Innovation Junkies Podcast

1.23 J.D. Meier – Hate the Problem, Love the Customer

The Jeffs talk with J.D. Meier, Microsoft’s Director of Innovation. They discuss innovation & real-world problems with topics including: what to look for in innovative people & how to help them nurture it, keeping teams focused & on track for innovation, & managing innovation leadership responsibilities.

Jeff Standridge: This is Jeff Standridge and this is The Innovation Junkies Podcast. If you want to drastically improve your business, learn proven growth strategy and generate sustained results for your organization, you’ve come to the right place. Over the next half hour, we’re going to be sharing specific strategies, tactics and tips that you can use to grow your business no matter the size, no matter the industry and no matter the geography.

Jeff Standridge: Weekly, we’ll bring in a top mover and shaker, someone who’s done something unbelievable with his or her business, and we’ll dig deep. We’ll uncover specific strategies, tactics and tools that they’ve used to help you achieve your business goals. Welcome to The Innovation Junkies Podcast.

Hey guys, if you’re looking to put your business on the fast track to achieving sustained strategic growth, this episode is sponsored by the team Innovation Junkie. To learn more about our Growth DX, go to\growthdx. Now let’s get on with the show.

Jeff Standridge: Welcome to The Innovation Junkies Podcast. My name is Jeff Standridge.

Jeff Amerine: And this is Jeff Amerine. Boy, I’m glad to be back with you today, Jeff.

Jeff Standridge: Hi. It’s great to be with you as well. It’s great to be with all of our listeners on the podcast today. Jeff, we have a fantastic guest I am honored to have Mr. JD Meier with us. He is the director of innovation at Microsoft. He serves as the head coach for Satya Nadella’s innovation team, where he shares digital transformation insights directly with Satya’s chief of staff. And he does this to accelerate digital transformation and digital innovation within the organization. JD super skill is sharing scalable expertise through insights and actions in the form of timeless principles, success patterns, proven and emerging practices. JD It is so great to have you with us today.

JD Meier: Thanks for having me. Great to meet you guys.

Jeff Standridge: Absolutely. Let’s say it’s a little earlier where you are. You’re on the West Coast, correct?

JD Meier: Yep, West Coast, Washington.

Jeff Standridge: Fantastic. Well, thank you for getting on here early with us today. So JD, let’s talk a little bit about you. Tell us a little bit about your origin story and how you got to be director of innovation at Microsoft.

JD Meier: Okay, so yeah. I’ve been at Microsoft about 24 years, and it’s been an interesting journey. Early on, I really focused on patterns and practices for putting Technical Legos together. Basically, how do we help our customers succeed with our platform? I spent about a decade in that group, learning how to build effective teams around the world, forming, storming, norming, performing, but really focused on how to make the most out of technology. And then about a decade back, I made a shift to figure out, how do we really do business because of technologies? How do we use technology to bring out the best in business? And it’s been an incredible learning curve.

JD Meier: But about five years back, I was head coach of Satya’s innovation team. That was really a key turning point for me, because my job was to speed up how we were doing innovation across all of our innovators. And I learned a lot, I got exposed to a lot of interesting challenges. And I would say that was really my greatest growth. And it was all born out of trying to figure out, how do we bring the most out of our technology? How do we help our customers make the most of their business? And then, how do you as an individual, really apply your creativity to innovate in the market?

Jeff Standridge: Great. So tell us, how do define innovation professionally? When you’re working with teams and with innovators within the organization, or you’re trying to introduce people to the concept of innovation, how do you describe or define innovation yourself?

JD Meier: That’s a great question. Yeah. So when I think about innovation, the very first thing that I go to, I like to be inclusive, and I like the idea that really innovation is about applying creativity, to bring ideas to life in the market. That’s how I think about it, applying creativity to bring ideas to life in the market. But the other thing I think about too, which adds perspective is, what kind of innovation? Is this sustaining innovation? In other words, are we really just working with our high end customers to help them address their more complex needs? Or is this more about disruptive innovation, where it’s coming in at the low end market, or where it’s going into a new market by coming in with a good enough product, but either meeting an unmet need or changing the experience of how things get done?

