Scott Kirsner: Success is all about leadership and putting structures in place and putting ops in place so that you can do something effectively and make customers happy day in and day out.
Jeff Standridge: This is Jeff Standridge, and this is the Innovation Junkies Podcast. If you want to drastically improve your business, learn proven growth strategies, and generate sustained results for your organization, you’ve come to the right place. Welcome to the Innovation Junkies Podcast.
Jeff Standridge: Hey guys, welcome to another episode of the Innovation Junkies Podcast. I’m Jeff Standridge.
Jeff Amerine: And this is Jeff Amerine, glad to be back for another episode. Who do we have on today, Jeff?
Jeff Standridge: Well, interesting you should ask, Jeff. We’ve got Scott Kirsner. Scott is the CEO and co-founder of Innovation Leader, which is a Boston-based media and events company that’s focused on helping innovators and large organizations deliver results. He spent two decades as a business journalist and contributing editor for the Boston Globe, Wired Magazine, Fast Company, Variety, The New York Times, Business Week, and a number of other publications. With that, Scott, great to have you with us today.
Scott Kirsner: Hey, it’s great to be here. Thanks for having me.
Jeff Standridge: No, it’s our pleasure, and we appreciate you for joining us all the way from Boston.
Scott Kirsner: Doesn’t take any travel nowadays through the magic of digital technology.
Jeff Standridge: That’s right.
Jeff Amerine: Video chat has changed the world, hasn’t it? It really has, particularly in the last two years. But speaking of that, getting into the swing of some things we might talk about during the podcast, as you reflect back on some of the giants of the past; innovators and inventors, in your case, who would your favorite innovator from the past be?
Scott Kirsner: I don’t know if this is a question you guys always ask on the podcast.
Jeff Amerine: First time, actually.
Scott Kirsner: This is new to me, but one person that I really like to reference, just because I think everybody can relate to the company, is Walt Disney. I grew up in Florida in the decade or two after Walt Disney World was opened in Florida. That was the family vacation destination for a lot of family road trips. What I think is interesting about Walt Disney is that when you look at anybody in the movie and entertainment industry, he really was always thinking about what was the next wave? What was the next technology that was going to come, and how could he take advantage of it?
Everybody always thinks about, “Oh, he invented the theme park, and that’s what’s so innovative about him.” But if you ever read any of the Disney biographies or you go to San Francisco, there’s a really great Disney family museum that has a lot of artifacts from the growth of the company. He was also somebody who was very interested in making some of the first sound cartoons, making some of the first color cartoon tunes using the technicolor process that was initially invented here in Boston. Then also looking at television as a distribution channel. So I think he’s an interesting person who was a founder of a company but created this company that has continually looked at what is the next wave, how are theme parks and television and streaming and digital media all going to evolve. Today, even if you’re not back to traveling to theme parks, you may get Disney content on something like Disney+, which is just their latest wave of innovation.
Jeff Amerine: Yeah, that’s a good one. I mean, Walt Disney definitely had an impact on nearly every aspect of our lives, if you think about it. How we consume information and how we feel about animated films, et cetera. Jeff, what about you?
Jeff Standridge: Yeah, I have one. Before that, I remember on Sunday evenings as a child watching the Wonderful World of Disney, all those shows that they had on. I have to go back in the spirit of, we’ve talked a lot here about testing and learning and reiterating and pivoting and what have you. I go back to Thomas Edison. Folklore says that he failed several thousand times at his invention of the incandescent light bulb. And somebody said, “How can you fail X thousands of times and still keep going?” He said, “Oh, I didn’t fail that many times. I now know X thousands of ways that it won’t work.” I just think that’s a classic story of perseverance and testing and learning and making incremental changes to see if you can make your product a reality.
Scott Kirsner: And it’s funny, it’s a little-known fact, but Thomas Edison started his career as an inventor in Boston, not New Jersey. So when he was in Boston, he worked in the same incubator building. They didn’t call them incubators or co-working spaces back then. But, there was an incubator building in downtown Boston where people were thinking, what is the next wave of technology after the Telegraph? One of the things they were thinking about was how do you make Telegraph wires more efficient? How can they carry more messages?
