[music]. So I as a professor of innovation, a professor of management have been studying innovation for a long time. And I kept looking into the, sort of the theories, the, the, the practices, the stories of innovation to try to understand what's going on? How is it that innovation happens? What is it that causes innovation to go forward? What is it that stops innovation? You know, what is going on there? Let me share a couple of stories of a couple of the insights I had. First problem is there's a ton of books. There are thousand and thousands and thousands of books on innovation. And so, that's problematic in some ways because, you know, as a lay person, as a person coming in, as a person who doesn't study this, I don't know my way around, and in fact, I didn't know my way around and I'd, I studied this stuff, I'm a professor of this stuff. I was studying it and I couldn't figure out what was going on. But, through lot's and lot's and lot's of reading and lot's and lot's of, of, of sort of taking in books and trying to understand them, I began to see a set of patterns. The patterns were, that there were certain kinds of books that were written. So let me sort of say, I, I go to the library, I check out a bunch of books, I read a bunch of papers. And I, it sort of occurs to me that what they're talking about in a certain kind of book. They say the problem of innovation is the problem of the individual and their tool set. The way people think. For innovation to happen, you need ideas and ideas have to be different. So people have to think different in order for innovation to occur. I thought hm, that makes sense. We have people like Leonardo Da Vinci, Albert Einstein Niels Bohr, these people who thought differently than everyone else and by thinking differently, they were able to bring us to a different place. So, certainly that must be true, the individual has enlarger tool set. However, in my reading, I ran across another kind of book. This book was very interesting. It was written by, you know, sort of a different kind of person, different people were, were studying in different ways. And those people said, first of all, don't listen to those other people, because they're psychologist and they don't know what they're talking about. What, what really happens is, the group, it's a group's culture that matters, because here, I'll, I'll show you. Take, give me your ten Leonardo Da Vincis and put them in a room together and have them start brainstorming. Oh, we'll use antimatter and I'll use duct tape, and have all these ideas and memory metal and things are going on all around, people are having great ideas. And then, here's what you do, have the CEO, the boss, the big chief of the company, come in and listen to the brainstorm and say, that won't work. Last person said, they got fired. What a terrible idea. Get out of here. Stop wasting time. What happens to innovation? Gone. Maybe the problem with innovation is not the individual thinking different, but maybe it's the groups. When we form groups to make innovations, right, we need other people. They're going to be our customers. They're going to be our helpers. They're going to supply us with money. Maybe that's the problem with innovation, that the group's culture has a support risk. The group's culture has to allow us to play with these ideas. Hm, so I was thinking between these individual level view, the psychological view, and the next view, which is what I call the social psychological view. They're, they're very different. They make very different assumptions about what matters. So I thought this was it. But then, I ran across another kind of view, another kind of book, another set of literature and research, and thinking about innovation. And this group says, you know what, individuals don't matter and groups don't matter. At least they don't matter that much. What really matters is the organization. Because if you have an organizational structure that sort of messes things up, that does not allow things to move, doesn't allow information to go from here to here. If your strategy is about staying still, about sort of reinforcing, about reducing risks instead of about changing new things, you're not going to have innovation. In fact, if you think about this, if you make computer chips, it's really different than making potato chips. And there's a complete difference there. What is that? Is that the real reason, maybe that's the real problem of innovation. That organizations are structured in the ways to take our ideas, and to move them through groups, and then will allow us move the information around us, strategically execute our ideas. Maybe that's the problem of innovation. Well, I like to believe that. It, it's just these three. But in fact, there's more. There's another view by the economists. Sort of we can call it a market based view, and the market view says innovation, in order for innovation to be meaningful it has to be adopted, that people actually have to move it and bring it into their lives. They have to change their life around it and if the market does not see the utility in the value of innovation hey're not going to adopt it. Maybe it's a creative idea, but if it's not adopted, it is not an innovation. And so we can think about that, there's many, the seque example that I was using before. The market did not see the utility and value of that thing. And so maybe the problem is there. Maybe the problem is in it the market. However, there's, there's got more views another view of the society. We talked about human cloning for a moment ago. Maybe the society has to say, that proposition for change you have, we like that. And so we will not make that illegal. We'll let that be legitimate. We'll in fact aspire to that. That's a change that we think makes us better. Makes us better at who we are. Makes us better at what we want to be. So maybe that's the, the secret to innovation is to find things that society will say, yes, that's in fact a good thing, that's something we want. However, I was an