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Unshackle Your Team’s Creativity

Forward Business Planning

Have you ever wished for more input, insights, and ideas from the employees on your team?

Especially when our businesses are not performing as well as we’d like, we really need our teammates’ creative ideas. But when we gather a group and ask for ideas—whether for new product features, cost reduction ideas, or ways to improve service—we often see the same, recycled thoughts. Or ones that are only a smidgen better than what’s currently being done.

It’s not the employees’ fault. Humans are wired to keep doing what they’ve been rewarded for in the past. We are wired to protect our allies, and to avoid risk. These tendencies tend to hold us back when it comes to thinking in new ways. We are shackled by what’s worked before and have a hard time imagining a new way of doing things.

Here are a few techniques for helping your team break free to develop new ways of thinking about your business. Continue Reading →

5 Ways to Gain Extraordinary Customer Insight

Composite image of businessman looking on a ladder

Have you ever invested great time and expense in developing and launching a new product or service, only to see revenues fall far short of expectations?

We think we’re delivering exactly what the customer has asked for, but it turns out that we didn’t really understand what our customers were willing to buy.

We’ve all been there. McDonald’s introduced chicken wraps and other menu items to satisfy the demands of health-conscious diners, only to find that customers don’t actually want to eat healthy food at McDonalds. The fries are just too tempting.

Especially in fast-changing markets, companies often get so busy running the business, they fail to understand their customers’ experience and needs. They are blind to what actually goes on when customers use their products.

Let me suggest a few ways to break out of this cycle, so that you understand what your customers value and how they think. Continue Reading →

Is Your Corporate Culture Killing Innovation and Speed?

Easy win

In the past few years, Cisco, Coca-Cola, GE, IBM, MasterCard and other large companies have begun to launch “internal startups”—teams of employees who are sheltered from corporate rules and bureaucracy – to stimulate entrepreneurship and creativity, and infuse agility.

I spoke recently with the leader of a business that existed – for a while – as an internal startup within a large corporation.

The thinking was that employees within this quasi-startup would be free to focus on their goals. Team spirit and collaboration would replace hierarchy. Innovation, risk-taking, and learning from failure would flourish. Time formerly spent on meetings and emails with other corporate groups would be spent focusing on the customer.

All those good things came true, as long as the team was left alone. Continue Reading →

Growth and Profitability from Outlier Customers

Red umbrella fly out from crowds of black umbrellas

When you deal with the same types of customers, buying the same products and using them the same way, every day, it’s easy to be lulled into a smug confidence that you know everything you need to know about how customer needs are evolving.

Market research and management reporting systems are notorious for “averaging” all customers together. This blends specific needs into a bland summary of general information. As a result, critical “outlier” information gets lost in the mix, and companies lose out on valuable insights about customer needs.

They focus product and service enhancements on the “average” customer, and as long as she’s pretty happy, they think they’re doing well.

This is dangerous.

When we ignore the unusual customers – the ones at the edges of the bell curve – we miss important market signals.

These “outlier” customers are those who do things a little differently.  They may use our product or service in an unusual way, perhaps even in a way that’s never occurred to us.

Why is this important? Continue Reading →

Be Prepared and Take Action Quickly!

Take action key on a computer keyboard, business concept

One Monday in 2013, my husband and I spent the night in our car. Shortly after midnight, on our way home from playing hockey (this is a new sport for us, and great fun), we were amazed to encounter a huge traffic jam on Atlanta’s I-285. As we slowed to a stop, we saw a plume of fire as big as a house rising from a burning tractor-trailer a third of a mile ahead. Scenes from disaster movies looped in my head, and we talked about what to do if things got worse.

We passed the first hour reading books on our iPhones, then slept intermittently while waiting for the emergency workers to put out the fire and clear the wreckage. Someone from a nearby car borrowed our jumper cables, and Rob got out from time to time to walk ahead to see how things were progressing. We started the car periodically to warm up.

This incident reminded me how important being prepared can be. I was thankful to have a warm coat and sensible shoes but thought about a few things that we should keep in the car in the future. Snacks, water, a first-aid kit, at least a third of a tank of gas.

I thought, too, about business preparedness. Business people tend to enjoy planning for good things, like new products, revenue growth and hiring. It’s worth taking the time to prepare for unpleasant surprises as well, since you can tremendously improve your outcomes with a little planning.

Here are a few examples: Continue Reading →

Six Obstacles That Stop Agility In Its Tracks

Professional sprinter jumping over a hurdle

Are you struggling to make your company more agile?

