Lessons from Innovation Trends: Wisdom to Navigate Corporate Evolution

1. Day 2. management Innovation Forum. Dubai. 10 may 2009.

2. Tom Peters’ X25*EXCELLENCE. ALWAYS.Innovation.The Mess is the message.Part 1/Dubai/10 May 2007In Search of Excellence 1982-2007

3. … and just wait

4. “I am often asked by would-be entrepreneurs seeking escape from life within huge corporate structures, ‘How do I build a small firm for myself?’ The answer seems obvious:Buy a very large one and just wait.”—Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics

5. “Forbes100” from 1917 to 1987:39members of the Class of ’17 were alive in ’87; 18 in ’87 F100; 18 F100 “survivors” significantly underperformed the market; just 2 (2%), GE & Kodak, outperformed the market from 1917 to 1987.S&P 500 from 1957 to 1997:74 members of the Class of ’57 were alive in ’97; 12(2.4%) of 500 outperformed the market from 1957 to 1997.Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market

6. Welcome to the “Club of Shattered Dreams”: Of Korea’s Top100 companies in 1955, only 7 were still on the list in 2004. The 1997 crisis “destroyed halfof Korea’s 30 largest conglomerates.”Source: “KET Issue Report,” Kim Jong Nyun (14.05.2005)

7. “It is generally much easier tokill an organizationthan change it substantially.”—Kevin Kelly, Out of Control

8. Fooled by Randomness: The Hidden Role of Chance in Life and the Markets—Nassim Nicholas Taleb

9. “This book is about luck disguised and perceived as non- luck (that is, skills) and more generally randomness disguised and perceived as non-randomness. It manifests itself in the shape of the lucky fool, defined as a person who benefited from a disproportionate share of luck but attributed his success to some other, generally precise reason.”“We underestimate the share of randomness in just about everything, a point that might not merit a book—except when it is the specialist who is the fool of all fools.”“Mild success can be explainable by skills and labor. Wild success is attributable to variance.”Source:Fooled by Randomness: The Hidden Role of Chance in Life and the Markets —Nassim Nicholas Taleb

10. “[Eisenhower] chafed miserably as General MacArthur’s aide in the Philippines, and in the end was promoted to lieutenant colonel only because General George C. Marshall remembered him, from years of inspecting dreary peacetime army bases, as the best bridge player in the U.S. Army.”—Ulysses S. Grant, Michael Korda

11. Blitzkrieg?

12. Case: RealityGermans cross Meuse into France. Whoops: French intelligence completely drops the ball. (Loses track of the Germans—no kidding.)Germans keep advancing; outrun supply lines; no land-air co-ordination. Hitler orders advance stopped.General never gets the word. General marches to Paris, virtually unopposed.Germans shocked.After the fact, Germans label it “Blitzkrieg.”

13. “Blitzkrieg in fact emerged in a rather haphazard way from the experience of the French campaign, whose success surprised the Germans as much as the French. Why otherwise did the High Command try on several occasions, with Hitler’s backing, to slow the panzers down. … The victory in France partly came about because the German High Command temporarily lost control of the battle.”—Julian Jackson, The Fall of France: The Nazi Invasion of 1940

14. Case: Lessons LearnedDo something.Get lucky. Attribute luck to superior planning.Get medals.

15. The Mess Is the Message! Period!An Economic Interpretation of the Constitution of the United States —Charles Beard (1913)The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger —Marc LevinsonTube: The Invention of Television —David & Marshall FisherEmpires of Light: Edison, Tesla, Westinghouse, and the Race to Electrify the World —Jill JonnesThe Soul of a New Machine —Tracy KidderRosalind Franklin: The Dark Lady of DNA —Brenda MaddoxThe Blitzkrieg Myth —John Mosier

16. “Containerization is a remarkable achievement. No one foresaw how the box would transform everything it touched—from ships and ports to patterns of global trade. Containerization is a monument to the most powerful law in economics, that of unanticipated consequences. … This history ought to be humbling to fans of modern management methods. Careful planning and thorough analysis, those business school basics, may have their place, but they provide little guidance in the face of disruptive changes that alter an industry’s very fundamentals.”—Marc Levinson, FT, 0425.06 (author of The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger)

17. LessonsNeed-drivenA thousand “parents”MessyEvolutionary“Trivial”Relentless ExperimentationTrial & many, many eRRORs“Real heroes” seldom around when the battle is wonLoooong time for systemic adaptation/s(many innovations) (bill of lading, standard time)Not …“Plan-driven”The product of “Strategic Thinking/Planning”The product of “focus groups”

18. Mintzberg+The Rise and Fall of Strategic Planning

19. “Apparently our society, not unlike the Greeks with their Delphic oracles, takes great comfort in believing that very talent ‘seers’ removed from the hurly-burly world of reality can tell foretell coming events.” —Len Sayles/Columbia

20. “A pattern emphasized in the case studies in this book is the degree to which powerful competitors not only resist innovative threats, but actually resist all efforts to understand them, preferring to further their positions in older products. This results in a surge of productivity and performance that may take the old technology to unheard of heights. But in most cases this is a sign of impending death.” —Jim Utterback, Mastering the Dynamics of Innovation