JD Meier: Once people realize that there’s levels and layers to innovation and that anybody can innovate by applying their creativity. I think it opens up the ballgame. And then the trick is just to set the stage for people about how can they bring what they have, their skills, to the table because, innovation, I also think of it as a team sport.

Jeff Standridge: So what are some of those skills that you look for in helping people recognize? Because, my experience is, and we had a podcast guest on the other day, Josh Linkner, and we were talking about creativity, everyone has creativity. And we used the example of my wife who can walk into a blank room and can envision what that room is going to look like. But don’t ask her to get creative in putting together a business solution. I’m the opposite, right? I can’t envision anything relative to decorating a room. But I feel like I’m fairly innovative at being able to put together a creative business solution. So, talk about some of the skills that you really look for in people and help them nurture and bring out for the innovation process.

JD Meier: So that’s a really good way to frame it actually. Everybody’s going to have their strengths. The things that I look for, really as a composition of a team, and you want that user focus, that user experience, you want that business experience too, of course, and you want the technology experience. And usually you’re not going to find all of that to a high degree, in a single individual. So the trick is to get the team into a place where they can bring that out, as they solve the problems. And to me, one of the most effective things really goes back to the Double Diamond.

JD Meier: It’s a fancy, cool name, but picture two diamonds in your mind, and on the left diamond, that’s really the problem space, and on the right hand side is the solution space. But the reason why it’s a diamond is because you’re elaborating, you’re diverging before you converge around the problem. Really you’re brainstorming the problem side first, and then the best output of that problem side is a creative question. It’s actually a creative question that becomes input for the solution side. Same thing on the solution side that, instead of going for the first thing that looks like it’s the answer, it’s exploring what a better answer might be. So again, you’re diverging, you’re elaborating, you’re brainstorming possible solutions before you converge back to the right one. That’s that diamond effect, the expanding and contracting through the problem solution side.

JD Meier: So if you have the business expertise on the team, if you have the technology expertise in the team, usually, the biggest challenge comes down to figuring out how to directly address what the pains, needs and desired outcomes of the end user. That’s why a lot of innovation comes down to people scratching their own itch, because they have empathy for it, they feel the pain. As one of my friends, he put it pretty simply, he said, “Either you hate the problem, or you love the customer, but that really gets your head in the game.”

JD Meier: And so when I think of the skills, and especially when I think about creativity, a lot of people may not see themselves as creative. And it depends on how they internally represent that to themselves. But when you play that game of walking through the customer experience, such as the customer journey end to end, and if you simply really step in and feel the pains and needs along that journey, and imagine what good will look like, that changes the game. But a really important distinction, this is where I think a lot of people end up with either conflict or get stuck is, some people will get stuck in the current state. They’ll think, “Well, that’s not how we do things, it’s never been done that way. Or we can’t do that, because we’ve never done it before.” And the trick is to suspend your disbelief, that might even be a key skill, suspending disbelief, and to step into what a possible future might be, before you figure out how to actually solve it, before you figure out how to actually get there.

JD Meier: And really, you could just think of that as, in Stephen Covey terms, working backwards from the end in mind, working backwards from that scene to the future that you want to create. Once you start to create those compelling scenes of the future, I think that that helps really, the team engaged. And the trick there then is, now you’ve got a bunch of skills on the table. So if your wife is the visionary, great, you absolutely need that, if you’re good with the business skills, great, you absolutely need that. But now it’s the sequencing of it. And it’s really working backwards from that scene of the future, that future business state, and then weaving things in from they’re. Really working back from human desirability.

