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InnoTac/Act:Innovation Tactics/A Bias for Action
Tom Peters/InnoTac+Act.0622.06
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PART ONE:INNOVATION
TACTICS
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Tom Peters on …
Innovation tactics
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Premises I
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“A focus on cost-cutting and efficiency has helped many organizations weather the
downturn, but this approach will ultimately
render them obsolete. Only the constant pursuit of
innovation can ensure long-term
success.” —Daniel Muzyka, Dean, Sauder School of Business,
Univ of British Columbia (FT/09.17.04)
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“Forbes100” from 1917 to 1987: 39 members of the Class of ’17 were
alive in ’87; 18 in ’87 F100; 18 F100 “survivors” underperformed the
market by 20%; just 2 (2%), GE &
Kodak, outperformed the market 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
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“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
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More than $$$$
#1 R&D spending,
last 25 years?
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GM
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“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
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Premises II
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What “We” Know “For Sure” About Innovation
Big mergers [by & large] don’t workScale is over-rated
Strategic planning is the last refuge of scoundrelsFocus groups are counter-productive“Built to last” is a chimera (stupid)
Success kills“Forgetting” is impossible
Re-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 memoirs of CEOs you should be institutionalized“Herd behavior” (XYZ is “hot”) is ubiquitous
… and amusing“Top teams” are “Dittoheads”
CEOs have little effect on performance“Expert” prediction is rarely better than rolling the dice
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Try It
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“This is so simple it sounds stupid, but it is amazing how few oil people really
understand that you only find oil if you drill wells. You may
think you’re finding it when you’re drawing maps and
studying logs, but you have to drill.”
Source: The Hunters, by John Masters, Canadian O & G wildcatter (80%)
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“While many people big oil finds with big companies, over the years
about 80 percent of the oil found in the United States has been
brought in by wildcatters such as Mr Findley, says Larry Nation,
spokesman for the American Association of Petroleum
Geologists.” —WSJ, “Wildcat Producer Sparks Oil
Boom in Montana,” 0405.2006
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“We made mistakes. Most of them were omissions we didn’t think of when we initially wrote the software. We fixed them by doing it
over and over, again and again. We do the same today: While our competitors are still
sucking their thumbs trying to make the design perfect, we’re already on prototype
version No. 5. By the time our rivals are ready with wires and screws, we are on
version No. 10. It gets back to planning versus acting: We
act from day one; others plan how to plan—for months.”
—Bloomberg by Bloomberg
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“The secret of fast progress is
inefficiency, fast and furious and
numerous failures.”
—Kevin Kelly
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Culture of Prototyping
“Effective prototyping may
be the most valuable core competence an
innovative organization can hope to have.”
Michael Schrage
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Think about It!?
Innovation = Reaction to the Prototype
Michael Schrage
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“We are in a brawl with
no rules.” —Paul Allaire
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S.A.V.
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Screw Around Vigorously
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Screw It Up
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“Fail faster. Succeed sooner.”
David Kelley/IDEO
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Fail. Forward.
Fast.
–High-tech Exec/PA
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“FAIL, FAIL AGAIN. FAIL BETTER.”
—Samuel Beckett
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“Reward excellent failures.
Punish mediocre
successes.”Phil Daniels, Sydney exec
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Read This!
Richard Farson & Ralph Keyes:
Whoever Makes the Most Mistakes Wins: The Paradox
of Innovation
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Sam’s Secret
#1!
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“Tom, very simple. Sam was
not afraid to fail.” —David Glass to TP, on the occasion of
Sam’s induction into The Sales & Marketing Hall of Fame
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Plan B
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"I think it is very important for you to do two things: act on your temporary conviction as if it was a
real conviction; and when you realize that you are
wrong, correct course very quickly.” —Andy Grove
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“The most successful
people are those who
are good at plan B.”
—James Yorke, mathematician, on chaos theory in The New Scientist
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Parallel Universe
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Build a “School on top of a school” (The Parallel
Universe Strategy)
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B.School Innovation Strategies: Exec Ed/Continuing Ed (fewer restraints).
