Speaker 1: And oh, by the way, ideas are addictive Human beings.
Speaker 1: Just we love it, we love it.
Speaker 1: I'm going to let you and I jam down on how we can solve HR.
Speaker 1: We're going to come up with a ton of ideas and we're going to love what we do.
Speaker 2: It's going to feel good.
Speaker 2: It's going to really feel good, so good.
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Speaker 3: Rebel on HR Rebels.
Speaker 3: Welcome Rebel HR listeners.
Speaker 3: Thank you for joining us for another week.
Speaker 3: This one is going to be fun With us.
Speaker 3: Today we have Andy Binns.
Speaker 3: He is co-founder of ChangeLogic, a Boston-based strategic advisory firm.
Speaker 3: He works with CEOs, boards, senior teams and tries to help navigate allite the world with innovation.
Speaker 3: He has a guidebook called the Corporate Explorer that helps with practices that enable managers to go from idea into action and demonstrates how success is not only possible but may offer entrenched companies better odds than venture capital-backed startups.
Speaker 3: Thanks for joining us, andy.
Speaker 1: Hi there, carl, very nice to be with you.
Speaker 1: Thank you for inviting me on your show.
Speaker 3: Well, extremely excited, and it's one of those things that this topic for me just spoke to me, and when I got the request to speak with you and I saw some of the work you were doing, I said yes, we need to talk on the podcast.
Speaker 3: So appreciate you joining us today and we are going to start by talking about change.
Speaker 3: So what got you interested in helping organizations understand how to innovate?
Speaker 1: in helping organizations understand how to innovate.
Speaker 1: Well, you know, I think what got me really interested in this was I really am a bad employee.
Speaker 1: I just hate being inside organizations at some level, and so you know, I think that I wrestle with that issue, and the one place that things seemed to click for me was when I was with IBM.
Speaker 1: This was 20 years ago, so that means I'd already had 10, 15 years of being a bad employee before I got this one and I got assigned to work with um.
Speaker 1: Ibm had these emerging business opportunities and these were like new businesses.
Speaker 1: The idea was to um to create, from the assets the company had, some new places that it could explore.
Speaker 1: Right, and I was like, okay, I've not, I've not.
Speaker 1: I've read stuff about innovation.
Speaker 1: I had done some stuff in my previous consulting career around innovation, but this was the moment in which my imagination fired, because I saw a place where the the rebels, to use your term could actually live in an organization, to use your term could actually live in an organization, that there is a role for those who want to push the boundaries and to take organizations in different ways, and I just thought it was a neat combination of innovation in large organizations.
Speaker 3: I love that and you know it's really interesting about that.
Speaker 3: First of all, I love that you're like, yeah, I'm just not a good employee.
Speaker 3: Know what's really interesting about that?
Speaker 3: Um, first of all, I love that you're like, yeah, I'm just not a good employee, um, but I I would.
Speaker 3: I might, you know, flip that a little bit and say you know, um, maybe you're not a good employee in an organization that doesn't let you be creative and innovative is is that fair?
Speaker 1: well, so, so, so that that may be, but.
Speaker 1: But the interesting thing that's embedded in your question about let you be right is that it's the organization's job to enable us and I don't think that's very often the recipe of success right book, corporate Explorer.
Speaker 1: How corporations beat startups at the innovation game is that when we look at examples of really successful innovation in large corporations, it has at the center a rebel, somebody who is going to seize an opportunity, seize a problem in the world they want to solve.
Speaker 1: And it's them who take, bring the energy to bring the purpose, bring the passion to convert that into a business.
Speaker 1: And they're very rarely given the opportunity.
Speaker 1: Most of them take it Right, and that, for me, is a little bit of the same story.
Speaker 1: So you've got to take these opportunities and, yes, organizations can enable.
Speaker 1: I don't we can talk about how you do that, but I just think that's an important sort us to build the, you know, the, the platform for innovation.
Speaker 3: But, um, what it sounds like to me in in what you just described is it's more about us getting the right people empowered to do the work and then, and then getting out of their way.
Speaker 3: Am I on the right track there?
Speaker 3: I think I think you are.
Speaker 1: I mean, I think that there's a little bit more we can say.
Speaker 1: But but the, the, the.
Speaker 1: The notion is that within most organizations and after a while this isn't true, right, they can get to the point where, where, where, that you, you have a hard time with this Most organizations, there are explorers.
Speaker 1: There are people whose bias is towards how do I create, create, create, how do I do new, new, new?
Speaker 1: And then there are people who are much more how do I optimize, how do I bring stability, how do I bring regimentation?
Speaker 1: And what you need to do is figure out how you set some number of those explorers free not all of them, because then you just create a zoo, right, but allow some of these people to really drive, give them a license to explore, if you will, and that is what will secure the sort of innovation outcomes that many organizations are looking for, innovation outcomes that many organizations are looking for, and that impulse that they have is very similar to an entrepreneur.
Speaker 1: So some of what they do is different and some of what they do is the same.
