Category Archives: Leadership

What is Your Mindset? Fixed, Growth or Hybrid?

GUEST POST from Stefan Lindegaard

What does it mean to have a mindset? How does it shape your actions, and those of the people you interact with? Is it steadfast, or does it evolve? Could it perhaps be a fusion of elements? It’s crucial to understand mindsets as they influence not only our behaviors but also the behaviors of those we engage with, allowing us to better navigate the world.

Research defines “mindset” as a mental frame or lens that selectively organizes and interprets information, orienting an individual’s understanding of experiences and guiding their responses and actions.

This definition, adapted from Carol Dweck by Salovey and Achor, illuminates that our mindset, composed of our thoughts and beliefs, influences our perception of ourselves, our environment, and the broader world. Such understanding is vital in team dynamics, leadership, and organizational contexts.

Dweck identified two primary mindsets:

1. A fixed mindset, in which intelligence is viewed as static, leading to the desire to appear intelligent and influencing specific behaviors.

2. A growth mindset, where intelligence is seen as something that can be developed, sparking a desire to learn and driving diverse behaviors.

The growth mindset, characterized by the belief that abilities can be honed with consistent effort, is shaped by how we perceive and tackle five critical areas:

Viewing effort as a path to mastery
Demonstrating persistence in the face of obstacles
Seeing others’ success as a source of inspiration and learning
Embracing challenges
Welcoming criticism as an opportunity to learn and grow

However, we need to acknowledge that our mindsets aren’t strictly “fixed” or “growth” in nature. They’re typically a hybrid of both, influenced by the context and phase of our lives. It’s is also situational. Our response to situations can shift, revealing the dominance of one mindset over the other at different times. Recognizing this within ourselves and avoiding prematurely labeling others is vital.

A Few Cases, Examples

To give a practical example, let’s look at the world of education. Imagine a student who struggles with math. With a fixed mindset, they might think, “I’m just not good at math,” and subsequently put less effort into learning. However, if they adopt a growth mindset, they would perceive math as a challenge they can overcome with practice and effort. Using different strategies and seeking help when necessary, the student’s math skills can improve, highlighting the practical application of a growth mindset.

In the business world, Microsoft provides an excellent case study. Under CEO Satya Nadella’s leadership, Microsoft shifted from a fixed to a growth mindset. Nadella introduced Dweck’s growth mindset concept to the company culture, fostering innovation and collaboration. The shift, encapsulated in the motto “Learn it all” vs. “Know it all,” encouraged employees to remain open-minded, learn from their mistakes, and continually improve. This change in mindset led to increased employee engagement, innovation, and contributed to Microsoft’s recent growth.

In sports, athletes often exemplify the growth mindset. Consider basketball legend Michael Jordan. He was cut from his high school varsity team because he was deemed “not good enough.” Rather than accepting this as an unchangeable state, he viewed it as a challenge and redoubled his efforts to improve. His eventual rise to becoming one of the greatest basketball players of all time showcases how a growth mindset can lead to superior performance in the face of setbacks and criticism.

As I often say, “The essence of the growth mindset in an organizational context is to instill a mindset focused on continuous improvement rather than the need to prove that one is the best.”

Implementing the growth mindset in team dynamics is part of my work. However, it doesn’t stand alone. It must be complemented by other factors like fostering a learning culture, ensuring psychological safety, and expanding the comfort zone. All these components are critical to effective team, leadership, and organizational development.

If you have questions or interesting perspectives on these topics, I would be more than happy to discuss them. Get in touch!

Image Credit: Pixabay, Stefan Lindegaard

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How to Build Innovation Resilience in Uncertainty

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Reality Strikes Back

How to Build Innovation Resilience in Uncertainty

GUEST POST from Robyn Bolton

“This time feels different.” I’ve been hearing this from innovation practitioners and partners for months We’ve seen innovation resilience tested in times of economic uncertainty and geopolitical volatility. We’ve seen it flourish when markets soar and capital is abundant. We’ve seen it all, but this time feels different.

In fact, we feel a great disturbance in the innovation force.

Disturbances aren’t always bad. They’re often the spark that ignites innovation. But understand the disturbance you must, before work with it you can.

So, to help us understand and navigate a time that feels, and likely is, different, I present “The Corporate Innovator’s Saga.”

Episode I: The R&D Men (are) Aces

(Sorry, that’s the most tortured one. The titles get better, I promise)

A long time ago (1876), in a place not so far away (New Jersey), one man established what many consider the first R&D Lab. A year later, Thomas Edison and his Menlo Park colleagues debuted the phonograph.

In the 20^th century, as technology became more complex, invention shifted from individual inventors to corporate R&D labs. By the late 1960s, Bell Labs employed 15,000 people, including 1,200 PhDs. In 1970, Xerox’s famed Palo Alto Research Center (PARC) opened.