JD Meier: At the end of the day, if what you’re trying to do isn’t worth it for the end user, it’s not going to matter anyway. Too many people stumble along their way of trying to work their way forward, only to get into a situation that nobody wants anyway. So working backwards with the end in mind, applying creativity, business experience, user desirability, and technical feasibility, that’s how you make things happen.

Jeff Amerine: That’s great. And Jeff, I don’t want to monopolize here, but I got a follow up then I’m going to hand it over to you.

Jeff Standridge: No, go right ahead. No that’s fine. Go right ahead.

Jeff Amerine: So, JD, one of the experiences that Jeff and I have is, everyone falls in love with their idea or they fall in love with their solution before they’ve really done a good job of vetting the problem, and probably more importantly, the scope of the problem. How do you keep people on track in that regard when they’re innovating and they’re continuously trying to jump to the solution or jump to the end in mind before they’ve actually quantified and qualified the problem at hand?

JD Meier: Yeah, that’s a great question because I see that. I see the same issue a lot too. A lot of people will be attached to their thinking and they’ll associate their idea. I have to remind people that, you ran out your idea, and we will make a better idea together. But we’ll work through the process. But some very pragmatic things are, simply keeping an index of the ideas. I’m not comfortable if I have less than 50 ideas, just to even work with. But the other thing too, is, when people demo their idea, or when people write their idea down, it comes from a different perspective. And so having people write their idea down as a narrative memo, that’s huge.

JD Meier: And what I mean by that is simply hitting pause, writing your idea down by sharing what’s on your mind, how do you see the world? How do you understand the problem? What do you see as the drivers of the problem and the drivers of value? How do you see how it could be done differently? And then what’s a strength based way that you can actually use to get there? When somebody writes the idea down like that, the beauty is, is it takes the idea from in their head and attached to them, it’s down on paper, now people can look at it a bit more objectively. And it really sets the stage for another very pragmatic exercise, which is to write the Mock Press Release.

JD Meier: I think when people write the Mock Press Release, again, it puts them in a different frame of mind. And that’s huge, that’s key. The fact that you’re looking for that winning headline, you’re looking for the surprise, you’re looking for the aha, that’s a big deal. And by getting people to shift their perspective, that’s really the key, it’s about getting shifts in perspective. And whether it’s through writing, whether it’s through putting multiple ideas down on a board, on a whiteboard, on a piece of paper, but also stepping into that future experience. That’s when I think people start to realize, either they may not fully understand the problem, or they may not have a lot of clarity around what would be the game changing play that they can actually go do. And I think those are very pragmatic ways to step in and feel the experience.

JD Meier: The other thing is to remind people to explore other ideas, they don’t have to agree. But what they should be able to do is articulate another person’s idea effectively. And what I found is that when teams, if they really get stuck, if there’s a lot of conflict, especially there, usually it’s because either people don’t feel heard, or they feel that they haven’t gotten to a particular perspective that they feel that they’re representing. So for example, I’m a big fan of Edward de Bono’s, Six Thinking Hats. What I liked about his hats was that he brought perspectives to the table. A positivity view, a negative view, which was about, how do we make this real? There was a facts and figures view, there was a feelings view. And each of those perspectives, I found that people are usually driving from a primary one.

JD Meier: And as long as you can cycle through those, and the way to cycle through those is, I find, you don’t have to wear the imaginary hats, you can just ask questions. So for example, how do we feel about this? What are the facts and figures? How can we make this happen? When you walk through those questions and address the perspectives and people feel heard, now they’re open to other ideas, and everybody learns more. And the big thing that I got as a takeaway from De Bono, it was a couple things. But the idea that anybody can think better if they can change perspective, that’s huge. That was like, if you boil down the body of his, almost 50 books, it comes down to, if you can change perspective, you can actually think better, especially as a team.