engineer, I was trained as an engineer, as a young person, very young. And there was always a view in engineering that the problem of innovation has nothing to do with people at all. The problem of innovation is that some kind of technology has to be developed and has to work. Think about it this way. When you do brain surgery, it's hard to keep the body alive. It's just hard. And it's not about individuals or groups or organizations, it's not about society, it's just a very difficult thing to get the oxygen into the hemoglobin and get that through the lungs and get that to the cells, a very difficult thing. So if you look at these, you ask them a question. Well, which one is it? Which of these is true? Let me ask you to just take a moment and think about, which one of these do you believe is true? Is the problem that, of why innovation fails, the individaul? Is it that the person is not challenged to think differently? Is that the problem? Or maybe it's the problem of the group, that new ideas are killed by a group during brainstorms because of members' behavior. The CEO comes in and does these behaviors. Or, maybe innovation's killed at the organization level, because the organization doesn't consider innovation as strategic. Where's the market? The market fails to recognize, or respond, to an opportunity to make life better. Or, is it because society that society doesn't except something as legitimate, and society does not support values and aspirations that, that don't go with it. It has to support us, it has to make us feel better as a society. Or, is it technologically that the, the innovation was just not fully developed. Maybe the innovation is not quite ready for prime time. It's not quite ready to be released into the world. So which one is it? Why does innovation fail? Well, I'm not sure. But let's take a look at some other approaches. So again, what I just talked about was the ways in which The academic literature, the books that we read talk about innovation. And any innovation book you pull off the shelf can, can pretty much be slotted in any one or two of these categories here, and, and it takes that perspective. But now, as I began to look at this, I was thinking about, well, how do I make sense of this? Yeah, they're all true, of course they're all true, but which one is true when? And which one is more true? So let me tell you few stories about some other things that, that had occurred to me as I was doing lots of reading and I was trying to understand what was going on. One thing I came across, I was doing some work with the company called ACH Foods, ACH Foods in Memphis, Tennessee. They have a number of, of interesting brands, one of their brand is called Mazola and it's a oil brand and many, many countries have Mazola oil. One day I was there, we were working on some innovation projects and they showed me a product that they had come out with. This product is called Pure. So this is Pure, and, Pure is interesting, because it is 100% fat, it's 100% oil. And it's naturally fat free, there's no oil in this oil. What does that mean? There's no oil in the oil, how can that be. Well, take a look. If I take a look at the look at this. 0 calories 0 fat, 0 trans fat, 0 cholesterol, 0 carbohydrate, 0 protein. This stuff is better than water I guess. No, in fact, take a close look here. Serving size, 1 4th of a second of spray, 0.25 grams. Hm, so it seems what they've done is they've made the serving size, so small that it falls under the regulations about what fat is. How, what fat content is. In fact, it is under half a gram of fat per serving. So let me see if i can get a quarter of a second of spray. Oh, that's not a quarter of a second of spray. Okay, I guess I will get fat. I ate too much of that. So you get the idea there that, that's one, let's take that as an example. Here's another example. This was the first electric car. The Nissan Tama. In fact, we're thinking now, oh, we have all these great electric cars. Then here's an old one, that was done in the 40s. Why would they have done this car as an electric car? Well, there's some things here that were going on. Think about the time. Think about what's going on in the world. Think about the availability of, of national resources things like oil and things like that. Hm, it begins to make sense why the Nissan Tama would have been done. Here's another one, the PalmPilot. Maybe you've seen the PalmPilot or heard about the PalmPilot, but let me tell you a little bit about the story of the PalmPilot. So this PalmPilot was this device that was formed Apple, company Apple had been trying in the early 90s to, to basically to, to crack this problem, that, that is, to innovate around this problem called handwriting recognition. So their idea is if I could get people to put things in, into, let me go grab mine here, if I could get people to do entry into their device with handwriting, that would be very successful. It would be an easy thing and people could carry it around. Well, it was very difficult to do that. But one person figured it out. And he said, well, why are we making it hard for a computer to recognize handwriting? Because if you think about the way people write, sometimes you write this way, sometimes you write that way, sometimes you print, sometimes you're in cursive. There's all these different ways of writing. And so what happens is very difficult for the computer to understand. And so, this gentlemen said, why don't we just, we're doing dumb, the, we're acting dumb as Jeff Hawkins, we're doing the dumb thing. We're making the computer do the hard thing. Lets just have the person do the hard thing. Lets just have the person do the hard thing. Lets teach him a new way to write. Hm, let's get everyone to write a new way so the computer can understand it. And in fact, it was very successful. It took about 5 minutes to learn the graffiti drawing language that was here and that was designed to allow the computer to understand it very rapidly. Interesting. This was a very successful product that