Web (fewer restraints). “Parallel Universe” approach (JKC/Bob S)!
Recruit “weird” (in places you can get away with it—eg, students,
continuing ed faculty lesser admin jobs)!
Message: LOOK FOR/EXPLOIT THE “WEAK” (Unregulated) SPOTS!
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JKC
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Jill Ker Conway/Smith
1. Scour for renegades; wine & dine.
2. Go outside for funds.
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Change? Ha! Try: End Run! Build Your Own! Period!
“We’re never going to persuade the
conservatives to accept [our view]. We
need to build our own institutions.” —anon.
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Parallel Universe/
Venture Fund
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“Venture” fund (E.g. Gerstner/Amex,
Dow/Marriott, Grove/Intel, Bedbury/Starbucks)
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2/50**Scott Bedbury/Starbucks/<1%/<4 of 400/ grabbed best/all wanted to be there/2%-50%
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Shell
“Game Changer”
10% of technical budget “set aside and used to fund
promising but nontraditional ideas through a staged
funding process similar to that used by venture capitalists”
Source: Financial Times/08.2003
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We Are What
We Eat
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We become who we hang
out with!
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Measure “Strangeness”/Portfolio Quality
StaffConsultants
VendorsOut-sourcing Partners (#, Quality)
Innovation Alliance PartnersCustomers
Competitors (who we “benchmark” against)
Strategic Initiatives Product Portfolio (LineEx v. Leap)
IS/IT ProjectsHQ LocationLunch Mates
LanguageBoard
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Requirement: Discomfort
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“I’m not comfortable unless I’m
uncomfortable.”—Jay Chiat
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Find ’em
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“Some people look for things that went wrong and try to fix
them. I look for things that went right, and try to
build off them.” —Bob Stone
(Mr ReGo)
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“Somewhere in your organization, groups of
people are already doing things differently and
better. To create lasting change, find these areas of positive deviance and fan the flames.” —Richard Tanner
Pascale & Jerry Sternin, “Your Company’s Secret Change Agents,” HBR
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Sing Them
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Demos! Heroes! Stories!
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REAL Org Change: Demos & Models (“Model
Installations,” “ReGo Labs”)/ Heroes (mostly extant: “burned to
reinvent gov’t”)/ Stories & Storytellers (Props!)/
Chroniclers (Writers, Videographers, Pamphleteers, Etc.)/
Cheerleaders & Recognition (Pos>>Neg, Volume)/
New Language (Hot/Emotional/WOW)/ Seekers
(networking mania)/ Protectors/ Support Groups/
End Runs—“Pull Strategy” (weird alliances, weird
customers, weird suppliers, weird alumnae-JKC)/ Field “Real People” Focus (3 COs) (long way away)/
Speed (O.O.D.A. Loops—act before the “bad guys” can react)
C.f., Bob Stone, Lessons from an Uncivil Servant
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Stories … Paint me a picture … Story
“infrastructure” … Demos … Quick prototypes …
Experiments … Heroes … Renegades … Skunkworks … Demo Funds … V.C. … G.M. … Roster … Portfolio … Stone’s
Rules … JKC’s Rules
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“My mission is that of a mole—
my existence only to be known by upheavals.” —Jan
Morris, Fisher’s Face, Or, Getting to Know the Admiral
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Org Structure
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Core Mechanism:“Game-changing Solutions”
PSF (Professional Service Firm “model”/The Organizing Principle)
+
Brand You(“Distinct” or “Extinct”/The Talent)
+
Wow! Projects (“Different” vs “Better”/The Work)
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Band of Brothers
(& Sisters!)
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“Never doubt that a small group of
committed people can change the
world. Indeed it is the only thing that
ever has.” —Margaret Mead
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Hard is soft.Soft is hard.
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First-level Scientific Success
The smartest guy in the room wins”
Or …
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First-level Scientific Success
FanaticismPersistence-Dogged Tenacity
Patience (long haul/decades)-Impatience (in a hurry/”do it yesterday”)
PassionEnergy
Relentlessness (Grant-ian)
EnthusiasmDriven (nuts!)