JD Meier: And the other surprise, at least a big surprise for me was that, he found that if you don’t start with the positive, if you start with the negative, you can’t see the positive. He found that, if you start with a negative, you can’t see the positive perspective. If you start with the positive perspective, you can always see the negative. So what I’ve learned is, always, if you walk into a room in your default pattern, and this was mine, my default pattern was, what’s wrong with this picture? I’ve been working in security for a while, I was used to finding flaws. And so I walk into a room, what’s wrong with this picture? I had to flip it around and start with, what’s right with this picture? And that was really a game changer for me.

Jeff Amerine: Got it.

Jeff Standridge: A quick follow up to that is, so you’ve hit a number of things about great mindset, the mindset that’s fertile ground for innovation, about process, about being consultant to your own ideas and whatnot. And forgive me, I think we’ve got a fire engine in the background here. But the other thing is, how do you go from having these isolated innovators that have good process to a culture of innovation in an enterprise? What are your thoughts about that?

JD Meier: That’s a great question because changing culture is a very difficult thing, because you’re really talking about values. That was the first thing I had to realize, what is culture about? And culture is really about values. And so one of the ways of growing the value of innovation, I think, goes back to really growing a growth mindset, getting people to challenge their biases, which sometimes that’s even just being aware of them, educating people about their own biases. But it’s also about creating an environment or a context where people value that open learning and mistakes. When you’re innovating, you’re making mistakes, you’re trying things you’re putting yourself out there, you’re going to the edge, you’re exploring what hasn’t been done before. It’s not a safe place and no real risk, no real reward.

JD Meier: So to get that reward, people have to be willing to put themselves on the line, and it means changing their ideas of what can be done and what’s possible. And how do we even explore the art of the possible? One of the very simplest ways that I’ve been able to do it in a few different contexts is, I use the phrase, imagine if. I know that sounds incredibly simple. But if you get people practicing the habit of just using the phrase, imagine if, imagine if you didn’t have to go to register when you checked out of a store?

JD Meier: If you get people just talking about, dreaming up and using this simple phrase, imagine if, anybody can use it, anybody can do it anywhere. You could do it while you’re watching a movie, you could do it while you’re in a meeting, you could do it while you’re … Just about any context, but it starts reminding you that things can be done differently, things could be better. And that, imagine if, opens the door, because it lets you play with possibility. And I think that’s the real trick in shifting to an innovation culture is getting people to feel safe, to be more open, and to play with possibility.

Jeff Standridge: Have you come across any specific technologies that you’ve adopted, that help you drive innovation or make innovation easier, or vet and collect ideas, any particular technology solutions that you’ve used or like to use in your innovation space?

JD Meier: So in general, one of my best tools of choice is, I love yellow sticky pads. I love pens and yellow sticky pads, I really love whiteboards, and then, in a digital world, I love any remote collaboration tool where you can put up a whiteboard, so people can share the thinking, or even something as simple as sharing, visual frames or canvases. I’m a big fan of the Business Model Canvas, I found that a lot of people can have a lot of different views or different ways of looking into a business. But if you pull up a Business Model Canvas, suddenly everybody can pay attention to who do we think the customer segment is? How does the value chain actually work? What’s the operating model? They can actually step into the business, and they can agree to, how do we see the current state of the business model?

JD Meier: And then the beauty is, with that same Canvas, you can turn around and switch gears and you can imagine a future business model. And you can use that same perspective, step into it, and what I found that that does, people sometimes can have a fuzzy view of what change might look like or what change can be. But when you’re that precise of, here’s what the current state is for x, here’s what the future state could be. That, I think really drives clarity. And the more clarity that you can drive, especially in a remote scenario, that to me is where technology rises and shine. When people can see what everybody’s looking at, and everybody can get their head in the game, their hands in the game, that’s a big deal.

Jeff Standridge: Hey, folks, we’ll be right back with the episode. But first, we want to tell you about a limited opportunity to take advantage of our growth DX. For a limited time, we’re offering a free strategy call to see whether our unique diagnostic tool is right for you. Go to\growthdx, to learn more.

