When Scaling Innovation Backfires

How One Company Became the Theranos of Marshmallows

When Scaling Innovation Backfires

GUEST POST from Robyn Bolton

Here’s a head-scratcher when it comes to scaling innovation: What happens when your innovative product is a hit with customers, but you still fail spectacularly? Just ask the folks behind Smashmallow, the gourmet marshmallow company that went from sweet success to sticky situation faster than you can say “s’mores.”

The Recipe for Initial Success

Jon Sebastiani sold his premium jerky company Krave to Hershey for $240 million and thought he’d found his next billion-dollar idea in fancy French marshmallows. And initially, it looked like he had. 

Smashmallow’s artisanal, flavor-packed treats weren’t just another fluffy, tasteless sugar puff – they created an entirely new snack category. Customers couldn’t get enough of their handcrafted, churro-dusted, chocolate-chip-studded clouds of happiness. The company hit $5 million in sales in its first year, doubled that the next, and was available in 15,000 stores nationwide in only its third year.

Sounds like a startup fairy tale, right? Right!  If we’re talking about the original Brothers Grimm versions.  Corporate innovators start taking notes.

The Candy-coated Vision

Sebastiani and his investors weren’t content with building a successful premium regional brand. They wanted to become the Kraft of craft marshmallows, scaling from artisanal to industrial without losing what made the product special. It’s a story that plays out in corporations every day: the pressure to turn every successful pilot into a billion-dollar business.

So, they invested.  Big time.

They signed a contract with “an internationally respected builder of candy-making machines” to design and build a $3 million custom-built machine and another with a copacker to build an entirely new facility to accommodate the custom machine.

Bold visions require bold moves, and Sebastiani was a bold guy.

The Scale-up Meltdown

But boldness can’t overcome reality, and the custom machine couldn’t replicate the magic of handmade marshmallows. It couldn’t even make the marshmallows.

Starch dust created explosion hazards. Cinnamon wouldn’t stick. Workers couldn’t breathe through spice clouds. The handmade ethos of imperfect squares gave way to industrialized perfection. Each attempt to solve one problem created three more, like a game of confectionery whack-a-mole.

By 2022, Smashmallow was gone, leaving behind a cautionary tale about the gap between what customers value and what executives and investors want. The irony? They succeeded in their mission to disrupt the market – by 2028, the North American marshmallow market is projected to more than double its 2019 size, largely thanks to the premium category Smashmallow created. They just won’t be around to enjoy it.

A Bittersweet Paradox

For so many corporate innovators, this story hits close to home. How many promising projects died not because customers didn’t love them but because they couldn’t scale to “move the needle” for a multi-billion dollar corporation? A $15 million business might be a champagne-popping moment for an entrepreneur, but it barely registers as a rounding error on a Fortune 500 income statement.

This is the innovation paradox facing corporate innovators: The very pressure to go big or go home often destroys what makes an innovation special in the first place. It’s not enough to create something customers love – you must create something that can scale to satisfy the corporate appetite for growth.

Finding the Sweet Spot

The lesson isn’t that we should abandon ambitious scaling plans. Instead, we must be brutally honest about whether our drive for scale aligns with what makes our innovation valuable to customers. If it doesn’t, we must choose whether to scale back our ambitions (unlikely) or let go of our successful-but-small idea.   

After all, not every marshmallow needs to be a mountain, but every mountain climber (that’s you) needs a mountain.

Image credit: Unsplash

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Innovation or Not – The VR Path to the Super Bowl

Innovation or Not - The VR Path to the Super Bowl

GUEST POST from Art Inteligencia

In the competitive arena of sports, athletes and coaches are perpetually seeking the next edge, the innovative stroke of genius that will propel them towards success. Enter Jayden Daniels, a pioneer quarterback who has embraced one of the most cutting-edge tools in sports performance enhancement: Virtual Reality (VR) training. Is this a true innovation or just another gimmick? Let’s journey through the lens of Jayden’s experience and see how this technology is reshaping the sporting world.

The Virtual Reality Revolution in Sports

For decades, athletes have relied on traditional training regimes, focusing on physical conditioning and repetitive skill drills. However, VR has transformed the landscape by introducing immersive environments where athletes can practice without the physical constraints of time, space, or risk of injury. Through VR headsets and meticulously simulated environments, players like Jayden Daniels are able to visualize and rehearse plays and strategies, improve their decision-making, and enhance their mental resilience.

“VR training is like a playbook come to life—it gives players the opportunity to be in the game without being on the field.”

Realizing this potential, Daniels incorporated VR training into his routine, and the results have been phenomenal. His ability to read defenses and execute plays has been augmented by this technology, helping him transition from mere player to game-changer.

Here is a video that tells the in depth story with commentary, but it won’t let me embed it here so just click the link in the box to watch it on YouTube:

EDITOR’S NOTE: Key takeaways include the technology’s ability to run at 1.75x speed so that on game day things slow down for the quarterback and he is able to engage in extra preparation without the entire team having to be present, and even to familiarize himself with away stadium nuances like where the play clocks are, etc.

Case Study #1: The Championship Turnaround

One of the most striking illustrations of VR’s impact occurred during a pivotal championship game. Daniels’ team was facing a formidable opponent known for their complex defensive schemes. The team’s traditional preparation methods were proving inadequate against such a sophisticated defense.

In the weeks leading to the game, Daniels immersed himself in VR simulations of the opponent’s defense. He studied every blitz, every zone coverage, and every adaptive quirk under the close guidance of his coaches, who were able to create a virtual replica of the team they were facing. By the time the championship game arrived, Daniels was not only prepared—he was several steps ahead.

During the game, his performance was near flawless. He anticipated defensive movements with uncanny accuracy, leading his team to a come-from-behind victory that analysts credited in large part to his innovative use of VR.