In my work with organizations in virtually every industry, I find that business agility – the ability to spot and capitalize on new business opportunities as they emerge – is a capability that many companies aspire to, but few achieve.

What makes agility so elusive?

I’ve observed six primary obstacles to achieving agility. Continue Reading →

What Was Volkswagen Thinking? When Smart People Work Together To Cheat, Something Is Terribly Wrong.

News came out this week that VW engineered its software to evade emissions tests. The vehicle can detect when it’s being tested, to reduce emissions to allowable levels. As soon as the test is over, under real driving conditions, emissions are 30 or 40 times higher.

Volkswagen has acknowledged that similar software exists in 11 million diesel cars worldwide. The CEO has resigned.

This scandal hurts the reputation not only of VW (which also owns Audi, Porsche, Lamborghini, and Bentley), it hurts the reputation of Germany. When we think “German engineering,” we’ve historically thought of reliability, precision and performance. Now we may be more inclined to think “sneaky” or even “dishonest.”

When our teenagers misbehave, we often are tempted to say “what were you thinking??”  Psychologists tell us that this is unhelpful. The teen brain is not fully developed, so teens actually can’t think ahead to anticipate the implications of their actions as well as adults can. But VW is a full-grown company.

We also say to our children “Don’t cheat, because you’ll only be cheating yourself.” In this case, VW cheated its employees, its customers, its shareholders ($26 billion in share holder value was erased this week), its country and people everywhere who’d like safe, clean air to breathe.

I don’t know how much the departing CEO, Martin Winterkorn, knew about VW’s software, which so stealthily cheated on emissions tests. As a top leader, you can’t know everything your employees are doing.

But the CEO is responsible for his company’s culture. He exemplifies the values that guide that culture.  He should set clear expectations for fair-play and honesty.

And he clearly did not do that; at least, not well enough. When groups of very smart people work together to cheat the system, as it appears VW engineers did, it’s a symptom of deep cultural rot within a company’s soul.

Winterkorn has stated that he is “endlessly sorry” and asks for “trust on our way forward.”

That trust is going to take a long, long time to rebuild.

Want breakthrough ideas? Look outside. WAY outside.

AAEAAQAAAAAAAAb8AAAAJDhkOTgyMDkyLWQ5ZjItNDg3ZC1hZWFiLWE4ODk1MGIwODAwZAI recently met with the leaders of a highly successful company. Sales growth, which had been strong for years, was headed into negative territory. They were desperate to find the next “big idea” that would put their company on track for future growth.

As they discussed potential innovations, the same tired, incremental ideas that had been tossed around for years kept resurfacing.

What they needed was something to shake up their thinking.

These managers had been so busy delivering product, serving customers, dealing with people issues, managing the budget and attending meetings, that they had focused all their attention inward. They hadn’t looked outside their industry for new ideas in months, or even years. As a result, their thinking was stale and uninspired.

When you want to develop breakthrough ideas, try looking at companies outside of your industry to fuel new thinking. If you are in healthcare, look at technology or consumer products companies.  If you are a services company, look at manufacturers. You get the idea.

Pick one company, and list what’s intriguing, controversial, new or different about it. Be specific about what you observe, and then ask: “How might we apply this idea in our own company?”

An industrial products business, for example, looked at Walmart as an exemplar, even though the two companies are in different industries and are of vastly different size.

The smaller company observed how Walmart has made its store-brand Ol’ Roy dog food the bestselling brand in the world, and decided to explore the idea of offering private-label products. It observed how Walmart has standardized apparel sizes across many different clothing suppliers, and decided to simplify and standardize its product sizes, so customers could more easily specify and buy what they needed.

This video describes this process:

Click here for a framework and example.

When I suggested “looking outside your industry” in a blog post a few weeks ago, readers contributed how they had:

  • Found new ideas for an aerospace company by looking at consumer products technology trends.
  • Developed a new hotel concept after looking at the consumer and employee experience across brands like Starbucks, Harley Davidson and Quick-Trip.
  • Applied ideas from investigative journalism to sales training.
  • Employed GM and Toyota product positioning and pricing ideas within an information services company.

Next time you want to develop new ideas for performance improvement and growth, look at companies in completely different industries than your own.  Be specific about what you observe, and then think about the implications for your own company.

What’s right under our noses can save lives, and our businesses

 

Years ago, my father had a heart attack.  Worried that our big, protective dog wouldn’t let the ambulance team into the house, he lay in bed and waited for my mom to return from running errands, rather than calling 911.