Alexander Graham Bell and Thomas Edison worked in this same incubator building in downtown Boston. And like you said, Edison had a lot of failures, and he was working on inventions here in Boston that didn’t quite pan out. One of them was a vote recorder that legislatures or governmental bodies would use to record votes more accurately. And apparently, that was something that politicians at the time just didn’t want. And so Edison had a falling out with his investors and then relocated to New Jersey. And so eventually found some success in New Jersey with the light bulb and tying it into Disney. He was one of the first people who invented movie viewing machines. Initially, it was not a projector. It was the Kinetoscope, this movie viewing machine that you would look into, and it was kind of a personal movie viewing experience.
Jeff Amerine: Yeah. I mean, Edison was definitely a giant. The interplay between Edison and Tesla and George Westinghouse has always been really interesting to me. And George Westinghouse, interestingly enough, was the one that I was going to say was my favorite. I actually worked at Westinghouse early in my career. And the thing that I liked about him was the level of practicality that he applied to create the business around what he had developed. He was obviously on the alternating current side of that debate between AC and DC back in the day. I think the thing that I really appreciated about the fact was that there was ego that drove most of these guys and most people that are highly creative. He seemed to have the ability to get past his ego and to figure out how to work with people to move things forward. And I think that’s an attribute that’s not always the case in highly creative folks. So George Westinghouse was going to be the one that I’d say was my favorite from that timeframe, for sure.
Jeff Standridge: Well, very good. Scott, let’s hop in and talk a little bit about you. I gave just a brief glimpse of who you are but I wanted to give you the opportunity to tell us a little bit more about you and Innovation Leader.
Scott Kirsner: Well, thanks. I mean, Innovation Leader really exists kind of for one key purpose, and that’s, you guys have worked a lot in the startup innovation sector and helping grow small businesses into big businesses. And we kind of just felt, six or seven years ago, that there was so much focus on the startup world and how do startups raise money? How do you find a co-founder, how do you hire talent? How do you, potentially, do a first distribution deal with a bigger company? But, nobody was focusing on the large companies, the General Electric, Disney, Starbucks, Marriott, Boeing, that scale of company, and all of the innovation challenges that they have, like once you get big and successful, how do you continue innovating, experimenting, rolling out new products and services and kind of staying relevant to consumers as their habits change, as everything gets more digital as we go into and, and hopefully out of a global pandemic.
And so our focus is data, research, case studies, online and offline events for people in those large companies who in some way are responsible for innovation. And that can be lots of different titles. Sometimes it’s emerging technologies, sometimes it’s R&D, it might be design or new product development, but those are the people who are part of our community.
Jeff Standridge: So how did you, yourself, come to this line of work? Particularly innovation in general, Innovation Leader specifically.
Scott Kirsner: I mean, I just have always liked writing about new stuff. And so, I went to journalism school here in Boston, had a really fun job at the Boston Globe in the early days of digital publishing, helping them figure out how they were going to get their content online, and then just really wanted to write and travel the world and go to interesting places. So I had a long stretch where I was writing for Wired Magazine and Fast Company and the New York Times. Just traveling to sometimes large companies, sometimes startups, tracking Google and YouTube as those companies were getting started, going to visit bigger companies like General Motors and Volkswagen and Disney, both in California and in Florida. I have always been interested in the people and the processes and the mechanisms around getting new cutting-edge stuff to happen.
So, I did a lot of magazine writing and newspaper writing and then got together with two co-founders that I had met in the mid-’90s when we were all working at the Boston Globe as part of that digital publishing group. And we very much took the lean startup approach to Innovation Leader, just a little bit of our own startup capital, and set up a website and see if people would buy subscriptions to it. And it’s grown from there, and we’re big believers in the lean startup methodology. Whether you’re a startup or a bigger company, you can definitely apply it.