The MVP Moment

This VR-driven insight culminated in one memorable play: a perfectly executed fake pass that caught the opposing defense entirely off-guard, leading to the game-winning touchdown. This wasn’t just victory—it was an unveiling of how technology and sport can harmonize to create extraordinary outcomes.

Case Study #2: The Rival Rumble

In another celebrated match-up, Daniels faced his long-time rivals—a team that had bested his own in recent seasons. Known for their reactive plays and dynamic shifts, this opponent posed a considerable mental challenge that extended beyond physical prowess.

Once again, VR training became Daniels’ secret weapon. By simulating hundreds of scenarios, his VR regimen enabled him to practice responses to the rival’s play-calling tendencies, helping him build a memory bank of potential outcomes and counter-strategies.

When faced with crucial decisions on the field, Daniels was markedly less stressed and more composed. He deftly outmaneuvered the rival’s defense, leading his team to a decisive victory, and doing so with an air of confidence that captivated spectators and silenced skeptics.

The VR Vision

By the end of the season, Daniels had not only improved his own performance but had also inspired a wave of interest and investment in VR training across the league. Teams began revisiting their training paradigms, nudging the sports industry towards a more tech-savvy future.

Innovation or Not?

Jayden Daniels’ success with VR training may invite debates about whether this is innovation or merely a novel tool in an athlete’s repertoire. Regardless of where you stand, what cannot be denied is the transformative impact VR has had on enhancing an athlete’s strategic prowess and mental fortitude.

Beyond just quick optical improvements, VR training stands at the intersection of cognitive science and performance enhancement, offering a paradigm where mental sharpness is honed in tandem with physical capabilities. For Daniels, and countless athletes following in his footsteps, VR presents a formidable new teammate in their quest for greatness.

As we stand at the threshold of a technologically enhanced sports era, the question still lingers in the locker room and boardrooms: Is VR the future of sports training, or just another fleeting fad? For Jayden Daniels, it’s clear that VR is more than just a tool—it’s a revelation.

Image credit: Wikimedia Commons – All-Pro Reels of District of Columbia, USA

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The Breakthrough Lifecycle

The Breakthrough Lifecycle

GUEST POST from Greg Satell

Many experts suspect that the COVID crisis is receding into the background. It is, of course, hard to know for sure. There will continue to be debate and we will still need to have some mitigating measures in place. Still, for the most part, people are back at work, kids are in school, and relatively normal routines have returned.

Generations from now, historians will most likely still question what lessons are to be gleaned from the past few years. Should we strengthen our multilateral institutions or have they become so sclerotic that they need to be dismantled? Is the rise of populist nationalism a harbinger for the future or a flash in the pan?

One thing I don’t expect to be hotly debated, in fact seems perfectly clear even now, is that science saved us. Untold thousands, working mostly anonymously in labs around the world, created a vaccine of astonishing efficacy in record time. It is these types of breakthroughs that change the course of history and, if we can embrace their power, lead us to a better future.

A Seemingly Useless Idea

The MRNA technology that led to the Moderna and Pfizer-BioNTech vaccines have the potential to revolutionize medical science. It can rapidly reprogram the machinery in our cells to manufacture things that can potentially cure or prevent a wide range of diseases, from cancer to malaria, vastly more efficiently than anything we’ve ever seen before.

Yet while revolutionary, it is not at all a new idea. In fact Katalin Karikó, who pioneered the approach, published her first paper on mRNA-based therapy way back in 1990. Unfortunately, she wasn’t able to win grants to fund her work and, by 1995, things came to a head. She was told that she could either direct her energies in a different way, or be demoted.

This type of thing is not unusual. Jim Allison, who won the Nobel Prize for his work on cancer immunotherapy, had a very similar experience when he had his breakthrough, despite having already become a prominent leader in the field. “It was depressing,” he told me. “I knew this discovery could make a difference, but nobody wanted to invest in it.”

The truth is that the next big thing always starts out looking like nothing at all. Things that really change the world always arrive out of context for the simple reason that the world hasn’t changed yet.

Overcoming Resistance

Humans tend to see things in a linear fashion. It is easier for us to imagine a clear line of cause and effect, like a row of dominoes falling into each other, rather than a series of complex interactions and feedback loops. So it shouldn’t be surprising that, in hindsight, breakthrough ideas seem so obvious that only the most dim-witted would deny their utility.

When we think of something like, say, electricity, we often just assume that it was immediately adopted and the world simply changed overnight. After all, who could deny the superiority of an efficient electric motor over a big, noisy steam engine? Yet as the economist Paul David explained in a famous paper, it took 40 years for it to really take hold.

There are a few reasons why this is the case. The first is switching costs. A new technology almost always has to replace something that already does the job. Another problem involves establishing a learning curve. People need to figure out how to unlock the potential of the new technology. To bring about any significant change you first have to overcome resistance.

With electricity, the transition happened slowly. It wouldn’t have made sense to immediately tear down steam-powered factories and replace them. At first, only new plants used the electricity. Yet it wasn’t so much the technology itself, but how people learned to use it to re-imagine how factories functioned that unlocked a revolution in productivity gains.

In the case of mRNA technology, no one had seen a mRNA vaccine work, so many favored more traditional methods. Johnson & Johnson and AstraZeneca, for example, used a more traditional DNA-based approach using adenoviruses that was much better understood, rather than take a chance on a newer, unproven approach.

We seem to be at a similar point now with mRNA and other technologies, such as CRISPR. They’ve been proven to be viable, but we really don’t understand them well enough yet to unlock their full potential.

Building Out The Ecosystem

When we look back through history, we see a series of inventions. It seems obvious to us that things like the internal combustion engine and electricity would change the world. Still, as late as 1920, roughly 40 years after they were invented, most American’s lives remained unchanged. For practical purposes, the impact of those two breakthroughs were negligible.

