The Emergent Approach to Strategy: Adaptation, Innovation, and Historical Insights

In this episode, the focus is on Peter Compo's discussion of 'The Emergent Approach to Strategy,' specifically its application to adaptation and emergence in strategy development. The conversation explores the parallel between biological evolution and human innovation, highlighting the importance of adaptive systems in creativity and strategy. Historical examples, such as the early automotive industry led by Henry Ford and modern electric cars pioneered by Elon Musk, are used to illustrate how low-level disciplines and rules can lead to high-level strategic outcomes and industry transformations. The episode delves into the principles of complex adaptive systems, emphasizing the balance between discipline and free-thinking, and how effective strategies emerge from rigorous local actions. Peter Compo also addresses the concept of levels within organizations, stressing the significance of being attuned to low-level operations to drive innovation while avoiding becoming prisoners of past successes.

00:00 Introduction and Welcome

00:08 The Concept of Adaptation and Emergence

03:43 Historical Examples of Adaptive Systems

07:13 Ford's Strategy and Its Evolution

10:39 The Theory of Levels in Creativity and Innovation

18:54 Connecting Levels to Strategy

27:41 Ants and Social Insects: A Case Study

31:48 Intel's Transition to CPUs

35:20 Conclusion and Final Thoughts

Link to Peter’s website: https://emergentapproach.com

Link to Peter’s Music: https://www.youtube.com/channel/UCJsn2zbnx8dwvHJrisdkAtg

Link to Scale with Geoffrey West Part 1 of 3: https://youtu.be/P3WowJWdX5w?si=lcgHp-bC6OrAuobG

Link to Aidan McCullen for Keynotes, workshops and event MC.

https://theinnovationshow.io

Find us on Substack for Shownotes and competitions:

https://thethursdaythought.substack.com

Peter Compo, Aidan McCullen, emergent strategy, Peter Compo, adaptive systems, innovation, complex adaptive systems, business strategy, evolutionary mechanisms, creativity, Henry Ford, Tesla, Elon Musk, execution, Intel CPUs, corporate discipline, low level rules, high level outcomes, market forces, leadership insights

The Emergent Approach to Strategy with Peter Compo: A Deep Dive into Adaptive Systems

In this episode, we welcome Peter Compo, author of 'The Emergent Approach to Strategy,' to discuss the chronic failures in strategic planning and how his new book aims to redefine strategy through the lens of complex adaptive systems. Peter explains the importance of moving away from traditional planning methods and embracing an agile, emergent approach that focuses on adaptability and real-time guidance. Drawing from 25 years of experience in corporate America, including his tenure at DuPont, Peter provides practical insights into how organizations can raise their probability of success by understanding and addressing the real bottlenecks to achieving aspirations. We explore key concepts from his book, such as the triad of aspirations, bottlenecks, and strategy, and the role of rules and constraints in fostering innovation. With a mix of theory and practical application, this episode is a must-listen for corporate leaders, business strategists, and anyone interested in innovation and strategic planning.

00:00 Introduction to Strategy Failures

01:32 Guest Introduction: Peter Compo

02:06 Elevator Pitch: New Theory of Strategy

07:29 The Role of Discipline in Innovation

07:47 Music and Corporate Strategy

12:46 Challenges in Strategy Execution

14:00 The Misunderstanding of Strategy

17:43 Planning Under Uncertainty

21:30 The Importance of Adaptive Strategy

35:57 Emergent Strategy and Mintzberg's Teachings

36:44 Deliberate vs. Emergent Strategy

37:55 Understanding Strategic Constraints

39:24 Exploring Different Strategic Approaches

41:33 Overview of Strategy Concepts

43:12 Defining Strategy Across Fields

47:18 The Role of Rules in Strategy

52:22 The Triad of Aspiration, Bottleneck, Strategy

01:02:45 Consulting and Real-World Applications

01:07:22 Conclusion and Resources

Link to Frank Barrett’s episode “Yes to the Mess” part 1 and 2: 

https://youtu.be/xgkk-Vlgtt0?si=-Ddv-aGFj8XtsDrF

https://youtu.be/D7dR5Gi7i80?si=bJ3NhwhhnuYWgVbl

Link to Peter’s website:

https://emergentapproach.com

Link to Peter’s Music:

https://www.youtube.com/channel/UCJsn2zbnx8dwvHJrisdkAtg

Link to Aidan McCullen for Keynotes, workshops and event MC:

https://theinnovationshow.io

Find us on Substack for Shownotes and competitions:

https://thethursdaythought.substack.com

strategy, innovation, complex adaptive systems, Peter Compo, Aidan McCullen, DuPont, emergent approach, strategy definition, corporate strategy, business strategy, adaptive systems, strategy framework, Roger Martin, Michael Porter, Mintzberg, Charlie Parker, jazz improvisation, creativity in strategy, bottleneck, aspirations, goals, execution, discipline in strategy, innovation challenges, long-term planning, organizational change, innovation process, strategic planning, decision making, business leadership, corporate America

In the latest episode of the Corporate Explorer series, brought to you by Wazoku, we discuss the importance of balancing personal instincts with data and evidence in business decisions. Guests, Product Marketing Manager for Electric Vehicles & Customer Experience with Cadillac, Sarah Spoto and Vincent Ducret from ChangeLogic share their experiences of implementing experimental frameworks in China for General Motors. They emphasize the critical steps of assumption analysis, prioritizing hypotheses, and iterative experimentation, while also addressing challenges in corporate environments, such as maintaining cultural buy-in and celebrating failures as learning opportunities. Sponsored by Wazoku, the episode offers deep dives into innovation management, strategic risk-taking, and the use of connected collective intelligence to drive business success.

