How CEOs Can Increase the Value of Innovation — with guest Tendayi Viki

Pam Harper: Find out how CEOs can increase the value of innovation. Our guest today says, "It's time to start a movement that transforms how innovation is managed." Join us for episode 191 of Growth Igniters® Radio with Pam Harper and Scott Harper.

Chris Curran: This episode is brought to you by Business Advancement Incorporated, enabling successful leaders and companies to accelerate to their next level of success. On the web at growthignitersradio.com. and now, here's Pam and Scott.

Pam Harper: Thanks, Chris. I'm Pam Harper, founding partner and CEO of Business Advancement Incorporated, and sitting right across from me -- as always -- is my business partner and husband, Scott Harper. Hi, Scott.

Scott Harper: Hi, Pam. It's great to join you again for another episode of Growth Igniters® Radio, and as always our purpose is to spark new insights, inspiration, and immediately useful ideas to help visionary leaders to accelerate themselves, and their companies of course, to their next level of game-changing, innovation, transformation, and growth.

Pam, speaking of transformation and growth, CEOs and C-suite executives in established companies -- those that are well beyond start-up -- often ask us, "How can we increase the ROI of our innovation?"

Pam Harper: I think this question comes up so much because, on the one hand, top leadership is asked to invest in innovation. However, there's not necessarily a clear connection between investing and the tangible value creation that their many stakeholders care about.

Scott Harper: No, it's not, and this is an issue. The farther away you are from the cutting edge of where innovation supposedly is happening, the harder it is to see that. One thing is clear, Pam; it's critical for CEOs and top leaders to recognize the essential role that they really do play in shaping innovation and transformation for their company's success.

Pam Harper: That's why we're glad to be speaking today with Tendayi Viki, an award-winning author, and corporate innovation expert. As an associate partner at Strategyzer, he works with companies to develop their internal ecosystems so they can innovate for the future while managing their core business. He's written three books, The Corporate Startup, The Lean Product Lifecycle, and his latest which we're going to be talking about today, Pirates In The Navy: How Innovators Drive Transformation.

Pam Harper: Just a little bit more about Tendayi: he previously served as Director of Product Lifecycle at Pearson, where he co-developed an innovation framework that won Best Innovation Program 2015 at the Corporate Entrepreneur Awards in New York.

Tendayi has been shortlisted for the Thinkers50 Innovation Award and was named on the Thinkers50 2018 Radar List for emerging management thinkers to watch. He's also a regular contributor at Forbes. You can read much more about Tendayi by going to growthignitersradio.com, episode 191, and scrolling down under resources.

Tendayi, welcome to Growth Igniters® Radio.

Tendayi Viki: Hey, Scott. Hey, Pam. Thank you for having me, it's a real pleasure to be here.

Pam Harper: It's funny, there's so much about innovation to talk about. If you gather a group of people who talk about innovation, we all have different definitions; but when we came across you and what you were talking about and reading Pirates In The Navy, we said, "There's a kindred spirit here."

Scott Harper: Absolutely.

Pam Harper: Tell us a little more about you and what prompted you to write your book, Pirates In The Navy.

Tendayi Viki: People often say that scars are beautiful, so Pirates In The Navy is my "scars are beautiful" book. It's all the lessons I've learned from making all kinds of mistakes while trying to bring innovation about inside large organizations. What really prompted me to write the book is the role that leadership can have in making sure that they establish a repeatable innovation ecosystem within their organizations.

Tendayi Viki: It was Steve Jobs who said, "It's better to be a pirate than to join the navy." He was making this distinction between startups and how fast-moving they are, and large companies and how slow-moving they are, but we all know that these days, large companies also have to innovate otherwise they get disrupted and they're unable to sustain their success all the time, so it becomes really important that leaders are able to cultivate a group of innovators that I'm calling pirates in the navy.

Tendayi Viki: The book is really just about how to do that, and also how then those pirates in the navy can drive transformation that is sustainable within the organization.

Scott Harper: Okay. Now, you state that corporate innovation is a paradox. We've all heard that "big companies can't innovate, but you don't think that's true. You do say it's a paradox. How does this impact the value of innovation over time in established companies?