What made the difference wasn’t so much the inventions themselves, but the ecosystems that form around them. For internal combustion engines it took a separate networks to supply oil, to build roads, manufacture cars and ships and so on. For electricity, entire industries based on secondary inventions, such as household appliances and radios, needed to form to fully realize the potential of the underlying technology.

Much of what came after could scarcely have been dreamed of. Who could have seen how transportation would transform retail? Or how communications technologies would revolutionize warfare? Do you really think anybody looked at an IBM mainframe in the 1960s and said, “Gee, this will be a real problem for newspapers some day?”

We can expect something similar to happen with mRNA technology. Once penicillin hit the market in 1946, a “golden age” of antibiotics ensued, resulting in revolutionary new drugs being introduced every year between 1950 and 1970. We’ve seen a similar bonanza in cancer immunotherapies since Jim Allison’s breakthrough.

In marked contrast to Katalin Karikó’s earlier difficulty in winning grants for her work, the floodgates have now opened as pharma companies are now racing to develop mRNA approaches for a myriad of diseases and maladies.

The Paradox Of New Paradigms

The global activist Srdja Popović once told me that when a revolution is successful, it’s difficult to explain the previous order, because it comes to be seen as unbelievable. Just as it’s hard to imagine a world without electricity, internal combustion or antibiotics today, it will be difficult to explain our lives today to future generations.

In much the same way, we cannot understand the future through linear extrapolation. We can, of course, look at today’s breakthroughs in things like artificial intelligence, synthetic biology and quantum computing, but what we don’t see is the second or third order effects, how they will shape societies and how societies will choose to shape them.

Looking at Edison’s lightbulb would tell you nothing about radios, rock music and the counterculture of the 60s, much like taking a ride in Ford’s “Model T” would offer little insight into the suburbs and shopping malls his machine would make possible. Ecosystems are, by definition, chaotic and non-linear.

What is important is that we allow for the unexpected. It was not obvious to anyone that Katalin Karikó could ever get her idea to work, but she shouldn’t have had to risk her career to make a go of it. We’re enormously lucky that she didn’t, as so many others would have, taken an easier path. It is, in the final analysis, that one brave decision that we have to thank for what promises to be brighter days ahead.

All who wander are not lost.

— Article courtesy of the Digital Tonto blog
— Image credits: Pixabay

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Beating the Bougainvillea Blues

Why cutting back can sometimes be the best innovation option

Beating the Bougainvillea Blues

GUEST POST from John Bessant

Every year about this time we move southwards. Like very late swallows. Desperately seeking some of the yellow stuff to help recharge our solar cells and thaw out frozen fingers. Our preferred destination is Cyprus, Aphrodite’s island, a jewel set in the Mediterranean whose long history of invasion by others suggests significant local attractions. In particular it has a track record of sunshine hours which is hard to match, an average of 300 days per year.

(Of course that begs the question of what climatic shape the other 65 days take and it would be greedy to expect the absence of a few drops of rain or the odd cloud or two….)

Unfortunately the changeable element in the weather pattern has a predilection for December/January and so this year we have enjoyed a meteorological smorgasbord in which the weather has been experimenting with all the things it otherwise never gets a chance to play with. Including hail, thunder, snow (visible in the distance dusting the mountaintops), winds, even waterspouts out at sea.

Plus rain. Quite a lot of it. In fact enough to challenge even my generous view that it’s OK to wash out another day of my sunshine stay because the dams need filling up ready for the dry spring and summer.

Despite this I’m mostly doing fine with my optimism, enjoying the peace and beauty of the island (when we can go outdoors) and compensating for the lack of sunshine by drinking its distilled variety in the form of local wines to accompany local foods, liberally sprinkled with excellent olive oil, again courtesy of the missing sunshine…

However this morning sees me a little end-of-year blue because I’m pressing my nose up against the rainy window pane to see the bougainvillea. Or rather not seeing it. Let me explain.

When we bought the house one of the things I loved was the bougainvillea. Three trees worth of it, massive gnarled old trunks which spiraled up and over a wooden pergola guiding the branches and leaves to create a spectacular roof of purple and red. Look down on it from the bedroom window and there is your magic carpet waiting for you to climb aboard and fly away, watching the world below through its soft feathery leaves. Look up at it and you have a wonderful cave of shade, shielding you from the fierce summer sun, with its thick green foliage and gentle impossible blossoms. Whichever angle you viewed it from the effect was the same — crystalized summer …

Except that last year the pergola frame on which this whole amazing confection was resting gave up the ghost. Pressed down and strangled by its burden of branches it finally began to lean dangerously to the point where we had to bite the horticultural bullet and rethink.

Our superhero builder Dave sucked his teeth, cocked his head a couple of times then confirmed that we needed to replace the frame with a stronger new pergola suitably secured to the ground. But in order to effect this reconstruction we’d need to cut back the bougainvillea. Big time.

Cue Ollie whose green fingers and experienced brain have learned to work with the island’s fecund sun-rich approach to growth. He reliably reassured us that the project would work and that, while the short-term operation might look a little savage, it would all come out right in the end. He reminded us that this was precisely why the local wines taste so good — because the vineyard owners understand the importance of pruning.

I’d noticed this; the winter round of hacking back the thick bushes which had been so rich in foliage and fruit to the point where there are just a few stumps sticking up like dead men’s fingers clawing at the sky. And yet by the spring time the whole glorious cycle starts to repeat itself. His parting words were along the lines of ‘trust me… Nature’s got this!’

We bit the bullet. So what greeted us this year on arrival was a somewhat stark reduction in the foliage. In fact no foliage at all, just a couple of very lonely-looking stumps…..

Not so easy on the eye but I’ll try to have faith. And at least it offers an interesting metaphor for how we might think about innovation management at the start of a New Year.

It’s a safe bet to assume that there are plenty of resolutions buzzing round the brains of those with a stake in helping create value from our ideas. Lots of good intentions about doing things differently in 2025, expansive plans to try out new approaches, deploy new tools, do new stuff.