00:00 Introduction: The Pitfalls of Instinct-Driven Decisions

00:40 The Role of Data in Corporate Exploration

01:07 Sponsor Message: Wazoku's Innovation Ecosystem

01:56 Incubation and De-risking New Business Ideas

02:19 Meet the Corporate Explorers: Sarah Spoto and Vincent Ducraix

02:50 Sarah Spoto's Journey in Corporate Innovation

04:40 Vincent Ducraix's Background and Experience

06:55 The Business Learning Life Cycle Framework

08:10 The Importance of De-risking in Corporate Ventures

13:04 Challenges and Strategies in Corporate Experimentation

14:33 The Role of Leadership and Team Buy-in

21:08 Case Study: Experimentation in China

30:28 Final Thoughts and Contact Information

Find Sarah here: https://sarahspoto.com

Find Vincent here: https://changelogic.com/team/vincent-ducret/

https://www.linkedin.com/in/vducret/ 

Key Takeaways

This conversation explores business experimentation using a framework outlined in the Corporate Explorer book. Here are the key takeaways:

Challenges of Corporate Innovation:

• Reliance on past experience can lead to failure in new ventures due to high uncertainties.
• Traditional methods like surveys might not capture the right data for untested ideas.

The Business Experiments Framework:

• Identify Key Assumptions: List all critical assumptions about your new venture (customer value proposition,problem addressed, etc.).
• Prioritize Assumptions: Focus on the riskiest assumptions that could derail the project.
• Design Experiments: Create creative experiments to test these assumptions with real customer data (not just surveys).
• Collect Learnings: Analyze experiment results to validate or disprove assumptions.
• Iterate: Use learnings to refine your approach and potentially conduct new experiments on remaining assumptions.

Benefits of Business Experiments:

• Reduces risk by validating assumptions before significant resource investment.
• Provides data-driven decision making for building the right product for the right customer.

Challenges of Implementing Business Experiments:

• Balancing Speed and De-risking: There's a tension between demonstrating progress and taking the time to properly de-risk the project.
• Cultural Shift: Organizations need to embrace experimentation and see failures as learning opportunities.
• Team Buy-in: Both leadership and working-level teams need to understand the value of experimentation.

Success Factors:

• Strong Leadership Support: Having advocates who understand and champion the approach is crucial.
• Cultural Investment: Educate teams on the process and celebrate failures as learning opportunities.
• Focus on Learning: Value the insights gained from experiments, even if they disprove assumptions.

Example Implementation:

• Sarah Spoto's experience in China highlights the importance of setting the right incentives and building a cross-functional team for experimentation.
• Assumptions analysis is a valuable starting point, even if full experimentation isn't implemented.

Overall, business experimentation offers a structured approach for de-risking new ventures and making data-driven decisions in the face of uncertainty.

Very few large companies manage to avoid stalls in revenue growth. These stalls are not attributable to the natural business cycle. Our guest's careful analysis reveals that most such stalls directly result from strategic choices made by corporate leaders. In short, stoppages in growth are almost always avoidable.

This extensively researched book analyses the growth experiences of more than 600 Fortune 100 companies over the past fifty years to identify why growth stalls and to discover how to rectify a stall in progress or, even better, avoid one. Board members and executives in companies of all sizes will find this book a practical and essential resource. 

Our guest investigated the incidence and consequences of growth stalls in major corporations and then probed the root causes.

Examining hundreds of stall points, the authors conclude that the greatest threat to a company's growth is obsolete strategic assumptions that undermine market position and innovation and talent management breakdowns. It is a pleasure to welcome back our recent guest in the Clayton Christensen tribute series, the author of “Stall Points: Most Companies Stop Growing - Yours Doesn't Have To - Derek van Bever

C.S. Lewis once said, “Good and evil increase at compound interest. That’s why the little decisions we make every day are of infinite importance. the smallest good act today is the capture of a strategic point from which, a few months later, you may go on to victories you never dreamed of” This quote came to mind as I pondered today's book. Just as the good things we do compound over time, so too do the not-so-good things, it was jinn Dryden who wrote first we make our habits then our habits make us. This is the case for the daily stresses we tolerate, our guest calls these microstresses. “Microstress: tiny moments of stress triggered by people in our personal and professional lives; stresses so routine that we barely register them but whose cumulative toll is debilitating.” In its annual State of the Workplace survey, Gallup concluded that only 33 per cent of those surveyed were“thriving” in their well-being, with 44 per cent of employees reporting experiencing “a lot” of stress in a typical workday—a record high.1 But little recognised or adequately studied is the toll of this new form of stress.

The toll is so subtle that we barely register it, but the cumulative effect can derail even high performers, both personally and professionally. We welcome the author of "The Microstress Effect" Karen Dillon

This is my guest appearance on The Disruptive Voice Podcast. Exploring the theories of disruptive innovation across a broad set of industries and circumstances with academics, researchers, and practitioners who have been inspired and taught by Professor Clayton M. Christensen. In his book, Undisruptable: A Mindset of Permanent Reinvention for Individuals, Organizations, and Life, Aidan McCullen writes about how, centuries ago, sailors would set out to sea with maps labelled with the Latin words hic sun dracones - here be dragons - which meant that they didn't know much - if anything - about the uncharted waters and unexplored lands that awaited them. In today's volatile and uncertain world, there are parallels to be drawn between the odysseys of past and present. There are also strategies that can be employed, both by corporations and by individuals, to thrive amidst challenging circumstances, and they center on the intentional development of a mindset of permanent reinvention. Aidan himself exemplifies this mindset, having built capabilities as a professional rugby player, a digital media specialist, an innovation and change consultant, a professor at Trinity College Dublin, and host of The Innovation Show podcast, where he's in the midst of a three month series dedicated to the life, work, and theories of Clayton Christensen. In this Disruptive Voice episode, he joins Katie Zandbergen to discuss the experience of putting the series together, including not only re-reading all of Clay's books but also having in-depth conversations with his co-authors; the necessity of building capabilities before we need them; lessons we can learn from immortal jellyfish; insights gleaned from making the time to read eclectically; finding assets in ashes; and, above all, the importance of facing the dragons in our lives and of always becoming - the concept of permanent reinvention.

Today’s book offers over eighty assignments, countless ideas, and memorable stories collected throughout The Stanford d.school’s decade-plus history. Today’s guest painstakingly curated this collection from some of the world's most inventive minds, including d.school and IDEO founder David Kelley amongst others.