Speaker 1: It's a matter of understanding the difference between the two.
Speaker 1: There's one other thing, one other bubble I want to burst, carl, if I may, which I think is important, and I'm afraid I'm going to blame HR for this one, just for that we're fair game.
Speaker 1: Go ahead.
Speaker 1: Yeah, yeah, you asked me on your show.
Speaker 1: So here is what happened, and I will generalize this point in a sec.
Speaker 1: I'm in Germany in an unnamed large financial services company and I'm with the head of global talent and we're discussing the work we've done with them to think about how to create an innovation unit, to explore some opportunities that they see to go after.
Speaker 1: And this is maybe my third or fourth visit.
Speaker 1: And I say to her so you know, leadership of this unit is really important.
Speaker 1: You know what progress have you made?
Speaker 1: Ah, yes, andy, we have come to a solution to this.
Speaker 1: We've decided we'll hire from outside because that way, if we fail, the consequences are less.
Speaker 1: Way, if we fail, the consequences are less.
Speaker 1: In other words, it won't do any harm to our talent succession if somebody fails and we have to eject them from the system.
Speaker 1: Outsiders have a really hard time leading innovation inside corporations because they have no social capital, they have no track record of performance, they don't have any favors they can call on from other people, and so what we find is that ones who are really successful at this have a track record, people know them and when they fail, because we can get onto this innovation is often about this notion of rapid failing, learn by testing and so on, that you don't know.
Speaker 1: Is it the person or is it the idea?
Speaker 1: Did they learn something or is it just because they're not very good?
Speaker 1: But if they're an old timer, there's somebody who has that track record, then you know to trust them.
Speaker 1: This is somebody who they are doing something new and we know they've done one in the past.
Speaker 1: Therefore, we can trust them, and so part of getting this formula right is actually trusting the people you have already.
Speaker 1: It's not about always recruiting in the premier entrepreneurial talent, or even entrepreneurs in residence is very much in vogue at the moment.
Speaker 1: This can get you some part of the way and it's not.
Speaker 1: It's not irrelevant, it's part of the formula.
Speaker 1: But you've got.
Speaker 1: The corporate explorers are often high social capital, been in the company a while, but just exploratory, build relationships, know how to get things done.
Speaker 1: And you've got.
Speaker 1: And the job is how do you set them free?
Speaker 1: Know how to get things done.
Speaker 3: And the job is how do you set them free?
Speaker 3: That's really interesting and it does go counter to what so many organizations do.
Speaker 3: Right, it's the well, we need new ideas, or we need to come up with a new go-to-market strategy, or whatever the innovation need is, and it's like the immediate default choice is well, we better go hire from the outside, because we probably don't have that person inside the organization.
Speaker 3: That's the assumption, right, like that's like the base case assumption.
Speaker 3: But what you just described, it's really interesting.
Speaker 3: I'm reflecting on innovation in the HR space, which is obviously one of my favorite things to do.
Speaker 3: But a great example in my current organization.
Speaker 3: I have been here for just about four years now.
Speaker 3: I didn't really start making any traction until about two and a half years in, and a lot of that had to do with exactly what you described.
Speaker 3: I didn't necessarily have any social capital.
Speaker 3: I was an unproven resource.
Speaker 3: People were like I don't know if I want to give this guy any any head count or invest, cause I don't know if the direction that we're going here is is is worth it.
Speaker 3: Right, it's like there was like that, and so I didn't have, really didn't have, many resources, and you know, fortunately now we're making progress, but it's slow.
Speaker 3: It takes a long time, but it's a really interesting point.
Speaker 1: And I've seen that in HR as well.
Speaker 1: One of my clients has had a succession of HR leaders.
Speaker 1: They're about to get another one and, unfortunately, the initial reaction to the person coming in will likely be well, is it worth me spending my time with this person?
Speaker 1: Because the last two didn't last either and it's the same phenomenon.
Speaker 1: Yeah, and we just have to respect social networks, even in, you know, modestly sized organizations, right, maybe, especially in modestly sized organizations, because they look, and often are, very, you know, friendly and affiliative.
Speaker 1: But that that isn't.
Speaker 1: People may like you, but that doesn't mean that they're going to help you or that they're willing to put what they have now at risk.
Speaker 1: That's the challenge.
Speaker 3: Absolutely so.
Speaker 3: I think it's you know.
Speaker 3: I think one of the really interesting points you made is we think about you know things like org design and talent selection and where you know where's the right seat on the bus for this person was the point that you made about you know that balance, like the optimizers and the explorersers, and you know, yeah, if you have too many explorers and it, it is a zoo, right, it's like a bunch of monkey monkeys swinging from tree to tree and you're like wait a minute, where's?
Speaker 3: Where's the entrance to the zoo?
Speaker 3: Again, like how do we get out?
Speaker 3: And, uh, so, so, as you, as you were, you know writing this guidebook andbook and doing your research, and just in your vast experience with organizations, what tactics have you seen that work as it relates to how do I structure an organization to empower the right people and optimize the right roles?