was only displaced by the BlackBerry by RIM. And I believe it was probably because RIM had online e-mail which no one else had. And they had it probably for as much patent reasons as they had for technical reasons. Well, here's another one, this for you in Northern Europe, you might recognize this as a Schnellimbiss. It's sort of a fast food joint, like the equivalent of a traditional McDonald's. So if you'd been in Germany a hundred years ago, you might have seen these things. Well, if you wanted to break into this industry, that is, to go into the Schnellimbiss industry, the problem is all the good spots. This is the food place, they have french fries, they may have sausage, they may have beer, they may have all kinds of things that are interesting to people. And, they have it in a place where you walk by. And, the problem is the places where you walk by are all taken. The good spots are taken, next to the subway station, next to a you know, soccer stadium, next to they're all taken. And so, if you want to move into this industry, it's going to be very difficult to do. Well, someone figured out how to do it, and I present to you, the grill walker. The grill walker's a person, they walk around, they have propane on the back, that's the gas in the back, and they have the grill in the front. And they make these sausages, and they walk around and sell them would you like a sausage, sir? Would you like a sausage? Hm, what do you think? This is a pretty good response to the problem of these location monopolies that people had. Why was this successful when the electric car wasn't? Why was this successful and the first MP3 player wasn't? That's, that, that's been perplexing to me. As I started thinking about this in more detail, I started thinking about, like, why did this thing work? What was the, the, the, what happened that allowed this thing to work? Well, it turns out there were a number of conditions of success, things that had to be true in order for this thing to work. He had to have hungry people. They had their own certain health codes. There were all these things that I've shown here that have to be true in order for this project to work. But in fact, you see this small area here, the small overlap area, is in fact the area where the current solution is. The current solution solves all these problems. So now, somehow, the new entrant, the new person in there has to open up this space in some way that allows for more different ideas for how to solve this problem. And so, where there were location monopolies before, by having a person walk around pushing this thing around, we have no location monopolies, and all of a sudden, we're at a place where we can try something different. So in fact, there, here is something very different. A little research on this invention, on this company, and it turns out they sell their most sausages where? Where do you think they sell the most sausages? So, let's, let's say they were in Germany, and they were walking around selling sausages. Where would they sell the most sausages? Well, number one is soccer games. Of course, after soccer games and people come out, they're hungry, maybe they've had some beer, they've shouted a whole great deal at the players and at the opposing team. They're hungry and so they eat it all up. And the second most, which is kind of interesting to me, they said that they sell a lot of sausage at government demonstrations. Of all the places to sell our sausage, I guess that kind of again, we're shouting at people, and doing that kind of thing, makes us hungry as well. So here, we see how the starting with the small, with the puny, remember the puny idea? Starting with the small, puny idea, if we can just open up that space and open up that space, there's more possibilities for us to innovate in. Same goes for the handheld innovations why I showed you the PalmPilot, well, there are all these things that had to be true. It had to cost a certain amount. We had to have a certain device size. We had to have a certain battery life, and the processor speed, and all these things had to be true. But the problem was the software was so complex that this thing didn't work. There was not an overlap. And so, when Jeff Hawkins came in he said, well, let's just have the person do the hard part and let the computer do the easy part. By doing that, he created an overlap and all of a sudden, there was a possible solution. So, all the conditions of innovation, all these different things that are the conditions were met and so, innovation was possible. So as I've been thinking about this, I've been finding more and more stories that sort of meet this, this, this pattern. There's a story about the Metropolitan Opera, and how they went to their, propose a project, their, a new way of, of letting more people into their space called live in HD. And so, live in HD, what it is, is the opera, opera's excuse me, the opera's performed live, and then they videotape it, they don't videotape it, they video it and stream the video into a series of movie theaters around the country. And so people in the movie theater can actually watch the opera as it's going and these are people who might normally, normally go to the opera. People who might not be able to fly to New York and do the opera there. Well, the way this thing came about is interesting. So if you think about what are the conditions under which a successful performing arts program can be put on and it's kind of interesting. So we have things like the board, and then, of course, the board is the governing body of the, of the opera. They're going to say, yeah, we want to do some Mozart or we're going to do some Wagner, and then that's the decision and so all the choices that we have are inside of that. Then we have a certain stage size, and production size, and production cost and, you know, all these things that have to be true in order for this innovation to occur. Well, this one is interesting in that, when they first started working innovation, in fact, they worked a year