(Brutal?) CompetitivenessEntrepreneurialPragmatic (R.F!A.)
Scrounge (“gets” the logistics-infrastructure bit)
Master of Politics (internal-external)Tactical Genius
Pursuit of (Oceanic) Excellence!High EQ/Skillful in Attracting + Keeping Talent/Magnetic
Prolific (“ground up more pig brains”)
Egocentric
Sense of History-DestinyFuturistic-In the Moment
Mono-dimensional (“Work-life balance”? Ha!)
Exceptionally IntelligentExceptionally Clever (methodological shortcuts/methodological genius)
Luck
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Hard is soft.Soft is hard.
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“Most important,
he upped the energy level at Motorola.” —Fortune on Ed
Zander/08.05
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4/40
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4/40
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De-cent-ral-iz-a-tion!
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Ex-e-cu-
tion!
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Ac-count-a-bil-ity!
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6:15A.M.
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Inno64: Innovation Strategies & Tactics
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Parallel universe /Exec Ed v res MBAEnd run regnant powers/JKCFind done deals-practicing mavericks/Stone-ReGoBell curves2016 in 2006Non-industry benchmarkingEverything = PortfolioV.C.s all!Hot language/Wow-Astonish me-Insanely great-immortal-Make something greatLead customers/PW-EmbraerLead suppliers /Top decile R&DWeird alliancesMottos/Paul Arden (“Whatever You Think Think the Opposite”)Hire freaks/Enough weird people?Weird Boards!!!
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CEO track record of Innovation (nobody starts at 45!)System/GE-Immelt“Strategic thrust overlay”CalendarBig Delta easier than SmallMBWA with freaks-weirdos/JKCMBWA/Boonies’ labsV.C.-formal/IntelAcquire weirdChildren’s crusadeOld farts crusadeGo Global at any sizeStop listening to customers Talent!/Unusual sources-Hire innovators-V.C.sEschew giant mergers
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Remember: scale economies max out earlyAssisted suicide! (“Built to last” = Chimera-snare-delusion)Burn your press clippings“Forgetting” “strategy”Fire all strategic plannersTempo!Final product bears little relation to starting notionDesign! Design! Design! (“culture,” not program)All innovation: Pissed-off peopleGut feel rules!Focus groups suckWeird focus groups okayBe-Do philosophy
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CelebrationsCulture-little as well as big Inno (“everyone-an-innovator”)Life = Wow ProjectsAcknowledge messiness-pursue serendipity (Blitzkrieg-Containers-Science-Jim Utterback)R.F.A.Culture of execution4/40: decentralization, execution, accountability, 615AMEVP (S.O.U.B.)/Systems-process “un-design”Diversity for diversity’s sakeWomen-Women-Women/customers (they “are the market,” not a “segment”)-leadersBoomers-Geezers (“all the money”)
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CRO (Chief Revenue Officer) “culture”/top-line obsessedCIO (Chief INNOVATION Officer)LaughterFacility-space configurationExperiments-prototypes“Reward excellent failures. Punish mediocre successes.”Bizarrely high incentives (& penalties)We are what we eat/We are who we hang out with (E.g.: Staff-Consultants-Vendors-Out-sourcing Partners/#, Quality-Innovation Alliance Partners-Customers-Competitors/who we “benchmark” against -Strategic Initiatives -Product Portfolio/LineEx v. Leap-IS/IT Projects-HQ Location-Lunch Mates-Language-Board)
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PART TWO:A BIAS FOR
ACTION
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TP/BW/circa 1982 on BigCo Sin #1: “too much talk,
too little do”
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TP circa 2006 on BigCo Sin #1: “too much talk,
too little do”
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Excellence1982: The Bedrock “Eight Basics”
1. A Bias for Action2. Close to the Customer3. Autonomy and Entrepreneurship4. Productivity Through People5. Hands On, Value-Driven6. Stick to the Knitting7. Simple Form, Lean Staff8. Simultaneous Loose-Tight Properties”
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Tom Peters on …
A Bias for
Action
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CONTEXT
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“It is not the strongest of the
species that survives, nor the most
intelligent, but the one most
responsive to change.” —Charles
Darwin
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Pathetic!
