Stories, moments, people and ideas of interest from within the worlds of innovation and design, spotted and written about by Helen Walters, design writer, editor, and ideas editor at TED. Attitude, errors and opinions obviously all the writer's own.
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January 15, 2013
"Downloadable music is just a fad and people will always want the atmosphere and experience of a music store rather than online shopping."
As HMV calls in the administrators, it’s worth taking a look back at Why Companies Fail—The Rise and Fall of HMV, published last August. In the piece, former HMV consultant Philip Beeching gives an inside scoop on working with the iconic music retailer. The quote above comes courtesy of then-managing director Steve Knott, commenting right after HMV went public in 2002.
Beeching describes his reaction to this response with a thoughtful reminder: “the dotcom bubble had just burst and many people were mistaking this stockmarket meltdown for an internet meltdown.” In other words, hindsight is always 20:20 and it’s easy to scoff at those who turn out to have got something wrong. Nonetheless, the inability to imagine a different way often proves to be catastrophic.
As such, this is a useful take on a sorry and sadly somewhat typical story. Just remember: any time anyone writes something off as a “fad,” hear the alarm bells ringing. It may indeed turn out to be a gimmick of the highest order, but it’s certainly worth taking the time to take another look.
“If we can enhance the experience, more people will spend more of their leisure time with us.” So said Thomas O. Staggs, chairman of Disney Parks and Resorts, in this piece about a huge investment the company is making to streamline the process of visiting the mega themepark. In At Disney Parks, a Bracelet Meant to Build Loyalty (and Sales), writer Brooks Barnes details the efforts Disney is making to move visitors away from having to use cash or credit and encourage them to use a connected wristband. Disney can then mine insights into what its visitors are actually doing when they’re at the parks. It’s not a small investment: analysts figure it’ll cost the company up to $1 billion. But I guess that’s the price you need to pay these days to get first-hand, reliable data on your customers.
"We thought that one way to communicate respect would be to always be on time to meetings with entrepreneurs. Rather than make them wait in our lobby for 30 minutes while we attended to more important business like so many venture capitalists that we visited, we wanted our people to be on time, prepared and focused. Unfortunately, anyone who has ever worked anywhere knows that this is easier said than done. In order to shock the company into the right behavior, we instituted a ruthlessly enforced $10/minute fine for being late to a meeting with an entrepreneur. So, you are on a really important call and will be 10 minutes late? No problem, just bring $100 to the meeting and pay your fine."
— Another great piece by Andreesen Horowitz founder, Ben Horowitz: Programming Your Culture is a smart take on an important topic, filled with common sense. I also loved this line: “The world is full of bankrupt companies with world-class cultures. Culture does not make a company.”
"Ideas, in a sense, are overrated. Of course, you need good ones, but at this point in our supersaturated culture, precious few are so novel that nobody else has ever thought of them before. It’s really about where you take the idea, and how committed you are to solving the endless problems that come up in the execution."
— Simply lovely. In Be Wrong as Fast as You Can, New York Times magazine editor Hugo Lindgren lays it all out on the line, in a first-person confessional with a moral for us all. Now, please excuse me but I must stop procrastinating and reading Everything On The Web and get back to it.
So Avis has bought collaborative consumption poster child company Zipcar for $12.25 a share. As you might imagine, this has sparked a number of reactions, from those concerned that, consumed by a fusty incumbent, the innovative upstart will now lose its way, to those excited at the scale Avis can lend the still-fledgling company. The press release doesn’t say much beyond the expected platitudes, though Avis “anticipates” that key Zipcar executives such as CEO Scott W. Griffith will remain at the helm of the company. It’s certainly been interesting to watch Zipcar’s journey so far—and that will continue as the firm moves to become a test case for those looking to manage disruption both internally and at scale.
Update: tweet from Zipcar cofounder Robin Chase neatly sums up the issues at hand:
“Avis buys Zipcar. Should reduce fleet costs & make zip profitable. Concerned about whether OldCo can build NewCo in new innovative economy.”