21. The Perils of Conservatism/Industry Leadership“ ‘Good management’ was the most powerful reason [leading firms] failed to stay atop their industries. Precisely because these firms listened to their customers, invested aggressively in technologies that would provide their customers more and better products of the sort they wanted, and because they carefully studied market trends and systematically allocated investment capital to innovations that promised the best returns, they lost their positions of leadership.”—Clayton Christensen, The Innovator’s Dilemma

22. What “We” Know “For Sure” About InnovationBig mergers don’t workScale is over-ratedStrategic planning is the last refuge of scoundrelsFocus groups are counter-productive“Built to last” is a chimera (stupid)Success kills“Forgetting” is impossibleRe-imagine is a charming idea“Orderly innovation process” is an oxymoronic phrase (= Believed only by morons with ox-like brains)“Tipping points” are easy to identify … long after they will do you any good“Facts” aren’tAll information making it to the top is filtered to the point of danger and hilarity“Success stories” are the illusions of egomaniacs (and “gurus”)If you believe the “cause & effect” memoirs of CEOs you should be institutionalized“Herd behavior” (XYZ is “hot”) is ubiquitous … and amusing“Top teams” are “Dittoheads”Statistically,CEOs have little effect on performance“Expert” prediction is rarely better than rolling the dice

23. “We are in a brawl with no rules.”—Paul Allaire

24. S.A.V.

25. Paul Allaire: “We are in a brawl with no rules.”TP: “There’s only one possible answer—S.A.V.”**Screw Around Vigorously

26. try it. Try it. Try it. Try it. Try it. Try it. Try it. Try it. Screw it up. Try it. Try it. Try it. Try it. Try it. Try it. Try it. Screw it up. it. Try it. Try it. try it. Try it.Screw it up. Try it. Try it. Try it.

27. “I am often asked by would-be entrepreneurs seeking escape from life within huge corporate structures, ‘How do I build a small firm for myself?’ The answer seems obvious:Buy a very large one and just wait.”—Paul Ormerod, Why Most Things Fail: Evolution, Extinction and Economics

28. S.A.V.

29. 10.05.2007Try stuff (Fast .. Keep movin’)Focus (minimize distractions; one-at-a-time)ALWAYS underscore Action-ExecutionMBWASkill #2: Talk. (Storytelling) Skill #1: Listen.You = CalendarStoke your curiosityEclecticsmStay in touch with real people (Engage!)(Stay away from management if you don’t like people)Keep strategy docs to <3 pages (2? 1?)Role One: “Connoisseur of talent”U. WeirdDecency! Integrity!Life they lead/Stories they tell

30. “To change minds effectively, leaders make particular use of two tools: the stories that they tell and the lives that they lead.” —Howard Gardner, Changing Minds

31. “A key – perhaps thekey – to leadership isthe effective communication of a story.”—Howard Gardner/Leading Minds: An Anatomy of Leadership

32. Tom Peters’ X25*EXCELLENCE. ALWAYS.Innovation.Talent.Part 2 /Dubai/10 May 2007In Search of Excellence 1982-2007

33. Bonus: Priorities

34. “I used to have a rule for myself that at any point in time I wanted to have in mind — as it so happens, also in writing, on a little card I carried around with me — the three big things I was trying to get done. Three.Not two. Not four. Not five.Not ten.Three.”— Richard Haass, The Power to Persuade

35. “Really Important Stuff”:Roger’s Rule ofThree!

36. “Dennis, you need a … ‘To-don’t ’ List !”

37. “The onething you need to know about sustained individual success: Discover what you don’t like doing and stop doing it.”—Marcus Buckingham, The One Thing You Need to Know

38. People Power:The Talent50

39. 1. People First!

40. Whoops: Jack didn’t have a vision!**GE = “Talent Machine” (Ed Michaels)

41. “Omnicom very simply is about talent. It’s about the acquisition of talent, providing the atmosphere so talent is attracted to it.”—John Wren

42. < CAPEX> People!

43. 2. “Soft” Is “Hard.”

44. Excellence1982: The Bedrock “Eight Basics” 1. A Bias for Action 2. Close to the Customer 3. Autonomy and Entrepreneurship 4. Productivity Through People 5. Hands On, Value-Driven 6. Stick to the Knitting 7. Simple Form, Lean Staff 8. Simultaneous Loose-Tight Properties”

45. 3. FUNDAMENTAL PREMISE: We Are in an Age of Talent/ Creativity/ Intellectual-capital Added.

46. Agriculture Age(farmers)Industrial Age(factory workers)Information Age(knowledge workers)Conceptual Age(creators and empathizers)Source: Dan Pink, A Whole New Mind

47. “Human creativity is the ultimate economic resource.”—Richard Florida,The Rise of the Creative Class

48. “The Creative Age is awideopen game.”—Richard Florida, The Rise of the Creative Class

49. “THE FUTURE BELONGS TO … SMALL POPULATIONS … WHO BUILD EMPIRES OF THE MIND … AND WHO IGNORE THE TEMPTATION OF—OR DO NOT HAVE THE OPTION OF—EXPLOITING NATURAL RESOURCES.”Source: Juan Enriquez/Asthe Future Catches You

50. 4. Talent “Excellence” in Every Part of Every Organization.