Jeff Standridge: Sometimes we see people in organizations, they know they need to be innovative. There’s somebody that’s got the mandate, we need to do more innovation, we need to be more creative, et cetera, and they tend to go down this path towards sometimes what we’d pejoratively refer to as innovation theater, where they’re going through [crosstalk 00:19:52], but it’s not really sticking. And in some ways that’s even worse. That’s back to square one. Maybe you shouldn’t have done it at all. What are your thoughts about that?

JD Meier: Yeah, I see that happen a lot. And usually, in my experience, it’s because it’s not connected to the end users. They’re not wrapping the business around the end users, which is where the magic really needs to happen. As soon as you’re relevant, because you know somebody’s pains, needs and outcomes, that’s what’s going to make the innovation relevant. But if you don’t have the empathy, if you haven’t actually validated with your customers, or your end users, that’s going to be a problem. The real trick is to do the small business experiments. One of the most beautiful things that I think Satya did with the innovation team early on was, he really drove it from the idea of bring me new business models.

JD Meier: So imagine now it’s not, bring me something neat that the technology can do, there’s a lot of technology tricks, it’s, show me how it’s relevant and the way that it can actually help create and capture new value. Because really, the job is to help leaders reimagine how to create and capture value if they want to lead their business effectively and successfully in the digital era, with their digital customers. And so that’s the trick is, it’s the relevancy trick, understanding who the personas are, who is this innovation really for and how is it going to change their world, or change their experience or change their journey?

JD Meier: And just by focusing on who the innovation is actually for and making sure that in the voice of the end user or the voice of the customer you have their pains, needs and desired outcomes, you just gone miles and shrank that gap between your innovation theater and relevant innovation that’s using creativity to solve real problems in the real world and create real value.

Jeff Standridge: That’s great. We had a guest a couple of weeks ago that talked about finding those problems for which there is a tailwind versus a headwind. And that really was a good metaphor for me to think about. So I see the library behind you, and you and I share the love of reading. And so I’d love to know, in that stack of books back there, or actually, probably you have other stacks, if you’re like me beyond just that, what’s the most influential book you’ve read? I’m going to ask you two questions, the most influential book you’ve read, say, in the last 12 to 24 months? And then what are you reading now?

JD Meier: Good question. Interestingly, the book in the last 12 months has actually been the Sylvan Method. It’s a story of a guy named Jose Silva. And he wanted to find a way to apply his creativity to solve problems, whether it was education, whether it was health, you name it. And he had this really interesting idea that if you could access your alpha state, you could get into this frame of mind where you don’t have fear, you don’t have jealousy, you just have this creative vision. And for some reason, in this brain state, you don’t have all of your typical biases. And so that was fascinating to me. And to see that when he created his method, he actually used it to help coach CEOs to change their business and have competitive advantage. The military actually paid him $20 million to develop his methodology.

JD Meier: And then I was surprised to find this book on Amazon, where, wow, for $6 I can learn his method. The method that he used to help his kids do better in school, the method that he used to help people solve the unsolvable. And I thought, “Wow, amazing.” In this book are a handful of skills that you can actually practice. So that’s probably the most influential book I would say, in the last 12 months.

JD Meier: When it comes to what am I reading now? I’m actually rereading Tony Robbins, Unlimited Power. In all of my experience, so much of the outer reflection of what you get back from the world really starts from that inner engineering. And to me, it’s probably one of the best books ever, on inner engineering, basically, how to change your neurology, so you can think, feel and take better actions.

Jeff Standridge: Very good. Jeff, questions that you have.

Jeff Amerine: Yeah. You’ve hit on so many interesting things the book lists, the process for innovation, how to get a culture of innovation that sticks. What are some things happening with technology in general, to the extent that you can talk about it that have you excited. As you were to look at in state five years or 10 years down the road, what are some categories of things that are pretty exciting to you at this point?