He didn’t realize how important speed was in minimizing the damage a heart attack causes.

The US death rate from coronary heart disease fell by 38 percent from 2003 to 2013, and faster emergency treatment was a key reason.  

Hospitals across the country have slashed “door to balloon” time—the time from when a patient enters the hospital to when doctors clear the blockages in the patient’s arteries to get blood flowing to the heart again. They’ve done this with no new medical discoveries, no new technology and no new payment incentives. They simply uncovered existing best practices and spread the word about them.

It started when Medicare assembled data on the time it took hospitals across the country to get blood flowing after heart attacks. The results varied widely, but the worst news was that the times were not getting any better year-to-year.

Until a team of cardiologists identified the 11 hospitals with the shortest door to balloon time, and set out to find out what was different.

The fastest hospitals weren’t the big, famous institutions you would expect to see on such a list–some were small town and community hospitals. But they had a few things in common. The best-performers had ambulance paramedics transmit electrocardiogram results to the emergency room, so the ER team could prepare. They gave the emergency room doctor power to decide whether the surgery team would be summoned from their beds, rather than consulting first with cardiologists.  They eliminated the need to fill out long consent forms before work got started. And they sounded the beepers for the entire surgery team simultaneously, instead of calling individuals one by one.
These procedures were common sense, but few other hospitals were using them.

In the businesses I work with, it’s amazing how often common sense procedures remain the secret of a few high-performing business units, while other business units labor without this knowledge.

Simple best practice sharing could dramatically improve results, and yet it often doesn’t happen.  Business units are heads-down, dealing with their own problems. They don’t take the time to learn from other areas of the company.  They often can’t recognize best practices in their own units that should be shared with others.

Here are a few tips for spotting and benefiting from best practices within your organization:

  1. Choose the right metrics. In comparing hospitals, researchers were wise in choosing the “door to balloon” metric. It was an easily understood metric that tied directly to what really counted – preventing deaths.
  2. Know who is performing well. This is harder than it seems. For example, the age and health of the population being treated by each hospital greatly affected hospital outcomes. Researchers had to understand such factors to recognize the real high-performers.
  3. Take a bird’s eye view. Ask an unbiased group to compare processes across business units, to find the commonalities, and to communicate what they find. I once worked with a client team to uncover best practices across a large and diverse set of third party sales agencies. We interviewed, we observed, we analyzed and compared. Our objectivity was key to being able to identify a few key performance drivers, ranging from staffing and compensation policies, to pricing and operations procedures. Implementing these across the business helped drive a 23% increase in margin.
  4. Create forums for sharing. International building products manufacturer Cemex has created a social-network style online forum to connect employees across continents to solve production problems, innovate new products and enhance marketing. Another company I know holds a short conference call each Friday. Over 300 employees participate, though there is no mandate that they do so. Three or four people are selected each week to share a technique they used to help a customer or make a sale. The entire call only takes 15 minutes, but is immensely valuable in improving performance and motivation.
  5. Create a best-practices repository that all business units can access. As a consultant at McKinsey & Company, I could tap into a database of learnings from prior, similar projects whenever I began work in an industry or function I had little experience with. Resources like this can make even the newest employee far more effective.
  6. Identify internal experts on various topics, and make sure employees know how to reach them. EnPro Industries has done a superlative job at this. It freed up experts’ time to answer questions, provide advice to teams, and travel to observe, advise and learn from business units outside their own. The  designated “experts” may have started off with only average knowledge, but over time, they grew in capability. Like bees fertilizing flowers, these experts spread ideas between business units, and connected employees for collaborative problem solving. Soon there was a strong network of people around the company working to address the company’s biggest opportunities.
  7. Look at power, policy and process. In order to speed up emergency room response time, hospitals had to give emergency room doctors far more power than they previously had. They had to change long-held policies requiring time-consuming consent forms to be completed. And they had to change the process, transmitting electrocardiogram results as the ambulance was enroute. None of these three–power, policy and process–were easy to change, but they all made an immense difference to outcomes.
  8. Focus on the good you are trying to do, rather than competition between business units. Health care workers are highly motivated to save lives, so they worked together to bring down door to balloon time nationwide. Your company may not be saving lives, but my bet is you’re doing something important. Focus on the value you are creating for customers, the great service you provide, or creating an even better place to work. Putting the good you are doing—your noble purpose—at the forefront will stimulate creativity and collaboration across the organization.