Tendayi Viki: Yeah, the paradox. I remember once, I think it was an article that I saw somewhere that said, "Corporate innovation is like elephants trying to do ballet." I was recording an interview with Thinkers50, and it was on YouTube, and they asked me, "How would you describe what you do?" I said, "I help elephants do ballet."

Tendayi Viki: My six-year-old was watching that, and he took it literally. He was like, "Really, Dad? You work with elephants?" In one sense, the success that an established company accomplishes becomes the very barrier against developing a really great innovation process. It is the imperative of the CEO, the board, and the leaders in the organization to make sure that they're scaling the success of whatever they've found.

Tendayi Viki: Steve Blank has a really strong perspective about why founders of startups get fired. It's because you get to a certain point where all that chaos of a startup is no longer useful. You now need to actually systematize the work that you're doing so that you're able to actually then harvest the value that you've created or exploit that you created. You need to know who can build systems for scaling, systems for hiring, systems for managing logistics, and all types of things that organizations need.

Tendayi Viki: The problem with those systems is that they're designed for delivering against a known business model with a known customer and repeatable processes, whereas innovation is about exploring the unknown, and so when we're asking a company whose processes are designed for executing the known to start turning its attention to exploring the unknown, then you're dealing with a paradox.

Tendayi Viki: Those two things are equally important, and so they have to be world-class at executing their current business model, and they also have to be world-class at exploring new opportunities. That tension really starts to impact the value of innovation over time. The way that leaders do that is by rather than creating a complementary capability to drive innovation, the first thing they try to do is to manage innovation using their current processes.

Tendayi Viki: Once they start to do that, they start to trim down how crazy their explorations can become. Because if you're using traditional metrics to manage innovation, then your teams will only ever work on safe bets, and what are safe bets? Stuff that you've always done. You end up stuck in that loop, and that's how you can decrease the value of innovation over time.

Pam Harper: And yet, in your book, and as we certainly have seen, there are these incredible people, intrapreneurs, that are visionaries who are innovators who are able to transcend all of this. Tell us a little more about how you see that.

Tendayi Viki: It's been really interesting; over the last decade or so I think, we really celebrate the entrepreneurs, the Steve Jobs, the Mark Zuckerbergs, the Bill Gates. We celebrate them, and the more brash the entrepreneur, like Elon Musk, the more we love them. We're like, "Yes, these people are brash, they're disrupting and they're creating new change within the world!"

Tendayi Viki: What's interesting about that is that we tend to under celebrate the role of intrapreneurs that are the innovators that are working inside large corporations. What we also tend to do is to advise intrapreneurs to conduct themselves as if they're entrepreneurs.

Tendayi Viki: And they can't do that. The only way you can create value as an intrapreneur with innovation is to pick up all the great techniques around creativity, innovation, coming up with breakthrough ideas, testing those ideas, customer focus, all of those things. You need to pick up those tid bits from entrepreneurs, but you need to leave the brashness at the door.

Pam Harper: Yes, it's a different world.

Tendayi Viki: It's a totally different world. I do this survey in some of my workshops where I ask people, "What's the number one characteristic of the successful intrapreneur, a corporate innovator working inside a large organization?" I give them the list, being inventive, being focused on customers, and then the last thing I put in there is political acumen. Most of the time, people ignore the political acumen piece, but actually, that is the superpower of the intrapreneur.

Scott Harper: Absolutely, it's something that, when I worked as a corporate innovation leader, I learned that the hard way. But eventually, I did learn, and we were actually incredibly successful at doing new stuff in very well-established companies.

Pam Harper: Scott was an intrapreneur, and yet ...

Tendayi Viki: He was a pirate in the navy.

Pam Harper: ... Yes, he was, and yet there's this other thing. I've gone to any number of conferences, including conferences I've led, and I hear frustration from CEOs and others in the C-suite where there's a feeling of, "We're not sure what to do with ..." and I put this in quotes, "... these people."

Scott Harper: Yeah, "those people."