Jeff Standridge: So, it’s interesting. We talk a lot about the intersection of innovation and leadership in our company, Innovation Junkie. And, it’s been my experience that not a lot of people are talking about, what we talk about, the three domains of; number one, how to disrupt the status quo or how to challenge the status quo in the form of innovation. Number two, how to make that innovation stick in the form of long-term organizational change or transformation, and number three, the leadership required to make all that happen. So when I came across several months ago, or a couple of years ago, actually Innovation Leader, I was very pleased to see that you guys were bringing those two domains together. Talk a little bit about that and how that came to be.
Scott Kirsner: Well, it’s really hard because I think you guys must see this as you’re working with younger growing companies. Success is all about leadership and putting structures in place and putting ops in place so that you can do something effectively and make customers happy day in and day out. And then, it’s scaling that up. It’s going to other states, or it’s going to other countries.
And so, I do think that great leadership and vision and that operational muscle are so important to growing companies. And yet, you hit a point, and sometimes it might be you have 500 employees or 1,000 employees. Definitely, you’ve hit this point when you have 5,000 or 10,000 employees where you’re so operationally focused that anything that might challenge the status quo people will look at really skeptically. And there just isn’t enough time. There aren’t enough resources. And sometimes people actively argue against new ideas, and it’s just because how do you find the time?
People like Rita McGrath talk about this idea of creating an ambidextrous organization. It’s very hard. You don’t know a lot of people who have true ambidexterity, and they can play tennis great with both hands, or write neatly with both hands. And I just think that organizations usually have a lot of that operational bias. They’re biased towards the quality of service. They’re biased, in the case of an airline, for safety and on-time departures and on time arrivals. And innovation really does, and the word disrupt doesn’t get thrown around lightly, but it really can disrupt things in an organization that’s very operationally focused. So, I think the challenge if you want to be more innovative, is how do you find the time, resources, and people who can be part of that?
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Jeff Amerine: Then the other thing to look for in large businesses, particularly if they’re publicly traded, is they’ve got a quarterly incentive to make sure that they’re hitting analyst expectations and that the stock price stays up and whatnot. And at most, they’re talking there’s incrementalism associated with what they’re going to do. It’s operational efficiency improvements. How can you, in your experience, convince an organization to do something that requires a long term view? And that is, to invest in innovation and commit to people being able to take risks when they’ve got these quarterly incentives that all the senior executives are going to be tied to in some way or another.
Scott Kirsner: Well, I mean, you put your finger on really the key north star that most senior leaders manage toward, and it is those quarterly results, quarterly sales numbers. If they’re senior enough that they’re on the analyst call every quarter, they want to have something positive to talk about. They want to have just enough new stuff to keep the analyst happy, but not too much new stuff that the analysts start asking questions about; hey, why are you investing so much in innovation? And what are you under-investing in? Because you’re putting all this money into, whatever it may be, testing ten new products or hiring 50 new chemists or scientists. So, I do think that there has to be a way of creating urgency around innovation. Sometimes, that’s pointing to what’s happening in the startup world and how it potentially threatens you as an established player. Sometimes it’s highlighting what customers are doing or saying when they stop buying your product or start buying less. And sometimes it’s just potentially looking at analyst reports or market research that points to big shifts in behaviors.
Are shopping malls ever going to come back? And if that sort of shopping mall retail location was a big part of your strategy in the past, you better be doing a lot of things to figure out how you’re going to be relevant to those customers who might never develop that habit in the first place or never return to that habit. And so, I think you have to have the ability to paint a picture of things that all create what we call innovation urgency.
And one of the things that I think creates innovation urgency in 2021 and is going to continue into 2022 is just the record amounts of venture capital funding that are flowing into the startup world. So we set records in 2020; we’re going to set records in 2021 in terms of money that’s flowing into startups that all want to carve away a little piece of a large established company or a medium-size established company’s business. And now they’ve got $50 million or $100 million in the tank to take you on and try to peel away some of your customers. And I think when you talk to a lot of medium-size or large companies, they can have trouble finding a million or $2 million for an initiative or finding one or two people that they can pull over to dedicate to something. And so that’s something that I think you could look at as creating innovation urgency.