Speaker 1: Good, good, yeah.
Speaker 1: So first, we think about innovation as being about three disciplines ideation, incubation and scaling.
Speaker 1: And they're each.
Speaker 1: You know they're obviously related and in real life they're not quite as separate as that makes it sound.
Speaker 1: You're often working on scaling even as you're doing ideation, but for the purposes of understanding, think about them as three separate disciplines.
Speaker 1: And ideation is about understanding unsolved customer problems.
Speaker 1: What are the jobs that they want to do that if you were to solve for them, you could develop strong customer loyalty and attraction.
Speaker 1: You know you could develop, you know, strong customer loyalty and attraction.
Speaker 1: Incubation is about experimenting, using data to tell you which ideas to invest in and avoiding the trap of investing ahead of your learning.
Speaker 1: So it's one of those great big corporate things.
Speaker 1: Let's just spend money on it, right?
Speaker 1: Rather than let's move slowly, incrementally, incrementally, test and learn.
Speaker 1: And then scaling is about converting a successful experiment into revenue, and it's a place where most corporations or startups for that matter really struggle, right.
Speaker 1: Corporations have particular struggles, which is unfortunate because they have most of the assets to do the scaling, but we can talk about that One of the things that.
Speaker 1: So, if you've got that sense of idea incubate, scale you're going to treat each of these differently.
Speaker 1: Right Idea is about engaging many people.
Speaker 1: It's inside the company, outside the company, deep customer insight.
Speaker 1: It's an opportunity to turn the company outside so that you drive as much outside in innovation, not inside out.
Speaker 1: It's not a matter of what you know, what technologies, processes, products you have.
Speaker 1: It's a matter of what problems you solve.
Speaker 1: So that's a big piece of why ideation, I think also why CEOs often bring us back to ideation, because they see that opportunity to connect us more with customers.
Speaker 1: So it's okay to make that a mass involvement opportunity in a company.
Speaker 1: But you've got to select.
Speaker 1: Not everything you decide on is something that you're going to progress.
Speaker 1: At some point you've got to say, okay, there's a down select to a set of opportunities that you're going to then incubate.
Speaker 1: Now in the book we talk more about how do you set up ideation so that that's easy, and we talk about, even in ideation, narrowing around areas that have the most opportunity and things like that.
Speaker 1: But at some point you're going to make a hard decision and then you incubate and at this point you start to think about well, we're ready to invest.
Speaker 1: So I'm going to take some of kyle's time and I'm going to focus him on this innovation, right?
Speaker 1: So you start to we.
Speaker 1: We often set up um, a sort of a sprint team, like an agile process, um, and for the first 90 days we've got people sequestered to a team for maybe you of their time to do this and they're going to go through that first level of validation of the business and then, after that first 90 days, you're going to decide are you going to pony up the investment to put people on 100%?
Speaker 1: And at that point you're creating a venture that you're going to separate away from the core business.
Speaker 1: You've got to separate and explore unit from the core business.
Speaker 1: It doesn't have to be often a different building.
Speaker 1: Some people do put it in a different building or a different city but even if it's just on a different floor or if there's a corner of the building that you can give it to, because often when you're exploring into new areas, it needs to work in a different way, have a different culture, different working practices, because you might be addressing a different customer set or business model or whatever.
Speaker 1: And then the scaling story you're definitely into this as a separate organization with its own routines and so on, and so that sort of changes as the innovation matures.
Speaker 1: Essentially, is that getting at what you're thinking?
Speaker 3: Yeah, that's very helpful and, I think, just the systematic way to how innovation works.
Speaker 3: It's interesting because a lot of times you hear these stories, right Like the light bulb moments, and somebody was trying to.
Speaker 3: They was trying to, they were doing something you know at 3M and stumbled across scotch tape, right, and it was because someone was trying to do some other random project that absolutely didn't work, but you know they stumbled into it and and you hear about these.
Speaker 3: But I mean, so often we're kind of, we're almost like paralyzed, like okay, well, how how do I, how do I actually make that happen in my organization?
Speaker 3: Right, like like, how do we, how do we figure out scotch tape on accident?
Speaker 1: and and and kyle.
Speaker 1: I think this may be where you're going.
Speaker 1: My reaction is we're solving the wrong problem, right that that we're solving the how do I get lots of ideas problem, and and oh, by the way, ideas are addictive.
Speaker 1: Human beings just love it, we love it.
Speaker 1: I'm going to let you and I jam down on how we can solve HR.
Speaker 1: We're going to come up with a ton of ideas and we're going to love what we do.
Speaker 2: It's going to feel good.
Speaker 2: It's going to really feel good.
Speaker 1: So good, but the problem is all about incubation and scalability and it's not about creativity.
Speaker 1: I've got nothing against creativity, I've got nothing about generating lots of ideas, but really we're focused in the wrong place, and this is one of the challenges that corporations get into.