She is with us today to share some of those assignments to spark our creativity because a common characteristic of our audience is - without a doubt - curiosity. It is a pleasure to welcome the Executive Director of the Stanford d.school and the author of Creative Acts for Curious People: How to Think, Create, and Lead in Unconventional Ways, Sarah Stein Greenberg.

Find Sarah here: http://www.sarahsteingreenberg.com

Find d School here: https://dschool.stanford.edu/books

In Chapter 5 of Tushman and O’Reilly’s "Lead and Disrupt", the authors share how Cypress Semiconductor used a similar venture funding model, complete with a one-page business plan, for initial funding to grow $40 million in businesses. With their approach called a “Federation of Entrepreneurs”, Cypress is a great case study in ambidextrous leadership.

In June 2019, Infineon Technologies announced it would acquire Cypress for $9.4 billion. The deal closed in April 2020, making Infineon one of the world's top 10 semiconductor manufacturers. 

We are joined today by that ambidextrous leader, the former CEO of Cypress TJ Rodgers and the author of Lead and Disrupt, Charles O’Reilly III.

In Chapter 5 of the Corporate Explorer, Binns, Tushman, and O’Reilly share how a Corporate Explorer created a new business inside the consulting and accounting firm Deloitte.

His new unit, Deloitte Pixel, uses the “wisdom of crowds” to solve complex management problems. His first experience of the power of crowds came when he was part of a self-organised community that came together to provide relief for victims of the 2004 Indian Ocean tsunami. This taught him that communities of people could self-organise and do work that traditional organisation structures might struggle to perform. He then started to apply similar principles of crowds to management consulting. 

It is a pleasure to welcome that very Corporate Explorer, joined by his friend Andrew Binns.

There is no formula for immunity to disruption. Invincibility is an illusion. However, one factor explains why some succeed at corporate venture building. Our experience working with midsize and large legacy firms has shown us that innovation is as much about leadership as it is about the method, strategy, organization, and culture. Leaders who ignite and sustain an exploration spirit are more likely to succeed than those who rely on past strengths or success formulas to carry them through.

Corporate Explorers are at the centre of every story of corporate innovations whose intense curiosity makes them dare to go where others do not. These are leaders capable of closing the gap between knowing what needs to be done to grow new businesses and doing so. Today’s book is 20 years in the making. It started when our guest attended an IBM Strategic Leadership Forum at Harvard Business School led by our previous guests in this series, Michael Tushman and Charles O'Reilly III.

Our guest had just joined IBM from McKinsey and was assigned as an internal consultant supporting these budding businesses. We are about to hear that story and so much more.

It is a pleasure to welcome the author of “The Corporate Explorer: How Corporations Beat Startups at the Innovation Game”, Andrew Binns.

Why do successful firms find it so difficult to adapt in the face of change – to innovate? In the past ten years, the importance of this question has increased as more industries and firms confront disruptive change. The pandemic has accelerated this crisis, collapsing the structures of industries from airlines and medicine to online retail and commercial real estate. Today, business leaders are obligated to investors, their employees, and communities. At the core of this challenge is helping their organizations to survive in the face of change.

The original edition summarized the lessons the authors had learned as researchers and consultants over the previous two decades. Since then, they have continued to work with leaders of organizations worldwide confronting disruptive change. With updates to every chapter, including new examples and analysis, this fully revised edition incorporates the lessons and insights the authors have gained in the past five years. Two new chapters critically examine the role of organizational culture in promoting or hindering ambidexterity and its underlying fundamental disciplines. Using examples from firms such as Microsoft, General Motors, and Amazon, O'Reilly and Tushman illustrate how leaders can align their organization's cultures to fit the needed strategy and how ideation, incubation, and scaling approaches, when used all together, can successfully develop new growth businesses.

In part 2 of our Tushman and O'Reilly series, Charles O'Reilly III explores the importance of cultural alignment in encouraging change. We focus on the cases of DaVita, Microsoft and AGC.

00:01:17 Origin Story

00:05:20 Ideate, Incubate, Scale

00:07:37 Culture

00:10:50 The Tyranny of Success: Gunfire At Sea 

00:24:20 The L.E.A.S.H. Model

00:21:45 Organisational Culture Change: How Microsoft Transformed Its Culture 

00:26:58 DaVita: A Community First, A Company Second

00:31:51 The Importance of Language For Culture Change

00:36:12 AGC INC. IN 2019: “Your Dreams, Our Challenge.” 

00:42:48 Waiting Until It Is Too Late to Change

In part 1 of our Tushman and O'Reilly series, Michael Tushman examines how leadership, culture, and organizational architectures can be both critical facilitators of innovation and, not uncommonly, formidable obstacles. They demonstrate how to clarify today's critical managerial problems, use culture and commitment to promote innovation and implement strategy, and deal with changing innovation requirements as organizations evolve.

The Power of Communication: Insights from Sally Susman, Author of 'Breaking Through'

In this episode, Aiden welcomes Sally Susman, author of 'Breaking Through: Communicating to Open Minds, Move Hearts, and Change the World' to discuss the vital role of communication in professional and personal settings. Sally shares insights from her extensive career, including her experiences working with top leaders at Pfizer, Estee Lauder, and American Express. The discussion explores the misconception of communication as a soft skill, the importance of authentic outreach, the power of gratitude, and Susman's innovative approaches during the COVID-19 pandemic. Sally also emphasises curiosity, creativity, and intentionality as key components for effective communication. Throughout the episode, real-life anecdotes and practical advice offer listeners valuable lessons on leadership and connection.