And there’s no shortage of new things to try. There’s a whole industry out there dedicated to challenging us to revise our innovation approaches — research papers, conference speeches, benchmark case studies, even, dare I say it, the odd blog or two like this one. The invitation to re-frame, to reinvent ourselves comes at us from multiple angles — and there’s a bewildering but enticing display of new tools and techniques which threaten to turn us into children running through the innovation sweet-shop on a serious sugar high.

And now we have AI. You don’t need to be Cassandra to be capable of making a pretty safe bet — 2025 will be the year of AI moving mainstream. Already a majority of organizations report experimenting with the enormous opportunity; it won’t take long before that converts to proven improvements in practice. Changing the ways in which we work with innovation, the products and services we offer and the different targets we try to reach.

The danger in all of this is that we keep adding to our repertoire, adding more and more growth to our innovation operations. We risk them becoming a close cousin to my bougainvillea thicket, overgrown to the point of collapse.

Innovation is all about creating and developing ‘routines’ — patterns of behavior which enable us to repeat the innovation trick. We learn over time effective ways to make it happen — how we search effectively, how we choose amongst different opportunities, how we implement in agile fashion, streamlining the process of converting ideas to value. Over time we build on those which work for us, embedding them in ‘the way we do things round here’, shaping them into the kind of innovation system which the International Standards Organization now recommends. Not just slogans about the importance of innovation but the structures, processes and policies to enable those behaviors.

Managed well this is a prescription for healthy growth. But it’s not a matter of abstract systems or process flow charts; it’s much closer to the challenge of planting and tending an orchard. A rich harvest of innovation fruit comes from strong branches on trees which have matured thanks to careful cultivation. Maintaining what’s already established and allowing for new shoots, sprouting in new directions, opening up more possibilities for future growth.

This doesn’t happen by accident. We need to think about ‘innovation horticulture’ — how best to manage the orchard.

Orange Grove

That’s a lesson which has been learned quietly by many organizations, who’ve been playing the innovation long game. Members of the ‘Hundred Club’, those who’ve survived and thrived over a century or more. Organizations which have ridden out some stormy weather by a commitment to innovation and to creating the kind of innovation system of which the ISO would be proud.

What they have in common is the ability to maintain what works, not just following fashion but carefully reviewing how they manage innovation on a regular basis. They’ve become skilled at enabling new growth through adding new routines, analogous to planting new saplings or grafting new strains on to old branches. Above all they’ve mastered the art of pruning to create space for this to happen.

This is the key part of the dynamic capability which innovation represents. The ability to step back and review, asking three simple questions. Of the innovation routines, the way we manage the process:

· What do we need to do more of, reinforce and strengthen?

· What do we need to do less of, even stop?

· And what new routines do we need to develop to cope with new challenges?

It’s as much about letting go as it is about adding new approaches. And it is crucially about strategically identifying where we need the new growth to come from. Just like a skilled gardener cuts back deep but also makes sure she has identified the spurs, the tiny buds which will provide the sites from which new things become possible.

This extended gardening metaphor might sound a little fanciful but we’ve got plenty of examples to illustrate it. Think about 3M, one of the longest established innovation gardens, still able to grow vigorously in new directions after well over a hundred years. During the early part of this century the company invested heavily in developing routines around six sigma and process improvement, securing significant gains in terms of productivity. But it soon became clear that the relentless focus on doing what they already did but better was driving out their capacity for breakthrough innovation. So the program was pruned to allow more exploration space. Importantly it wasn’t abandoned but rather trimmed back to enable new growth to come through.

Or Procter and Gamble, making the bold decision to cut back on the long (150 years) tradition of routines built around research and development and making the radical shift to a more open approach. ‘Connect and develop’ is now at the heart of how they innovate, drawing in a steady flow of ideas from outside the company alongside their internal capabilities. It has taken a quarter of a century for these new routines to mature but they now yield significant gains across the innovation spectrum.

Or the German company Hella, experiencing a key challenge around its rapid growth from being a successful 19th century start-up to a large established player. Its early experience helped create routines around new opportunities, triggered by new technologies and by discovering new market niches. There was plenty of innovation activity, a veritable hive of creativity with bees buzzing in and out working on a growing number of projects. But proliferating projects meant increasing costs and growing confusion around priorities which could only be solved by adding more minds to the mix. In the end the innovation engine began spinning out of control, overheating with all the innovation efforts.

It came to a head with a review which suggested that of the roughly 4000 products in the range at that time the vast majority took up time and effort but made little contribution. In particular it suggested that:

· 95 products were responsible for around 80% of turnover and 34% of R&D costs

· 305 were responsible for 15% turnover and 35% R&D

· 3100 were responsible for 5% of turnover and 31% of R&D !!!

The answer wasn’t to slam feet on the innovation brakes and stop. But it was about pruning, cutting back on most of the projects and focusing attention on those with strategic contributions to make. And having done this, to put in place new systems for project selection, portfolio management and regular staged reviews.

So whilst I’m still harboring doubts I’m hoping to see a bougainvillea renaissance beginning on my next visit. A sort of blooming version of ‘Field of Dreams’. As with baseball teams so with pergolas and bougainvillea bushes. Create the space — and the new growth will come.

Of course it’s not just about cutting back to make space in our innovation garden. The other side of this involves introducing new routines to enable new growth. But these by their nature will be young seedlings, not well-established trees. They need careful tending and experienced innovation gardeners understand the importance of supportive structures and growth regimes to help them take root. Using canes and trellises, introducing fertilizers and nutrients and above all keeping a careful eye on these early-stage experiments. They won’t all survive but those proto-routines of today could become critical capabilities in the future so it’s worth investing the time and effort now.

