The Dartmouth Professor and author describes what it means to take a ‘wide lens’ approach to innovation
In The Wide Lens you write that innovation is a problem for everyone because it is held up as the solution to everything. Why is there so much hype about innovation and why does it so rarely live up to expectations?
I’m not sure how much is explicit hype as opposed to just hope. Innovation basically means, ‘we’ll do something different and it will make things work out.’ But the problem is that those are two different statements. Doing something different doesn’t necessarily mean that the effect is going to be better. What we know is that to do anything different takes a lot of work; and even so, hard work doesn’t guarantee success. Often times you think you have a great idea and you start investing in bringing that change about only to find that, while you’ve done your work, other pieces of the puzzle haven’t aligned. The missing pieces are blind spots, and this book talks about how you can use a new set of tools to see what those other pieces look like before you run into them.
You argue that, in order to think and act in an increasingly interconnected world, managers need to adopt an ‘ecosystem strategy’. What characterizes this approach?
What it asks of managers – and that can include anyone relying on some kind of coordinated effort to bring about a change, whether you’re in the corporate or non-profit world or just trying to get the kids out the door in the morning – is to look at the system in which you plan to innovate and try to identify two types of ‘ecosystem risk’. The first is co-innovation risk, and to assess it you need to ask who else needs to innovate for your innovation to succeed? So, besides me doing something different, who else’s behaviour needs to change? The second type of ecosystem risk is adoption chain risk: who else needs to buy-in before the end customer gets to see the full value proposition?
In some ways, what this does is it tries to make something that any successful manager has as an intuition more explicit. The reason that’s important is because when you’re working with others, making things explicit means you coordinate more effectively.
Can we talk a bit more about co-innovation risk? You say in The Wide Lens that “the logic of co-innovation is a logic of multiplication, not averages.” What does that mean?
When you’re thinking about the odds of an innovation succeeding, the issue is to recognize how hard these different changes are going to be – not just your innovation but the other innovations that need to come about for it to reach the end customer. Whenever you talk about probabilities, you’re talking about this logic of multiplication. So, if I have a 50-50 chance of winning my innovation bet and you have a 50-50 chance of winning your innovation bet, it’s important that we don’t live with that and say “okay I guess there’s a 50-50 chance that the system comes together.” Just like flipping coins, 50 per cent times 50 per cent is 25 per cent. Once you recognize that, you can set better expectations and you can start asking questions about what you want to manage towards.
You can change those odds by putting resources in different places and reinforcing the weak links, and by changing the goals changing and timeframes, for example. I can recognize that the 50 per cent chance that I have of delivering my project is a 50 per cent chance of delivering it this year, but if you gave me another six months maybe it would be 80 per cent. As you’re thinking about how you want to allocate these forces and how you want to prioritize the investment of not just money, but of people’s efforts, you want to have this holistic view on risk before you make the commitments.
And, while this is something that people might intuit, with The Wide Lens you’re trying to make it explicit and create a framework for its application?
Our intuitions tend to focus on averages. If you go into a board room and see four confident people, you say “well, everything’s going to work out.” You don’t tend to think about the individual probabilities of success and how they can the magnify the risk of failure.
[This article has been reprinted, with permission, from Rotman Management, the magazine of the University of Toronto's Rotman School of Management]