00:00 Introduction and Guest Welcome

00:39 The Importance of Communication

03:24 Lessons from Estee Lauder

06:09 Personal Background and Family Influence

08:51 The Power of Gratitude

13:15 Perfecting Your Pitch

23:02 Humour in the Workplace

29:36 Challenges at Pfizer

32:03 Facing the Biopharma Reputation Challenge

33:37 The Pandemic's Impact and New Leadership

35:02 Albert Bourla's Bold Vision

36:30 Revolutionising Vaccine Development

37:25 The Media's Role in the Journey

38:55 Pfizer's Transformation and Recognition

40:46 Innovative Leadership and Personal Growth

49:30 Curiosity and Creativity in Action

56:47 The Power of Intentionality

58:46 Concluding Thoughts and Inspirations

Find Sally here: https://www.sallysusman.com/media/

Our guest is an American scholar, educator, and religious leader who has been a general authority of the Church of Jesus Christ of Latter-day Saints since April 2015 and was the church's seventeenth Commissioner of Church Education from 2015 to 2019. He served previously as the 15th president of Brigham Young University–Idaho from 2005 to 2015 and as the Harvard Business School (HBS) dean from 1995 to 2005. He was also the George F. Baker Professor of Business Administration. He published an important series of studies on technological innovation with various co-authors. The organisational linkages, or integration, required to accomplish innovation is a thread that runs through these studies. These insights culminated in his book with Carliss Baldwin, “Design Rules: The Power of Modularity,” which explores the rules for integrating components that shaped innovation in the computer industry and many others.

He studied economics with Clay Christensen in the Fall of 1970 and became his dissertation advisor years later alongside Joe Bower.

Kim Bryce Clark is with us to celebrate the life and theories of his friend Clayton Christensen and, indeed, share some of his theories.

Global poverty is one of the world’s most vexing problems. For decades, we’ve assumed smart, well-intentioned people will eventually be able to change the economic trajectory of poor countries. From education to healthcare, and infrastructure to eradicating corruption, too many solutions rely on trial and error.

Today’s guest reveals a paradox at the heart of our approach to solving poverty. While noble, our current solutions are not producing consistent results and in some cases, have exacerbated the problem. At least twenty countries that have received billions of dollars worth of aid are poorer now. The right kind of innovation not only builds companies—but also builds countries. The Prosperity Paradox identifies the limits of common economic development models, which tend to be top-down efforts. It offers a new framework for economic growth based on entrepreneurship and market-creating innovation. 

It’s a pleasure to welcome the co-author of The Prosperity Paradox: How Innovation Can Lift Nations Out of Poverty, Efosa Ojomo.

Find Efosa here: http://efosaojomo.com/

Like an old machine emitting a new and troubling sound that even the best mechanics can’t diagnose, the world economy continues its halting recovery from the 2008 recession. Look at what’s happening in the United States: Even today, 60 months after the scorekeepers declared the recession over, its economy is still grinding along, producing low growth and disappointing job numbers. 

One phenomenon we’ve observed is that, despite historically low-interest rates, corporations are sitting on massive amounts of cash and failing to invest in innovations that might foster growth. That got us thinking: What is causing that behaviour? Are great opportunities in short supply, or are executives failing to recognise them? And how is this behaviour pattern linked to overall economic sluggishness? What is holding growth back? 

Most growth theories are developed at the macroeconomic level—at 30,000 feet. That perspective is good for spotting correlations between innovation and growth. To understand what causes growth, however, you have to crawl inside companies and the minds of the people who invest in and manage them. This article (which builds on a New York Times piece Clay wrote in late 2012) attempts to form a theory from the ground up by looking at company experience.

They are the words of the authors of a beautiful paper; one is Clay Christensen and the other is his collaborator, and someone you know would have co-authored at least one book with Clay. Indeed, I feel this article was headed towards becoming a book.

It is a pleasure to welcome a great friend of Clay Christensen, yet another soul deeply touched by the man, the author of “Stall points” behind me on the shelf and author of the 2014 paper, The Capitalist’s Dilemma, Derek van Bever.

As legendary Harvard Business School professor Theodore Levitt said, "People don't want to buy a quarter-inch drill. They want a quarter-inch hole!" Many organisations focus on creating products for narrow demographic segments rather than satisfying needs when customers want to "hire" a product to do a job. We are joined by Bob Moesta, Master Innovator, Maker and Entrepreneur; Expert Investigator of Consumers’ Motivations and Decision-Making Processes; Co-Creator of the “Jobs-To-Be-Done” Theory; President of The ReWired Group. 

Clayton Christensen mentored Bob Moesta, and they became fast friends. Bob was one of the principal architects of the Jobs To Be Done theory. He expands on the theory and shares his respect for his friend Clay.

Find Bob here: https://therewiredgroup.com

Today’s book is a book about progress.
Yes, it’s a book about innovation—and how to get better at it. But at its core, this book is about the struggles we all face to make progress in our lives.
If you’re like many entrepreneurs and managers, the word “progress” might not spring to mind when you’re trying to innovate. Instead, you obsess about creating the perfect product with just the right features and benefits to appeal to customers. Or you try to fine-tune your existing products continually so they’re more profitable or differentiated from your competitors. You think you know what your customers would like, but it can feel hit or miss. Place enough bets, and—with a bit of luck—something will work out. But that doesn’t have to be the case, not when you truly understand what causes consumers to choose. Innovation can be far more predictable and profitable, but only if you think differently. If you want to compete—and win—against luck, this is the book for you. 

Welcome to another episode in our very special series to celebrate the work of Clayton Christensen.

Today we are joined by the co-author of Competing Against Luck, Taddy Hall.

Our guest was the Harvard Business Review editor until 2011, when today's book changed her life. She graduated from Cornell University and Northwestern University’s Medill School of Journalism. In 2011 she was named by Ashoka as one of the world’s most influential and inspiring women. She is also an incredible author and has co-authored with the late Clayton Christensen. She is here today to discuss the concepts of one of my favourite books, which also changed my life's direction. 

We welcome back for part 2, the co-author of How Will You Measure Your Life? Karen Dillon. 

Find Karen here: https://www.karendillon.net

Our guest was the Harvard Business Review editor until 2011, when today's book changed her life. She graduated from Cornell University and Northwestern University’s Medill School of Journalism. In 2011 she was named by Ashoka as one of the world’s most influential and inspiring women. She is also an incredible author and has co-authored with the late Clayton Christensen. She is here to discuss the concepts of one of my favourite books, which also changed my life's direction.

 We welcome the co-author of How Will You Measure Your Life? Karen Dillon. Find Karen here: https://www.karendillon.net

The genesis of today’s book centred on a question posed years ago to “disruptive technologies” coauthor Clayton Christensen: where do disruptive business models come from? Christensen’s best-selling books, The Innovator’s Dilemma and The Innovator’s Solution, conveyed important insight into the characteristics of disruptive technologies, business models, and companies. Today’s book emerged from an eight-year collaborative study in which our guest sought a richer understanding of disruptive innovators —who they are and the innovative companies they create.

