1. Steve Gladstone
October 23, 2012

2. Agenda
 Today, we’ll look at some seemingly disparate concepts, and draw them
together:
 Innovation and motivation
 Detour I…The “Innovator’s Dilemma”
 Detour II…The “Fractal” mindset to drive innovation in the context of the
organization
 “The Godfather” as a model for driving innovation and change
 Lessons learned at the frontline: Culture and situational awareness
 Project, product, and solution companies
 Bringing it all together through “joined-up” thinking
 Finally, time-permitting, we’ll discuss fractals and artificial life as a potential model
for organizations
 Please feel free to ask questions as we go

3. So, You Want to Have an Impact?
 Explore deeply and personally what “impact” means to you
 Is it: Execute on established paths for change and innovation?
 Is it: Define & shape change and innovation?
 Is it: A seat of considered wisdom at the C-level table?
 If not, what does impact mean to you?
 Surprises in motivation…
 Money? Yes…and no.
 For creative tasks, higher rewards can lead to lower performance…
 Impact
 Mastery
 Self-direction
 Optionally: RSA Motivation Video

4. Intrapreneur
Defined
 In 1992, the American Heritage Dictionary acknowledged the popular use of a
new word, intrapreneur, to mean:
 “A person within a large corporation who takes direct responsibility for
turning an idea into a profitable finished product through assertive risk-
taking and innovation”
Source: Wikipedia

5. Detour I…The Innovator’s Dilemma (ID)
 Ground-breaking book by Clayton M. Christensen:
 How “good” companies can do everything “right” and still lose market leadership, or
disappear altogether!
 Incremental vs. disruptive innovation:
 Incumbents tend to pursue incremental (“listen to customer”)
 New entrants pursue disruptive
 Low-end disruptions eventually gain market share:
 New entrant, inferior at first, crawls “up-market”
 Later, incumbent loses market share, and often misses opportunity
 Examples:
 5.25”  3.5” Disks
 Minicomputers  PC’s
 Desktop publishing

6. The Innovator’s Dilemma Visualized
10% Growth = $10M
Incumbent
Features, Value, etc.
• Listens to the customer
• Inferior product…at first
• Incremental innovation
• Mostly ignored by market and incumbent
• Organization optimized for high price point
• Pursue low-end features
• But, add more over time…
New
Entrant 10% Growth = $100K
$ (Cost, Price, etc.)

7. The Innovator’s Dilemma Visualized
Incumbent
• Perceived as legitimate in mid-market
Features, Value, etc.
• Converts some customers from
incumbent…others notice and may follow
• Eventually begins to threaten incumbency
New Entrant
$ (Cost, Price, etc.)

8. Another View of the ID End State
Typical Incumbent Strategy:
- Sustain Market Share
- Sustain Customer Satisfaction
ID Impact:
- Lose Market Share
- Decrease Customer Satisfaction
- Struggle to Recover
Organizational Scale (Typically, Time)

9. Detour II…Fractals: Emergent Complexity from Recursive Simplicity
The Koch Snowflake & Coastlines
“Self-similarity”

10. Fractal Examples In Nature

11. Fractal Examples In Practice
Social Networks
Programming/Project
Methodologies
Digital Image Compression
Cell Phone Antenna

12. Fractal Behaviors of an Organization Drive Emergent Results and Culture
 Executive Sponsorship vs. Sleepership
 Emergent project results (Good or Bad)
 Information/Knowledge Silos
 In retrospect, can observe small factors that
 Roles and Responsibilities
compounded to the final result (Good or Bad)
 Responsibilities and Authority
 Can observe self-similar behaviors at differing
 Commitment and Accountability scales
 Performance Metrics  Company “culture” is emergent
 Etc.
Elementary Organizational Emergent
Behaviors Structure Outcomes

13. Fractals: Not Always What You Might Expect
Fractal geometry will make you see everything differently. There is a danger in reading further.
You risk the loss of your childhood vision of clouds, forests, flowers, galaxies, leaves, feathers,
rocks, mountains, torrents of water, carpet, bricks, and much else besides. Never again will
your interpretation of these things be quite the same.
— Michael F. Barnsley
Fractals Everywhere (2000)

14. OK, so you want to be an Agent of Change
 Regularly evidence deep understanding to Execs/C-levels
 What it takes to execute an idea in a company/industry context
 Know thy personal and company culture
 Create a shared “sense of urgency” through communications
 Gain awareness of “fractal” behaviors and weigh against desired project outcomes
 Only “joined up” thinking makes it happen
 Generate results…tangible and intangible
 Projects, products, and solutions execute with highest success probability
 Company and deliverables are crisply branded
 Build resilient trust with Execs/C-levels
 Executive sponsorship vs. “sleepership”
 “The Godfather” consigliere as a model