Pam Harper: Right, They say, "we want them to do well. We want them to stay, we want them to do well, we want them to provide a return on investment ..."

Scott Harper: Create value...

Pam Harper: ... Yes, create value. I feel like there's a real thirst and a recognition that we need to do something -- I'm speaking now as a CEO -- we need to do something to support creating more value. So, what is the most important way that you see that CEOs, C-suites, and boards, who are becoming increasingly interested in what's going on throughout the organization, can increase the value of innovation?

Tendayi Viki: That's really fascinating because what we're noticing, even in my own work, is this gap. CEOs and boards and people that are working in C-suites really recognize the value of innovation. They really want to start driving innovation more, and they really recognize the value that it can contribute to growth. There's an aspiration towards creating more valuable innovation.

Tendai Viki: Then, you turn around and you ask them about the innovation capabilities in their organization, and they're less satisfied with the innovation capabilities they've got. This gap is what we're really trying to bridge with your question. The core principle that we tend to emphasize is that as leaders, as the CEO, as the CTO, whatever, or even as the board: you need to resist the urge to pick the winning ideas yourselves.

Tendayi Viki: That's the first principle. I often say to leaders, if you're going to get a tattoo, get one that says, "I can't pick the winning idea on day one," and then look at it every day when you come to work. Because we know that with innovation, the best way to get good ideas is to have loads of ideas.

Tendayi Viki: Every single research that we have around creativity and innovation tells us that leaders cannot pick the winning idea on day one, instead what they can do is create the context in which the winning ideas emerge.

Scott Harper: Bingo! Absolutely.

Tendayi Viki: The question then becomes, what is that context and how do you build that context so that it allows "those people" to actually thrive. One of my favorite sayings is, "When a flower fails to bloom, you don't start shouting at the flower, "Grow, man!" what you do is you start working on the garden, and the soil, and the nutrients in the soil, to see if they're really supportive."

Tendayi Viki: That's the same thing that we want to do for our intrapreneurs and for our innovators is to ... really start asking ourselves, "what are those enablers of innovation that we can create as leadership? What are the blockers of innovation that we can start to take down as leadership?" As we create those paths, we're much more likely to find that innovators become successful.

Pam Harper: Right. So it's in that tension between what can we do and what's getting in the way that there is value to be found. We're going to cut to a quick break now, and when we come back, we'll dig deeper with Tendayi Viki, corporate innovation expert and author of Pirates In The Navy, about some myths of innovation and how to over come them. Stay with us.

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Pam Harper: Welcome back to Growth Igniters® Radio with Pam Harper -- that's me -- and Scott Harper. Today, Scott and I are speaking with Tendayi Viki, corporate innovation expert and author of the book, Pirates In The Navy, about the role CEOs can play in increasing the value of innovation in their companies. Tendayi, how can people find out more about you, your company, and your book?

Tendayi Viki: Yeah, so you can learn more about me, the company, and the book, by going to tendayiviki.com. That's where you can learn more about me and the work that I do. If you want to hire us for doing work, consulting, advisory, it's strategyzer.com. I work with Alex Osterwalder over there.

Pam Harper: That's right, and you are coming to us today from London. That's actually where you're based, correct?

Tendayi Viki: Yes, I'm based out of London.

Pam Harper: See, innovation is right there. Who would've imagined say, 30 years ago, that we'd be doing something like this? Innovation comes in lots of forms, and yet there are still a lot of myths out there. Let's talk about a few of them. One of them is the myth around strategic alignment. Tell us more about that.

Tendayi Viki: Before the break, we were having a conversation about how CEOs can increase the value of innovation, and we were talking about how they can create the context in which the best ideas emerge. One of the biggest problems that we tend to have with innovation or with innovation teams is that leaders are not giving them clear strategic guidance about what they should work on, so innovators are often unsure about whether the stuff they're working on actually matters to the company.

Tendayi Viki: We all know that as an innovator if you're working on something that doesn't matter to the company, it doesn't really matter how cool it is; it'll be hard to scale it when it becomes time to become successful. One of the myths that we have around this topic is ... I've met corporate innovation heads who will say to their teams, "My job is to let 1000 flowers bloom." It's like, that's not really the job. That's not even good for a garden; "I'm going to let 1000 flowers bloom in my garden."