You can find my podcast here and my videos here

And if you’d like to learn with me take a look at my online course here

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Image credits: Dall-E

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Startups, Companies, Acquisitions and Hurricanes

Startups, Companies, Acquisitions and Hurricanes

GUEST POST from Mike Shipulski

If you run a company, the most important thing you can control is how you allocate your resources. You can’t control how the people in your company will respond to input, but you can choose the projects they work on. You can’t control which features and functions your customers will like, but you can choose which features and functions become part of the next product. And you can’t control if a new technology will work, but you can choose the design space to investigate. The open question – How to choose in a way that increases your probability of success?

If you want to buy a company, the most important thing you can control is how you allocate your resources. In this case, the resources are your hard-earned money and your choice is which company to buy. The open question – How to choose in a way that increases your probability of success?

If you want to invest in a startup company, the most important thing you can control is how you allocate your resources. This case is the same as the previous one – your money is the resource and the company you choose defines how you allocate your resources. This one is a little different in that the uncertainty is greater, but so is the potential reward. Again, the same open question – How to choose in a way that increases your probability of success?

Taking a step back, the three scenarios can be generalized into a category called a “system.” And the question becomes – how to understand the system in a way that improves resource allocation and increases your probability of success?

These people systems aren’t predictable in an if-A-then-B way. But they do have personalities or dispositions. They’ve got characteristics similar to hurricanes. A hurricane’s exact path cannot be forecasted, the meteorologist can use history and environmental conditions to broadly define regions where the probability of danger is higher. The meteorologist continually monitors the current state of the hurricane (the system as it is) and tracks its position over time to get an idea of its trajectory (a system’s momentum). The key to understanding where the hurricane could go next: where it is right now (current state), how it got there (how it has behaved over time), and how have other hurricanes tracked under similar conditions (its disposition). And it’s the same for systems.

To improve your understanding of how your system may respond, understand it as it is. Define the elements and how those elements interact. Then, work backward in time to understand previous generations of the system. Which elements were improved? Which ones were added? Then, like the meteorologist, start at the system’s genesis and move forward to the present to understand its path. Use the knowledge of its path and the knowledge of systems (it’s important to be the one that improves the immature elements of the system and systems follow S-curves until the S-curve flattens) to broadly define regions where the probability of success is higher.

These methods won’t guarantee success. But, they will help you choose projects, choose acquisitions, choose technologies, and choose startups in a way that increases your probability of success.

Image credits: Pexels

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The Dark Side and the Shep Side of Customer Service

The Dark Side and the Shep Side of Customer Service

GUEST POST from Shep Hyken

Let’s play a game. We can call it ‘Lousy Service Versus Good Service’, or a better title I came up with: ‘The Dark Side Versus the Shep Side’.

‘The Dark Side of Service’ is just bad. The opposite is what I teach in my customer service (CX) keynote speeches and customer service training program. Here are some Dark Side and Shep Side examples:

Dark Side: Making customers wait for long, unreasonable lengths of time.

Shep Side: Customers don’t wait. But that’s not always possible, so if they do have to wait, they are told how long, and the company honors its commitment.

Dark Side: Employees are rude. In my annual customer service research (sponsored by RingCentral), the top reason customers leave one company to go to another is rude employees!

Shep Side: Employees are the exact opposite of rude. Our research found the top reasons customers come back to a company are employees who are helpful, knowledgeable and friendly.

Dark Side: The experience is marred by friction and unfriendly customer policies. It seems like it’s never easy to reach a person or get help, and even if you’re trying to buy something, sometimes the company makes it hard. It’s almost as if they have a sales-prevention department.

Shep Side: Customers love companies that are easy to do business with. It’s more than convenience – although customers love convenience. Being easy in business means processes and policies that are customer-friendly. It’s easy to reach a customer support agent. Employees respond quickly to customers’ messages. Maybe it’s a hassle-free return or exchange policy. The point is, the experience is just easy!

Dark Side: Inconsistent experiences … one day, the service and experience are great. The next time, they aren’t. The customer wonders, “What will the next experience be like?”

Shep Side: When customers have a consistent and predictable experience, they trust you. They know what they are going to get. They “own the experience,” often to the point where a customer won’t take the risk of doing business elsewhere for fear of being let down. This is what you want customers to experience.

The Dark Side and the Shep Side of Customer ServiceI could go on and on with examples like these, but instead, how about you come up with your list? Use these examples as conversation starters to find your version of the Shep Side of service. Start by asking where you fall short or receive complaints. Dig deep to find the root cause of these problems. Then, determine what the opposite of these problems would be. More importantly, what drives the opposite experience? And when you find it, do what’s necessary to make it consistent and predictable. That’s what customers want: a consistent and predictable experience they can count on.

Image Credits: Unsplash

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The Two Main Opponents of Digital Success

The Two Main Opponents of Digital Success

GUEST POST from Howard Tiersky

I have written before about the importance of the role that emotion plays in driving your customer’s or audience’s behavior in digital channels.

When creating digital touch points, it is natural to focus on the capabilities and content that we believe customers will want, need, and hopefully love. This is essential as your digital touchpoint must have a strong core value proposition to the visitor in order to be viable.

However, it’s important to be aware of a psychological factor called Negativity Bias. What Negativity Bias says is basically that our negative emotions are more powerful in our psyche than our positive emotions. We might be excited about going on vacation, but if we are worried it might rain, those negative feelings can outweigh the positive ones.

At FROM we spend a lot of time testing websites, mobile apps and other digital experiences with real end-users and we get to observe their emotional reactions first-hand. After watching hundreds of these tests, I would have to say that our research confirms this idea of negativity bias. Simply put, no matter how promising or worthwhile a site is when it starts to trigger negative reactions in users, they usually abandon it quickly, no matter how initially interested they may have been. Note there is an exception to this rule which we call the Bruce Springsteen Rule – perhaps showing our age. For many years the TicketMaster site was quite terrible and yet when the moment came that a new Bruce Springsteen concert opened up for sale, tens of thousands of people would flock to the site and frankly just suffer through the purchase experience in order to get those tickets. So if your site experience is the digital equivalent of a Bruce Springsteen ticket (Millennials, please substitute Justin Bieber), then you may have found a way to neutralize negativity bias. Otherwise, read on.