Episode II: Attack of the Disruptors

For most of the twentieth century, R&D labs were the heroes or villains of executives’ innovation stories. Then, Harvard Business School professor Clayton Christensen published, The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail.

He revealed that executives’ myopic focus on serving their best (most profitable) customers caused them to miss new waves of innovation. In example after example, he showed that R&D often worked on disruptive (cheaper, good enough) technologies only to have their efforts shut down by executives worried about cannibalizing their existing businesses.

C-suites listened, and innovation went from an R&D problem to a business one.

Episode III: Revenge of the Designers

Design Thinking’s origins date back to the 1940s, its application to business gained prominence with l Tim Brown’s 2009 book, Change by Design: How Design Thinking Transforms Organizations and Inspires Innovation.

This book introduced frameworks still used today’s: desirability, feasibility, and viability; divergent and convergent thinking; and the process of empathy, problem definition, ideation, prototyping, and testing.

Innovation now required business people to become designers, question the status quo, and operate untethered from the short-termism of business,

Episode IV: A New Hope (Startups)

The early 2000s were a dizzying time for corporate innovation. Executives feared disruption and poured resources into internal innovation teams and trainings. Meanwhile, a movement was gaining steam in Silicon Valley.

Y Combinator, the first seed accelerator, launched in 2005 and was followed a year later by TechStars. When Eric Ries published The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses in 2011, the US was home to nearly 100 startup accelerators.

Now, businesspeople needed to become entrepreneurs capable of building, and scaling startups in environments purpose-built to kill risk and change.

In response, companies spun up internal accelerators, established corporate venture capital teams, and partnered with startup studios.

Episode V: Reality Strikes Back

Today, the combination of a global pandemic, regional wars, and a single year in which elections will affect 49% of the world’s population has everyone reeling.

Naturally, this uncertainty triggered out need for a sense of control. The first cut were “hobbies” like innovation and DEI. Then, “non-essentials” like “extra” people and perks. For losses continued into the “need to haves,” like operational investments and business expansion.

Recently, the idea of “growth at all costs” has come under scrutiny with advocates for more thoughtful growth strategies emerging There is still room for innovation IF it produces meaningful, measurable value.

Episode VI: Return of the Innovator (?)

I don’t know what’s next, but I hope this is the title. And, if not, I hope whatever is next has Ewoks.

What do you hope for in the next episode?

Image credit: Pexels

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Six Key Habits of Great Leaders

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Six Key Habits of Great Leaders

GUEST POST from David Burkus

In a world of growing complexity and seemingly constant crisis, we need great leaders more than ever. But when you look at the stories in the press or check the staggering numbers of burnout and disengagement in surveys, it seems like fewer and fewer leaders are rising to the challenge. It starts to seem like becoming a great leader is too complicated and nearly impossible.

But when you survey people on what makes them appreciate and follow leaders, it turns out there are just a few simple habits that set great leaders apart. Simple, but not necessarily easy.

In this article, we will explore what great leaders do across six key habits that make them influential and their teams successful.

1. Promote Purpose

The first habit great leaders do is to promote purpose. Great leaders understand the importance of connecting the larger organizational purpose to specific projects and tasks. They are able to do more than regurgitate the mission statement of the organization. They can draw a connection between the organizational purpose and the work of their specific team. In doing so, they inspire their team members to see the bigger picture and understand how their contributions align with the overall goals. Furthermore, great leaders shift the conversation towards “who” benefits from the work and promote pro-social purpose. This helps team members feel a sense of fulfillment and motivation in their work, knowing that they are making a positive impact.

2. Clarify Vision

The second habit great leaders do is to clarify vision. A clear vision is crucial for the success of any organization, and great leaders excel at explaining what success looks like and where the organization is heading. They are able to paint a vivid picture of the world or the specific people the organization serves and what it will look like when the vision is achieved. Even when plans change, great leaders provide a clear vision of what a good job looks like. They use the concept of “commander’s intent” to communicate the vision of a successful mission, ensuring that even in constant turmoil, everyone understands the desired outcome and can align their efforts accordingly.

3. Create Accountability

The third habit great leaders do is to create accountability. Great leaders understand the importance of holding people accountable to their jobs and calling them up to a higher standard. They ensure that individuals are held accountable to the result, not just the tasks. By providing the necessary resources for individuals to achieve their goals, great leaders empower their team members to take ownership of their work and deliver exceptional results. Leaders provide autonomy to team members, allowing them to decide how the work gets done. But they’re also reminding everyone on the team that autonomy means greater accountability to the team, not less. They are leaders who hold their team to a higher standard and encourage them to perform even greater.