The project’s primary purpose was to uncover the origins of innovative—and often disruptive— business ideas. Most of us think creativity is an entirely cognitive skill; it all happens in the brain. A critical insight from our research is that one’s ability to generate innovative ideas is not merely a function of the mind but also a function of behaviours. This is good news for us all because it means we can improve our creative impact if we change our behaviours We welcome Hal Gregersen, co-author of The Innovator's DNA 

Find Hal here: https://halgregersen.com

More than a decade ago, Mark Johnson, SAP’s Henning Kagermann, and Clayton Christensen hashed out the principles of business model reinvention in the pages of the Harvard Business Review. Essentially, a business model can be broken down into four distinct elements:

1. A value proposition
2. 2. Resources 
3. 3. Processes,
4. 4. A profit formula

 This means in practice that the new and different must be separated and even protected from the tried and true. As Mark says, “To play a new game on a new field requires a new game plan.” —Clayton M. Christensen

It is a pleasure to welcome the author of multiple titles, a great friend of the show, and the co-author of that 2008 paper Clay mentioned, a Top 50 HBR article of all time, Reinventing Your Business Model; Mark W. Johnson.

That HBR article: https://hbr.org/2008/12/reinventing-your-business-model

Disrupting Class is an unsettling title for a book about the schooling process. The title conveys multiple meanings. The principal message is that disruption can usefully frame why schools have struggled to improve and how to solve these problems. Welcome to another episode in our series to celebrate the life work and theories of Clayton Christensen; today’s episode Is on his 2008 book, Disrupting Class. We welcome the co-author of “Disrupting Class, How Disruptive Innovation Will Change the Way the World Learns: Michael B Horn

Video of Clay https://www.youtube.com/watch?v=TbAGRSPw8ZI

Timestamps:

00:00:00 Intro 

00:03:02 Clayton Christensen Relationship

00:05:53 The Why of Disrupting Class

00:08:14 What Does The Theory Have to Say?

00:10:37 Intrinsic v Extrinsic Motivation and Jobs Theory

00:14:47 Interdependence and Modularity

00:22:15 Organisational Design and Authority

00:28:40 Train people how to think not what to think

00:29:37 Model of Disruptive Innovation

00:32:42 Non-Consumption Contexts

00:37:42 Resistance from the Status Quo

00:41:02 Cramming

00:46:06 RCA, Vacuum Tubes, Sony and Transistors 

00:49:09 Incubation Outside the Core 

00:53:43 Value Network and Ecosystem

00:56:28 The Role of Regulation

01:02:13 Jobs To Be Done Theory

01:06:12 Democratising the theories

01:10:10 Final Thoughts on Disrupting Education

01:10:10 Final Thoughts on Clayton Christensen

The Proximity Revolution: Transforming Industries and Daily Life

In this episode, we delve into the proximity revolution with authors Rob C. Wolcott and Kaihan Krippendorff. The discussion centers on how digital technologies are expediting the production and delivery of customized products, services, and experiences, vastly transforming industries from agriculture to healthcare. The concept of 'proximity' shows promise in improving sustainability, optimizing supply chains, and enhancing customer personalization through innovations like vertical farming and on-demand 3D printing. 

The conversation also explores the strategic implications of this shift for businesses, highlighting the importance of visionary thinking and practical applications. Tune in to discover how proximity is poised to reshape our world and what leaders can do to navigate these changes effectively.

00:00 Introduction to the Proximity Revolution

01:02 Meet the Authors: Rob C. Wolcott and Kaihan Krippendorff

02:25 Defining Proximity: Anything, Anywhere, Anytime

03:28 Real-World Examples: Coca Cola Freestyle and Vertical Farms

06:09 Proximity in Agriculture: From Dubai to Your Dinner Table

09:52 The Role of Technology in Proximity

11:15 Proximity in Food Supply Chains: Efficiency and Sustainability

12:50 Innovative Solutions: Haier's Peking Duck Challenge

16:34 Moment of Use and Controlled Environment Agriculture

22:54 Case Study: Interstellar Lab and Growing Food on Mars

26:38 Why Proximity? The Drivers Behind the Trend

27:00 The Shift in Global Conditions and Technology

28:04 The Rise of Small Footprint Production

28:42 Digital Proximity and Generative AI

29:28 Geopolitical and Climate Drivers

30:16 The Digital Customer and Predictive Analytics

30:53 Domino's Pizza: A Case Study in Proximity

33:26 Healthcare Revolution: Medicines on Demand

34:52 On Demand Pharmaceuticals: A Game Changer

37:37 Future of Healthcare: Predictive Monitoring

42:53 Proximity Strategies for Businesses

49:01 Investing in Proximity Innovations

51:09 Conclusion and Where to Find More

52:09 Bonus Episode on Proximity in Action with Dr Ian McCabe

Some essential lessons in "Seeing What’s Next" relate to disruptive innovations. Four critical lessons are: 

1. Disruption is a process, not an event. 

2. Disruption is a relative phenomenon. What is disruptive to one company may be sustaining to another company. 

3. Different or radical technology does not equal disruptive. 

4. Disruptive innovations are not limited to high-tech markets.

Disruption can occur in any product or service market and can even help explain competition among national economies. 

Today’s book shows how to use the theories of innovation developed in The Innovator’s Dilemma and The Innovator’s Solution—and introduces some new ones as well.

The book argues that it is possible to predict which companies will win and which will lose in a given situation--and provides a practical framework for doing so.

We are joined by a long-time collaborator, friend and student of both Clayton Christensen, and he is a long-time friend of this show,  Scott D. Anthony

The HBR article Scott mentioned: https://hbr.org/2022/01/persuade-your-company-to-change-before-its-too-late

The Innovator’s Dilemma summarised a theory that explains how, under certain circumstances, the mechanism of profit-maximising resource allocation causes well-run companies to get killed.  The Innovator’s Solution, in contrast, summarises a set of theories that can guide managers who need to grow new businesses with predictable success—to become the disruptors rather than the disruptees—and ultimately kill the well-run, established competitors. To succeed predictably, disruptors must be good theorists. As they shape their growth business to be disruptive, they must align every critical process and decision to fit the disruptive circumstance.