Tendayi Viki: You want to curate your garden and make sure that you're putting the right flowers in there that suit your design perspective or the soil or the area in which you live or even the aesthetics of your house. The question is, what are the innovation guidelines that we can give our teams so that they're not working on any random interesting idea, I'd rather they're working on things that are actually going to be ultimately valuable to the organization.

Pam Harper: What's really interesting about what you're saying is, if you go back to the premise of our episode, which is people want more ROI on their innovation and yet at the same time if it's not aligned with the strategy, how could it possibly provide that ROI?

Tendayi Viki: Exactly. If it's not aligned with strategy, I don't even know how you could measure ROI at all; I don't even know what the hook would be. Where would you start? I guess you could say that ... and I've met people who say this: as long as it generates revenue, it's actually fine. But as you know, there's an opportunity cost to that. If you're chasing this idea and then you're chasing the next idea and chasing the next idea, you never as an organization develop deep expertise in any particular arena.

Tendayi Viki: You don't really study deeply any trends. I think there's even research that shows venture capital firms that use the bucket, the methodology of investing where they just chuck things in a bucket. They go, "Yeah, we work in AI," or whatever, so whatever AI startup comes up, they invest in it.

Tendayi Viki: Those venture capital firms get less returns versus venture capital firms that have had clear investment thesis, so they have a theory about how AI is going to impact the world or whatever area they're thinking about, and then they develop a deep expertise in that and then they invest in startups that are an expression of that thesis.

Scott Harper: Yeah, focus, focus, focus is so important, and yet you can't be so tightly focused on what you're doing now that you strangle the innovation, it has to be what are the next big needs that aren't currently being met that are out there that we can meet that still fall within our sandbox?

Tendayi Viki: Exactly, and that's the paradox of innovation. People think that when you say innovation and creativity we mean free for all, but that's not what we mean. We mean strategic guidance, and then when people hear strategic guidance, they hear core business, but that's not what we're talking about, we're talking about future facing strategic guidance. Where is the world going? Where do we see our company in that world? How can we use innovation to respond to the changes that are happening in the world?

Tendayi Viki: As you get more clarity on that, you're then able to give innovation strategy guidance, and that becomes the basis upon which you select projects, you supervise teams, and you measure the ROI that we were talking about earlier.

Pam Harper: That's a good point. I think it's encouraging though, we are seeing more companies that are starting to take that approach, wouldn't you agree?

Tendayi Viki: Yes, absolutely. I've been involved in a lot of projects myself now with our various clients where we do what we call a strategy sprint. We spend like a month reviewing the world, reviewing their business model. We have a tool that we call the disruption risk assessment, we evaluate their business model, evaluate the data, or any disruption risks they're seeing emerging in their markets, and then start coming up with a thesis about how do we want to respond?

Tendayi Viki: Only after that do we then say, "Okay, let's start doing ideation, and here's the canvas within which we're going to be painting," because if you're not painting in any canvas you're really basically doing graffiti.

Scott Harper: Yeah, now this is what you were just talking about is in direct opposition to something that many of us at big companies have seen, and you've gotten up on your soapbox any number of times talking about innovation theater, and what that actually does.

Pam Harper: Let's define that ...

Scott Harper: Yeah, tell us ...

Pam Harper: ... for people who are not as familiar with that term.

Scott Harper: ... tell us something about that and what it does to innovation in reality.

Tendayi Viki: Yeah, that's a really interesting one, because there's a certain coolness factor to innovation that's kind of undeniable. Some of the stuff that we do is really cool, the ideation jam, the sticky notes, the whiteboards, the football tables, the beanbags, the really cool rooms that we work in, the hackathons with the pizza night, et cetera, et cetera.

Tendayi Viki: If you're on the outside looking in, you start to think this is really cool work, I'd like to get involved in this, and what you forget is that all of those methodologies were designed to be in service of creating value. They're not just to do for fun in and of itself, all of those concepts and practices, the way that [inaudible 00:21:11] do their work, the way that we at Strategyzer do our work, we do that in service of helping companies create value.