JD Meier: Cool, okay, yeah. So at the very macro level, I think of ESG, environment, social and governance, or a lot of people be running around talking about sustainability. But I bring that back into the idea that, everybody wants a business that’s good for the planet and good for people. That sets the stage for a lot of innovation in terms of supply chains, in terms of product transformation, in terms of ways of working, in terms of mobility and how we travel. So that right there, we’re at an amazing, I would say inflection point, where companies have to reimagine themselves.

JD Meier: So talk about an incredible stage for innovation, wow, but then enter into this mix, enter into this ballgame, everything from I would say, in terms of disruptive technologies, I would say, AI, I would say, IoT, I would say, blockchain, I would say, mixed reality. And so if you were to walk through, and I think of this as my innovative scenarios’ frame or framework, what I do is I keep those particular technologies in mind, put those along the top, along the left hand side, I would step into a business, and I call it the CEO pattern. But customers, employees and operations, I call it the CEO pattern.

JD Meier: So the idea is to reimagine the customer experience, reimagine the employee experience and reimagine operations. And now, what do you have in that mix? What do you have at your fingertips? You have those technologies either in isolation or in composition. And when you’re combining those things, talk about an amazing change in experience. However, the trick is never to lead with the technologies, the trick is to actually lead and work backwards from the end experience in mind. That’s why doing things like those press releases is such a big deal. That’s why doing things like a future state of the business model is such a big deal. You’re really setting the boundaries, at the same time, you’re opening up the stage for opportunity, ideation, innovation, but at the same time, you’re staying grounded in what are the big components in this Canvas that you have for this new world?

JD Meier: But when I look at the world and the biggest change, it’s going to be ESG, ESG will be driving the biggest changes in the planet. How do we save the planet? How do we do better with the resources that we have? I think you’re going to experience a lot of shifts in the market where consumers are going to choose, they’re going to want a company that they know for sure, has a great sustainability story, everything from their supply chain, to the products that they create, to how they give back to the planet. So, it’s a incredible opportunity for any leader in today’s world, to embrace that shift and to use these technologies to create business because of technology, not the other way around.

Jeff Standridge: That’s great. So, JD, we’ve got a number of listeners who are in roles similar to yours, either they’ve stepped into those roles or they’re looking to move into those roles, or they’re in ancillary roles and they just want to drive innovation. And you’ve said a lot of great things today that I know I’m going to go back and relisten to. You’ve really piqued my curiosity on a number of things. But give us your best nugget for someone stepping into an innovation leader role, whether it’s the chief innovation officer, director of innovation, regardless, they have the mantle of leadership responsibility for innovation with their organization. Give us your best nugget or two that you would tell those folks stepping into that new capacity.

JD Meier: Okay. I would say, first and foremost, remember that innovation is a team sport and a people game. But I would also say, make sure that everybody has a shared understanding of the idea of innovation management as a capability. To really make sure that there’s a shared understanding of innovation management itself. A lot of times people hear innovation and they think, “Oh, you mean our digital lab?” Or “You mean our garage?” I’m like, “No. Paint the bigger picture.” The bigger picture of innovation really starts with early trends and insights. It’s about being able to manage your crowdsourcing and ideas. It’s about putting those ideas into an actual portfolio that you can prioritize against the outcomes that you want to achieve. And then it’s about driving those ideas through a funnel, and it’s really taking those ideas into the market.

JD Meier: But that’s the game. When people understand the end to end game and they understand why they’re doing and what they’re doing and how they’re doing along those pieces of the puzzle, that’s when everybody can play in the game a lot better. And then there’s also a tool that I think it’s underserved. And that tool is really strategic foresight. Not a lot of people know the term, not a lot of people actually use the methodology, but to me, it’s incredibly key because in front of strategy is foresight. One of the most strategic questions you can ask anybody is, what does your business need to look like a year from now? Very simple question, but it’s a very cutting question.

