

Speaker 3: (40:42)
Yeah. So, so I think it, that in the era of the way I think about it is in the Clayton Christensen era, uh, where technology invention is, is key, uh, or is what's driving the innovation. Then, you know, I think you can make a case that, uh, launching a startup that's sort of external from the company, um, that completely reinvents itself from top to bottom and, and then ends up taking the market of the, the mothership. You know, maybe that's actually what, what would work then? Um, because the whole business model is different. When you go from a hard drives that are three and a half inch drives to hard drives that are, are, or go from five and a quarter to three and a half. There's a lot of changes, you know, not only in, in, uh, it's in the production, right? All of the mat, raw materials, uh, the form factor, then getting the form factor into the ecosystem because all of the cages that were in sort of the, it centers all took five and a quarter drives, not the three and a half.

Speaker 3: (41:47)
And so you have to look for new markets and then it happened to be, you know, laptops and handhelds. And so it's a complete reinvention of the, the whole business really, um, until the, the other, uh, changes happen that will incorporate the, the smaller drives. So that's that model actually probably still exists to some degree in technology invention, but for the vast majority of companies, that's not what they need to do. They're applying technology that's existed. If you look at the startups that have been successful over the last 10 years, it's not about invention. It's about, uh, it's about applying this to new applications. I mean, Facebook didn't invent anything. Um, and so, uh, algorithms that, uh, you know,  moderation algorithms, which I'm not sure that's done anything yet. So, um, uh, so that's an, so the old school example is the snake that, you know, eats itself, right?

Speaker 3: (42:43)
So it eats the tail. And then, and then it it's the, the new snake. Whereas I believe that now what is required is applying this technology and you have to continuously do it because things are moving so quickly that, uh, your advantage is can you address particular needs better than the competition? And so that stuff is changing all the time. And so the only people that really can do that are the ones that are in front of their customers on a regular basis, like in the B2B world, it's the account managers and the marketing and the product managers that are working on the existing businesses that know more about the customers than anybody else inside the company than, and your customer support people. So those are the people that are gonna understand better how, what the evolving needs of the customers are. And if you couple that with understanding the emerging technology and understanding demographic changes that could re, uh, affect your market sizes, those are the people that are gonna have a myriad number of ideas on how to continuously improve the product, or to break the product down and assemble it in a different way that you could go after a different market segment.

Speaker 3: (43:47)
Um, or, you know, so if you start thinking about how do I leverage existing products for new market segments, or how do I take my existing products and go after new market segments or what additional products will allow me to own more of my customer's time based upon our existing products, those type of things are all kind of innovation. It's not disruptive though. It they're more incremental and that's totally fine. If you stay on top of that stuff, then I don't think that you need to completely reinvent. I don't think that you need to start over, which is the old model. And so if one builds into the systems, this ability to make those changes and to be aware of what those needs are and the technology that's coming down, and what start up are up to, then you can continue to relaunch or find new markets or new products that are two or three years down the road, maybe.

Speaker 3: (44:44)
And so you can have a different part of your organization. That's, that's capturing that, but, but it's this ethos that's built into the core business, that things are changing fast enough, the world is complex. I need to not only be executing, I need to be continuously learning. And, and to me COVID brings that home, right? I mean, so if you, you wake up in March, 2020, and suddenly your consumer don't have any money and your, your small businesses are going outta business, your innovation group, isn't saving you from that moment. If your market fails, it's completely changed in, in a new day, your innovation group has nothing to say about that. You are now faced with uncertainty and you have to figure that out. And the companies that actually have already built that ethos into their business are able to figure it out. They're able to pivot in the moment.

Speaker 3: (45:35)
And there's a couple of case studies in the book, you know, that describe that. And so it's not what I want people to think about is, you know, maybe don't use the word innovation because again, people will say, that's not my job, but if you think about it, exploration mode admitting what you don't know and going and exploring solutions or learning about what you don't know or bringing in the right expertise that makes execution more efficient. Exploration may makes execution more efficient. And so we have to build that exploration to the degree that it's needed based upon uncertainty into the core business, and automatically you are now more resilient than you were before. And so that's sort of the fundamental precept is that it's not that exploration doesn't belong to some siloed group. Everybody needs that exploration mode to a different degree.