How easy is it for a startup right now to go out and raise a million or $2 million, really $10 or $20 million that you see getting put into lots of startups around the US and the world? And here we are a big established company, and we can’t scrape together a million or two between the couch cushions to develop an idea that we think is going to be really important in three years or five years. So if you find yourself having trouble making that argument, boy, you have problems, and you don’t have enough innovation urgency.
Jeff Amerine: Well, and it’s particularly important because the half life of publicly traded companies is shorter now than it ever has been. I mean that their tenure in the down industrials is as short now as it ever has been. And that creative destruction that’s happening is happening at kind of an accelerating rate to the peril of those large companies that can’t figure this out. So I think your point is really compelling about that.
Scott Kirsner: And also, I mean, one example that everybody can relate to is what’s happening in electric vehicles and how many startups you have that are getting funded and getting to production. And they don’t have a huge product line. I mean, even Tesla does not have a vast line of products today. Rivian, which has been in the headlines recently, the electric truck company doesn’t have a vast product line, but how long are people going to wait for the established car companies to come up with an all-electric model that works for them? Are they going to wait another year, two years, three years? I think that big companies, a lot of times they’re sitting on their heel, they’re sitting on their behind a little bit as these startups peel away customers, and that’s a really dangerous place to be. It becomes very hard to grow when you have these brands that are attracting your customers and making them happy. And it’s going to make it very hard for some of the established car companies. Once they start rolling out their own electric models to figure out, okay, now how do we market given that a lot of the early adopter and even some of the not so early adopter customers have just bought a vehicle from Tesla or Rivian or another one of the electric car makers.
Jeff Standridge: And speaking of electric car makers, I saw an article this past weekend of Ford’s model, 1978 F 100 totally electric vehicle, that they’ve got out there. I mean, it’s obviously not to market, but I think it was a response to Twitter followers saying, please replicate the 1978 Ford F 100 in an electric model. And it looks exactly like the 1978 Ford.
Scott Kirsner: Yeah, and I’ve seen the electric Ford Mustang out in the wild this summer. And so Ford and GM are both trying to be really fast followers here.
Jeff Standridge: So we talked about creating a culture of innovation and an urgency of innovation. I’ve also seen, and both Jeff and I have worked in larger organizations as well, this tendency, maybe it’s not under the innovation umbrella, but it’s this, I have a great idea kind of thing. And then we begin putting investment, whether it’s a hard investment, our soft investment in terms of people’s time and effort, and a little bit of money here only to look up six months down the road and realize that all of that effort was wasted because we didn’t really think through the idea. We fell in love with that idea. We didn’t really try to articulate the business problem we were trying to solve, validate that business problem, et cetera. Do you see that as well in your work with companies from an innovation perspective?
Scott Kirsner: Yeah, I think a lot of times it’s led by just excitement around a technology. It’s like, hey, we’re in financial services, so we should figure out how to do something with blockchain, or we’re in manufacturing so let’s figure out how augmented reality can be used on the assembly line. And so it’s technology-led rather than opportunity or business problem-led. And I think you need to have some kind of process and constraints for innovation activity based on experimentation.
We talked about the lean startup methodology. That’s pretty good, in terms of saying, we’re going to build just enough of the product to put in front of some customers and see if they would place an order for it or actually put real cash on the barrelhead to buy it. But, as you point out, Jeff, you really do need to understand— what is the business problem that we have that this idea is going to solve? Not just, is there a senior executive running around who got excited about us having an Alexa skill. What are the metrics for success? What is this going to do for our customers? But we just know that there’s an SVP who thinks our company needs to have an Alexa skill ASAP.
Jeff Amerine: If they can be more beholden to doing unbiased customer discovery, where they’re asking good open-ended questions, you think about it. If you’re in a product company, in particular, you’re going to go into any of those kinds of conversations with biases around what you hope they will say, right? You’re hoping that you can design your survey instrument, whether they say this or not, in a way that validates your own thinking. Whereas we advise large and small customers— be a consultant to your own idea, to the extent that you try to kill it as early as possible in the process. And if it survives, it’s kind of a venture studio model, follows lean canvas, then you’ve got something if it survives that rigorous customer discovery.