JD Meier: You may not be able to predict the future, you may not know exactly what it is. And that’s not the point, but the point is to have some hypotheses about what the world might look like. In order to know what the world might look like, you have to be aware of disruptive trends, disruptive events, that’s what sets the stage. And the beauty of strategic foresight is that, it’s a couple things. But from the pandemic, this is what really popped for me, I heard a lot of people saying, “I can’t wait till we go back to normal.” I was like, “Really, dirty bathrooms, incredible traffic.” There’s a lot of things that I’d actually like to leave behind.

JD Meier: The idea of strategic foresight, is to really break that down and to look at, what do you actually want to leave behind? Great be deliberate about it. What do you want to carry forward? What was great before, that you actually do want to carry forward? Be deliberate about it, be intentional. And then the most important piece, I think, is the third piece, which is, what can you do now that you can uniquely do now that you couldn’t do before in the new context? The reason why that’s key, especially in the game of innovation is, that there’s a funny thing that happens when people try to create the future. The first thing is, if they’re trying to predict the future, all they do is they bring more past, that’s just normal, the thing that people do is they bring more past.

JD Meier: But the second thing that happens is, if you would actually look the brain under an MRI, and somebody is talking about the future, the brain shuts down the empathy part, don’t have empathy for the future, you can’t feel it. That’s why stories are so important, but that’s also why a tool like strategic foresight is such a big deal. Because that helps people to be very intentional and to make conscious choices about, that was the before context, this is the context that we’re in now and here’s what we can do that we really couldn’t do before. And I think it’s putting that piece before the strategy that really is the difference maker. Because a lot of people have a strategy based on, what they know, usually off the top of their head, but do the heavy lifting around the trends and insight and around disruptive technologies, disruptive events, shifts in values.

JD Meier: Anybody who’s trying to be innovative in today’s world, but isn’t thinking about the shifts and values of end consumers and users who want a business that’s good for the planet good for people, they’re missing out on the biggest value creation. At the end of the day, innovation is a game of creating and capturing new value. And so I think that’s how you put the whole puzzle together.

Jeff Standridge: And circling back to something you said a few moments ago, I’m assuming that that tool of imagine if, is one of those tools that you use to try to spur or stimulate strategic foresight?

JD Meier: Absolutely. Because it helps you suspend disbelief, because you realize that you’re playing and pretend. You’re saying, “All right, we don’t know how we’re going to solve it yet, but imagine if this was true. Imagine if we could do this.” So it puts the emphasis on what would be worth doing, before you figure out how you’re going to do it. And because you’re leading with what would be worth doing, now you’ve set the stage for people to go and do what they do best, which is apply that creative vision actually apply that creative problem solving.

Jeff Standridge: Fantastic.

Jeff Amerine: JD, the thing that’s so instructive about what you’re talking about is, we’ve all seen the stats about how the half life for existing large companies decreases with every year. In other words, that idea of staying relevant and creative destruction and the fact that things are changing so rapidly, that if leaders don’t adopt the mindset that they better be figuring out how to reinvent, reimagine, et cetera, they neglect doing so at their own peril, because we’ve all seen the roadkill of the Dow 30 and others over the course of the last 20 years, they’re no longer listed, no longer relevant, maybe no longer in business.

Jeff Amerine: And so, one of the things that’s seems to be constantly in a rub is, you’ve got quarterly, and particularly if you’re publicly trading, quarterly demands of doing well with Wall Street and delivering on all those expectations and all that. And yet innovation, by its very nature, requires a long term view. For senior leadership how can they reconcile that? How can they make sure that they deliver on the expectation of shareholders on the quarterly reviews, and also have this long term view of constantly reimagining and reinventing the business?