Speaker 2: (46:26)
So if I am a senior executive at a big company, and I know that the company needs to be more innovative, your advice is, is probably not go build an innovation group, uh, without sort of reading the whole book. Like, what should I do as

Speaker 3: (46:47)
A, well, first I wanna understand what you mean. Yeah. First I wanna understand by why do you need to be more innovative? Like, what is your outcome? You have to define that word. And that's the problem is that that inside the big companies, they don't define the word. So everybody runs around the company thinking about a different definition of the word innovation. And so if the, what is, what is the, the core business, the salesperson or the core business mean by being more innovative, they probably mean that we need to be faster and we need to respond to what customers want. Right. They don't really mean, I, I need you to go reinvent a product. That's gonna take five years to take the market. They want this stuff now. Right? And so it's the ability to be agile. And so what I think that they should do is that executive should form teams out of his groups.

Speaker 3: (47:39)
And if, if, if they've got interdisciplinary or cross-functional, that's great, and he should assign, she should assign missions to those different teams. So your mission is here is to improve our market. Share over here, your mission is to improve our core business sales numbers. And so you, you form these teams, you give them a mission. Um, depending upon the degree of uncertainty, you're gonna staff those teams differently. You give those teams a mission, you give them the resources they need to accomplish the mission. You give them autonomy that they get to go and solve that problem, how they want to, and you give them the metrics that is going to evaluate how they're doing. So we're not measuring tasks. We're measuring progress towards that desired outcome. That team now has to report back to the leader on a regular basis, weekly or biweekly, those metrics, uh, the leader's job becomes, I need to mentor.

Speaker 3: (48:36)
I need to clear the path for this team. I'm not telling them what to do. They're not checking in with me on a daily basis. I don't care how long they're on zoom on a daily basis. I want the report on how they're, how the progress towards accomplishing the mission. And then I step back. And so it's giving them autonomy to solve those problems. And so you have to, you know, maybe you start with things that are, you know, low risk or relatively easy, like as a leader, I'm thinking, well, what keeps me up at night? Where is my uncertainty? How am I going to hit my numbers? How am I gonna achieve my execution goals? Where's the uncertainty that I have. Okay. Maybe I can spin up some teams that will help solve that uncertainty. And so those type of things are, you know, they could be internal process issues.

Speaker 3: (49:23)
They could be internal productivity issues. They could be internal efficiency issues, or they could be customer facing improving sales scripts, or trying a new marketing campaign. I mean, a lot of this experimentation people do anyway, but this is sort of formalizing the idea so that we can recognize that exploration mode is actually beneficial to, to the execution. So it's up to leaders to build into your team's work explicitly time for exploration time for learning about customers, time for running experiments. And I, I really think that what the leaders will find is number one, we have the ability to do it. The people can do it. And number two is that it makes us more efficient.

Speaker 2: (50:09)
Let's talk about how middle managers fit into this paradigm that you just described and went through. Um, you know, we, we've seen a lot that there are people managers or analysts or entry level, and they're ready to go, they're ready to try new things and explore or innovate, or, you know, they, and then there's the senior leaders who are, you know, they've, they're all about innovation and they talk about it and they want their organizations to be more innovative. And then there's this layer of people in between who are, you know, they're directors, they're general managers, they're VP they're. And at the same time, you know, the senior leaders are telling you gotta hit this number. You gotta, you know, wall, Street's calling whatev, like, how do you, how do, how do you ma what's this? What do you do in that, with, with, yeah. I mean,

Speaker 3: (51:09)
That's, that's who I, I think that's who I was just describing. And so I totally agree with you. We give actually all of this new training to the younger people, the, the lower level, the design thinking and lean startup and agile, and, and we're creating these agile teams and the leadership overall, gung ho you know, they're cheerleading. And then we, you know, we don't give any of that training or, or any of that, uh, you know, new ways of working to the middle management and the toughest part about them is what they really need to do is delegate their authority. And of course, they feel like that authority is the only thing that they have. Um, and so, and they also, they, they also maybe lack trust that their teams are able to do that. And so that's really, the big hurdle to overcome is, is getting those leaders to, to trust that their people can do the work at the same time.

