There are four powerful and competing forces operating in all organizations today: (1) the turbulence of daily work, (2) incremental process improvement, (3) sustaining innovations, and (4) disruptive innovations. All are essential but truly different in most respects. In a perfect environment, with finite resources, an organization would have all operating together in harmony, with the right proportion of resources devoted to each. How do you get the balance right in your organization between today and tomorrow?

1. ©2014
FCB
Partners.
All
rights
reserved.
Brad
Power
and
Steve
Stanton
Webinar:
March
25,
2014
CoExistence:
Today’s
Performance
Engine
AND
Tomorrow’s
Innova=on
Energy

2. Are
You
Tuning
the
Performance
Engine
or
Innova=ng?
The
Performance
Engine
An
Innova=on
Ini=a=ve
— Day-­‐to-­‐day
— Sustaining,
incremental
— Repeatable,
predictable
— Occasional
— DisrupKve,
radical
— Uncertain
outcomes
1

3. Can
You
Create
an
Organiza=on
that
Embraces
Con$nuous
Innova$on?
Why
Now?
Drivers
— Social,
mobile,
‘Big
Data’,
cloud,
sensors,
cameras
— SoOware
is
eaKng
the
world
Threats
— Shorter
produce
lifecycles
Opportuni=es:
Role
Models
— High-­‐tech
disruptor:
Google
— Retail
and
high-­‐tech
disruptor:
Amazon
— Product
disruptor:
3M
2

4. Amazon’s
Approach
to
Con$nuous
Innova$on
Innova=on
Examples
— Kindle
— Web
services
— Amazon
Prime
— Drones?
Management
System
— Think
big:
the
everything
store
— Focus
on
customer
value
— Disrupt
yourself
(used
books,
Kindle)
— Set
up
lab
in
Silicon
Valley
(A9,
Lab
126)
— AcquisiKons
(Zappos)
— Missionary
(relentlessly
disrupKve)
and
mercenary
(calculaKng
and
ruthless)
3

5. Google’s
Approach
to
Con$nuous
Innova$on
Innova=on
Examples
— Driverless
car,
maps
— YouTube
— Google
Glass
— Google
Fiber,
Project
Loon
— Google
Goggles
Management
System
— Google[x]
(moonshots)
— AcquisiKons
(Makani)
— 20%
Kme
— Quick
demos
— Run
lots
of
experiments
and
let
the
market
decide
— Fail
fast
and
learn,
scale
up
quickly
if
it
shows
promise
— Culture
of
openness,
analyKcal
rigor,
and
respect
for
workers
4

6. 3M’s
Approach
to
Con$nuous
Innova$on
Innova=on
Examples
— Scotch
tape
— Post-­‐Its
— Thinsulate
Management
System
— 15%
rule
(free
Kme)
— InnovaKon
centers,
labs
— Technical
council,
forums
— 30%
rule
(new
products)
— 6%
rule
(R&D
spending)
— Seed
capital
— Technical
career
track
— Rewards
(Carlton
Society,
Golden
Step)
5

7. 6
©2014
FCB
Partners.
All
rights
reserved.
What
do
we
mean
by
CoExistence?
— There
are
four,
powerful
and
compeKng
forces
operaKng
in
all
organizaKons
today:
– The
turbulence
of
the
day
job
– The
incremental
process
improvement
world
– The
search
for
sustaining
innovaKons
– The
hunt
for
disrupKve
innovaKons
— All
are
essenKal,
but
truly
different
in
most
respects.
— In
a
perfect
environment
with
finite
resources,
an
organizaKon
would
have
all
operaKng
together
in
harmony,
with
the
right
proporKon
of
resources
devoted
to
each.

8. 7
©2014
FCB
Partners.
All
rights
reserved.
Tidal
Forces
at
Play
The
Turbulence
of
Daily
Opera=ons
Incremental
Improvement
Sustaining
Innova=on
Disrup=ve
Innova=on
Day
Job
Six
Sigma
Lean
ReinvenKon
Current
op
model
Current
Current
New
Work
Improve
Change
Transform
Performance
Engine
Performance
Engine
ConKnuous
InnovaKon
ConKnuous
InnovaKon
OperaKon
OperaKonal
Excellence
OperaKonal
Excellence
Product
Leadership
Sameness
Beper
Sameness
Much
Beper
Sameness
Different
Stable
Small
Incremental
Bigger
Incremental
DisconKnuous
Today’s
results
Near
Future
Near
Future
Farther
Future

9. 8
©2014
FCB
Partners.
All
rights
reserved.
Propor=onal
to
Disrup=on?
Stable
World
Change
Coming
Disrup=on
Now!
You?
Daily
OperaKons
90%
85%
75%
Incremental
Improvement
5%
5%
5%
Sustaining
InnovaKon
5%
5%
5%
DisrupKve
InnovaKon
5%
15%

10. 9
©2014
FCB
Partners.
All
rights
reserved.
However…
— On
one
hand,
organizaKons
absolutely
must
drive
their
Performance
Engines
to
produce
the
processes
and
results
that
are
needed
for
today’s
customers.
— On
the
other
hand,
organizaKons
must
also
generate
ConKnuous
InnovaKon
Energy
to
prepare
for
and
evolve
into
successful
futures.
— In
many
organizaKons,
these
two
imperaKves
are
in
direct
conflict
and
resource
investment
is
imbalanced.
— In
reality,
as
most
large
tradiKonal
companies
compete
for
scarce
resources,
the
Performance
Engine
almost
always
wins
the
lion’s
share.
— Sustained
success
requires
a
well
designed
and
evolving
strategic
balance
between
the
Performance
Engine
and
ConKnuous
InnovaKon.

11. 10
©2014
FCB
Partners.
All
rights
reserved.
Brad:
Where
to
Start?
1. Build
the
sense
of
urgency:
How
big
is
the
threat
of
disrupKon?
OpportuniKes?
2. Form
a
guiding
coaliKon
3. Develop
a
vision:
IdenKfy
‘moonshots’
driven
by
emerging
technology
4. Organize:
Process
owners,
Process
innovaKon
lab
5. Define
and
start
tracking
process
innovaKon
measures
10

12. 11
©2014
FCB
Partners.
All
rights
reserved.
Steve:
Where
to
Start?
1. Measure
and
allocate
resources
explicitly
across
4
domains
2. Ensure
discrete
sponsorship
for
each
domain
3. Do
less
4. Sharpen
strategy
and
strategic
planning
outcomes
5. DramaKcally
improve
‘sensing’
processes
6. Be
even
more
paranoid
7. Have
balanced
measures
and
execuKve
incenKves
8. Think
Big,
Start
Small,
Learn
Fast