Scott Kirsner: And I do think one of the things that you may find as tough for clients that you work with is just large companies are used to honing and developing something and coming up with the packaging and coming up with the slogan and spending a year or 18 months of that before they put it in front of a customer in a, are you going to buy this sort of way? And focus groups are not, are you going to buy this, right? Focus groups are, do you like the pink package or do you like the purple package? And so I do think getting that customer validation, and there are lots of people who are really smart about this, Steve Blank being one, Eric Reese, obviously, Alex Osterwalder that if you can compress that time, figure out, as you said, the potential points of failure really early on. And starting to get that customer input and build some customer momentum early on, saves you a lot of money, and saves you a lot of time. And I think that is what can help large organizations become more agile.
Jeff Standridge: Well, let’s talk about what’s on the horizon for Innovation Leader.
Scott Kirsner: We always feel like there are lots of interesting questions for us to explore, and some of the ways we do that are by surveying people or by doing interviews with people at large companies. We were just talking last week to the chief technology, and digital officer at Best Buy, who, as you might imagine in Q4, is a pretty busy person, given this is their most important quarter of the year. So, some of what we’re working on is a report around emerging technologies and how companies sort through the noise, filter through the noise, figure out which technologies are going to solve a business problem for them and work with those efficiently.
We’re looking at how traditional R&D organizations are evolving and what some of the ways are that they’re opening up to, what some people call open innovation, or just ideas from outside the company. And we’ve done some small in-person events in the second half of 2021. We really like getting people together in person because these peer groups just have great exchanges. We were doing one last week in New York City with a really interesting group of people from big brands in 2022. Hopefully, it’s going to be easier and safer for people to travel and come to larger events. And so we’re planning to do a conference called Impact that we’re planning for May 2022, that’ll be in New York City.
Jeff Standridge: Very good. I happened to think, as you were talking through this, do you do any work with higher education institutions? I think one of the single greatest industries that is ripe for innovation is the entire education system in the United States, but particularly higher education, where costs have grown, student debt has ballooned, and the preparation for a workforce to meet the economic demands is sometimes questioned.
Scott Kirsner: Yeah, those are all really good points. We occasionally interview people in the world of higher ed. As you were talking, I was thinking about a broadcast interview we did last year, I think, with the president of Southern New Hampshire University, which has been one of the leaders in experimenting with online degree programs and also on-campus programs that can help reduce the cost of tuition and kind of make college degrees more accessible. And so, yeah, we do have members in higher ed; we have members in nonprofit and government, not just private sector innovation. And I think higher ed is just higher ed and the utility sector and probably the defense contracting sector. There’s just some industries, and healthcare would be another one, that are so insulated, they’re so regulated. There’s very little competition.
If you think about your choices, right. For who you’re going to get water service from, or natural gas service or electricity at your house, a lot of companies have that sort of utility mindset where you have to buy from us. And I do think a lot of higher ed feels that it’s like, they feel that, oh, our brand or our position in this particular region is so strong that they’re not doing enough to bring the cost down and make higher ed accessible to more people. And you started to see it, right? Like there are colleges that are being forced to merge or to close because suddenly, their customers just go away. And so I think that is a cliff that for some of the smaller schools that don’t have as big of an endowment and don’t have state support, they’re definitely feeling some innovation urgency.
Jeff Standridge: Well, and Clayton Christensen, a couple of years before his death, predicted that 50% of higher education institutions would either close, go bankrupt, or shut their doors within 15 years. Number one, because the business model’s broken, and number two, because online universities, like Western Governors and Southern New Hampshire, and what have you, they’re doing things innovatively to bring the costs down and to ensure quality. And then number three, this cliff of 18-year-olds, that’s going to occur between ‘24 and ‘26, where the number of 18-year-olds is just going to dry up. And you can’t manufacture 18-year-olds in the next three years. We had to do that a long time ago, right?