Speaker 3: (51:58)
They really wish that they weren't just always fighting fires and they wish that they could be more strategic because the way they're gonna get noticed by the bosses above is that they're actually doing something strategic and, and, and, you know, sort of rallying resources that actually result in these positive wins, but they can't, as long as they're managing all of these individuals, I think. And so it's really, to me, the step is building the trust between them and their team members between their them and the people that they're managing and get out of the day to day management get out of really, I think the one on one management, I really think that you need to assemble a team of people and assign them the mission. And they reporting back to you the progress towards accomplishing the mission. And if you've got multiple groups of people, you've got multiple teams, then there's this sort of a, a layer team of teams, you know, comes from general McChrystal's book, uh, which is a great book team of teams.

Speaker 3: (52:53)
But you, you have to add this later, that's sort of aggregating all of the information that you're getting from the teams below and the manager, the middle manager's job is to aggregate the information below, aggregate the output and make sure that's aligned to the priorities aligned to what they're assigned to do. And so that leader becomes responsible for allocating the resources and forming the teams and forming the missions necessary to achieve their goals. And then they are the ones that need to build in this time and space for ex exploration in order to maybe exceed the goals, but certainly be more efficient in achieving their goals. In the end. If one goes through that sort of transformation, you have fewer layers of middle management. There's no doubt that that's sort of the layers that gets weeded out, but it's because in the end, an individual can manage multiple teams.

Speaker 3: (53:48)
And those teams have, you know, are two like Bezos, two pizza teams, they have eight to 10 people on it, or something like that. You don't need, uh, managers based upon the number of people it's managers based upon the number of teams now. And so you need fewer, uh, uh, middle management, which of course means less silos, uh, less fiefdom. Uh, it means that the company moves a lot faster, um, by eliminating some of those layers. And so, uh, you know, the bank I N G completely did that sort of transformation, um, uh, managing people by, you know, sort of this agile teams formed into squads and all of that, and got rid of the, you know, all, some of the layers of their middle management in order to be able to be more responsive to the customers. Um, so it's kind of one of those tricky things that, yes, it re results in fewer middle managers, but those middle managers that remain are the ones that can be strategic, that can delegate their work, that know how to form this team of team's layer so that they are maintaining them and, and not controlling, but, but putting into place the flow of information, right?

Speaker 3: (55:02)
So if you're in the old school command and control information flowed one way from the middle down to the edge, and it didn't really matter to them, whether there was feedback or not, but if you're delegating authority and you're allowing these teams to make decisions and to solve problems, the information is actually out on the edge. And so somebody needs to manage that flow of information and, and make sure and allocate, manage the resources based upon that information and send that information back up as well as across the organization so that there's not redundancy. And so that people can learn the insights and the results of experiments and all of these things that people are learning about the markets out there needs to be spread around the company. And that may end up changing executive decisions that may change priorities. And so that's part of the aware part of rad, right, is that we have to increase our awareness of the changes that are going on in the world, and those need to be filtered up to the top so that the priorities can be changed based upon new instances in the world. And so, you know, if you're, if you're dependent upon manufacturing in 2020, and you catch wind of factories closing in China in December, 2019 in January, 2020, you're way, the more way more prepared about what's coming than those that have waited until March, 2020 to start you know, listening to what's going on in the world. And so a lot of that is empowering the edge.

Speaker 2: (56:27)
Um, so brand, I, I, as always, I, I love talking to you and I would like to continue this conversation for the next, um, two hours, but, uh, I can't, um, uh, or I guess we could, but, um, so, uh, but I wanna thank you for joining us. Um, this is the book, uh, disruption proof. Uh, you can go to Barbara's bookstore, there's a, a link in the, in the chat, hopefully you'll, uh, we're inspired by this conversation and, and we'll, um, we'll take a look, uh, at what brand, uh, brand has put together. Um, BR thank you so much, uh, again, um, really a pleasure to, uh, listen to your insights and experiences based on many decades of doing this kind of work for, uh, companies big and small.

Speaker 3: (57:16)
Yeah. Thanks, Steven. Thanks for having me and always great to talk to you. And, and, uh, I, I encourage people. Number one. Yeah. You know, buy the book, support your independent book seller, but also reach out, uh, I'm brant@brantcooper.com Brant Cooper on all social media. So if you, you have questions that we didn't get to, happy to answer them. I, I respond to, to all the, the emails. And so I encourage you to reach out and connect with me and, and, uh, yeah, hope everybody enjoys their day and, and really, uh, Steven again. Thanks. Thanks for, for hosting.

Speaker 2: (57:51)
Thank you. Thanks everyone. Have a great day.