We are joined to share some concepts from The Innovator’s Solution by Clayton Christensen's co-author Michael E. Raynor

Articles mentioned

Skate to Where the Money Will Be

by Clayton M. Christensen, Michael E. Raynor, and Matthew Verlinden

https://hbr.org/2001/11/skate-to-where-the-money-will-be

Of waves and ripples: Disruption theory’s newest critic tries to make a splash

by Michael E. Raynor

https://www2.deloitte.com/us/en/insights/topics/innovation/disruptive-innovation-theory-lepore-response.html

The paper I wanted to share today aims to provide a common language about the research process that helps management scholars spend less time defending the style of research they have chosen and build more effectively on each other’s work. I felt this series on Clayton Christensen’s work and theories would be incomplete without this episode. It is a great pleasure to welcome the co-author of that paper and a person who has built on this work considerably, Paul Carlile.

Papers mentioned in the episode are listed here: https://www.bu.edu/questrom/profile/paul-carlile/

Our guest’s award-winning research introduces a new perspective on value creation and competition when industry boundaries break down in the wake of ecosystem disruption. His two books, The Wide Lens and Winning the Right Game, have been heralded as landmark contributions to strategy literature. Clayton Christensen described his work as “Path-breaking”, and Jim Collins has called him “One of our most important strategic thinkers for the 21st century.”

It is a pleasure to welcome Ron Adner. 

Find Ron here: https://ronadner.com

In 2003, media companies and newspapers were in free fall, when American newspapers earned only a tiny percentage of revenue from digital. The Deseret News and Deseret Digital Media were the envy of others, with more than 50 percent of the organization’s combined net income coming from digital sources.

All this a little more than three years after a former Harvard Business School professor took over the company. How did he do it?

He developed his strategy thanks to his work with Clayton Christensen and employed the research to recalibrate how Deseret is organised and does business. Today, he has recalibrated his life and reallocated his resources to causes other than the business world. More about that shortly.

First and foremost, he is with us to pay tribute to his friend, share how his theories helped him perform a spectacular turnaround in the media industry and share insights from his book, “Dual Transformation, How to Reposition Today’s Business While Creating the Future.” It is a rare treat and absolute honour to spend time with the author of “Dual Transformation” with Scott D Anthony and Mark Johnson and “From Resource Allocation to Strategy” with our previous guest Joe Bower. Clark Gilbert, welcome to the show.

We covered the Innovator’s Dilemma with Matthew Christensen in the first part of this series, but we did not cover Chapter 7 of the Innovator’s Dilemma,that chapter Is entitled “Discovering New and Emerging Markets” It opens as follows:

“Markets that do not exist cannot be analyzed: Suppliers and customers must discover them together. Not only are the market applications for disruptive technologies unknown at the time of their development, they are unknowable. The strategies and plans that managers formulate for confronting disruptive technological change, therefore, should be plans for learning and discovery rather than plans for execution. This is a crucial point to understand because managers who believe they know a market’s future will plan and invest very differently from those who recognize the uncertainties of a developing market.”

You may know those to be the words of Clayton Christensen, but what you may not know is that this concept of discovery-driven growth stems from the work of a very special friend of the Innovation Show, it is an immense pleasure to welcome Rita McGrath.

Topics Covered on this episode: 

00:00:00 - Intro and Sponsor

00:02:28 Rita McGrath Welcome

00:04:15 Clayton Christensen Relationship

00:07:35 Discovery-Driven Planning

00:12:05 Client Example of Too Attached to Outcome

00:13:23 Redefining Failure: Failing Fast is Not Always Failing

00:14:04 Example of Varo Bank 

00:18:51 KittyHawk Example

00:20:54 The Role of Luck

00:24:51 Honda SuperCub and NonConsumers

00:27:50 Jobs To Be Done and The McLean Hamburger

00:29:51 Origins of Discovery-Driven Planning

00:31:41 Most Mutations in Nature Fail, as do most ideas

00:32:47 Origins of Innovation Thinking From Schumpeter to Today

00:34:08 Discovery-Driven Planning Overview in a Nutshell

00:37:55 Disasters: EuroDisney

00:42:09 Disasters: PolaVision

00:43:15 Organisational Capabilities, Arenas and Kao

00:46:23 Selling an Idea to a CFO/Incumbent Gatekeeper 

00:51:06 UPM Example: United Paper Mills Example

00:55:00 R.A.C.E.

Find Rita here:

https://www.ritamcgrath.com/

Find Valize here:

https://www.valize.com/

In part 2 of our series to honour the work, life and theories of Clayton Christensen, Joseph Bower unpacks that famous HBR article, "Disruptive Technologies: Catching the Wave" This article spawned the book, "The Innovator's Dilemma" Joe Bower s the father of "Resource Allocation theory" included in his 1970 groundbreaking book, Managing the Resource Allocation Process. He has been a leader in general management at Harvard Business School for over five decades where he is the Donald K. David Professor Emeritus. He was Clayton Christensen’s doctoral thesis adviser and worked with Clay to develop and stress-test his theories.

Just some of the topics covered in this episode: 

• 00:00:00 Intro
• 00:01:46 Managing Resource Allocation
• 00:02:57 Dissertation Supervisor for Clayton Christensen
• 00:04:11 Traits of Great Leaders
• 00:06:19 Resource Allocation
• 00:08:44 Group Decision Making
• 00:26:56 The Human Element of Change
• 00:46:46 Advice for Changemakers and Leaders
• 00:51:25 Getting People to Change Their Mind
• 00:56:29 Final Thoughts on Clayton Christensen

The logical, competent decisions of management that are critical to the success of their companies are also the reasons why they lose their positions of leadership.” How can executives simultaneously do what is right for the near-term health of their established businesses while focusing adequate resources on the disruptive technologies that ultimately could lead to their downfall? The Innovator's Dilemma!!!

