Sustaining Success: Why Big Companies Need To Slow Down
As seen on Forbes.com
We’ve all heard some version of Aesop’s fable of the hare and the tortoise. It was written to pass on this simple message: Pragmatic plodding wins the race. Unfortunately, this lesson seems to be lost in most large companies trying to innovate today. The “need for speed” seems to be trumping common sense.
Visionary and impatient leaders at large companies want to win fast—just like entrepreneurs seem to be able to do. Many of these big company CEOs have quarterly earnings to report, which just adds fuel to their fire. As a self-proclaimed Idea Monkey, I get it—I really do. But impatient leaders striving to be more innovative must learn that speed and cleverness will not win you the new products race. Instead, it will cost you millions of dollars, your job and sometimes your company.
I understand the intoxicating nature of speed. As a kid, I would always bet on the rabbit. The very idea that a slow-moving tortoise could beat a quick-footed hare was preposterous. And like a romantic who watches the Titanic movie again and again, hoping for a different ending, I was always surprised by the tortoise’s painfully pragmatic victory. I wanted to believe that the quick-witted, speedy rabbit would win by a hair (sorry). He never did.
He still doesn’t.
If you are leading a large organization trying to innovate and using speed as a primary strategy, you are going to lose the race, too.
I know. I know. Entrepreneurs have you running scared. The rate of change is coming faster and faster, and the media seems to love these ridiculous startups with billion-dollar valuations popping up all over the place.
But the reality is that for every flash-in-the-pan, “overnight” success story, there are thousands of failures. And these startups aren’t putting hundreds or thousands of employees and shareholders at risk by racing from one idea to another. They also don’t have to deal with legacy systems, legal issues, HR and an entrenched workforce that large organizations like yours do.
The news isn’t all bad; they don’t have your brand, distribution or bank account either.
So don’t take the bait. When you hear your teammates throwing around buzzwords like open innovation, idea-athons, first-mover advantage, speed to market and shark tanks, don’t buy in to the growing perception that if you can build a fast-moving idea factory, you win every time. The fact is that you simply cannot expect to reinvent a historically successful company or industry in nine to 12 weeks.
Three very bad things happen when you try to push your teams to innovate quickly. These reactions are so predictable in large organizations that they are too sad—Titanic sad.
Rushing Reaction 1: Your Team Freaks Out
If you want to create drama, just tell your most reliable people that they have nine to 12 weeks to come up with the next big industry idea. You hired them to execute with precision, to mitigate risk, to do certain jobs very, very well. Now you are asking them to embrace an uncertain future, do things they don’t know how to do, all the while continuing to do their day jobs so the company can make budget numbers. Given their charge, they will either freeze or thrash about desperately. Neither reaction is going to help you become more innovative.
Rushing Reaction 2: Your Team Goes For Simple, Small And Safe
Your team is full of experts. They know what the market has always wanted, and they know how to produce it. They’ve been consistently rewarded for delivering your products or services more efficiently than your competitors. So when asked to innovate quickly, they lean heavily on their expertise. This means they will always gravitate toward products and services that look and smell like the past—particularly when you ask them to move too quickly. And when your most innovative thinkers suggest something different, your seasoned team members will aggressively push the idea toward a more comfortable, evolutionary version of what you’ve always been selling—they will dumb it down—which is why everything you launch seems to fall flat. Your team keeps making big ideas simple, small and safe.
The economic implications of this behavior are crippling. Small changes to products or services deliver very little margin and typically go unnoticed by the marketplace. Snore. So to move the needle, you must advertise more, which hurts your already slim margin. Small wonder that big companies must acquire their best innovations.
Rushing Reaction 3: They Don’t Innovate; They Invent
Inventors come up with an idea and then go looking for someone who wants it. Innovators find a significant need in the market and then (and only then) work to create a unique way to solve it. When pushed to go fast, your teams will try to invent based on their gut or the most compelling voice in the room—which is often the person with the biggest title and a pet idea.
Intuition is a lousy way to innovate. We’ve all seen this movie and know how it ends: The rabbit loses.
These three approaches never work. Next time I will tell you what will.