So what are these negative reactions we get from users? There are a variety of possibilities, but there are two primary emotional villains that lead the pack: confusion and frustration.

Confusion is usually the first emotion we see. A user begins perhaps looking for a product or researching a topic, but he/she doesn’t fully understand the interface, the results they are getting or the labeling or language used. They start to feel confused. Confusion is a harmful emotion because it tends to make people feel that they are at fault. They are perhaps too stupid to figure out how to use the site or app. You might think,” Well that’s better than them blaming us!” but in fact, it’s not. They say the best thing you can do to have a great first date with someone is to leave them feeling great about themselves, and so it goes with digital experiences. If a user feels they aren’t smart enough to figure out your site or app, they may not blame you, but they leave nevertheless, so the outcome is basically the same.

And by the way they may in fact subconsciously blame you for making them feel dumb.

So how to avoid confusion? Study users’ paths through the site via task analysis, as we do here at FROM. Anytime we test a site, even a very successful one, we always find many points of confusion. It’s a matter of basic hygiene: sites are constantly changing, and it’s hard to make sure that every tweak is totally clear to everyone. Doing quarterly or at least annual user tests to make sure you are aware of any confusion “bombs” that may have been planted on your site is just good business. Furthermore, confusion-related problems are often inexpensive to fix. Sometimes it’s simply about rewording a button or moving a call to action. Sometimes it’s about just removing a feature that’s causing more confusion than benefit.

The second emotional villain is frustration. When you are frustrated you aren’t feeling at all confused — generally, you know exactly what the site is supposed to do; it just isn’t doing it! Frustration can be triggered by site defects, slow performance, check out process that are more steps than the user feels they “should be,” policies that don’t give the user the outcome they want, or missing features that the user perceives “everybody else has” which may actually just mean that Uber and Amazon have them. It’s quite easy to frustrate users today as their expectations are so incredibly high. Creating frustration in digital users is super-damaging to your brand because many users create a meaning around the frustration which is that the brand just doesn’t care. Users believe that brands should know what they expect and that if they aren’t providing it, there can be only reason: they just aren’t bothering. This, of course, may be a completely erroneous conclusion… in our experience very often clients don’t realize the points in their customer experience that are creating frustration until we conduct the user tests that reveal these problems.

Frustration problems are often easy to fix, but sometimes they can be very challenging because they may stem from underlying technology issues that are expensive to remediate. Nevertheless, it’s essential to understand where these problems exist and gauge the impact they are having on your business results, so that you can make an informed decision about whether or when to invest in addressing them.

In our experience, sites that offer something of value and manage to avoid creating confusion or frustration for their visitors are winners. The first step to getting there is a user-research focused assessment so that you can face the reality of the emotional reactions you are creating. Once that is understood, a roadmap to improvement can be developed and results measured along the way.

This article originally appeared on the Howard Tiersky blog

Image Credits: Pixabay

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Five Must Reads for 2025

Five Must Reads for 2025

GUEST POST from Robyn Bolton

‘Tis the season for “year in review” and “top 10 lists.”  As fun (and sometimes frightening) as it is to look back, it is just as fun (and sometimes frightening) to look ahead.  After all, as innovators, that is what we naturally do.  So, in anticipation of the year ahead, here are 5 Must Reads to make 2025 far more fun than frightening.

(listed in alphabetical order by author’s last name so I can’t be accused of playing favorites)

Pay Up! Unlocking Insider Secrets of Salary Negotiation by Kate Dixon

Pay Up! Unlocking Insider Secrets of Salary Negotiation
  • This book is for everyone, especially… people who want to earn what they deserve
  • This book solves the problem of…the black box that is compensation and the fear of negotiating for what you’re worth
  • This book creates value by… Outlining a step-by-step system to:
    • Understand key terms and concepts and apply them to your situation
    • Research the information you need to confidently and competently negotiate
    • Know what to say and do (and NOT say or do) in the moment
  • Why I love this book: Full disclosure – Kate and I are friends, so I’ve had a front-row seat to her wisdom and humor (how many compensation books invoke Beyonce?) and the jaw-dropping impact she gets for her clients.  I’ve even gifted this book to others because I know it works!

Disrupt Yourself: Putting the Power of Disruptive Innovation to Work by Whitney Johnson

Disrupt Yourself - Putting the Power of Disruptive Innovation to Work
  • This book is for everyone, especially… people who are rethinking their careers and are ready for change
  • This book solves the problem of… knowing how to start redefining your career (and yourself)
  • This book creates value by… Turning Clayton Christensen’s Theory of Disruption into four principles for self-disruption, including:
    • Identifying your disruptive strengths
    • Stepping backward or sideways to grow
    • Patiently waiting for your career (and legacy) to emerge
  • Why I love this book: Two quotes: (1) “Disruption starts as an inside game” and (2) “Constraints can be the perfect remedy if you are having a difficult time.”

Live Big! A Manifesto for a Creative Life by Rochelle Seltzer

Live Big! A Manifesto for a Creative Life
  • This book is for everyone, especially… people who want to experience daily joy and creativity
  • This book solves the problem of…feeling stuck in the day-to-day reality of life, uncertain whit how to begin, and afraid to make big, drastic changes
  • This book creates value by… Offering 20 tips for:
    • Becoming a person who Lives Big, including slowing down, aligning to your purpose, and being patient
    • Acting big, including listening to your intuition, embracing change, and carrying on
    • Savoring the small joys of life, including the gorgeous design of the book
  • Why I love this book: Rochelle’s Discovery Dozen exercise is a game-changer.  I learned this tool when she was my coach, and I have continued to use it for everything from naming my business, to deciding if/when/how to act on an opportunity, and writing articles.