Speaker 1: So that's why we end up with innovation schemes that just have T-shirts or mugs or big, large-scale events or jamborees of ideas, rather than doing that committed stuff of actually innovating.
Speaker 1: And the energy can't come from the organization alone.
Speaker 1: It's got to come from these corporate explorers.
Speaker 1: That's why they're so important, because that is what works externally.
Speaker 1: You know, venture capitalists rely on great entrepreneurs and they look for serial entrepreneurs, right, people who know how to do this, so that it's in their bones to be an explorer, and and that is what what you see in corporate explorers as well is people who just have that passion, commitment and also this may be different to many entrepreneurs selflessness.
Speaker 1: They have to be ready to let other people make them successful, and so that means sometimes they're less showy, less it's all about me than we're looking for.
Speaker 1: So you might have explorers in your organization you haven't realized it because they don't make as much noise, but actually their capacity to lead and their capacity to identify opportunities may be outstanding, and that's certainly the case that we see in some of these stories in our book.
Speaker 3: That's a really interesting point and I'm reflecting so my organization.
Speaker 3: We make equipment, manufacturing, equipment capital, big grinders and things like that, and so we have a lot of engineers, grinders and things like that, you know.
Speaker 3: And so we have a lot of engineers and it's, you know, mechanical minded engineers, people who are just trying to figure out okay, how do I make this, how do I make this work a little bit better, how do I help out a customer?
Speaker 3: And and and some of our best innovators, as you described that, you know I'm I'm thinking through some of the like.
Speaker 3: We're talking like, literally, industry changing innovators.
Speaker 3: They're super introverted, uh, they're not showing, they would never take credit for anything, despite all the publications that prove them wrong.
Speaker 3: Yeah, and and but, but they are just, they are churning out that work and um, to the point that you know, the the industry looks at them as innovators, not just the organization, and if we don't incubate those folks and allow them the opportunity to scale, anybody in the industry would hire them sight unseen, at whatever salary they asked for, which would not be much, because they're humble and selfless, and you know, and and and it's.
Speaker 3: It's a really interesting point.
Speaker 3: You know, a lot of times we think about these flashy you know, tesla driving entrepreneurs.
Speaker 3: Maybe that's not the right profile.
Speaker 1: That's right, and and and.
Speaker 1: Many of these innovation programs involve setting up, um, you know, high profile innovation labs and so on, which I think, incidentally, have a role um, but they, they're not the same as what you just talked about.
Speaker 3: You know, I bet that none of these people had an innovation lab they had an office with a, with a couple of greasy parts and an idea, exactly.
Speaker 1: Now sometimes you need to think about how can I do a dynamic duo right?
Speaker 1: So maybe they're so introverted they can't commercialize or they're not very customer connected and actually if you look at many successful startups like Yahoo or Google, you actually see a dynamic duo.
Speaker 1: There's an insider and an outsider and sometimes you have to look at that kind of combination to get the right sort of corporate explorer effect that you're looking for.
Speaker 3: Absolutely, and you know, I think it's.
Speaker 3: This is just really kind of interesting.
Speaker 3: I think the thing that is is is is probably my favorite thing about this conversation is it's.
Speaker 3: It's turning so many things on their head that we kind of just assumed, about innovation, and I think a lot of times we're really reading, like some of the it's, it's almost like you're reading the headline without reading the article about innovation and you just assume like, oh, this person's, this person's a genius, nobody else could ever figure this out, you know, and um, or this, this this organization has, you know, has this figured out because they just they hired the smartest people.
Speaker 3: But you know, there, there's more to it than that.
Speaker 3: So, as you were, you know, putting this guidebook together, um, I've got to believe that you probably um learned quite a bit and through some of the research process, what were some of the things that actually surprised you as you were putting together this resource?
Speaker 1: So one of the things that surprised me in a way is just how many examples of corporate explorers are out there.
Speaker 1: I just, you know we started with the premise from our own experience, but then the more we looked, the more we found.
Speaker 1: And it's interesting, it's kind of like it's because it makes the statement you know, big company innovates in a new area.
Speaker 1: It's just not a headline right, and so we don't see it and therefore we believe the notion that it doesn't exist Right, and so we were.
Speaker 1: It was extraordinary how many, and how many have actually turned up since we wrote the book People who reach out to me.
Speaker 1: One of the ones I've enjoyed most of all is this lady, Yoki Matsuoka, at Panasonic, and Yoki was on the founding team for Nest, the thermostat, now owned by Google.
Speaker 1: So she's a serial entrepreneur, crazy smart AI person, mit PhD and so on, and now she works for Panasonic.
Speaker 1: She lived in America for many years, I think since her teenage years, so she's got Japanese and American, but now she set up this thing called Yo Labs, working for Panasonic, an executive officer of the company, creating new ventures for them, and I was like wow, I had no idea that a big Japanese company was making those kinds of steps, um uh, and we we've seen it many other places as well, that sort of so it's just the surprise uh of the uh of the amount that's out there.
Speaker 3: Yeah, it is.
