[music]. Welcome to the first lecture of the strategic innovation class. I wanted you to be sure to check out the, the logistics lecture that I, the logistics video that I did, where I talk about the syllabus. I talk about the deliverables. I talk about the expectations. All those things that I'm expecting. From you, as a participant in this course. Keep in mind there's tens of thousands of people signed up for this course, and if we're going to get through this together intact, we really need to be sure that the expectations are clear. What it is I ask from you, what it ask that you asking from me, and how it is that we can interact together. So, be sure and check out that video. And that'll be that I'll go through this syllabus step by step. You can watch this one first or watch that one first, either way. But certainly be sure to check it out. So, let's get started. One thing I want to make, make certain, to make clear for, for us all is that there's this, there's a difference between innovation and this thing called change. Innovation is what this class is about, is what we're after. But of course innovation requires some kind of change. Because you can't innovate by staying the same. And so one thing I want to, sort of make clear and also to reinforce again, again, and again in this course. Is that innovation is a positive again, innovation is something that you know when we have this idea about how the world is a better place, we want that kind of innovation, we're going to call innovation, we're going to seek it as a positive thing. On the other hand when other people have ideas that we don't completely agree with. They're going to, we're going to call it change. And so when it's innovation, we like it, we seek it and when its change we sort of, we sort of step back and, and push back on it. I mean think about this is innovation is what we do to them and change is what they do to us. And so in this dynamic we need to understand that there's no obligation that people have because of our good idea. Ideas. Let me say that differently. If I have a great idea about how you need to change, you have no obligation to accept that idea. It's up to me to convince you of that change. It's up to me convince you that the change is, in fact, an innovation. And that you're going to benefit from it. And so, as we go through all of the things we do. If you learn nothing else, that's the most important thing, that innovation is about selling our ideas. It's about getting other people to agree that this way of looking at the world, this way of, of behaving in the world, this way of these things that we're going to offer for you in the world. A better and so this is what I want to do for you is offer you a way of thinking about innovation that I think is a better way of innovation hopefully it's not change to you and hopefully it's innovation in your thinking. Let's take a look at the term thinking outside the box. Certainly in your language if your not a native English speaker thinking outside the box there's term for that you know sort of like there's this box and you have to think outside of it. I've worked with many, many companies. One of the stories I'll be telling, or outlined in the book, Creative People Must Be Stopped. And you can see the book, I'll actually, see a little a picture of it here. Check out the book. But basically just to, to pull a synopsis of many of the stories that people have told me in the organizations that I have worked with and the people I've spent time with, goes something this. So, take a look at this video and then come back and see what you think. >> It's Friday afternoon at 4:30, and your boss calls you into his office. He says, look, I need your help and I need it now. We need some big ideas around here, some stupendously great ideas. We want to make this company great once again. I'm talking breakthrough. You know, big bang, blue sky. Now I know I don't say this often, but I really need you to think outside the box. Wow, you've never heard them talk like this before... And so you start to get excited, then you actually start thinking big. You do a ton of research, you brain storm, you lose sleep. And you stretch your brain, and finally you do it, you find it, you come up with a great idea. So first hing Monday morning you go to present your idea for launching this company ahead. You're going to knock his socks off. Our world is going to be a better place. You show them your idea and after some silence the boss says, hm, this looks expensive. You know I appreciate how you're trying to push the boundaries but look, this is a business. We've got to make some money, not spend it. I want you to still think outside the box, but I want you to come up with something that's not quite so expensive. Arghh! So off you go to generate another idea. This time, you come up with a less expensive idea that's even better than the first one. You show it to the boss and he says[NOISE] this looks complicated. Now you realize, of course, that we've gotta make this in our plant. I mean, I want you to keep thinking outside the box, but can you at least make sure we can make the thing in our current facilities? You bring him another idea. Too disruptive. And another idea. Oh my gosh, that's too risky. And yet another idea. What on earth? That's just weird. Well, after a couple of months of this frustrating dance, you finally see it. You find it. You absolutely. Perfect idea. The one idea that you know will meet every last one of the requirementst that were set. So, you start your presentation and it seems to be going well. This time he doesn't ask any questions though, and after a few minutes he starts getting agitated and shouts this is puny. I mean I asked you think outside the box and you bring me this puny idea. What's wrong with you. You. Don't you know how to be creative? Normally people at work can be pretty blase and I