Tendayi Viki: If you just engage in ideation competition and then you announce the winner, and then everybody goes home, and nothing happens to those ideas, you've engaged in innovation theater, like the competition was cool. If you have a hackathon and everybody drinks pizza and then they have their beers or whatever, it's all good, and then after the hackathon, everybody goes back to their cubicle, you've engaged in innovation theater. You haven't really done anything that creates value for the organization.

Tendayi Viki: We define innovation theater as things that look like innovation when people are doing them, but ultimately create no value for the organization. Rita McGrath has an even better definition when she says, "Innovation theater is this excessive focus on ideation without thinking about how to take those ideas to become successful [inaudible 00:22:01]."

Scott Harper: In actuality, we've defined innovation as creativity put into action. That's not new, but it's not reduced to practice, it's not innovation.

Tendayi Viki: Exactly.

Pam Harper: It will be very disillusioning to some people, I know of a company for instance that has an innovation room or two, large company, and they have a lock on the door. It leads to ... okay, here's my thinking, who's allowed to be innovative, it's a little bit like there's a lock on the door to the restrooms, now there's a lock on the door to the innovation room. Does purchasing get in there? Is purchasing not allowed to be innovative? It raises a lot of strange questions when you do things like that. What do you think?

Tendayi Viki: Yeah, you saw it locked which is pretty cool, I've just walked ... this is even worse, where the innovation room is not locked, but nobody wants to go in there.

Scott Harper: Yeah, I've seen that too.

Tendayi Viki: I've seen that too, it's just empty. They built it, but building that room was never going to create any innovation in the sense that the organization itself is still putting pressure on people to meet their PNL numbers for Q2, and so nobody's ...

Pam Harper: Right, and it's well intended of course, but it just sends a strange message, like if you walk out of the innovation room, do you cease ...

Scott Harper: You're not innovative.

Pam Harper: ... right.

Tendayi Viki: Exactly, and if you don't have a sticky note, you're definitely not innovative.

Pam Harper: Right, got it.

Scott Harper: That's where building innovation into the life blood of the company, and it's not just innovating products and services, it's innovating every single aspect of how work is done, how people come up with creating value in accounting, in purchasing, and whatever. That's innovation too, and that goes against another of the myths that you write about in your book that big returns requite big bets. You have to put a lot of resources into it or you're not going to get anything out.

Tendayi Viki: Yeah, so this is one of my sort of ... I don't know if they can call it a pet peeve, but it's definitely one of the things I find interesting in its absurdity. I've been in organizations where leaders are complaining that their people don't know how to come up with great ideas.

Tendayi Viki: "Nobody has brought me a 10x idea." It's like, well first of all, it's impossible for you to know it's a 10x idea on day one. There's this idea that if innovation is being done right, you have to be making all these big bets, but actually innovation done right is making multiple small bets, testing those ideas really quickly, and then quickly identifying the winners.

Tendayi Viki: It is in the winners that you start investing more resources. It's really active portfolio management and a filtering process. You think about Silicone Valley as an ecosystem, it does that almost naturally, like venture capital firms, angel investors, they make multiple bets in various companies, and then some of them use the One-Third rule, one third of these are going to fail, one third will bring me the [inaudible 00:25:06] return, then we'll make all our money from one third of the ideas that actually become successful.

Tendayi Viki: It's in those ideas that they start making the bigger bets, so that's why you have seed funding all the way to series a funding which is the big bet. In large organizations, a team can come up with an idea, create a business case, and get series a level funding from day one. That's really a struggle, there's a phrase Alex Osterwalder likes to use where he says, "If you invest such a large amount of money in an untested idea, what you've done is you've condemned the team to succeed."

Scott Harper: Mm-hmm (affirmative).

Pam Harper: Oh.

Tendayi Viki: I like the juxtaposition of that, like this team is now condemned to succeed. They cannot fail, and so that really makes innovation hard to do because what you want to do is to make small bets that make it easier for teams to go, "Okay, we spent 25 grand on this, it turned out that there's nothing there. Customers don't want it, we can stop." Whereas, if you say, "We've already spent three million on it." You have to launch, and then you can blame sales for the failure.