Scott Kirsner: No. You could look at people in the workforce that might want to increase their education and get a better-paying job. And so I do think a lot of online schools, and to some extent, community colleges, that’s where they’ve always played well. I also think community colleges don’t get a lot of respect in most parts of the country, but they are much better at talking to local employers and understanding, what are the skillsets that these employers are hiring for today, and how can we build curriculum around those needs? Whereas, if I went across the river to Harvard or MIT and said like, “Hey, so are you talking to employers about who they want to hire?” You might get kicked out of the president’s office for asking this sort of question.
Jeff Standridge: Yeah, I believe that two-year institutions are the missing link to workforce development in our country. And I believe most four-year institutions don’t see themselves as a piece of the workforce development puzzle. And that’s a problem.
Scott Kirsner: No, I think it’s true. And like, you have to look for these weird, bizarre leading indicators sometimes like things that feel like they’re an anecdote at first, but then they become a trend, and then become the mainstream. And I remember like three or four years ago; I went to a conference here in Boston. And one of the other speakers was this kid was at Berklee College of Music, which is one of the great music schools that launches a lot of professional pop musicians and jazz, rock musicians. It’s not a school for classical musicians. And this kid had grown up in India, and he had learned how to play five or six different instruments by watching YouTube videos. And so if you can get into one of the country’s top music schools by watching YouTube videos for free on the internet, like that is a really interesting signal of disruption for music education, for sure.
Jeff Amerine: Well, the arbitrage that the large institutions counted on, the fact that they had control and you had to come to them, is eroding more and more. The accessibility is there for everyone. And, we see the same thing happening in currency, right? With cryptocurrencies and whatnot, the arbitrage, the control that the central banking institutions had, the financial institutions had, is being eroded. And there’s going to be some good things that come out of that, in that these are sectors that have not had any competition based on duopoly, oligopoly, or monopoly power that they had. And I think that adversity that they’re facing is a good forcing function to get them to either think about how to be more innovative or to plan to go out of business. They really don’t have a lot of other choices.
Scott Kirsner: Yeah. I think it’s true. And you see some examples. I was talking with some folks at Fidelity Investments here in Boston that are looking at crypto as an asset class that they are already helping people transition some of their holdings into Bitcoin now. I think they’re doing Bitcoin and maybe talking about doing Ethereum, but not doing Ethereum yet. And so, yeah, I think all kinds of financial institutions are going to have to figure out what role crypto is going to play for us. Or they’re going to find themselves battling it.
To go back to Walt Disney, as an example he looked at, when television came along, he said, oh, this is a great channel. We’re going to make content for it. Oh, and it’s also going to be used for me to promote my new theme park that I built in Anaheim. And at that point, all the other movie studios were looking at television as a threat and trying to figure out how to keep their top stars off of television shows so that you would have to pay to go see them in the movie theater. And so I think it’s always interesting. It does sort who the smarter, large companies are when they see something like crypto, and they say, okay, this is going to be important. How does this fit into our business? As opposed to just writing it off as a threat or pointing out all of its weaknesses and trying to stonewall against it.
Jeff Standridge: Well, Scott, it has been a pleasure having you with us today. Tell our listeners where they can find you and Innovation Leader.
Scott Kirsner: Well, we are on Twitter @InnoLead, and the website is innovationleader.com, and we also have a podcast called Innovation Answered that is on all of your favorite podcasting platforms. But I have to say this was really great. It was such a wide-ranging interview. And so, I take my hat off to you guys for really coming so well prepared with interesting questions.
Jeff Standridge: Well, we appreciate you for joining us. It’s been Scott Kirsner, CEO and co-founder of Innovation Leader, a Boston-based media and events company. We appreciate you for being with us and hope to cross paths again in the near future.
Scott Kirsner: All right. Thanks a lot, guys. Great talking to you.
Jeff Amerine: Thanks for coming on.
Jeff Standridge: Yep. Thank you all for joining another episode of the Innovation Junkies Podcast. Talk to you soon.
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 this 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.