Speaker 3: It is funny because I I started my organ or my career in an organization with, uh, with 300,000 employees and everything was a best practice, right, like so.
Speaker 3: It's like you literally had a guidebook on oh, how do I what binder in my office goes on what shelf?
Speaker 3: Right, and it was.
Speaker 3: It was all about control and you know, don't?
Speaker 3: you're a cog in the wheel.
Speaker 3: Don't step outside of it or you get smushed, you know, and so, yeah, to me hearing the term, you know, large organization and innovation, it's kind of like you know it's, it's okay, that's a buzzword, right, it sounds good, you put it on a recruiting flyer, but what is it actually like, like to work there, Right?
Speaker 3: So so, at those organizations that that have have kind of figured this out, Do you consider it a?
Speaker 3: Is it the ability to spot that talent as they're hiring people, or do you consider it more of an ability to develop people that just kind of have this natural inclination?
Speaker 3: Any insights there?
Speaker 1: Yeah, I think we do need to make this identification of of talent, probably when they've been recruited I don't know that you you bake it into a recruitment process necessarily, but certainly when you've recruited people into the company.
Speaker 1: Are these explorers?
Speaker 1: How many explorers have you got?
Speaker 1: And?
Speaker 1: And in your talent management system, you know, tag them, be aware of who they are, and and there are good, um, you know, tools that will, will tell you this.
Speaker 1: So there's one, uh, by a firm called human insight in the netherlands.
Speaker 1: Um, that does a great profile actually of a whole team that says are they exploratory or are they more stability oriented, and so on.
Speaker 1: We talk a lot about that, but it's a good tool, so, so, use something like that.
Speaker 1: There are others out there that will do something similar.
Speaker 1: And then I think the other thing you need to do is create these opportunities where they feel they have the license to explore.
Speaker 1: So in one of our clients, it was a particular project they set up for the internet of things.
Speaker 1: It's a technology firm.
Speaker 1: They wanted to figure out how they could connect more of their devices to the cloud and use AI to add value-added services, and so they just invited people to join a series of teams to go explore those opportunities and set up processes like that, but processes that have a clear decision-making approach tied to them, so you don't get into the zoo with ideas that never end.
Speaker 1: And so you're going to do identification of the explorers and we're going to do, I'm going to have a license to explore and I'm going to have some way of picking the winners out of that process and then separating them out because, as you say, this core business or exploit business operating system will kill them unless they've got a separate explore business system.
Speaker 1: They need to have some separation.
Speaker 1: And this is, this is the.
Speaker 1: You know, one of the two or three biggest things that the organization can do to make this work is create that separation and allow them to operate in a different way, be measured differently.
Speaker 1: Not on you know the lag, outcome, results of revenue and customer adoption, but on you know how many milestones have they hit, what have they learned?
Speaker 1: Customer adoption but on you know how many milestones have they hit, what have they learned, how close are they to to the sort of indicators that they're, that they're being successful?
Speaker 1: And if you can do that piece right then then you know you'll be a long way forward to empowering your explorers.
Speaker 3: Yeah, I think that's really interesting.
Speaker 3: You know, what's interesting about that is it's the, it's the same idea as the large organization, who is very structured, has, but it's putting that structure into a format that actually fosters the exploratory success.
Speaker 3: Right, it's that we always talk, we talk about KPIs all the time, right, and it's always quality, delivery on time, et cetera.
Speaker 3: And but when you're talking about innovation, you know, yeah, um, I can't remember the organization now, but you know, I know the organization that that actually tracks how much failure do you have?
Speaker 3: Um.
Speaker 3: I think it's, I think it's um, I think it's Mars that they actually track.
Speaker 3: You know you have to have so many failures this month or you're not successful.
Speaker 1: Well you must be sandbagging right.
Speaker 1: If you never fail, it's because you're too safe.
Speaker 3: Yeah.
Speaker 3: Right.
Speaker 3: Yeah, so really, really fascinating and and I think you know from my standpoint, I'm just thinking geez, I don't know.
Speaker 3: I don't know that we do a good enough job with that, right, you know we're still trying to fit our explorers into the same box as everybody else.
Speaker 3: You know, one of the things that I think through is, you know, compensation and incentive programs, and so we're trying to figure out right now what is an incentive program that makes sense, that is controllable, that makes sense but also allows for the you know, the kind of the entrepreneurial flexibility that we need to innovate so what are your thoughts there?
Speaker 1: on that A chapter in our book is around rewards and incentives, and so there's an assumption again that the best way to get corporate explorers in your organization is to figure out how to pay them in a way that reflects what an entrepreneur might get.
Speaker 1: Yeah, right, and, and you know, in some cases that's led to companies actually spinning out a company with employees in Right and then buying them back again and having them operate in the company.
Speaker 1: All that meant is that suddenly you're sitting next to a millionaire and you know that didn't really help employee engagement or or could be more, all reducing right, and you know, the funny thing is that all of the really successful explorers that we talk about in the book like, uh, jim peck at lexus nexus, right with an ohio company, right, uh, and they built this um leNexis risk solutions.