The Coaching Habit: Say Less, Ask More & Change the Way You Lead Forever by Michael Bungay Steiner

The Coaching Habit - Say Less, Ask More - Change the Way You Lead Forever
  • This book is for everyone, especially... busy managers who want to be better people leaders
  • This book solves the problem of…balancing hands-on management with team empowerment and individual development
  • This book creates value by… Guiding you through seven questions that help you:
    • Work less hard while having more impact
    • Break cycles of team overdependence and workplace overwhelm
    • Turn coaching and feedback from an occasional formal event into a daily habit
  • Why I love this book: A copy of the 7 questions sits just below my monitor, reminding me to be curious, dig deeper, and that every decision is a choice to do one thing and not another.

Readers Choice!

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It’s audience participation time!  In the comments below, drop YOUR recommendation for a 2025 Must Read.

Bonus points for telling us:

  • Who it’s for
  • Problem it solves
  • Value it creates
  • Why you love it

Image credit: MileZero, Misterinnovation.com

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Moments and Movements Are Not the Same Thing

Moments and Movements Are Not the Same Thing

GUEST POST from Greg Satell

On September 17th, 2011, protesters began to flood into Zuccotti Park in lower Manhattan. Declaring “We are the 99%” they planned to #Occupy Wall Street for as long as it took to make their voice heard. Similar protests soon spread like wildfire across 951 cities in 82 countries. It seemed to be a massive global movement of historic proportions.

But it wasn’t a movement. It was merely a moment. Within a few months, the streets and parks were cleared. The protesters went home and nothing much changed. #Occupy was, to paraphrase Shakespeare, full of sound and fury, signifying nothing. Certainly, no tangible aim was accomplished.

Failure has costs. Thousands of people for hours a day across several months adds up to billions of dollars worth of man-hours that could have been put to some useful purpose. Make no mistake. Creating positive change in the world takes far more than mobilization. You need a vision and a strategy, guided by values, designed to accomplish clear objectives.

Getting Beyond Grievance

Every change effort starts with a grievance. There’s something that people don’t like and they want it to be different. In a social or political movement that may be a corrupt leader or a glaring injustice. In an organizational context, the problem is usually something like falling sales, unhappy customers, low employee morale or technological disruption.

Whatever the case may be, the first step toward bringing change about is to understand that getting mired in grievance won’t get you anywhere. You can’t just complain about things you don’t like. You need to come up with an affirmative vision for how you would want things to be different and better.

The best place to start is by asking yourself, “if I had the power to change anything, what would it look like?” Martin Luther King Jr.’s vision for the civil rights movement was for a Beloved Community. Bill Gates’s vision for Microsoft was for a “computer on every desk and in every home.” A good vision should be aspirational. It should inspire.

One of the things I found in my research is that successful change leaders don’t try to move from grievance to vision in one step, but rather identify a Keystone Change, which focuses on a clear and tangible goal, includes multiple stakeholders and paves the way for future change, to bridge the gap.

For King, the Keystone Change was voting rights. For Gates it was an easy-to-use operating system. For your vision, it will undoubtedly be something different. The salient point here is that every successful transformation I have come across started out with a Keystone Change, so that’s where you will want to start as well.

Building In Constraints Through A Genome Of Values

Creating a clear vision for change is absolutely essential, but it’s only a first step. You also need to be clear and explicit about your values. While a vision for the future represents possibility, values represent constraints. Values make clear that we not only want things, but we’re also willing to incur certain costs to attain them.

For example, throughout his life, Nelson Mandela was accused of being a Communist, an anarchist, an extremist and worse. Yet when confronted with these accusations, he would always say that no one had to guess what he believed or what he was fighting for, because it was all written down in 1955 in a document called the Freedom Charter.

Importantly, the Freedom Charter imposed constraints on Mandela and his movement. When he rose to power, he couldn’t oppress white Afrikaners, because that would betray all that he’d been fighting for. That gave the movement credibility and power. Occupy, of course, was never clear or explicit about its values and never sought to constrain itself in any way. It’s activists were often seen as undisciplined and vulgar

In a similar vein, when Lou Gerstner set out to transform IBM in the 90s, he vowed that he would shift the company’s values from the “stack of its own proprietary technologies” to its “customers’ stack of business processes.” Yet it was his willingness to forego revenue on every sale to make good on this value is what made people believe in it. If not for that, it’s doubtful IBM would still be in business today.

Make no mistake. Values always cost something. If you are unwilling to bear costs and constraints, it isn’t a value. It’s a platitude. Change is always built on a foundation of shared values and common purpose. If you aren’t able to communicate clearly about what you believe and what you value, you can’t expect others to join you.

Mobilizing People To Influence Institutions

In October 2011, at the height of the #Occupy protests, the civil rights legend and Congressman John Lewis showed up at an #Occupy rally in Atlanta and asked to speak. He was refused. Some attributed the snub to racism among the privileged white protestors. Others faulted Lewis himself, who didn’t understand the complex rules of the rally.

The protester who led the charge to block Lewis, however, described a different motivation. For him, Lewis’s great crime was that he was part of the “two-party system” and therefore unworthy of trust. “Any organization that upholds the legitimacy of the two-party system simply buttresses interests opposed to those of everyday people,” the man said.

This is, of course, total nonsense. Every regime or status quo depends on institutions to support them. That’s why a key part of any transformation strategy is to mobilize people to influence the institutions that can bring change about. One major reason that #Occupy failed was that it mobilized people to do no more than sleep in parks and snarl out epithets.

Now consider Martin Luther King Jr., who was able to bring considerable influence to bear on the US political system, just as Thurgood Marshall and Charles Hamilton Houston did with the US legal system and Nelson Mandela did with international institutions. These men had at least as much reason to be skeptical as any #Occupy protester, but understood that it is institutions that have the power to make change real.