would dare say lazy, but when you bring them an innovation they suddenly kick into high gear and they start working overtime, undermining, blocking, maiming, debilitating, torpeoding, subverting, ignoring and just plain killing your innocent, well-intentioned and sometimes even your great ideas. Why do they act like creative people must be stopped? If this story sounds familiar to you you're not alone. I've heard this story of frustration again and again and again from people at every kind of organization, in every kind of industry and all around the globe. Of course it's not always the boss who plays the role of lead knucklehead and torpedo innovation in the organization. Sometimes your customers, your clients or your partners. Maybe it's your supplies, your colleagues or even your team. Sometimes it's even you who pulls the trigger and stops innovation dead. What if you could predict who was going to trample your creativity and how they were going to do it? What if you could figure out before hand how innovated ideas are likely to killed? So how can a great idea get killed? Let me count the ways. One, it dies because it's not a great idea and you can't come up with a better one. Two, it wilts because your work group critcized the idea mercilessly. And they do so in public. Three, it drowns in your organization's stifling bureaucracy. It gets suffocated by risk aversion. Four, your idea gets ambushed by rivals, or even customers in your industry, people who are threatened by it. Five, it gets whacked by a society that regulates your bold idea into meaningless drivel. Six. The technology delivers a coup de grce death blow, by subjecting your idea to the heartless laws of nature. Of course, you don't believe that creative people must be stopped, but wouldn't it be nice to know beforehand how to outsmart those innovation-killing knuckleheads who do? So the kind of story this video tells is interesting. We end up with these, these puny ideas after someone tells us again and again and again go out and do something amazing, go out and change the world. And again, we bring back an idea no that's no good that's no good that's no good. So this dynamic is actually true. I believe it happens a great deal. People have told me it's true and I'm sure that you've experienced this idea in your life. As well, its kind of dynamic of someone saying go change the world and then they coming back and not offering you any mechanism for doing it. So how do we get past this puny idea and how do we get past sort of this thinking outside the box problem, when you think outside of the box let me tell you a few stories about what happens you know what really happens when you think outside the box. So, here's a great example, this car the was, was made by the General Motors Corporation,early 90s called the EV-1 it eh, the codename the GM Impact, by the way the impact is a terrible name for a car . But the impact was an all electric car. It could go about 60, 70 miles on a charge. It could go very fast. This car in fact could go, and well I'll say this, this car still holds the world land speed record for a mass produced electric car, 186 miles per hour. Not sure what that is in kilometers per hours but it's well above 200 and its a great Testament to the kind of performance this car had. So, in California they made about 2,000 of these cars and they passed them out and they let people use them actually people leased them. People who thought this was a meaningful thing bought this car and loved it. I mean, you may think it's kind of ugly and people generally tell me that it's ugly, but when they hear it goes fast and it's red, they seem to like it a lot more. So here's a story. So this car went out people like the cars, and then one day General Motors said hey, we need the cars back. After the lease was back they said we need the cars back, and some people said no, let me have the car. In fact, one person offered a million dollars to be able to keep the car. He loved the car. This particular person also had a Ferrari, and this car could out accelerate his Ferrari because. Think about it, in an electric motor you get full torque at zero RPM unlike a gasoline car and that's for you nerds that's meaningful, but for, for a normal person, you just ignore what I just said. This car, it was powerful, it could accelerate like crazy and it was fast. And so there were some people that really, really wanted these cars back. And the company said no, you can't have the cars, we need the cars back. Why do you think it is that they wanted the cars back? Unless you've heard the story, you probably didn't think it was to do this with them. In fact, all the cars were taken back, there were a few that were put in museums here and there, and they were crushed. So here you have a brilliant idea crushed. Why would that be? So this is not a puny idea. In fact, a puny idea would be ignored, but this idea was crushed. Let me[UNKNOWN] show you another little story. There was a product in the United States called New Coke. And Coca-Cola decided that they were going to make their product better, that they were going to make it taste better. And so what they did as you, if you're a big company like Coca-Cola and you have a lot of money, you're going to do a lot of taste tests right? Of course, you're going to get people to taste it. Taste this, taste this. Which one tastes better? Mmm that tastes better. Taste this, taste this. Go to as many people as you kind find, you know, millions dollars of taste tests. Yeah, this one's better, and make it this much better. So here you have a product that has improved perofrmance. It's better, it's new. People hated it. People did not like this product. In fact when they switched to new Coke, there were fights. People were literally fighting each other in front of the freezer, in front of the cooler section of their local store, because they wanted the