4. Provide Fair Feedback

The fourth habit great leaders do is provide fair feedback. Feedback is a crucial tool for growth and development, and great leaders excel at providing fair feedback. They tailor their feedback to the individual’s situation, skills, resources, and accountability goals. Great leaders give feedback that is in equal proportion of positive to negative, focusing on building upon the great things. Poor leaders often spend most of their coaching time on constructive criticism—which can be demotivating and decrease performance. Instead, great leaders create a balance between appreciation and constructive criticism to motivate and improve performance, ensuring that team members feel valued and supported in their professional growth.

5. Build Safety

The fifth habit great leaders do is to build safety, as in psychological safety. A psychologically safe environment is essential for fostering innovation and growth, and great leaders understand this. They provide feedback in a way that does not blame individuals for things outside of their control, encouraging transparent and honest conversations about failures to extract lessons and improve. By establishing a culture of safety, great leaders create an atmosphere where team members feel comfortable taking risks and learning from their mistakes. This leads to increased creativity, collaboration, and ultimately, success.

6. Develop Oneself

The final habit great leaders do is to develop themselves. Great leaders recognize the importance of continuous learning and self-improvement. They take responsibility for developing themselves as well as others. With a growth mindset, they actively seek out new information and skills, constantly striving to become better leaders. Great leaders understand that they need to develop themselves in the areas that their team needs in order to be better leaders. By investing in their own growth, they set an example for their team members and inspire them to also pursue personal and professional development.

The habits discussed in this article are what make great leaders worth following. They’re simple, but not necessarily easy. And they need to be done on a regular basis. But great leaders understand the importance of these habits and strive to incorporate them into their leadership style. By promoting purpose, clarifying vision, creating accountability, providing fair feedback, building safety, and developing oneself, leaders can inspire their teams to do their best work ever.

Image credit: Pixabay

Originally published on DavidBurkus.com on August 21, 2023

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Can Leaders Defy Gravity?

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Can Leaders Defy Gravity?

GUEST POST from Mike Shipulski

If you pull hard on your team, what will they do? Will they rebel? Will they push back? Will they disagree? Will they debate? And after all that, will they pull with you? Will the pull for three weeks straight? Will they pull with their whole selves? How do you feel about that?

If you pull hard on your peers, what will they do? Will they engage? Will they even listen? Will they dismiss? And if they dismiss, will you persist? Will you pull harder? And when you pull harder, do they think more of you? And when you pull harder still, do they think even more of you? Do you know what they’ll do? And how do you feel about that?

If you push hard on your leadership, what will they do? Will they listen or dismiss? And if they dismiss, will you push harder? When you push like hell, do they like that or do they become uncomfortable, what will you do? Will they dislike it and they become comfortable and thankful you pushed? Whatever they feel, that’s on them. Do you believe that? If not, how do you feel about that?

When you say something heretical, does your team cheer or pelt you with fruit? Do they hang their heads or do they hope you do it again? Whatever they do, they’ve watched your behavior for several years and will influence their actions.

When you openly disagree with the company line, do your peers cringe or ask why you disagree? Do they dismiss your position or do they engage in a discussion? Do they want this from you? Do they expect this from you? Do they hope you’ll disagree when you think it’s time? Whatever they do, will you persist? And how do you feel about that?

When you object to the new strategy, does your leadership listen? Or do they un-invite you to the next strategy session? And if they do, do you show up anyway? Or do they think you’re trying to sharpen the strategy? Do they think you want the best for the company? Do they know you’re objecting because everyone else in the room is afraid to? What they think of your dissent doesn’t matter. What matters is your principled behavior over the last decade.

If there’s a fire, does your team hope you’ll run toward the flames? Or, do they know you will?

If there’s a huge problem that everyone is afraid to talk about, do your peers expect you get right to the heart of it? Or, do they hope you will? Or, do they know you will?

If it’s time to defy gravity, do they know you’re the person to call?

And how do you feel about that?

Image credit: Pexels

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Five Keys to Company Longevity

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Five Keys to Company Longevity

GUEST POST from Robyn Bolton

The quest for immortality is as old as humankind. From King Gilgamesh in 2100 BCE to Jeff Bezos and Larry Page, the only thing that stops our pursuit of longevity is death. So why don’t we apply this same verve and vigor to building things that last forever? Why don’t we invest in corporate longevity?

Consider this—in the last 80 years, human life expectancy increased by almost 30% while corporate life expectancy declined by almost 500%. Other research indicates that the average company’s lifespan on the S&P 500 Index dropped from 60 years in 1960 to just under 15 years in 2024.

We spend billions on products to slow, stop, and even reverse aging. Yet, according to the New York Times, there are just seven keys to living longer.

Could achieving corporate longevity possibly be just as simple?

Yes.

Here are five keys to corporate longevity.