Pam Harper: Yes, I can see that. What we're getting at here is in order to really create more value, get more value from your innovation, you need to clear away these myths, and there are others in the book that you describe, and then to implement some good ideas. We're going to get to that, but first we're going to take another quick break, and when we come back, Scott and I will speak more with Tendayi Viki, corporate innovation expert and author of the book, Pirates In The Navy, about immediately useful ideas for leading more valuable innovation. Stay with us.

Scott Harper: You are listening to Growth Igniters® Radio with Pam Harper and Scott Harper. Brought to you by Business Advancement Incorporated. We're on the web at growthignitersradio.com. Pam, as we've been speaking with Tendayi Viki about top leaderships essential role in increasing the value of innovation, this springs to mind a conversation we had with Dr Rita Gunther McGrath about a related topic, that's how to respond to major changes in business before they happen so you can get a jump on the competition.

Pam Harper: Yes, that was a great conversation. We discuss highlights of Rita's book, Seeing Around Corners, and how leaders and their organizations can sharpen their ability to distinguish emerging trends that signal major changes in the business environment from the noise.

Scott Harper: That's very important.

Pam Harper: We also discuss immediately useful ideas to position your organization to take timely advantage of these opportunities.

Scott Harper: You can listen to this conversation by going growthignitersradio.com, selecting episode 191 and clicking on the link to our conversation with Rita McGrath in the resources section.

Pam Harper: Welcome back to Growth Igniters® Radio with Pam Harper and Scott Harper. Over the last two segments, Scott and I have been speaking with Tendayi Viki, corporate innovation expert and author of the book, Pirates In The Navy, about the roles CEOs and top leadership can play in increasing the value of innovation in their companies. Tendayi, remind us again how people can find out more about you, your company, and your book.

Tendayi Viki: Yeah, so tendayiviki.com, that's where you can find out more about me, and if you're looking to work with us, it's strategyzer.com, where I work with Alex Osterwalder.

Pam Harper: Okay, and you can also find links and other related information by going to growthignitersradio.com, episode 191, and scrolling down to resources. We are at the point in this episode where we talk about how do we take all of this great information and distill into it immediately useful ideas that are going to help the CEOs and other top leaders who are listening to create an environment that leads to more valuable innovation. Tendayi, let's start with the first idea, what's something immediately useful?

Tendayi Viki: I actually think that something that's immediately useful to leaders is connected to that concept that we spoke about earlier which was we were saying that leaders cannot pick the winning ideas on day one, so instead they need to be making multiple bets, then the question becomes, how do I know which idea to then increase bets on?

Tendayi Viki: How do you track the success of an idea to make sure that you're making the right choices and what I often find is that leaders make those choices based on traditional metrics around business cases, but actually what matters in innovation, and this is the useful idea that I think can be really useful is whenever you're looking at an innovation team as a leader, you must always ask yourself this question, how close is this team to finding a business model that works?

Tendayi Viki: That question raises other questions, which is you have to start thinking beyond just the road map and the technology they're working on. You have to start thinking, have they discovered something that customers find valuable?

Pam Harper: If somebody were to just stop at this point and say, "Let me get this down," what's the next thing they would do? Reach out to customers or ...

Tendayi Viki: Exactly, so if they have a great technology but they still haven't validated whether or not there's a real customer need, that's the next thing they need to do because you are as far away from finding a business model that works as you can be if all you have is technology.

Tendayi Viki: But if you have technology that you know customers want and a solution that resonates, you can then move onto other questions around pricing, or channels, or how to scale, which are also important questions for finding a business model that actually works.

Pam Harper: But if you were in a large established company maybe coordinating more with the people in marketing too who've likely done some of this research.

Tendayi Viki: Yeah, absolutely. Not only coordinating with people in marketing, which is really interesting, because they give you really great market insights, I often also insist that the team themselves go and look in the whites of the eyes of a customer, because I find it is really hard to become an advocate of the customer if you've never met the customer.