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“Ninety percent of what we call
‘management’ consists of making it difficult for people to get things done.” – Peter
Drucker
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“Forbes100” from 1917 to 1987: 39 members of the Class of ’17 were
alive in ’87; 18 in ’87 F100; 18 F100 “survivors” underperformed the
market by 20%; just 2 (2%), GE &
Kodak, outperformed the market 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
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“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
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A BIAS FOR ACTION
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Excellence1982: The Bedrock “Eight Basics”
1. A Bias for Action2. Close to the Customer3. Autonomy and Entrepreneurship4. Productivity Through People5. Hands On, Value-Driven6. Stick to the Knitting7. Simple Form, Lean Staff8. Simultaneous Loose-Tight Properties”
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“Never forget implementation
boys. In our work it’s what I call the ‘missing 98
percent’ of the client puzzle.” —Al
McDonald/McKinsey
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“We have a ‘strategic plan.’ It’s
called doing things.” — Herb Kelleher
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“This is so simple it sounds stupid, but it is amazing how few oil people really
understand that you only find oil if you drill wells. You may
think you’re finding it when you’re drawing maps and
studying logs, but you have to drill.”
Source: The Hunters, by John Masters, Canadian O & G wildcatter (80%)
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“We made mistakes. Most of them were omissions we didn’t think of when we initially wrote the software. We fixed them by doing it
over and over, again and again. We do the same today: While our competitors are still
sucking their thumbs trying to make the design perfect, we’re already on prototype
version No. 5. By the time our rivals are ready with wires and screws, we are on
version No. 10. It gets back to planning versus acting: We
act from day one; others plan how to plan—for months.”
—Bloomberg by Bloomberg
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"I think it is very important for you to do two things: act on your temporary conviction as if it was a
real conviction; and when you realize that you are
wrong, correct course very quickly.” —Andy Grove
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S.A.V.
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Screw Around Vigorously
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Sam’s Secret
#1!
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“Fail faster. Succeed sooner.”
David Kelley/IDEO
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Fail. Forward.
Fast.
–High-tech Exec/PA
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“Reward excellent failures.
Punish mediocre
successes.”Phil Daniels, Sydney exec
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Boyd on TEMPO
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“The most successful
people are those who
are good at plan B.”
—James Yorke, mathematician, on chaos theory in The New Scientist
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He who has the quickest
O.O.D.A. Loops* wins!
*Observe. Orient. Decide. Act./Col. John Boyd
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OODA Loop/Boyd Cycle
“Unraveling the competition” Quick Transients/Quick Tempo (NOT JUST
SPEED!) Agility “So quick it is disconcerting” [adversary over-reacts
or under-reacts] “Winners used tactics that caused the enemy to unravel before the fight” (NEVER
HEAD TO HEAD)
BOYD: The Fighter Pilot Who Changed the Art of War (Robert Coram)
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“The stuff has got to be implicit. If it
is explicit, you can’t do it fast enough.” —John Boyd
BOYD: The Fighter Pilot Who Changed the Art of War (Robert Coram)
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Tempo!*
70-10
*Boyd/O.O.D.A. Loops/Mike Leach/Texas Tech
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70-10/Nebraska/Unk QB 643 yards K.State/ Linemen spread wide/All legals go out for pass/Defenders confused & tire (Boyd/Tempo is not speed/“Re-arrange the mind of the enemy”—T.E.