Speaker 1: Or we talk about Christian Kirtisch at Unica Insurance in Hungary and now Austria, or Kevin Carlin at Analog Devices, creating this condition-based monitoring business they didn't have any special incentives.
Speaker 1: Yes, they benefited personally, and Jim is now on his third gig as a CEO, right, so you know, their careers grew.
Speaker 1: They've done well, you know, hopefully financially as well, but there was no special incentive scheme to allow them to do that.
Speaker 1: I think there are some modifications you can make, maybe to to put them on longer term incentives rather than anything that's shorter term incentives rather than anything that's shorter term.
Speaker 1: But this sort of shadow stock and all these other kinds of ways of giving special incentives, I think you know could lead to some very unfortunate outcomes and there's no evidence that they're needed.
Speaker 1: What's needed is, you know this, giving them the license, putting them in a position that they can succeed.
Speaker 3: You know, I think that's really interesting and it reminds me of you know all the research around incentives.
Speaker 3: You know especially monetary incentives or you know short-term incentives.
Speaker 3: You know that a lot of times we put this goal in place or this metric and we think, okay, if this metric is achieved, here's the incentive and that is going to impact human behavior in a positive way, because this is a driver.
Speaker 3: But I can only assume that in your research and in your work with corporate explorers, that many of them are probably not as driven by money, but they're more driven by the opportunity to make a change or make an impact or innovate.
Speaker 1: That's right.
Speaker 1: I mean one of the corporate explorers that we talk about.
Speaker 1: He had this idea.
Speaker 1: So this is Christian Curtis in Hungary.
Speaker 1: He had this idea for an entirely new insurance business model and in the book we tell the story of how he gets agreement from his managers to go forward with it.
Speaker 1: But he also took it to venture capitalists.
Speaker 1: He had two firms ready to back him to spin it out as his own firm, and he makes the choice to stay inside, knowing that the financial rewards would be different.
Speaker 1: But it's about his tolerance of risk, the sorts of risks he wants to take.
Speaker 1: Right, we often miss.
Speaker 1: We think of risk as just being one kind of risk.
Speaker 1: There's lots of different risks we take, and he was willing to take the risk of moving.
Speaker 1: You know being unpopular with his colleagues, right.
Speaker 1: But he wanted to stay within a corporate environment because he liked the assets and the ability to get things done and he liked the people.
Speaker 1: He's a part of a system he actually likes where he is and the people that he's with.
Speaker 1: He's a part of that community, and so for him the finance wasn't important.
Speaker 1: Well, it wasn't as important.
Speaker 1: I'm sure he cares about money, um, but what mattered was that he could do this and reinvent his own firm, because he's a part of that firm, he's a part of that community.
Speaker 1: It matters to him, it's part of his values to be there.
Speaker 1: It's part of his value.
Speaker 1: He did this from hungary, but this is now moving across europe and it matters to him to be a proud hungarian as well.
Speaker 1: You know, and, and, and the same is true of you know, in in ohio, I'm sure you know.
Speaker 1: It's just like what the difference you make to your community, to your city, to your company, actually, for some folks, is a big motivator in all of this.
Speaker 3: Yeah, just take a look at how many people wear like college football teams on their yes, on their clothes, right, sometimes that, sometimes that drive is is as important, um, or or very important, yes, so I do want to talk.
Speaker 3: I have one more question and kind of in the same vein, and I think it's about organizations who are changing rapidly and becoming more corporate.
Speaker 3: So going through a growth journey corporate, so you know, going through a growth journey and and, and you know, naturally when you get bigger, you start to put in more stuff, more bureaucracy, more controls, more you know more of a corporate mass to make sure that things are checking and out and everything.
Speaker 3: So so how, how do organizations retain what got them there, that entrepreneurial edge, that innovative spirit?
Speaker 3: You know what?
Speaker 3: What are the strategies to make sure you don't lose your kind of your core purpose there?
Speaker 1: this is.
Speaker 1: This is really important, carl and and, and.
Speaker 1: We've been um.
Speaker 1: We've consulted to a couple of firms that you know we would call unicorns, and you know they've both gone public in, in, uh, in the last um, in the last year, through, you know, the SPAC route to going public and and and it's exactly the story.
Speaker 1: We've always been entrepreneurial.
Speaker 1: We're now, you know, um, one of them a billion dollars in value in, in revenue as well as in value, and more and more value, and um, and and there's new things we want to do, but as we started to try to do them, we struggled, we couldn't do the thing, and and it comes back down to the founding team, right?
Speaker 1: So in both of these stories, what we find is that the entrepreneur that started it didn't have a system for replicating what he did right, and it is both he and these instances and that their response was to want to continue to control as much as possible, on the grounds that you know they're the smartest people in the room, right, and they structured the organization and its innovation in such a way that everything came back to them.
Speaker 1: Contrast that with jeff bezos right, maybe not our poster child and everything he does have a spaceship.