Tendayi Viki: You end up getting stuck in arguing about your own technology and what feature should go where, but the question is, is that feature really creating value for home? What are we helping customers accomplish? That is basically the root in which you start that journey towards finding something that works. It's a really key thing in terms of leadership.

Pam Harper: As the CEO, it would be encouraging and nurturing a culture that would enable people who are innovators to actually make those trips to go out of the office, to reach out to these people, to Zoom with them, all of that.

Scott Harper: Yeah, and create the context for the innovation so that it's relevant.

Tendayi Viki: Exactly.

Scott Harper: Good. Tendayi, great idea there, how about a second immediately practical idea.

Tendayi Viki: The second immediately practical idea that I have is more for the intrapreneurs. Intrapreneurs are really interesting in the sense that they try and isolate themselves.

Scott Harper: Sometimes.

Tendayi Viki: Sometimes ... not you only, Scott.

Pam Harper: That's good, that's good.

Scott Harper: Okay, they do try to isolate themselves, yes.

Tendayi Viki: Yeah, in the sense that they want to protect their babies, they don't want the corporate antibodies killing their babies too soon, and so they try and avoid contact with leaders et cetera. The immediately useful idea for them is that you cannot do this on your own, it is virtually impossible. You have to collaborate with others, you have to build what we call the bridge between your innovation team and the core business.

Scott Harper: Absolutely.

Tendayi Viki: I've worked with intrapreneurs that are like, "No, I'm not talking to anybody in the core business. I'm going to work on my idea, and then as soon as I'm done, if nobody wants to scale it, we'll just spit it out."

Tendayi Viki: I'm like, "Okay, sure." That's as easy it is, it's even harder to spit things out because now you've got corporate finance involved, you've got legal involved. There is no avoiding the core business, so building that bridge to the core is something that really, really matters I think.

Pam Harper: I'm trying to think, a CEO or a top leader can do some things within the corporate culture, making it easier for innovators, the intrapreneurs to reach out and have other parts of the organization reach back.

Scott Harper: Without squashing them.

Pam Harper: Right. Are you seeing more of that? Are you doing more work with that?

Tendayi Viki: Yeah, so as part of that the key takeaway for leadership is that ... can you create a culture in which innovation is legitimate? I was just on a call right now with a really great innovator who's trying to drive innovation in one of the big financial organizations, and he was saying that whenever somebody from finance or somebody from IT or somebody from compliance creates a process and says to the organization, "This is the process we're going to follow now."

Tendayi Viki: Very few people argue against that. They go, "Okay, that's the compliance guy, they know what they're talking about, let's do what they're saying," but if you're an innovator and you go, "We've built this really great innovation process," he says, "I get emails from everybody going, "Ah, interesting, but here's what you should really do.""

Tendayi Viki: Innovation is like ... it doesn't have legitimacy or power, which then makes it harder for innovators to collaborate with the core business. They face much more resistance, and so one of the questions we often ask is where does innovation sit on your [inaudible 00:34:39] chart?

Pam Harper: Yes, that goes back to that comment about those people.

Tendayi Viki: Exactly.

Pam Harper: It better not be those people, those people are our people. It is us.

Tendayi Viki: Exactly, and what we've seen is that with innovation sometimes a person is called the head of innovation, but the head of innovation reports to the VP of marketing, the VP of marketing reports to the chief marketing officer, then the chief marketing officer reports to the CEO.

Tendayi Viki: The head of innovation is four levels into the organization, they don't have legitimacy and power and influence, it then makes it hard for them to build this bridge to the core. Leaders should really be creating this legitimate environment for innovators to actually thrive.

Pam Harper: Yes. What about a third immediately useful idea?

Tendayi Viki: A third immediately useful idea is I often say to leaders that your team has a philosophy or a point of view about who you are. As you're leading your team, they're telling each other what they need to do or what they need to say in order to influence you to make the decisions that support them.

Tendayi Viki: The question is are you creating a culture that is conducive for innovation? The moment people hear culture, and that's where the useful take away is, the moment people hear culture, they start to think about culture as some mythical vibe that comes down from the mountain to bless the people.