1. Take care of yourself today AND invest for tomorrow

We all know what we should do to stay healthy. But one night, you don’t sleep well, and hearing your 5:00 am alarm is physically painful. What harm is there in skipping just one workout? At work, you had a bad quarter, so cutting the research project or laying off the innovation team seems necessary. After all, if you don’t save today, there won’t be a tomorrow, right?

Right. But skipping workouts becomes a habit that can bring your retirement plans crashing down. Just like cutting investments in R&D, innovation, and next-gen talent makes keeping up with, adapting, and growing in a rapidly changing world impossible.

2. Build and nurture relationships. Inside AND outside your company

According to the Harvard Study of Adult Development, strong relationships lead to happier and healthier lives and are the biggest predictor of well-being. Turns out relationships are also good for business.

Strategic alliances and partnerships directly grow revenue. For example, 95% of Microsoft’s commercial revenue comes from its partner ecosystem. Starbucks’ collaboration with Nestle allowed the coffee chain to expand its presence in people’s lives while Nestle gained access to a growing category without the cost of building its own brand. There’s a reason that Andreessen Horowitz declared partnerships a “need to have” in today’s world.

3. Everything in moderation

Toddlers are the only people more distracted by shiny objects than executives. Total Quality Management. Yes, please. Disruptive Innovation. Absolutely. Agile. Thank you, I’ll take two.

Chasing new ideas isn’t wrong. It’s how you chase them that’s dangerous. Uprooting your existing processes and forcing everyone to immediately adopt Agile is the corporate equivalent of a starvation diet. You’ll see immediate improvements, but long-term, you’ll end up worse off.

4. Eliminate bad habits (and bad people)

“The culture of any organization is shaped by the worse behavior the leader is willing to tolerate.”

Read that again. Slowly.

To live longer, stop engaging in, tolerating, and justifying bad habits. To make your company live longer, stop tolerating and justifying people and behaviors that contradict your company’s culture. Eliminating bad behavior is tough, but it’s the only way to get to your goal. In life and in business.

5. Rest

Getting 7-8 hours of sleep a night adds years to your life. Less than five hours doubles your dementia risk. More sleep also boosts your productivity and creativity at work.

The latest example of rest’s power is the four-day workweek. In 2022, 61 UK companies adopted it without any changes in pay. Two years later, 54 still have the policy, and over 30 made it permanent. Other companies, like Microsoft in Japan, reported productivity increases of more than 40%.

What will you unlock with these keys?

As a leader, you have the power to build a legacy and a company that thrives for generations. But that only happens if you channel the same energy into achieving corporate longevity that you put into pursuing a longer, healthier life.

By embracing the keys of corporate longevity—caring for today while investing in tomorrow, nurturing relationships, practicing moderation, eliminating bad habits, and prioritizing rest—you’ll build businesses that endure.

The journey to corporate immortality starts with a single step. What’s yours?

Image credit: Pixabay

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You Are Probably Not Prepared to Innovate

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You Are Probably Not Prepared to Innovate

GUEST POST from Greg Satell

Becoming a successful executive is a fairly linear path. You start at the bottom and learn to solve basic problems in your field or industry. As you gain experience and improve your skills you are given more responsibility, begin to manage teams and work diligently to set up the practices and processes to help your team succeed.

The best executives make those around them better, by fostering a positive work environment, minimizing drama and providing strategy and direction that will enable the team meet its objectives. That’s how you deliver consistent results and continue to rise up through the ranks to the top of your profession.

At some point, however, you need to do more than just plan and execute strategy, you have to innovate. Every business model is disrupted eventually. Changes in technology, competitive landscape and customer needs make that inevitable and, unfortunately, executive experience doesn’t equip your for it. Here’s four things that will help you make the shift from operations to innovation.

1. Learn How To Be The Dumbest Guy In The Room

Good executives are often the smartest guys in the room. Through years of experience solving tough problems, they learn to be masters of their craft and are able to mentor those around them. A great operational manager is a great coach, guiding others around them to achieve more than they thought they could.

Unfortunately, innovation isn’t about what you know, but what you don’t. It requires you to explore, push boundaries and venture into uncharted areas in which there often are no true experts. You’re basically flying blind, which can be incredibly uncomfortable, especially to those who have had a strong track record of success in a structured environment.

That’s why the first step to making the shift from operations to innovation is to learn how to become the dumbest guy in the room instead of the smartest. Admit to yourself that you don’t know what you need to succeed and begin to explore. Actively seek out those who know and understand things that you don’t.

Being the smartest guy in the room helps you operate smoothly, but being the dumbest guy in the room helps you learn. The best way to start is by seeking out new rooms to spend time in.

2. Create A Bias For Action

Operations thrive on predictability. People need to know what to expect and what’s expected of them so that things can run smoothly. Every great operation needs to coordinate activities between a diverse set of stakeholders, including team members, partners and customers. That level of interoperability doesn’t just happen by itself.