Speaker 1: He does have a spaceship, yeah yeah, corporate explorer how to innovate without the spaceship that's what I should have called it.
Speaker 1: But Bezos has a recipe, right.
Speaker 1: He has a everybody gets the right to propose new ideas.
Speaker 1: And he's got this PR FAQ system one page press release, what the customers get out of my innovation FAQ, frequently asked questions, my backup as to the kinds of questions you might have about how we're going to get it done right System for how that can get proposed, and if you have an idea that people like, okay, well, I'll give you a two pizza team.
Speaker 1: In other words, only so many people can be fed by two pizzas.
Speaker 1: Right To go, work that up into an MVP and we'll take it into trial and find out.
Speaker 1: This is the incubate piece that I talked about.
Speaker 1: And then, when he scales, Amazon has all these separate units that operate with some high degree of autonomy, but they're all linked by two things they're linked by APIs, so everything is interoperable, and secondly, by a management system that is consistent, so all of their performance is transparent and the comparison to others is transparent.
Speaker 1: Personality, or do I put in place some minimal system that allows ideas to come up and give them the autonomy without sacrificing the access to the assets of the core business, if you will.
Speaker 1: So does that make sense?
Speaker 1: What?
Speaker 3: do you think yeah, yeah, it's a really interesting example and I'm just reflecting on you know, your, you know kind of your comment that that corporate innovators have an advantage over some of these VC firms and it sounds like to me, I mean, it's the systems, it's the structure that can enable the scaling and the incubating, and not just the, not just the light bulb ideas.
Speaker 1: And the fallacy that many of us sit with is that it's the ideas that matter.
Speaker 1: We all think that Polaroid and Kodak and Nokia and these other firms that they got disrupted and kicked out of, you know and sent into bankruptcy because they didn't see digital technologies coming, they didn't see digital photography or they didn't see app stores and touchscreens and smartphones.
Speaker 1: It's totally untrue.
Speaker 1: They all had the technology, they all had the insights.
Speaker 1: Polaroid had the world's first megapixel camera in the market in the 90s.
Speaker 1: The issue is they couldn't execute.
Speaker 1: It's about how do you use these assets.
Speaker 1: That makes the difference, not whether you have the ideas, and that is the hard part of it.
Speaker 1: I portrayed a very positive story.
Speaker 1: I've written this book with two professors, and you know um mike tushman from the harvard business school, charles o'reilly from stanford, and so I've got another story about what it's like to have, you know, a harvard and stanford professor marking your work every week sounds a little intimidating yeah, but but um, um, I forgot what I was going to say.
Speaker 1: That, um, what did I say before that?
Speaker 3: yeah, you were talking about um, the uh, um execution and uh, and then we've had a positive slant on this oh, yeah, yeah.
Speaker 1: So mike my tushman.
Speaker 1: My tushman always says what are the counterfactuals?
Speaker 1: And it's all very well to have these great stories, but it has to be a counterfactual.
Speaker 1: And there are counterfactuals in the book and the biggest is GE right and how it pursued GE Digital and what killed it was the social network right and so a lot of the sort of.
Speaker 1: There's a lot of view that if you have the CEO's support you must succeed.
Speaker 1: Well, he had all the support Jeff Immelt, the CEO of GE, could possibly give him.
Speaker 1: The guy stuck his future on this strategy to be a software company.
Speaker 1: But those weren't the things that killed Bill Rue, the leader of GE Digital.
Speaker 1: It was the sort of silent killers in the organization, like the system of optimization and so on.
Speaker 1: So I do need to to to highlight that this can be tough as well.
Speaker 3: That sounds like everything in HR, you know you start with these great intentions and then, oh wow, this is a lot harder than we thought it was going to be.
Speaker 1: And HR has a core explore problem the whole time because I want to get paid, I don't want to and, if I'm managing, I don't want to end up in prison for some breach of regulation.
Speaker 1: There is a core business of HR that you cannot screw up and then there has to be an explore.
Speaker 1: You have to again see these as separate, and I think this notion of separating the two may be appropriate in HR as well, rather than trying to make everything.
Speaker 1: I personally hugely dislike the Ulrich model of the HR generalist, Because the generalist it's in that name.
Speaker 1: I don't think this is well.
Speaker 1: I think it's open to challenge as to whether that really is the role of HR, and because the skills of delivering the repeatable results on pay conditions, employment law, are completely different to I'm going to figure out how to do innovation.
Speaker 1: I'm going to figure out how to contribute strategic skills.
Speaker 1: I'm going to figure out how to make hires and refresh our leadership team or board.
Speaker 1: So I just think that these are two different things as well.
Speaker 3: I actually, I agree 100% and it's and maybe this is just you know, I'm just happy that you said that because that's how I've structured my department.
Speaker 3: But you know, it's, it's the.
Speaker 3: You know, I agree wholeheartedly and I think it comes down to the.