JD Meier: Yeah. So I’ll try to unpack this, because there’s a lot of ways to solve this. But it so much goes first and foremost, back to how you’ve been thinking about the business. When I think about the business, I always like to use, effectively, a strategy pyramid. At the top of the pyramid is the ambition. It’s the bold ambition. It’s the North Star. It’s the, who do you serve? And why do you serve? In the middle, it’s the business models. And at the bottom of it is really the operating models. And when I tell people how to [inaudible 00:35:38] that transformation I say, “First of all you’re wrapping your business around your future customer, that’s a big deal. But the other thing to think about is the end game of digital transformation, which to me is, it’s a digital business on a digital platform, creating digital products and services in a digital ecosystem with a digital culture.” That’s basically the end game of digital transformation. That sets the stage for continuous innovation.

JD Meier: However, you have things like the Innovator’s Dilemma, you have the current business that wants to eat the future business as it’s trying to be born. And so the trick there, there’s a few different tools, you can either use the McKinsey Three Horizon Planning Model, you can use Pivot to the Future, another great book, you can use The Three Buck Solution. But if you unpack all of this, what’s the whole idea about? I think of it in terms of three tracks, I think of your current business, which is going to have the current business model, it’s going to have your current customer set, it’s going to have your current KPIs reinforcing that, and that’s what your quarterly focus is going to be based on.

JD Meier: Below that you’re going to have your future business model. That means it may be different customers, that means it’s going to be different KPIs, it’s going to require different skills, it’s that zero to one challenge. And that’s where even though there’s a long term view, what you’re really doing is you’re doing small business experiments today, to validate value to find your path towards that longer term view. And that third track is really the bridge between the current business and the bridge with the future business. But what I found is that if you don’t carve out space for that, whether you think in terms of tracks, whether you think in terms of the three horizons, whatever you use, the important idea, at least from what I’ve learned, is to have a very deliberate way of looking at the current business separately from that future business.

JD Meier: And if you think about it, that actually goes back to the whole idea of, sustaining innovation versus disruptive innovation. And it also goes back to that place of conflict, where in any given room, when you have somebody focused on the current state and fighting for it, and somebody focused on the future state and fighting for it, that’s the space of conflict. And the trick with conflict, I guess it’s a Covey approach, but it create a larger playground, and create the space of abundance. The way you do that is you make space for it. It’s about the mental model. Once people have that mental model, and they have a place for, “This is the current business, we can actually try to grow, we can invest, we have to have run the business leaders great.”

JD Meier: At the same time, I think everybody with all the disruption and all the changes they’ve seen in the market, acknowledge that, “Okay, yeah, we do have to have a space for the future business too.” The problem is in how people think about addressing the future space. Usually what happens is people come up with this amazing vision, this amazing ambition, but then people can’t see it and feel it because it’s too far away.

JD Meier: And this is where I found, I think, the McKinsey Three Horizon Model and to being helpful, because you can chunk those pieces down, and you can come up with the small business experiments today, so you don’t fall prey to the Innovator’s Dilemma. You don’t have the antibodies coming out on the system to destroy those ideas. What you’ve really done is you’ve carved out place for them, and you’ve connected it into your core business models. And when everybody has that visibility, and I would say that transparency and they can see that, now all of a sudden, it makes sense, “All right, it’s not random, it’s not off in the corner.” It may be disruptive but people realize, “That’s the future business while we’re still running our current business today.”

Jeff Standridge: That’s great. JD, we’re going to land the plane here today. It has been a pleasure having you with us. We have JD Meier, director of innovation at Microsoft. We may have to come back for a part two of this sometime down the road. You got a lot of great wisdom, a lot of great guidance, a lot of great advice and it has been an absolute pleasure having you with us today.

Jeff Amerine: Yeah, JD. Fantastic insights. Thank you so much.

JD Meier: Thank you. I had fun.

Jeff Standridge: All right. We’ll see you all on the next episode.

Jeff Amerine: Hey, folks, this is Jeff Amerine, we want to thank you for tuning in. We sincerely appreciate your time. If you’re enjoying The Innovation Junkies Podcast, please do us a huge favor, click the subscribe button right now and please leave us a review. It would mean the world to both of us. And don’t forget to share us on social media.

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