Over the years, a variety of methods, such as Total Quality Management (TQM) and Six Sigma have arisen that use rigorous statistical methods to optimize for established metrics. The idea is to hone processes continuously in order to elevate them to paragons of efficiency.

When you seek to innovate, however, established metrics are often of little use, because you are trying to do something new and change the basis of competition. Again, you are venturing into the unknown, doing things you and your organization have not developed the knowledge and skills to do well. Instead of seeking excellence, you need to dare to be crap.

The key to making this work is not to abandon all sense of restraint and accountability, but to manage risk by reducing scale. In an operational setting you always want to look for the largest addressable market you can find, but when you are trying to do something truly new, you need to find a hair on fire use case — a customer who needs a problem solved so badly that they are willing to work through the inevitable glitches and snafus with you.

3. Solve The Monkey First

Every good operational project has a roadmap, whether that is an ordinary budget, a project plan or a defined strategy. The early stages of a plan are usually the easiest. You want to get everybody on board, build momentum and then begin to tackle tougher problems. When you are trying to do something new and different, however, you often want to do exactly the opposite.

Every significant innovation involves something that’s never been done before, so you can’t be sure how long it will take or even if the core objectives can be achieved at all. So it’s best to get started working on the toughest problems early, because until you resolve those unknowns, the whole project is unworkable.

At Google’s X division, the company’s “moonshot factory,” the mantra is #MonkeyFirst. The idea is that if you want to get a monkey to recite Shakespeare on a pedestal, you’d better start by training the monkey, not building the pedestal, because training the monkey is the hard part. Anyone can build a pedestal.

Operational executives like to build pedestals so that they can show early progress against a timeline. Unfortunately, when you are striking out into the unknown, building a pedestal gets you nowhere. Unless you can actually train the monkey, working on the pedestal is wasted effort. You have to learn how to train monkeys.

4. Move from Metrics To Mission

Good operational executives sweat the numbers. They work within existing frameworks and hone operations to improve performance against established metrics. Yet when you are trying to do something truly new, established metrics often tell you little. The goal isn’t to play the game better, but to change it entirely.

In fact, established businesses often get disrupted precisely because they are focusing on outdated metrics. For example, when digital cameras first came out, they performed poorly by traditional standards of quality. They did, however, perform much better in terms of convenience and, as the quality of the pictures improved, replaced the earlier technology.

In a similar vein, while traditional brokerages focused on service, Charles Schwab offered minimal service at a far lower price. At first, it didn’t seem like a threat to incumbents, but as technology improved, it was able to improve service and keep the low flat fees. The model ended up transforming the industry.

So it’s important to not get blinded by metrics and focus on your mission. True innovation never happens in a straight line or proceeds at a measured pace. That’s why there is a basic tradeoff between innovation and optimization and very few people can do both. The best executives, however, learn how to bridge that gap.

— Article courtesy of the Digital Tonto blog and previously appeared on Inc.com
— Image credits: Pexels

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Who Are the Most Important People in Your Company?

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Who Are the Most Important People in Your Company?

GUEST POST from Mike Shipulski

When the fate of your company rests on a single project, who are the three people you’d tap to drag that pivotal project over the finish line? And to sharpen it further, ask yourself “Who do I want to lead the project that will save the company?” You now have a list of the three most important people in your company. Or, if you answered the second question, you now have the name of the most important person in your company.

The most important person in your company is the person that drags the most important projects over the finish line. Full stop.

When the project is on the line, the CEO doesn’t matter; the General Manager doesn’t matter; the Business Leader doesn’t matter. The person that matters most is the Project Manager. And the second and third most important people are the two people that the Project Manager relies on.

Don’t believe that? Well, take a bite of this. If the project fails, the product doesn’t sell. And if the product doesn’t sell, the revenue doesn’t come. And if the revenue doesn’t come, it’s game over. Regardless of how hard the CEO pulls, the product doesn’t launch, the revenue doesn’t come, and the company dies. Regardless of how angry the GM gets, without a product launch, there’s no revenue, and it’s lights out. And regardless of the Business Leader’s cajoling, the project doesn’t cross the finish line unless the Project Manager makes it happen.

The CEO can’t launch the product. The GM can’t launch the product. The Business Leader can’t launch the product. Stop for a minute and let that sink in. Now, go back to those three sentences and read them out loud. No, really, read them out loud. I’ll wait.

When the wheels fall off a project, the CEO can’t put them back on. Only a special Project Manager can do that.

There are tools for project management, there are degrees in project management, and there are certifications for project management. But all that is meaningless because project management is alchemy.