old Coke back. Why on earth did people want the inferior product, the product that did not taste better. Remember? Taste, taste, this one tastes better. They wanted this. Why would that be? The new product, hated. Thinking outside the box here I guess were they? Here's another little product. This was in fact the first commercially available MP3 player. It was by a company named Diamond. It was the Diamond Rio. In fact, I have one here, show you the Diamond Rio. So the Diamond Rio was interesting in that it was the first MP3 player. Why you know it looks actually there are some similarities between the ipod which came slightly later than this, this was around 1999 2000 ipod was around 2003 let me check those dates to make sure I'm correct on that but non the less, this one didnt fail, this one was not didnt we are not carrying this, why are we carrying the ipod instead Well the one story is that this company was sued, that Diamond Rio was sued because the only legal content it could get on this thing was stuff you recorded yourself, because if you took a CD and ripped it or if you did anything like that to make an electronic version of Commercial music, you certainly were violating the copyright code and this company was sued and they basically took this product off the product, put this product off the market. Hm. Thinking outside of the box, a very creative, very innovative product, sued. Another one. This thing here you may recognize. Yeah, you probably don't recognize it actually.This is a product that was, was designed to head, the chief, inventor on this product was Steve Sasson. And this happens to be the first digital camera. So what do you think happend? First digital camera by Kodak, should be, it should be great. Well, turns out in 2012, Kodak actually went bankrupt. Kodak stopped making film, they went bankrupt and became almost what we would consider a patent company. Where they hold a lot of patents. And they go around making money off licensing their patents. But they certainly aren't selling any products. That will have the kind of, of potential for change that the original digital camera had. Why would it be that the company that is, is the for, first foremost and foremost in, in photography, and invents the digital camera, loses out? What happened there? It's a story we'd want to be able to explain. Here you have a creative idea rejected. Another one, human cloning. Human cloning is ostensibly very creative, however it's considered immoral. It is in most places it's illegal. In fact there are all kinds of restrictions against it. There are state, in the United States, federal restrictions, state restrictions and the United Nations. Has restricted it. There's an Islamic Fatwa issued against it. The Roman Catholic church came out against it. Everyone agrees this is a bad idea, and so this potentially innovative procedure was banned. Why would that be? How can we explain that? Segway, how about that one? How many of you own a Segway? There's probably very few, because not so many Segways were made as were thought were going to be made. Made. Something like the iphone for example a very popular product now. You know in the early projections of the Segway, they believed they were going to make and sell as many Segways as they sell iphones today. How could they have thought that? Segway got a flat tire. Segway was essentially ignored. How could that be? Innovative product, you know, potentially revolutionary, if everyone drove this instead of a car, the world would be a very different place. Yet this product was ignored. Oh, and then there's things like this. Where you, you know, you try a great idea and you just get ridiculed. And, and that's not fun either. And then I have this other product, I wan, there's a company in, the state next to us. I'm in Tennessee, and south of Tennessee is the state of Alabama And one day a colleague of mine told me there about this company down there that was making this really interesting product and let me go grab some here and bring it over. So, this product is called sew and grow and sew and grow is this very interesting product it is it you put it in your plant, you put your plants in let your plants grow in this as time release nitrogen it has let me grab the. Retains moisture, time-released nitrogen. So here's the packaging promotes faster root growth. Chemical-free, environmentally friendly, ideal in drought areas, has no mixing or smelly odors. But turns out that Sow-N-Grow is made, let me read it here, Sow-N-Grow tm is 100% recycled human hair. Yuck. So. Yuk. So things get rejected, they get killed, they get ignored, they get crushed, they get. When you have a great idea, what's going to happen? Well, I'll tell you. The way I'm thinking about this and the way I think we'll work through is to say. Why does innovation fail? Why innovation fails because creative people must be stopped, let me say that again, innovation fails because the world behaves as if creative people must be stopped. If you have an idea and you have a creative idea, remember that's innovation and other people are going to see this as change, and their going to try to stop you. And so if you want to be a successful innovator, your job will be to say, how will they stop me. And so, let's think about this. If I could imagine, or, or come up with a way of understanding. What are the likely ways that my idea was going to get stopped. That could actually be very useful. Because if I have an idea and I know how they're going to stop me, I can become strategic, and I can sort of go around, I can sort of figure out a way to get around they're stopping my idea, and that's where the title of this class comes from is being strategic about innovation. Understanding that world behaves as creative people must be stopped and so it's our job to say, "How are they going to stop us, and how are we going to get around that?"