In our corporate work, we find the same principle applies. Would-be changemakers tend to construe institutions too narrowly. If it is an internal initiative, they overlook customers, industry associations, community leaders and other external stakeholders. If it is an externally facing initiative, they often overlook important internal stakeholders that can help.

Preparing For Your Moment

It’s easy to confuse a moment with a movement. A movement involves linking together small, but often disparate groups in the context of shared purpose and shared values. A moment occurs when an event triggers a temporary decrease in resistance to an action or idea that opens up a window of opportunity. Movements require preparation. Moments require little more than luck.

That’s why we see protesters suddenly fill the streets and then, almost as suddenly, dissipate with little or no impact. It’s why some startups catch investors’ imagination and race to billion-dollar unicorn status, only to crash and burn just as fast. Politicians’ fortunes rise and fall, social media stars have their moment in the sun before disappearing into obscurity.

Building a movement requires work. You need to get beyond mere grievances and articulate an affirmative vision. You need to identify and speak to shared values and build on common ground. You need to invite people to join your cause for their own reasons, which may be different from your own. And then you need to focus your efforts on influencing the institutions that can actually make a difference.

So we should never mistake a moment for a movement. However, we can build a movement in anticipation for a moment that we expect will come. Gandhi trained his disciples for ten years before the opportunity for the Salt March came along. King’s efforts failed in Albany, but triumphed in Birmingham under better circumstances. Polish protesters were ill-prepared in 1970, but learned from the mistakes and later brought down an empire.

The crucial point to remember is that moments of opportunity are rare. We need to prepare for them. So that when they happen and fortune smiles on us we are ready. We have everything in place. That’s how radical, transformational change comes about.

— Article courtesy of the Digital Tonto blog
— Image credits: Pexels

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Building Trust for High Performing Teams

Building Trust for High Performing Teams

GUEST POST from David Burkus

Trust is the bedrock upon which successful teams are built. High-performing teams are characterized by an elevated level of trust. This trust in high performing teams manifests in four distinct ways: teams trust each other to deliver, they trust that they can share new ideas, they trust that they can disagree, and they trust that they can make mistakes. Each of these aspects of trust contributes to the overall success and productivity of the team.

As a leader, it is your responsibility to set the tone and model trust within your team. This involves creating an environment where team members feel safe to share their ideas, voice their disagreements, and admit their mistakes. By doing so, you can foster a culture of trust that drives your team towards high performance.

In this article, we’ll review each type of trust in high performing teams and offer ways leaders can build each.

Teams Trust Each Other To Deliver

Trust in a team begins with the belief that each member will deliver on their commitments. This trust is built on clarity and understanding of each person’s role within the team. When team members understand how their work contributes to the overall team goals, they are more likely to feel accountable and deliver on their commitments. Lack of trust can manifest when people don’t know how their work fits into the team. This can lead to confusion, miscommunication, and ultimately, a failure to meet team objectives.

Regular team huddles can improve clarity and accountability, thereby fostering trust in the team’s ability to deliver. In huddles, the team meets at regular intervals to review progress, set new priorities, and discuss any potential roadblocks. Doing so as a team not only keeps everyone on the same page, over time it can instill a belief in each person that their teammates can deliver on their promises (assuming, of course, the teammates are actually delivering on their promises).

Teams Trust They Can Share New Ideas

High-performing teams are often characterized by their ability to generate and welcome new ideas. This requires a culture of trust where team members feel safe to share their out-of-the-box thinking. Diversity of experiences and perspectives can lead to innovative ideas that drive the team forward. But only if team members feel safe enough to share the innovative ideas that stem from their diverse perspectives.

Leaders play a crucial role in fostering this culture of trust. By modeling active listening and creating an environment where new ideas are considered and valued, leaders can encourage their team members to share their thoughts and contribute to the team’s innovation. When leaders demonstrate how to respect the new ideas of others, hearing them out fully, and discuss them, they not only teach the team how to do so but they send a message to everyone that “crazy” ideas are welcome here.

Teams Trust That They Can Disagree

Disagreements are a natural part of any team’s dynamics. As teammates from different backgrounds, perspectives or experiences discuss their problems or plan out critical tasks, they’re going to disagree on the best way forward. In low-performing teams, this conflict is often avoided, and ideas suppressed. However, in high-performing teams, disagreements are viewed as opportunities for growth and improvement. Team members trust that they can voice their disagreements and have their ideas challenged in a respectful and constructive manner.

Leaders can foster this trust by setting the tone for disagreements. When teammates speak up to disagree with a leader, it’s an opportunity to model respectful dissent and discussion. When teammates disagree with each other, it’s an opportunity for the leader to “referee” the conflict and establish ground rules for keeping conflict task focused. By welcoming disagreements and ensuring that everyone feels heard, leaders can create a safe space for constructive conflict and continuous improvement.

Teams Trust They Can Make Mistakes

Mistakes are inevitable in any team. Teams will make assumptions about the environment or get hit with unexpected changes. Failure on a team is unavoidable even on the highest-performing teams. In low-performing teams, failures quickly turn into blame sessions, which each member trying to save their own skin. However, in high-performing teams, mistakes are viewed as learning opportunities rather than failures. This requires a culture of trust where team members feel safe to admit their mistakes and learn from them.

In dysfunctional teams, people often hide their failures due to fear of judgment or exploitation. Leaders can counteract this by modeling vulnerability and admitting their own mistakes. This can help to build trust and create a safe environment for team members to learn and grow. When a team witnesses a leader taking responsibility for failure or admitting a shortcoming, they’re more likely to trust that leader in the future—and to trust each other.

Trust is the cornerstone of high-performing teams. It manifests in the team’s ability to deliver, share new ideas, disagree constructively, and admit mistakes. As a leader, it is your responsibility to foster this trust within your team. By setting the tone and modeling trust, you can create an environment where your team can thrive and do its best work ever.

Image credit: Pixabay

Originally published on DavidBurkus.com on October 30, 2023

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