Degrees don’t matter. What matters is that you’ve taken over a poorly run project, turned it on its head, and dragged it across the line. What matters is you’ve run a project that was poorly defined, poorly staffed, and poorly funded and brought it home kicking and screaming. What matters is you’ve landed a project successfully when two of three engines were on fire. (Belly landings count.) What matters is that you vehemently dismiss the continuous improvement community on the grounds there can be no best practice for a project that creates something that’s new to the world. What matters is that you can feel the critical path in your chest. What matters is that you’ve sprinted toward the scariest projects and people followed you. And what matters most is they’ll follow you again.

Project Managers have won the hearts and minds of the project team.

The Project manager knows what the team needs and provides it before the team needs it. And when an unplanned need arises, like it always does, the project manager begs, borrows, and steals to secure what the team needs. And when they can’t get what’s needed, they apologize to the team, re-plan the project, reset the completion date, and deliver the bad news to those that don’t want to hear it.

If the General Manager says the project will be done in three months and the Project Manager thinks otherwise, put your money on the Project Manager.

Project Managers aren’t at the top of the org chart, but we punch above our weight. We’ve earned the trust and respect of most everyone. We aren’t liked by everyone, but we’re trusted by all. And we’re not always understood, but everyone knows our intentions are good. And when we ask for help, people drop what they’re doing and pitch in. In fact, they line up to help. They line up because we’ve gone out of our way to help them over the last decade. And they line up to help because we’ve put it on the table.

Whether it’s IoT, Digital Strategy, Industry 4.0, top-line growth, recurring revenue, new business models, or happier customers, it’s all about the projects. None of this is possible without projects. And the keystone of successful projects? You guessed it. Project Managers.

Image credit: Unsplash

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What We Have Learned About Digital Transformation Thus Far

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What We Have Learned About Digital Transformation Thus Far

GUEST POST from Geoffrey A. Moore

We are well into our first decade of digital transformation, with both the successes and the scars to show for it, and we can see there is a long way to go. Realistically, there is probably never a finish line, so I think it is time for us to pause and take stock of what we have learned, and how best we can proceed from here. Here are three lessons to take to heart.

Lesson 1: There are three distinct levels of transformation, and operating model transformation is the one that deserves the most attention.

The least disruptive transformation is to the infrastructure model. This should be managed within the Productivity Zone, where to be fair, the disruption will be considerable, but it should not require much in the way of behavior change from the rest of the enterprise. Moving from data centers to cloud computing is a good example, as are enabling mobile applications and remote work centers. The goal here is to make employees more efficient while lowering total cost of IT ownership. These transformations are well underway, and there is little confusion about what next steps to take.

By contrast, the most disruptive transformation is to the business model. Here a company may be monetizing information derived from its operating model, as the SABRE system did for American Airlines, or overlaying a digital service on top of its core offering, as the automotive makers are seeking to do with in-car entertainment. The challenge here is that the economics of the new model have little in common with the core model, which creates repercussions both with internal systems and external ecosystem relationships. Few of these transformations to date can be said to be truly successful, and my view is they are more the exception than the rule.

The place where digital transformation is having its biggest impact is on the operating model. Virtually every sector of the economy is re-engineering its customer-facing processes to take advantage of ubiquitous mobile devices interacting with applications hosted in the cloud. These are making material changes to everyday interactions with customers and partners in the Performance Zone, where the priority is to improve effectiveness first, efficiency second. The challenge is to secure rapid, consistent, widespread adoption of the new systems from every employee who touches them. More than any other factor, this is the one that separates the winners from the losers in the digital transformation game.

Lesson 2: Re-engineer operating models from the outside in, not the inside out.

A major challenge that digital transformation at the operating model level must overcome is the inertial resistance of the existing operating model, especially where it is embedded in human behaviors. Simply put, people don’t like change. (Well, actually, they all want other people to change, just not themselves.) When we take the approach of internal improvement, things go way too slowly and eventually lose momentum altogether.

The winning approach is to focus on an external forcing function. For competition cultures, the battle cry should be, this new operating model poses an existential threat to our future. Our competitors are eating our lunch. We need to change, and we need to do it now! For collaboration cultures, the call to action should be, we are letting our customers down because we are too hard to do business with. They love our offers, but if we don’t modernize our operating model, they are going to take their business elsewhere. Besides, with this new digital model, we can make our offers even more effective. Let’s get going!

This is where design thinking comes in. Forget the sticky notes and lose the digital whiteboards. This is not about process. It is about walking a mile in the other person’s shoes, be that an end user, a technical buyer, a project sponsor, or an implementation partner, spending time seeing what hoops they have to go through to implement or use your products or simply to do business with you. No matter how good you were in the pre-digital era, there will be a ton of room for improvement, but it has to be focused on their friction issues, not yours. Work backward from their needs and problems, in other words, not forward from your intentions or desires.

Lesson 3: Digital transformations cannot be pushed. They must be pulled.

This is the hardest lesson to learn. Most executive teams have assumed that if they got the right digital transformation leader, gave them the title of Chief Transformation Officer, funded them properly, and insured that the project was on time, on spec, and on budget, that would do the trick. It makes total sense. It just doesn’t work.