Clayton Christensen fathered the “theory of disruptive innovation”, but he also fathered wonderful people who have built on his pioneering work.  We are honoured to be joined by one such pioneer. The apple does not fall far from the tree; he is offspring in mind and body and spirit we welcome Co-Founder, CEO, and Managing Partner of Rose Park Advisors, Matt Christensen, welcome to the show.

Today’s book takes a fresh perspective on what it takes for people to flourish in the workplace. Our guest suggests that when we focus on neurodiversity, we respect people’s deeper drives and motivations, and then companies will naturally achieve better results as a side effect. One thing we must keep in mind is that neurosignatures shouldn’t be thought of as static.

Our neurosignatures change throughout the day. When I get out of bed in the morning, my testosterone neurosignature is very high. But by evening, it’s almost nonexistent. I don’t want to conquer my goals at eight at night; I want to watch Netflix and chill.

We welcome back a great friend of the show, Friederike Fabritius, a multiple-time guest with her WSJ best seller: The Brain-Friendly Workplace.

Find Friederike here: https://friederikefabritius.com

The story of language is the story of humanity; the new understanding of language that our guests outline in this book radically revises our conception of ourselves. In today’s book, our guests outline a revolutionary perspective that overhauls almost everything we thought we knew about language.

We will hear how the game of charades reveals deep insights into how language works. We’ll hear how our brain can improvise linguistic ‘moves’ at an astonishingly rapid rate. We’ll hear how languages are in continual flux, how people without a common tongue can rapidly create a language from scratch, and why it’s likely that language has been independently reinvented countless times. We will realise how the creation of language is not only essential but also changes the nature of evolution. It’s a pleasure to welcome the authors of "The Language Game- How Improvisation Created Language and Changed the World", Nick Chater and Morten H. Christiansen.

Find Nick here:

https://www.wbs.ac.uk/about/person/nick-chater/

https://twitter.com/nickjchater

Find Morten here:

https://csl-lab.psych.cornell.edu

https://twitter.com/mh_christiansen

Understanding Emotional Dynamics for Creative Problem Solving with Wendy Smith

In this episode, Aidan is joined by Wendy Smith, co-author of 'Both/And Thinking,' to discuss the crucial role of emotions in addressing creative tensions and solving tough problems. Wendy emphasises moving beyond cognitive approaches to engage the heart, recognising and honouring emotions as vital to navigating uncertainty and innovation. The episode dives deep into actionable tools such as pausing to reflect, broadening perspectives, and dynamically adapting to changing environments. The episode concludes with practical insights from Unilever's approach to managing tensions under Paul Polman's leadership and tips for leaders to embrace paradoxical thinking in their organisations.

00:00 Introduction to Embracing Tensions

02:07 The Importance of Emotions in Innovation

03:45 Tools for Comfort with Discomfort

06:27 The Power of Pausing and Breathing

15:08 Broadening Perspectives for Creative Solutions

18:08 Navigating Organisational Change and Conflict

19:46 The Role of Dynamism in Innovation

22:56 Case Study: Honda's Emergent Strategy

26:09 Case Study: Paul Polman and Unilever

36:59 Leadership and Paradox Management

48:17 Conclusion and Resources

Find Wendy here:

https://bothandthinking.net

And Substack here:

https://wendyksmith.substack.com

Contact Aidan McCullen for Keynote Speaking, Corporate Workshops and Education Tourism to Dublin and California: https://www.linkedin.com/in/aidanmccullen/

https://aidanmccullen.com

Find the Innovation Show on Substack and Website: 

https://thethursdaythought.substack.com

https://theinnovationshow.io

It is a pleasure to welcome back the author of “Banks and Fintech on Platform Economies: Contextual and Conscious Banking “ Paolo Sironi, welcome to the show Evolving bank business models on outcome economies, resolving the tension between information and communication, which requires overcoming the fears of abandoning the shore of established operational models, and all the products and services rendered. In the dark of the new digital, financial and economic normal, only a crisp and clear vision can guide all stakeholders in the transformation effort. Furthermore, the regulators need to be aligned on the new digital strategies that will ferry the whole industry to more sustainable shores. What is needed is a business map and a compass to guide the navigation. The map is the Banking Reinvention Quadrant (BRQ), and the compass pointing to the North Star of higher business value is the theory of Financial Market Transparency (FMT)

The work of Clayton Christensen changed my worldview and, ultimately, my life. I have been lining up all his co-authors to celebrate his life and share his theories. We have been interviewing each of these great thinkers over the last few months and into 2023. We will bring you each of those episodes in chronological order of his book releases. It includes Matt Christensen, Clay's son and CEO of Rose Park Advisors, Rita McGrath, Joseph L. Bower, Michael Raynor, Scott D. Anthony Hal Gregerson, Taddy Hall Bob Moesta, Michael B. Horn Efosa Ojomo and Karen Dillon.

Coming Jan 23, 2023

While the mechanistic work mindset has spurred huge growth and riches for many, it’s an approach that has masked a fundamental truth: Rather than a machine, organizations are living, dynamic systems that can’t be programmed. Instead, they thrive through relationships, adaptive structures, diverse networks of people, the spaces they occupy, the tools they use – and so, so much more. For our guests– the answer to a better world lies in The Nature of Work Mindset: a new language inspired by forests and other elements of the natural world. This new vocabulary helps us to perceive work in a more dynamic way, to move away from the ‘organization as machine’ model and towards an ‘organization as organism’ view.

We welcome Paul Miller and Paul Miller.

Find Paul and Shimrit here: https://digitalworkplacegroup.com

The Irish Council for Civil Liberties (ICCL), along with six academics working in the area of artificial intelligence and data privacy, wrote an open letter to Irelands Minster for Justice Helen McEntee last month, noting that the use of Facial Recognition Technology raises serious and challenging issues about individual privacy and data rights.

Full letter here: https://www.iccl.ie/2022/iccl-highlights-concerns-over-proposed-garda-use-of-facial-recognition-technology/

We are joined by 3M’s first-ever Chief Science Advocate with 76 patents to her name. She is the author of The Heart of Science series of books, with all proceeds going to scholarships for underrepresented minority women in STEM. We will discuss those books in the New Year, but for now, she is with us on Innovation Bytes to discuss “The 6 most common Innovation E.R.R.O.R.S.!”