Speaker 3: The competencies that they have are very different than the competencies that I have, which is strategy and cultural sensitivity, and, you know, being flexible to change and and and dealing with dynamic situations and really emotional situations.
Speaker 3: And you know it's just there's a dichotomy.
Speaker 3: You know a human can't be all those things Right.
Speaker 3: It's just the reality of the situation.
Speaker 3: So I agree Now for all you HR people of one out there and you got an entire department and you are a true generalist.
Speaker 3: You know, I feel you, I've been there too.
Speaker 3: But if at all possible, if you, you know, if you can be aware of that and as you think about your organization, if there are things that you can structure to allow for a little bit of a diversion of how you measure success, depending upon the actual task, that would be my recommendation there.
Speaker 1: Yeah, no, that's fair.
Speaker 1: I should say it's easy to think about this Corporate Explorer story as only being about the largest organizations, but I can give you quite small organizations that have done this as well, certainly ones below 100 employees.
Speaker 1: There will be a point at which it's hard because you can't split an individual.
Speaker 1: I get that.
Speaker 1: So there is a point at which it's difficult, but certainly in the 20s, 30s and upwards, I can point to organizations with corporate explorers who renew themselves.
Speaker 1: Absolutely.
Speaker 3: Well, this has been just a wonderful conversation.
Speaker 3: Unfortunately, we are coming to the end of our time together, so I do want to get through the Rebel HR flash round questions.
Speaker 3: Yes, go for it Fascinated to hear these answers All right Question number one what is your favorite people book?
Speaker 1: Yes, the sort of way in which he, you know, with his HR leader, deliberately constructs the culture at Netflix.
Speaker 1: But I also love that it starts with a sort of humility of you know, we didn't get here with a brilliant like oh, I was always going to do this.
Speaker 1: We realized we were screwing up, we had a problem we had to solve and if we were going to scale this business, we needed to change.
Speaker 1: I thought that was a tremendous, really fun book and very insightful because of that humility.
Speaker 3: Absolutely, and talk about an innovator, right?
Speaker 3: I mean from mailing DVDs to your house to, yeah, you just push a button on your remote and you can watch whatever you want.
Speaker 1: That's right, and they have reinvented themselves several times and there's a Harvard case that will tell you how they could never make a move from DVDs to streaming.
Speaker 1: People bet against them at that point.
Speaker 3: I wish I would have bought that stock a while ago.
Speaker 3: Oh well, all right.
Speaker 3: Question number two who should we be listening to?
Speaker 1: So I have to say that I don't listen to a lot of business podcasts.
Speaker 1: So I listen a lot to a gentleman called Mike Duncan who has done a bunch of podcasts, one of them the History of Rome.
Speaker 1: But I'm an addict of his very long running sequence of revolutions podcasts and he's gone through the British Revolution, the English Civil War Revolution, the American Revolution.
Speaker 1: Until I became a citizen I'd call that the rebellion, but now I recognize it as the revolution.
Speaker 3: You're not allowed to be a citizen, if you call it that.
Speaker 3: I think that's on the test.
Speaker 1: That's right, the French Revolution, and so on.
Speaker 1: And that's on the test, that's right, the french revolution, and so on.
Speaker 1: And and what's really interesting is that when you listen to like these 10 revolutions, you get a few things.
Speaker 1: And revolutions happen when, when people resist change, when they try to stop renewal right, when they don't explore into the future adequately or learn their way into the future, and so in this, in in these stories, history, you get the same stories of what happens to companies that don't renew themselves, and I just love the way he presents it.
Speaker 1: So Mike Duncan is who people should listen to Awesome.
Speaker 1: Thank you.
Speaker 3: All right.
Speaker 3: Last question Great conversation today, just wonderful content.
Speaker 3: How can our listeners connect with you and get their hands on the Corporate Explorer?
Speaker 1: Well, please go to Amazon or your favorite e-commerce vendor and look for Corporate Explorer by Andrew Binns, mike Tushman and Charles O'Reilly.
Speaker 1: Thecorporateexplorercom.
Speaker 3: Awesome, Absolutely Just wonderful, wonderful conversation today.
Speaker 3: Really appreciate you coming on and sharing a different perspective from kind of the conventional wisdom and really really kind of stretching our minds here a little bit.
Speaker 3: So thank you, Andy.
Speaker 1: Thank you, kyle.
Speaker 1: I enjoyed it enormously and thanks to all of your listeners.
Speaker 1: And if people buy the book, read the book.
Speaker 1: Love your feedback.
Speaker 1: Perfect Thanks.
Speaker 3: All right, that does it for the Rebel HR podcast.
Speaker 3: Big thank you to our guests.
Speaker 3: Follow us on Facebook at Rebel HR Podcast, twitter at Rebel HR Guy, or see our website at rebelHumanResourcescom.
Speaker 3: The views and opinions expressed by Rebel HR podcast are those of the authors and do not necessarily reflect the official policy or position of any of the organizations that we represent.
Speaker 3: No animals were harmed during the filming of this podcast.