My dad was lucky.  Despite his delay in getting to the hospital, he was back to almost normal within a few months, riding his bike every day (often to the doughnut shop), traveling internationally, and enjoying life.

I’m thankful that hospitals have established these common sense procedures to save lives, and I’d love to hear what your organization has done to uncover best practices–I hope you’ll join the conversation! 

Amanda Setili (@amandasetili) is author of The Agility Advantage: How to Identify and Act on Opportunities in a Fast-Changing World (learn more and read a sample here.) and managing partner of strategy consulting firm Setili & Associates – visit us to engage on this and other posts.

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Learning from Elon Musk: Manage uncertainty by avoiding these three mistakes

Falcon 9 DSCOVR Launch

Falcon 9 DSCOVR Launch

Not long ago, I stood on a pier near Cape Canaveral, Florida and watched a SpaceX rocket launch.

People were wearing SpaceX t-shirts and talking excitedly. SpaceX has brought the thrill back into space exploration.

Founder Elon Musk figured that by developing a way to reuse rockets, just like airplanes, he could reduce the cost of travel to space by a factor of a hundred.

He’s well on his way to achieving that. The company created the first commercial spacecraft in history to shuttle cargo to and from the International Space Station, and has already cut the cost of launching into space to less than a tenth of its prior level.

His ultimate goal, however, is to colonize Mars, making human life inter-planetary.

How’s that for a bold vision statement?

Ten minutes after we watched the rocket launch that day, SpaceX attempted a precision landing of the spent first stage onto an unanchored ocean platform.

Though the SpaceX team judged the odds of success of landing on the platform as “50% at best,” they viewed the attempt as part of a learning journey—one step in a series of tests that would ultimately result in a fully reusable first stage.

No matter what business or industry you are in, risks exist. Competitors enter the market, customer tastes change, new technologies appear, and market prices can take dramatic and damaging swings.

The future is never certain; but in some industries—like space exploration—it is profoundly uncertain.

Good strategy nearly always involves a bet, so as leaders, we need to become comfortable making decisions when we have less information than we’d like, and when the future is highly unpredictable.

Musk has avoided three mistakes that I’ve observed other companies make in managing risk and uncertainty:

Mistake number 1: Taking no action. 

Executives often fail to make a strategic move because they are uncomfortable with the risks or can’t agree on whether it’s worth the potential reward. When the rest of the smartphone industry moved to touchscreen technology, BlackBerry (then called RIM) stuck with keyboards for far too long. BlackBerry’s market share plummeted as a result of this and other missteps, and the company found itself struggling to survive.

Just like SpaceX has designed a series of tests to learn how to reuse rockets, to bring the cost of space travel down, figure out what action you can take today to begin your learning journey.

In uncertain environments, place several small bets, then adjust your strategy based on the outcomes of those bets. For example, test several different versions of a new product or new advertising message. Watch how customers respond, then eliminate the unsuccessful versions while  building upon the successful versions.

Mistake number 2: Engaging in “me-tooism.”

This happens when a company takes the “safe” route by waiting until a competitor has succeeded with a new strategic choice, then follows the competitor’s moves. Almost every industry has a few companies that subscribe to this fast-follower approach. They avoid difficult strategic decisions, but find themselves with an undifferentiated offering and mediocre results. For example, auction websites auction.com, eBid.net, ePier, and others like them have not attained nearly the level of market penetration nor success as eBay—the company that pioneered online auctions.

Break out of the horse race by figuring out what you can do differently (and smarter) than the competition.

Mistake number 3: Assuming everything will go right.

Companies make a bold move, but fail to adequately identify and manage the inherent risks. They want to invest and grow, so their financial projections assume that many things will go right. I see this when companies enter new markets but fail to manage the risks, such as customer and channel acceptance. Hewlett-Packard’s failed introduction of the TouchPad tablet in 2011—a product it pulled only forty-nine days after launching it—provides an apt example.

Though one of the most innovative and courageous leaders of our time, Musk retains a grounded sense of what’s doable.

In David S. Kidder’s book The Startup PlaybookMusk was quoted as saying, “Wishful thinking is one of the most profound human failings, and the major reason why people adhere so strongly to wrong ideas. This doesn’t mean that you can’t be optimistic. You simply have to be realistic as well,”

To be realistic, you must assess your odds of success, then identify and address the risks head-on.

Avoid these three costly mistakes—paralysis, me-tooism, and wishful thinking—and you can manage successfully even in the most uncertain of business environments.