— In Believe Yahoo’s tech makeover? Can I interest you in the Brooklyn Bridge? Om Malik explains why he remains unconvinced that, even with the arrival of Marissa Mayer and, yesterday, Max Levchin, Yahoo has a long, hard battle ahead as it tries to regain its mojo. “Ask any 25-year-old young programmer who he or she wants to work for,” he writes. “Yahoo isn’t the name you hear.” Ouch.
"Do you really want to use all your concrete and steel to build parking lots? It seems pretty stupid."
Google’s Larry Page steps into the one-on-one CEO exclusive interview ring, in the wake of Tim Cook’s bout with Bloomberg Businessweek’s Josh Tyrangiel. Miguel Helft’s interview is far-reaching, and while it’s impossible to imagine that the chief of a public company will say anything controversial on the record, there are some interesting insights into the company’s culture and management, including Page’s comment above, related to their focus on developing driverless cars, which reflects a breadth of curiosity and interest one might not attach to an advertising company. The whole interview is well worth a read; here are some of the quotes that stuck out for me:
On internal culture/talent: “We want to do things that will motivate the most amazing people in the world to want to work on them.” Google’s focus on internal talent is pretty legendary. The question that this comment sparked for me, however, is “not on those who actually want to use the products?”
On interoperability and playing nicely with others (especially pertinent in the wake of the Twitter/Instagram bust-up): “I think it would be nice if everybody would get along better and the users didn’t suffer as a result of other people’s activities.”
Echoing my colleagues’ theory of the Innovation Ambition Matrix, Page outlines Google’s commitment of 70% of efforts to incremental innovation, 20% to adjacent projects, and 10% to new-to-the-world ideas. It’s a simple enough theory that is nonetheless super hard to pull off. As he puts it, “it’s actually hard to get people to work on stuff that’s really ambitious. It’s easier to get people working on incremental things.”
On the importance and value of iteration: “If you look at a product, and you say the day it launched, “It’s not doing what I think it should do.” We say, “Well, yeah. It just launched today.”
On the fact that he and his team aren’t even close to done yet: “I have a deep feeling that we are not even close to where we should be.” Well then.
"That most existing iPad magazine apps are slow, badly-designed, can’t search, etc. does not mean iPad magazine apps cannot be fast, well-designed, and searchable."
The post mortems and “I told you so”s are in full swing for the late Murdoch iPad publication, The Daily, with commenters split on the reasons for its fail. John Gruber (above) has a good piece which does not fall for Felix Salmon’s take that it wasn’t The Daily’s fault it was bulky, slow, and difficult to navigate. Gruber writes: “He’s 180 degrees wrong. All of these problems were entirely The Daily’s fault.” And, he concludes, this is really one more example of the fragmentation of big business as we used to know it: after all, a lean publishing team should be able to thrive on a budget of $5 million a year (though how many of those outfits, employing how many people, would be able to make a living from this, is another question altogether.)
Meanwhile, Twitter’s Michael Sippey flagged a post he wrote after one issue of The Daily, which turns out to have been awfully prescient. “The product doesn’t deliver on two fundamental features of today’s web — community and real-time,” he wrote, which if you ask me neatly nails the issues on the head. I follow the news pretty carefully, and can’t remember a time in which anyone flagged a story from The Daily. However painstakingly written, carefully edited, lovingly designed and beautifully produced, The Daily stories lived in a bubble. And that bubble just burst. iPad publishing will continue, of course, and hopefully those at the head of large organizations with an alleged appetite for innovation will be able to avoid the obvious mistakes next time around.
"There is no way to write a six-page, narratively structured memo and not have clear thinking."