Find Jayshree Seth on Linkedin https://www.linkedin.com/pulse/raising-innovation-6-most-common-errors-jayshree-seth/

We are joined by Friederike Fabritius, Wall Street Journal bestselling author of The Brain-Friendly Workplace: Why Talented People Quit and How to Get Them to Stay and of the award-winning book The Leading Brain: Neuroscience Hacks to Work Smarter, Better, Happier. She joins us on Brain Bytes to discuss Fun, Fear and Focus

Find Friederike here:

https://friederikefabritius.com/

Today’s book explores the 27 most important trends shaping the future of our global economy. This visually striking book draws on the oceans of data we're all surrounded by to extract insights about where we are and where we are headed. It is a must-read for entrepreneurs, executives, policymakers, regulators and anyone seeking to navigate a complex world. The futurist and author Alvin Toffler once wrote, “Information overload occurs when the amount of input to a system exceeds its processing capacity. Decision-makers have fairly limited cognitive processing capacity. Consequently, when information overload occurs, it is likely that a reduction in decision quality will occur.” Today’s guest eases information overload, makes signal from the noise and helps us make better decisions

We welcome sensemaker, founder and editor-in-chief of Visual Capitalist and author of “Signals: The 27 Trends Defining the Future of the Global Economy” Jeff Desjardins

The book is available here: https://store.visualcapitalist.com/product/signals-paperback-book/ and

Visual Capitalist's latest visualizations are available in a free daily email here: https://www.visualcapitalist.com/subscribe/

Developing an Ecosystem Playbook for Corporate Innovation with Best Buy Case Study

In this episode, we delve into the strategies corporate explorers need to develop successful partnerships and co-innovate to deliver value propositions to their consumers. Our guest, Christine Griffin, shares a six-step process for creating an ecosystem playbook, using Best Buy's expansion into the home health market as a compelling case study. We examine how Best Buy transitioned from a retail giant to an orchestrator of home health services through strategic acquisitions and partnerships. Additionally, we explore the importance of understanding value creation, identifying market breakpoints, mapping ecosystem players, and assessing financial flows. This episode also highlights the critical roles of scaling path, capabilities, capacities, and customer access in achieving business success. 

Special thanks to our sponsor, Wazoku, for supporting corporate innovation.

00:00 Introduction to Corporate Innovation

00:39 Sponsor Acknowledgment and Guest Introduction

01:52 Overview of Best Buy's Home Health Strategy

03:16 Best Buy's Acquisitions and Initial Footprint

03:55 Building Partnerships in the Healthcare Ecosystem

05:12 Mapping the Ecosystem and Identifying Break Points

10:04 Understanding the Players and Their Roles

12:35 Evaluating Incentives and Profit Pools

15:12 Developing a Scaling Path

18:03 The Importance of Stakeholder Involvement

19:46 Conclusion and Further Resources

Corporate Explorers, Innovation Strategy, Innovation Ecosystems, Best Buy Case Study, Christine Griffin, Scaling Startups, Corporate Innovation, Business Ecosystems, Strategic Partnerships, Innovation Show, Wazoku, Sustainable Innovation, Hubert Joly, Ecosystem Playbook, Technology Adoption, Corporate Explorer Series, Corporate Strategy, Innovation Tools, Best Buy Health, Business Development, Innovation Leadership, Change Logic, Healthcare Innovation, Digital Health, Startup Scaling, Entrepreneurship, Business Growth, Market Strategy, Innovation Mapping, Corporate Transformation

Find Christine here: https://changelogic.com/team/christine-griffin/

Find Wazoku here: https://www.wazoku.com

The Fintech Book is your primary guide to the financial technology revolution, and the disruption, innovation and opportunity therein. Written by prominent thought leaders in the European, UK and Hong Kong fintech investment space, this book aggregates diverse industry expertise into a single informative volume to provide entrepreneurs and investors with the answers they need to capitalize on this lucrative market. Key industry developments are explained in detail, and critical insights from cutting-edge practitioners offer first-hand information and lessons learned.  The financial technology sector is booming, and entrepreneurs, consultants, investors and asset managers are scrambling for more information: Who are the key players? What's driving the explosive growth? What are the risks? This book collates insights, knowledge and guidance from industry experts to provide the answers to these questions and more.  

Get up to speed on the latest industry developments.

Grasp the market dynamics of the 'fintech revolution' .

Realize the sector's potential and impact on related industries .

Gain expert insight on investment and entrepreneurial opportunities

Once upon a time, the Persian king of all kings, Shahryār, beheaded his wife after discovering she was unfaithful. Overcome with rage, the monarch resolved to exact revenge on womankind by taking a new wife each night and beheading her the next morning.

After most of the eligible women in the kingdom had either fled or been killed, Scheherazade, the daughter of the king’s advisor, devised a scheme to save herself and future victims. Scheherazade insisted on marrying the monarch, and on their first night together she told him a story, without revealing the ending.

The king permitted her to live another day to finish her tale, and so she continued with her cliffhangers for 1,001 nights. Eventually, Scheherazade’s stories caused the king to have a change of heart, realise the injustices he had wrought and cease his vengeful rampage. Scheherazade, the narrator of the tales of One Thousand and One Nights, earned her place as one of the shrewdest heroines in world literature.

While this story was set in the Islamic Golden Age, Scheherazade could be considered a highly effective coach or psychotherapist today. Through storytelling techniques, she awakened the king’s curiosity, challenged his behaviour and managed to change his outlook on life.

Scheherazade’s form of psychological intervention can be applied to different situations.

Manfred Kets de Vries is the Distinguished Clinical Professor of Leadership Development & Organisational Change at INSEAD and the Raoul de Vitry d'Avaucourt Chaired Professor of Leadership Development, Emeritus. He is the Programme Director of The Challenge of Leadership, one of INSEAD’s top Executive Education programmes. The article is available here: https://knowledge.insead.edu/leadership-organisations/how-change-someones-mind