Tendayi Viki: They think of culture as like, "Yeah, let's create this beautiful event," whatever. That's what they think about when they think about innovation culture, but really, culture in most organizations is really driven by what we celebrate and what we punish. The question is what are we celebrating and what are we punishing? Have we created a culture in which we celebrate the success of hitting your sales goals for Q1, and we punish teams that fail? If we do that, then everybody will start to view innovation as career suicide and they won't engage in it.

Tendayi Viki: When people are talking about an innovation culture, they forget that the role of leadership is to first create the context in terms of what they reward and what they punish. How can we build the right incentives for people to innovate? That's really the message I'm driving home there.

Pam Harper: The CEO has so much influence on that. In one of the panels that I led a while back, one of the CEOs on the panel said that he had created a what not to do award. Think about this for innovation, what not to do. What to do, and what not to do, and everything was encouraged. I think that this idea of being able to see what we are deliberately encouraging and what we are indirectly discouraging even is very important.

Tendayi Viki: Exactly, when I was with The Lean Startup Machine, we had an award for innovators, we used to call it the Old Yeller award. You know the movie where the guy ...

Pam Harper: [crosstalk 00:37:46].

Scott Harper: Sure.

Tendayi Viki: ... yes.

Scott Harper: Oh no, no! You don't shoot your own dog!

Tendayi Viki: I'm kind of dating myself here too, I know that movie, this shows how old I am, but what we say is we celebrate teams that voluntarily kill their own ideas after they discover that there's no value to be created for the organization. We give them the Old Yeller award as a way to celebrate that decision.

Pam Harper: See, there you go.

Scott Harper: Yeah, you just can't pull the trigger too fast, so you have to know when it's time and when it's not time.

Tendayi Viki: Yes, and it's also evidence based decision making, it's not just like, "We give up."

Pam Harper: Here we are, we're at the end of the episode. Do you have some final thoughts about how CEOs can increase the value of innovation?

Tendayi Viki: When you combine all of these things together, you start to realize that the infrastructure of innovation is really important. I used to get myself in trouble a lot when I first started my career, because I'd walk into organizations and say to them, "You need to become more innovative," and then the leaders would go, "What do you mean? Last year we launched that app. Right, Jennifer?"

Tendayi Viki: Jennifer would go, "Yeah, we launched the app, and the app won an award." Back then I didn't have the language that I have these days which is we want innovation to be repeatable. Sure, you can do one off projects here and there, one off projects that become successful, but how do you make innovation actually repeatable? You need leadership support to make innovation repeatable.

Tendayi Viki: How much time does a CEO spend on innovation? If they spend less than 10% of their time on innovation, that's a signal to the company that innovation doesn't really matter, so you need that to make innovation repeatable. You need a great organizational design that drives collaboration between all the different functions and only leaders can make that happen. Then, you need a great innovation practice with the right tools, so building the combination of all of these things is really the value that CEOs can do to increase the value of innovation.

Tendayi Viki: Otherwise, what you'll end up with is things that look like innovation, but it's really just your teams making things that are very similar to all the things you already do, and that's just efficiency innovation and tinkering right at the edges, you're not really expanding the potential of the ideas you could be working on.

Scott Harper: And, making them transformative.

Tendayi Viki: Yeah, exactly.

Pam Harper: Tendayi, thank you so much for being our guest on Growth Igniters® Radio. We've enjoyed the conversation.

Tendayi Viki: Thank you for having me, I've enjoyed the conversation too.

Scott Harper: Yes, indeed. Thanks, Tendayi. Thanks to you out there for listening to Growth Igniters® Radio with Pam Harper and Scott Harper. To get show notes and resource links for this week's episode, go to growthignitersradio.com, select episode 191.

Pam Harper: Until next time, this is Pam Harper.

Scott Harper: And, Scott Harper.

Pam Harper: Wishing you continued success and leaving you with this question to discuss with your leadership team.

Scott Harper: What is one thing we can do starting today that can actually increase how our company's innovation efforts align with our vision and strategy to foster transformation and growth?

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