Fine, I’m a writer, so obviously I’d be taken with Jeff Bezos’s management technique, described in the Fortune cover story, Amazon’s Jeff Bezos: The Ultimate Disrupter. Still, there’s something terribly compelling about his habit of forcing the company’s leadership team to sit in silence and read six-page “narratives” before any discussion. As he points out in the quote above, there’s no room for sloppy thinking in a six-page memo. Not one that you want your boss and all your managers to read, at least. The whole of this story is worth a read and all.
"If you have zillions of dollars and all the time in the world, I don’t think you’re going to produce great art. And you certainly won’t feel like sticking it to the man who’s giving you those zillions. It’s funny, isn’t it? In an ideal world, you wouldn’t have the types of pressures that can lead to great art."
— How the Beatles’ Yellow Submarine gave rise to modern animation is a beautiful homage to the legendary 1968 animation film. Written by Simpsons writer and Futurama producer, Josh Weinstein, the piece gives great insight into the paradox of the artistic process. He includes an important lesson on “how brilliant things get produced,” which he describes simply: “it’s called trusting in artists and letting them do their stuff.” For control freaky executives used to calling every shot, this is the hardest lesson to learn of all.
"It’s okay to be imperfect, to embrace Williamsburg."
— So says Melody Roberts, senior director, experience design innovation at McDonald’s, in this Fast Company piece, 3 Big Insights From Today’s Top Design Thinkers. Her insight is actually right on, that one extra-large size no longer fits all, but mainly I love this funny way of putting it, as if Williamsburg hipsters are actually representative of a genuine counter-culture. Here’s the thing: it’s more than likely that in midwest-headquartered McDonald’s, they really are. That’s not to meant to sound snobby—god knows, I’m the furthest thing from any kind of hipster you’re ever likely to find. What’s useful is that this neatly helps to explain the real challenge for Roberts and designers in such ginormous companies, especially those looking to tap into the slippery “yoof” market. Given that company leaders are inevitably far removed from any kind of actual “edge,” how far do designers push things? How can they be careful not to clutch desperately at the tail of an ever-elusive cultural animal that is forever changing its shape—and thus always appear one step behind? How can they not terrify their own internal audience with fuzzy tales of an amorphous society that is too unformed to have any true sense of its own identity? The answer: don’t even try. Grab onto the safe side of grit, instead. And thus: hello, Williamsburg.
Learning to Love Volatility is a great piece in the Wall Street Journal in which Black Swan sponsor Nassim Nicholas Taleb outlines his ideas for building a global economy that not only does not completely implode in times of volatility, it actually thrives on it. It is, he describes, an issue of “anti-fragility.” Get used to the term; I have a feeling we’ll be hearing it a lot in future. Here are Taleb’s five general rules for establishing anti-fragility, but do yourself a favor and read his full text and explanations:
Rule 1: Think of the economy as being more like a cat than a washing machine. —”[The] denial of the antifragility of living or complex systems is the costliest mistake that we have made in modern times. Stifling natural fluctuations masks real problems, causing the explosions to be both delayed and more intense when they do take place.”
Rule 2: Favor businesses that benefit from their own mistakes, not those whose mistakes percolate into the system. Citing the airline and restaurant industries, Taleb describes: “These industries are antifragile: The collective enterprise benefits from the fragility of the individual components, so nothing fails in vain. These businesses have properties similar to evolution in the natural world, with a well-functioning mechanism to benefit from evolutionary pressures, one error at a time.”
Rule 3: Small is beautiful, but it is also efficient. —“Experts in business and government are always talking about economies of scale. They say that increasing the size of projects and institutions brings costs savings. But the “efficient,” when too large, isn’t so efficient.”
Rule 4: Trial and error beats academic knowledge. —“To promote antifragility, we must recognize that there is an inverse relationship between the amount of formal education that a culture supports and its volume of trial-and-error by tinkering. Innovation doesn’t require theoretical instruction, what I like to compare to “lecturing birds on how to fly.” ”
Rule 5: Decision makers must have skin in the game. —“In the business world, the solution is simple: Bonuses that go to managers whose firms subsequently fail should be clawed back, and there should be additional financial penalties for those who hide risks under the rug. This has an excellent precedent in the practices of the ancients. The Romans forced engineers to sleep under a bridge once it was completed.”