The problem is one endemic to all business process re-engineering. The people whose behavior needs to change—and change radically—are the ones least comfortable with the program. When some outsider shows up with a new system, they can find any number of things wrong with it and use these objections to slow down deployment, redirect it into more familiar ways, and in general, diminish its impact. Mandating adoption can lead to reluctant engagement or even malicious compliance, and the larger the population of people involved, the more likely this is to occur.

So what does work? Transformations that are driven by the organization that has to transform. These start with the executive in charge who must galvanize the team to take up the challenge, to demand the digital transformation, and to insert it into every phase of its deployment. In other words, the transformation has to be pulled, not pushed.

Now, don’t get me wrong. There is still plenty of work on the push side involved, and that will require a strong leader. But at the end of the day, success will depend more on the leader of the consuming organization than that of the delivery team.

That’s what I think. What do you think?

Image Credit: Pexels

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Five Things Most Managers Don’t Know About Innovation

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Five Things Most Managers Don't Know About Innovation

GUEST POST from Greg Satell

Every business knows it needs to innovate. What isn’t so clear is how to go about it. There is no shortage of pundits, blogs and conferences that preach the gospel of agility, disruptive innovation, open innovation, lean startups or whatever else is currently in vogue. It can all be overwhelming.

The reality is that there is no one ‘true’ path to innovation. In researching my book, Mapping Innovation, I found that organizations of all shapes and sizes can be great innovators. Some are lean and nimble, while others are large and bureaucratic. Some have visionary leaders, others don’t. No one model prevails.

However, there are common principles that we can apply. While there is no “right way” to innovate, there are plenty of wrong ways. So perhaps the best way forward is to avoid the pitfalls that can undermine innovative efforts in your organization and kill promising new solutions. Here are five things every business should know about innovation.

1. Every Square-Peg Business Eventually Meets Its Round-Hole World

IBM is many peoples’ definition of a dinosaur. Not too long ago, it announced its 22nd consecutive quarter of declining revenues. Nevertheless, it seems to be turning a corner. What’s going on? How can a century-old technology company survive against the onslaught of the 21st century phenoms like Google, Amazon, Apple and Facebook?

The truth is that this is nothing new for IBM. Today, its business of providing installed solutions for large enterprises is collapsing due to the rise of the cloud. In the 90s it was near bankruptcy. In the 50s, its tabulating machine business was surpassed by digital technology. Each time eulogies are paraded around for Big Blue it seems to come back even stronger.

What IBM seems to understand better than just about anybody else is that every square-peg business eventually meets its round-hole world. Changes in technology, customer preferences and competitive environment eventually render every business model irrelevant. That’s just reality and there really is no changing it.

IBM’s secret weapon is its research division, which explores pathbreaking technologies long before they have a clear path to profitability. So when one business dies they have something to replace it with. Despite those 22 quarters of declining revenues it has a bright future with things like Watson, quantum computing and neuromorphic chips.

It’s better to prepare than adapt.

2. Innovation Isn’t About Ideas, It’s About Solving Problems

Probably the biggest misconception about innovation is that it’s about ideas. So there is tons of useless advice about brainstorming methods, standing meetings and word games, such as replacing “can’t” with “can if.” If these things help you work more productively, great, but they will not make you an innovator.

In my work, I speak to top executives, amazingly successful entrepreneurs and world class scientists. Some of these have discovered or created things that truly changed the world. Yet not once did anyone tell me that a brainstorming session or “productivity hack” set them on the road to success. They were simply trying to solve a problem that was meaningful to them.

What I do hear a lot from mid-level and junior executives is that they are not given “permission” to innovate and that nobody wants to hear about their ideas. That’s right. Nobody wants to hear about your ideas. People are busy with their own ideas.

So stop trying to come up with some earth shattering idea. Go out and find a good problem and start figuring out how to solve it. Nobody needs an idea, but everybody has a problem they need solved.

3. You Don’t Hire Or Buy Innovation, You Empower It

One of the questions I always get asked when I advise organizations is how to recruit and retain more innovative people. I know the type they have in mind. Someone fashionably dressed, probably with some tasteful piercings and some well placed ink, that spouts off a never-ending stream of ideas.

Yet that’s exactly what you don’t want. That’s exactly the type of unproductive hotshot that can stop innovation in its tracks. They talk over other people, which discourages new ideas from being voiced and their constant interruptions kill collaboration.

The way you create innovation is by empowering an innovative culture. That means creating a safe space for ideas, fostering networks inside and outside the organization, promoting collaboration and instilling a passion for solving problems. That’s how you promote creativity.

So if you feel that your people are not innovating, ask yourself what you’re doing to get in their way.