into innovation that they were working on this for a long time before they realized someone read the contract with the artist that said basically, you can't do this. So imagine, you're working on a project, you work on a project for an entire year, and then you find out you can't do it that way. Hm, so, understanding is what they did, where they re, they sort of changed, they reconfigured the way that they were talking about it, so they weren't talking about changing the artist's contract, changing the union contracts. What they were talking about is about an intellectual property agreement, is a very different thing, is a very positive thing. Changing a union contract's negative, and even the language makes you sort of grumpy and, but if you say oh, we're going to do profit sharing or we're going to have equity and we're going to do streaming royalties. All of a sudden, it's a very different conversation. It's the same thing, but it's a very different conversation. And so, by changing this, they were able to actually get this innovation done. And so, in fact, there is now live in HD through the Metropolitan Opera. Here's another one from the art world. Christo, you may have heard of Christo. Christo loved to wrap stuff and loved to, to sort of surround things and here he's wrapped 11 islands. So he had 11 islands. This is off the coast of Miami Key Biscayne, there's a set of islands there. And so, he decided he going to wrap these things in bright, hot pink polypropylene. Hm, okay, well, why would you do that? Well, okay, that's hard, that's why we do it. So, if we think about what was hard about doing it. Was it hard to think of the idea? Well, let me wrap something. He's looking around, maybe he's flying over in a plane saying, I'll wrap those islands down there. That doesn't seem that hard. But was is hard is getting a bunch of people to help you do this. So this thing required about 400 people, more than 400 people to do. There were my understanding is about 6 1/2 million square feet of hot pink polypropylene. Where do you get that? Hello, Home Depot, can I have some hot pink polypropylene, six and a half million square feet? We're going to need a deposit on that, sir. Couldn't imagine doing that we have to be, sew it altogether, all these things were sewn there was flotation devices inside to make them float. Had to be towed into place and people had to stay there day and night to make sure no one stole them, that the waves didn't carry them away. They had to consult with marine biologists, with mammal experts, with ornithologists, with bird experts, and make sure they weren't hurting anything. Even construction engineers to make this happen. So it seems like it would have been a pretty hard thing. But you know what? None of this was hard in compare to the permissions that they had to get. They had to get permission from the governor, they had to get permission from the county, they had to get permission from the Department of Environmental Regulation. They had to get permission from everyone, from all these organizations in order to allow this thing to happen. So what do you think is harder, getting some hot pink polypropylene or getting permission to wrap some islands? I'll bet it was the latter that was much more difficult. In fact, Christo and Jean-Claude, in their art, talk about the process, the part of the process of this thing is actually getting that permission. That's part of the art what, that they see. So, part of the art is overcoming the constraints that would stop this thing from happening, that is, creating the conditions of success. So looking at again and again and again, looking at so many different of these exercise, of these examples, it's been really interesting. And again check, check, check out the book if you want to see more specific examples about this. But basically sort of, the, the conclusion is, more generally, that there are at least six things that I found that will be, be involved with any innovation you can think of. So again, any innovation, you bring me, and I'll show you six things that have to be true, six conditions that have to be met in order for it to be a successful innovation. The first condition is a creative idea, you need a new idea. If it's the same old idea, it's not creative, it's not innovative, it's not new. So we need a new idea. Okay. And that's what the individual come with the new idea. The second thing is, you're going to need supportive group. Because anything that's interesting is going to involve other people, either as customers, as clients, as helpers, as spouses, as emotional support, as technical support. And so we're going to need supportive group. We're going to need other people. The third thing that has to be true is a execution capability. So it's not enough to have the idea, and then have people help us think about what it should be, but we actually have to be able to do the idea. And so, I sort of think of this as a organizational execution, execution. We have to organize people into a way that we, this thing can actually happen, so that this innovation can actually be real in the world. Next, we need some, a market. We need a place where we can sell this thing. We're an industry and we have to be able to sell it faster, better, cheaper than our competitors. And so we need a willing market for our idea, for the innovation. Then, we have to make sure the thing is legal. It has favorable regulation. People aspire to it. It doesn't violate some basic ethics or basic morals that we have as, as a society. And then, finally, the thing has to work. I mean, if it doesn't work, it's not innovation. So you can see, all these six things actually have to be true, and I argue that these will apply to any problem that you could bring, any kind of innovation problem that you might have. And so that's what this class is going to be about is about how do we recognize the innovation constraints? These are called this constraints. The condition of success, the constraints for any problem that you might bring.