Lawrence)/ “By changing the geometry of the game, and pushing the limits of
space and time on the gridiron, Mike Leach is taking Texas Tech to some far out places.” —Michael Lewis (NY Times
Magazine, 12.04.05, on Mike Leach/Texas Tech)
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“In war, delay is fatal.” —Napoleon
“The only way to whip an army is
to go out and fight it.” —Grant “ … demonstrating the tactic
that would become his hallmark: the immediate
move to seek out the enemy and attack him” —John Mosier,
on Grant “A good plan executed right now is far preferable to a ‘perfect’ plan executed next
week.” —Patton
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Relentless!*
*Churchill, Grant, Patton, Welch, Bossidy, Nardelli (GE execs), UPS, FedEx, Microsoft/Gates-Ballmer, Eisner, Weill, eBay, Nixon-
Kissinger, Gerstner, Rice, Jordan, Armstrong
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“This [adolescent] incident [of getting from point A to point B] is notable not only because it underlines
Grant’s fearless horsemanship and his determination, but also it is the first known example of a very
important peculiarity of his character: Grant had an extreme, almost phobic dislike of turning back and retracing his steps. If he set out for somewhere, he would get
there somehow, whatever the difficulties that lay in his way. This idiosyncrasy would turn out to be one the
factors that made him such a formidable general. Grant would always, always press on—turning back was not
an option for him.” —Michael Korda, Ulysses Grant
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“METABOLIC MANAGEMENT”
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The Leadership11
1. Talent Management2. Metabolic Management3. Technology Management4. Barrier Management5. Forgetful Management6. Metaphysical Management7. Opportunity Management8. Portfolio Management9. Failure Management10. Cause Management11. Passion Management
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“The secret of fast progress is
inefficiency, fast and furious and
numerous failures.”
—Kevin Kelly
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“Active mutators in placid times tend to die off. They are selected
against. Reluctant mutators in quickly
changing times are also selected against.”
—Carl Sagan & Ann Druyan, Shadows of Forgotten Ancestors
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“How we feel about the evolving future tells us who we are as individuals and as a civilization:
Do we search for stasis—a regulated, engineered world? Or do we embrace
dynamism—a world of constant creation, discovery and competition? Do we value
stability and control or evolution and learning? Do we think that progress requires a central blueprint, or do we see it as a decentralized,
evolutionary process?? Do we see mistakes as permanent disasters, or the correctable
byproducts of experimentation? Do we crave predictability or relish surprise? These two poles, stasis and dynamism, increasingly
define our political, intellectual and cultural landscape.”
—Virginia Postrel, The Future and Its Enemies
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“If things seem under control, you’re just not
going fast enough.” —Mario Andretti
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“I’m not comfortable unless I’m
uncomfortable.”—Jay Chiat
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“If it works, it’s
obsolete.”
—Marshall McLuhan
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Bossidy on EXECUTION
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“I saw that leaders placed too much emphasis on what some
call high-level strategy, on intellectualizing and
philosophizing, and not enough on implementation. People would agree on a project or initiative, and then nothing would come of it.” —Larry Bossidy
& Ram Charan/Execution: The Discipline of Getting Things Done
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“Execution is the job of
the business leader.” —Larry Bossidy & Ram
Charan/ Execution: The Discipline of Getting Things Done
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“Execution is a
systematic process of rigorously
discussing hows and whats, tenaciously following through, and
ensuring accountability.” —Larry Bossidy & Ram Charan/ Execution: The Discipline of Getting Things Done
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“Realism is the heart of execution.”
—Larry Bossidy & Ram Charan/Execution: The Discipline of Getting Things Done
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“robust dialogue”
—Larry Bossidy & Ram Charan/ Execution: The Discipline of Getting Things Done
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“GE has set a standard of candor.
… There is no puffery. … There isn’t an ounce of denial in the place.” —Kevin Sharer, CEO
Amgen, on the “GE mystique” (Fortune)
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“The person who is a little less conceptual but is absolutely determined to succeed will usually find the
right people and get them together to achieve objectives. I’m not knocking education or looking for
dumb people. But if you have to choose between someone with a
staggering IQ and an elite education who’s gliding along,
and someone with a lower IQ but who is absolutely determined to succeed, you’ll always do better with the second person.” —Larry
Bossidy/Execution: The Discipline of Getting Things Done
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Duct Tape Rules!