4. If Something Is Truly New And Different, You Need a “Hair On Fire” Use Case

As a general operational rule, you should seek out the largest addressable market you can find. Larger markets not only have more money, they are more stable and usually more diverse. Identifying even a small niche in a big market can make for a very profitable business.

Unfortunately, what thrives in operations can often fail for innovation. When you have an idea that’s truly new and different, you don’t want to start with a large addressable market. You want to find a hair-on-fire use case — somebody that needs a problem solved so badly that they either already have a budget for it or have scotched-taped together some half solution.

The reason you want to find a hair-on-fire use case is that when something is truly new and different, it is untested and poorly understood. But someone who needs a problem solved really badly will be willing to work with you to find flaws, fix them and improve your offer. From there you can begin to scale up and hunt larger game.

5. You Need To Seek Out A Grand Challenge

Most of the problems we deal with are relatively small. We cater to changing customer tastes, respond to competitive threats and fix things that are broken. Sometimes we go a bit further afield and enter a new market or develop a new capability. These are the bread and butter of a good business. That’s how you win in the marketplace.

Yet every business is ultimately disrupted. When that happens, normal operating practice will only make you better and better at things people care less and less about. You can’t build the future by looking to the past. You build the future by creating something that’s new and important, that solves problems that are currently unsolvable.

That’s why every organization needs to seek out grand challenges. These are long, sustainable efforts that solve a fundamental problem in your industry or field that change the realm of what’s considered possible. They are not “bet the company” initiatives and shouldn’t present a material risk to the business if they fail, but have a transformational impact if they succeed.

As I noted above, there is no one “true” path to innovation. Everybody needs to find their own way. Still, there are common principles and by applying them, every business can up their innovation game.

— Article courtesy of the Digital Tonto blog and previously appeared on Harvard Business Review
— Image credits: Pexels

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Adjacent Innovation is the Key to Growth and Risk

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Adjacent Innovation is the Key to Growth and Risk

GUEST POST from Robyn Bolton

It’s not easy leading innovation. Especially these days. You need to do more with less. Take risks while guaranteeing results. Keep up with competition through incremental innovation and redefine the industry with radical and disruptive innovation. It’s maddening. Until you find the Goldilocks Zone of adjacent innovation.

Adjacent Innovation: From Middle Child to Just Right

As HBS Professor Regina E. Herzlinger and her co-authors point out in a recent HBR article, the US is in the midst of an innovation crisis. The cost of lost productivity, estimated at over $10 trillion between 2006 and 2018, is a stark reminder of the economic consequences of a lack of innovation. This figure, equivalent to $95,000 per US worker, should serve as a wake-up call to the importance of innovation in driving economic growth.

The authors identify the root cause of this loss as the ‘polarized approach companies take to innovation.’ While companies focus on incremental innovation, the safe and reliable oldest child of the innovation family, the Venture Captialists chase after radical, transformative innovations, the wild, charismatic, free-spirited youngest child. Meanwhile, adjacent innovation – new offerings and business models for existing customers or new customers for existing offerings and business models – is, like the middle child, too often overlooked.

It’s time to rediscover it. In fact, it’s also time to embrace and pursue it as the most promising path back to growth. While incremental innovation is safe and reliable, it’s also the equivalent of cold porridge. Radical or transformative innovation is sexy, but, like hot porridge, it’s more likely to scorch than sustain you. Adjacent innovation, however, is just right – daring enough to change the game and leapfrog the competition and safe enough to merit investment and generate short-term growth.

Proof in the Porridge: 4x the returns in HALF the time

Last year, I worked with an industrial goods company. Their products aren’t sexy, and their brands are far from household names, but they make the things that make America run and keep workers (and the public) safe. The pandemic’s supply chain disruptions battered their business, and their backlog ballooned from weeks to months and even years. Yet amidst these challenges, they continued to look ahead, and what they saw was a $6M revenue cliff that had to be filled in three years and a product and innovation pipeline covered in dust and cobwebs.

From Day 1, we agreed to focus on adjacent innovation. For four weeks, we brainstormed, interviewed customers, and analyzed their existing offerings and capabilities, ultimately developing three concepts – two new products for existing customers and one existing product repositioned to serve a new customer. After eight more weeks of work, we had gathered enough data to reject one of the concepts and double down on the other two. Three months later, the teams had developed business cases to support piloting two of the concepts.

It took six months to go from a blank piece of paper to pilot approval.

It took just another 12 months to record nearly $25M in new revenue.

Those results are more than “just right.”

Be Goldilocks. Pursue Adjacent Innovation

Every organization can pursue adjacent innovation. In fact, most of the companies we consider amongst the world’s “Most Innovative” have that reputation because of adjacent innovation.

How will you become your organization’s Innovation Goldilocks and use adjacent innovation to create “just right” growth?

Image credit: Pixabay

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