This is the first of a series of video and text interviews with innovation leaders at a range of companies that are seeking to create innovation excellence in their organizations. This interview, and many others with innovation leaders from trailblazing organizations around the globe, will build upon the foundation of the research and findings contained in my first book – Stoking Your Innovation Bonfire – and will form part of a case study on Intuit for my next publishing effort. This effort will be a highly collaborative and interactive endeavor looking at what is required to make innovation a deep capability in successful organizations.

If you think your organization is doing some really great work to create innovation excellence in your organization, please contact me.

I am excited to present the first innovation interview in this video interview series examining some of the topic surrounding the development of a deep innovation capability. I had the opportunity to interview Scott Cook, Co-Founder and Chairman of Intuit, at The Economist’s “Innovation 2011: Entrepreneurship for a Disruptive World” event in Berkeley, CA. In this video Scott talks about some of the key factors required in helping an organization become excellent at innovation. Below you will find the video and a written transcript.

Here is the innovation interview transcript:

Hello everyone this is Braden Kelley of Blogging Innovation. here with Scott Cook the founder of Intuit. Scott, I would really like to ask you about innovation and building innovation as a deep capability within the organization and as you started Intuit and as you look to grow and make it a successful company, what are some of the key things that you tried to do to help make innovation a capability in a continuous possibility for the organization.

Scott: Yeah that is something we have been spending a lot of time on over the last 4 years so I think a lot of the DNA we have on innovation is good in the company but we had lost some of the skill and capabilities. We hired new people, new managers so we went into a big rebuilding starting in 07. Things that have been very— I mean what you are trying to do, is change and improve the way teams do their daily work and the way managers, what they expect of teams.

So we worked it at all levels, so I work with teams from the top and it changes your expectations of what business unit leaders do with their teams and then we have innovation catalysts who work to couch teams and help teams when they hit innovation roadblocks or trying to leap and really change their thinking. We also work on skill building so one example is that a number of our executives had actually narrowed who we would hire from various companies, good folks but it never actually done innovation in a way that we teach people to do it.

So we took 2 days of an off site with just the top 18 people in the company and had our innovation catalyst come in and have them do the very process that we expect to our teams. Customer immersion with the customers and the executives did it, why we recruited customers as they came in. The nature of going broad that day— in a nature of trying to come to a key insight, testing that insight back with the customers then going broad, I don’t care with that insight, what could you do and then narrowing.

We made them go through the same steps that we expect as a team so they personally could have done it. I find it hard for leaders to lead to a destination, they have not yet been. So that is why we had to work on a leash up level but at the same time we were working on the team so how they work. So that is, we also do internal company broadcasts where we take teams inside Intuit and they tell their stories of how they did it step-by-step because we all learn from stories.

Another thing that we do is we teach by doing. We used to teach by preaching, talk at people. I don’t find adults learn from being talked at. They just retain the same habits they already have. So if we really want to change habits you have to get them to practice the new habits. So now when we do company meetings or leadership development sessions most of it is doing very little of it as listening. We get them busy doing the very things we want them to do or with homework in advance where they had to interview people who do what we want, then to do and learning from that and report back into a very doing process.

So that has been a big change we have made as from how we actually conduct the meetings where we want to use them to change habits so it is a series of things, note it happens fast step-by-step. Some teams move faster than others and we try to use those to inspire the rest but I think as I worked with teams now I see them— we are getting better outputs higher success rates with customers much higher than ratings of new products, fewer failures are pruned out early and cheap which is the whole goal. So I have seen the output metrics now finally after 4 years at working at this that you would project in the desire from making these sorts of interventions.

Braden: So in talking with other people in Intuit, it became very clear that when the company started small there was this idea of Follow Me Home’s, and then you know kind of follow me into the office and the catalyst programs sounds like one of the things that you are doing to try to instill some of these behaviors across the company and expose people to some of the ideas. And as I, you know talked with people at the organization it became very clear that the design for the like concept that you are trying to move across the organization is spreading farther and wider and then as you pursue that what are some of the key challenges that you found and that you have overcome over time in relation to trying to take some of the small company ethos as you have grown and maintain that those aspects of designing for a customer to like?

Scott: I want to say 2 things one is there is a challenge of team size. The team’s size when we started of course was small so everyone in the team was very close to customers. Our team size has grew and it grew and it grew and once you get a bigger team you move from 4 people working on a product to the 20 or 30 or 50, well then you have got some people in the team who go out and meet with customers. Other people say “Nah, I don’t need to do that, you do that, oh just listen to what you are saying” and suddenly you just get most of the team who has never met with customers or has not met in the last year with customers or with prospects.

And then you have much more communication problems, you don’t have shared vision, you don’t have shared understanding, a lot of things go haywire so key is to get back to smaller team sizes. So we have been busting up the team sizes sort of taking teams that used to be 30 or 40 and broken up some note in some cases no team bigger than 4. And we have to architect the work a lot more if those teams are truly going to be independent and that is our jobs as leaders. So that has been one very helpful thing. I think another. I would focus on learning from customer behaviors, not learning from customers, learning from customer behaviors.

Because the tempting tendency is for people on teams to rely on what customers say and maybe that works if you are selling to specialists. Let us say you are selling to a doctor who does cardiac surgery 8 hours a day, 5 days a week maybe that person can really tell you accurately what they are going to do if confronted with a new offering. But for regular people that just sell regular stuff to who might do taxes ones a year or might work with a bank ones in a week or pay their employees ones every 2 weeks. What they tell you, maybe half of it they will actually do, but you actually don’t know which half you are listening to.

So I learn much more reliable behaviors, trust observable behaviors that you can observe and measure either measure remotely through what happens in the web or you can measure by observing with your own eyes. The tendency though when you take people having them trained and send them out to meet with customers is they have got to interview customers. Well you just invented the word’s most expensive way to do a customer interview. If you are going to interview them call them on the phone or send survey, don’t do Follow Me Home.

Follow me homes are there so you can see with your eyes so shut up, say nothing, watch for an hour or two, or three then you can ask him about what you saw and then you are asking about behaviors. That is still an interview, not the most reliable but it will be better because you are probing about specific behaviors yourself. So I say that is the second thing that we have worked to re-instill this trust behaviors and behavioral data, not attitudes or words.

Braden: Very good, well I think the insight is very important and really and the taking the time to listen like you said is very important to innovation, I mean that is what we are all trying to do there early is the people that follow blogging innovation so on behalf of the readers and the viewers of Blogging Innovation, I think you very much Scott for your time and again this has been Braden Kelley of Blogging Innovation here with Scott Cook of Intuit.

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