“Andrew Higgins, who built landing craft in WWII, refused to hire
graduates of engineering schools. He believed that they only teach
you what you can’t do in engineering school. He started off
with 20 employees, and by the middle of the war had 30,000
working for him. He turned out 20,000 landing craft. D.D.
Eisenhower told me, ‘Andrew Higgins won the war for us. He did
it without engineers.’ ”
—Stephen Ambrose/Fast Company
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The Leader’s Seven Essential Behaviors
*Know your people and your business*Insist on realism*Set clear goals and priorities*Follow through*Reward the doers*Expand people’s capabilities*Know yourself
Source: Larry Bossidy & Ram Charan, Execution:
The Discipline of Getting Things Done
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Action8/VPMR+/Peters on Bossidy*External Focus (Competitors/Customers)
*Realism/Truth-telling*Vision *Projects (Must add up to Vision) *Milestones*Commitment/Energy*RapidReview*Consequences (+/-)
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M + P = V
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TACTIC #1
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Culture of Prototyping
“Effective prototyping may
be the most valuable core competence an
innovative organization can hope to have.”
Michael Schrage
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EXCELLENCE.
4/40.
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4/40
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De-cent-ral-iz-a-tion!
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Ex-e-cu-
tion!
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Ac-count-a-bil-ity!
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6:15A.M.
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K.I.S.S.
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450/8
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“I wanted GE to operate with the speed, informality,
and open communication of a corner store. Corner
stores often have strategy right. With their limited resources, they have to
rely on laser-like focus on doing one thing very well.”
—Jack Welch/Fortune/04.05
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Lee’s Rule: Run It off a
Blackberry!
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“The art of war does not require complicated maneuvers; the simplest are the best, and
common sense is fundamental. From which one might wonder
how it is generals make blunders; it is because they try to be clever.” —Napoleon on Simplicity, from Napoleon on Project Management by Jerry
Manas.
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BIAS
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Excellence1982: The Bedrock “Eight Basics”
1. A Bias for Action2. Close to the Customer3. Autonomy and Entrepreneurship4. Productivity Through People5. Hands On, Value-Driven6. Stick to the Knitting7. Simple Form, Lean Staff8. Simultaneous Loose-Tight Properties”
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Importance of Success Factors by Various “Gurus”/
Estimates (Unreliable) by Tom Peters
Strategy Systems Passion/ Execution
Leadership
Porter 45% 20 20 15
Drucker 35% 30 15 20
Bennis 20% 20 35 25
Peters 15% 20 30 35
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MBWA
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MBWA
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25
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Mark McCormack: 5,000 miles for a 5
min. meeting!
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“The first and greatest imperative of command is to be present in person. Those who impose
risk must be seen to share it.”
—John Keegan, The Mask of Command
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LET US MARCH
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A man approached JP Morgan, held up an envelope, and said, “Sir, in my hand I hold a guaranteed formula for
success, which I will gladly sell you for $25,000.”
“Sir,” JP Morgan replied, “I do not know what is in the envelope, however if you show me, and I like it, I
give you my word as a gentleman that I will pay you what you ask.”
The man agreed to the terms, and handed over the envelope. JP Morgan opened it, and extracted a single
sheet of paper. He gave it one look, a mere glance, then handed the piece of paper back to the gent.
And paid him the agreed-upon $25,000.
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1. Every morning, write a list of the things that need to be done that day.
2. Do them. Source: Hugh MacLeod/tompeters.com/NPR
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Do them!
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“In classical times when Cicero had finished
speaking, the people said, ‘How well he spoke,’ but when Demosthenes had finished speaking,
they said, ‘Let us march.’” —Adlai Stevenson
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Let us march.
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Nelson’s secret:
“[Other] admirals more frightened of losing than
anxious to win”
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“A year from now you may wish
You had started today.”
—Karen Lamb
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You only find oil if you drill
wells. —T he Hunters, by John Masters,
Canadian O & G wildcatter
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TP/Chile: “I don’t know
if ‘it’ is possible.’ I do know it’s ‘necessary.’”