I particularly love this last story, but go on and read the whole article. Much to chew on here, not just for bankers and finance types, but for all those interested in innovating a future we can all believe in.
"Our engineers and scientists actually go and build their own prototypes and test the rigs themselves. And the reason we do that—and I don’t force people to do that, by the way, they want to do it—is that when you’re building the prototype, you start to really understand how it’s made and what it might do and where its weaknesses might be. If you merely hand a drawing to somebody and say, “Would you make this, please?” and in two weeks he comes back with it and you hand it to someone else who does the test, you’re not experiencing it. You’re not understanding it. You’re not feeling it. Our engineers and scientists love doing that."
Sir James Dyson, he of bagless vacuum cleaner fame, talks innovation, design, and entrepreneurship with Wired’s Shoshana Berger in How James Dyson Makes the Ordinary Extraordinary. I loved his description of the hands-on working environment he fosters at his company (above), while I also liked his take on patents, namely that they’re critically important when used correctly:
If you really want to improve technology, if you want things to work better and be better, you’ve got to protect the person who spends a lot of effort, money, and time developing that new technology. But you can’t patent something that another skilled engineer in the field could have calculated or done with his basic knowledge.
"Most organizations are afraid to show unfinished work. But the real fear should come from making policies and spending money on programs that have been developed in a vacuum with no user feedback. That’s why prototyping speeds innovation, leads to better solutions, and saves money."
As Americans head to the polls on Election Day, Parade runs Attention, Mr. President: No Politics, Just Our Solutions, a piece featuring ideas for the next President from a host of smarties, including the former U.S. comptroller general David M. Walker discussing the fiscal cliff, Geoffrey Canada of Harlem Children’s Zone on education— and Sarah Stein Greenberg, managing director at Stanford University’s Hasso Plattner Institute of Design (and a Monitor alum) describing some tools for Fostering Innovation. Whoever wins today (and god knows I have my preference), these are smart ideas to heed. I love this, from Sarah:
Each federal agency that reports to the President should pick one thorny problem to tackle. Each week they try a solution and by Friday they owe the President a report on the results: What failed, what was learned, and what’s next.
This should not seem like a crazily impractical idea. This is how innovation actually works. Come on, Mr President. Make it so.
"The problem wasn’t the idea; the problem emerged from the relentless pursuit of incremental profit within mature organizations. It’s a pursuit that drives us towards incremental wins by leveraging underutilized assets. And you know what’s wrong with this pursuit? Nothing. That’s the paradox."
Why Big Companies Can’t Innovate is a great read by Maxwell Wessel, looking at how and why Gerber went wrong when it tried to adapt its existing successful baby food product line into meals for grownups, or “Gerber Singles,” as its marketing wizards would have it. As Wessel points out, it wasn’t quite as revolting or ridiculous an idea as it might sound. He writes:
The idea had merit, and the trends the executive team noticed were real. Just look at any smoothie section in your local grocery store. Naked, Odwalla and Innocent sell hundreds of millions of dollars of product addressing the same problem that Gerber identified with a very similar solution.
But the culture necessary to manage and drive transformational innovation is very different from the one that’s designed to drive efficiency and incremental growth. It’s a topic that’s been top of mind as I’ve been working on the book Ten Types of Innovation (out early next year and now near enough done, so watch out for exponential increase in posting here as a result!) There’s certainly no easy answer to managing the balance and requirements of the very different kinds of innovation, but not even realizing that that that’s an issue is most certainly a surefire path to the kind of failure experienced by said Gerber Singles.
[Story via Lisa Gansky, who sold her photo-based company Ofoto to Kodak way back when. Interestingly, she added in her tweet promoting this story that the account matched her own experience moving from start-up to entrenched big company.]