15. Execution and Communication in Context
 Understand
 Industry trends and causal relationships
 Competitive, revenue, profitability, and growth impacts
 Get into stakeholder’s heads
 The CEO’s
 The customer’s
 Others (internal and external)
 Navigate any dual/mixed C-level roles
 CIO reports to CFO
 Dual CTO/CEO role
 Who really drives change/innovation?
 Engineering vs. product management (projects vs. products)
 Be forward thinking, but balance tactics and strategy
 If you only listen to customers, then you will only be as smart as them
 For disruptive innovation, paradigm shifts must be “on the table”

16. Know Thy Personal and Company Culture
 Alignment is essential in any organization
 Clear definitions of roles and responsibilities
 Project administrators vs. project managers
 Useful process vs. worship of process
 “Centers of excellence” delivery and metrics
 Commensurate responsibilities and authority
 Misalignment can lead to overly political environments
 Join commitment and accountability
 The union builds on what we know about motivation
 Is it a Project, Product, or Solution based company?
 Core to understanding what/how change and innovation can/will occur

17. Organizational Maturity Model: Projects, Products, or Solutions?
 Recognize that everyone says they want a solution
 Projects
 Customer says “Jump!”, and company says “How high?”
 Company brand centered in capability to execute
 Products
 Company willing to gently say “no” to customers
 Typically “market” driven
 Solutions
 Company says, “We are all things to all people.”
 Bring together People, Process, Technology
 Professional services consumes/customizes company products
 Typically viewed as “end-to-end” by customer
 So, which type is your personal sweet-spot? Is it aligned with the company’s?
Note: Projects and products do not play well together
if they share execution resources.

18. Project, Product, Solution Visualized
Typical Incumbent Strategy:
Leadership Changes - Sustain Market Share
Typically Required - Sustain Customer Satisfaction
“Solution”
• Core engineering builds product
• Professional services handles customization
• Business scales in products and services
“Product” ID Impact:
- Lose Market Share
• Build what the “market” wants - Decrease Customer Satisfaction
• OK. We need a “platform” and API gate-keeper - Struggle to Recover
“Project” •
•
Truly, have a “product”
Still, can we service mass customization?
• Build whatever customer specifies
• “Recreate the wheel” several times
• Eventually, claim a “product”
• Suffer code fragmentation Organizational Scale (Typically, Time)
• How do we contend with NRE-based business scaling issues?

19. Bringing it All Together – “Joined Up” Thinking
 Understand current company projects, products, and solutions
Projects
 Leverage knowledge of present “organizational maturity”
 In company cultural context, is the change/innovation realistic?
 Is it worth the professional risk? Solutions Products
 Truly “partner” with people/teams/organizations to bring it about
 Think like a developer, project manager, CEO, etc.
 Politics of change: Create buy-in
 No buy-in = No change
 Assert with passion and create excitement
 Be proactive, not reactive
 Take reasonable risks, but mitigate
 Change is hard: Empathize, but don’t fully sympathize
 Appeal to the “arrogance” of others (by making it their idea!)
 Ultimately, “Developers own the code”

20. Communications: Create a “Shared Sense of Urgency”
 Facilitate joined up organizational thinking/execution
 Partner with Marketing for communications
 Internal communications
 Be crisp and clear about why it is urgent (“an offer they can’t refuse…”)
 Does everyone share the vision, or just versions of it?
 Authorized internal communications can serve as a lock-in
 Care and feed the messaging, don’t abandon it
 External communications
 Media and trade shows must reflect the change/innovation
 Align or revise branding strategy, as required

21. Finally, Claim Your Seat at the Table
 Significant change/innovation rollouts typically have material impact on company
 The stakes can be high
 Successful change agent championing is usually career-making
 Failure to execute (for any reason) can create a stigma for those that championed
 While execution of an idea is almost everything, its not the only thing
 Don’t burn too many bridges, as you will need them to come along next time
 And, contrary to “The Godfather”, a carefully placed horse head won’t quite do it…

22. Today, We Covered…
 Some seemingly disparate concepts, and drew them together:
 Innovation and motivation
 The “Innovator’s Dilemma”
 The “Fractal” Mindset to drive innovation in the context of the organization
 “The Godfather” as a potential model for driving innovation and change
 Lessons learned at the frontline: Culture and situational awareness
 Project, product, and solution companies
 Bringing it all together through “joined-up” thinking

23. Thank You for Participating Today
 Questions & Answers
 Steve Gladstone, spglad@hotmail.com
 Your comments & suggestions are welcomed