Pulp Innovation Chapter LVIII: The Return of Status Quo

By: Jeffrey Phillips

While working hard to push the innovation plan forward in record time, Marlow is surprised to find he has been assigned a new team member. He discovers quickly that the new colleague is very invested in the existing processes and methods. They’ve thrown him yet another obstacle instead of a much-needed catalyst.

The euphoria didn’t last long.  It never does.  The roller coaster goes both up, and down.  There’s a slow ascent to the top, followed by a rapid plummet to the bottom.  In our case it was almost an immediate descent.

Monday, I turned up at Accipiter to meet with Susan.  There I discovered we had a new participant.

“Brockwell has decided he is just too busy to work with us on a daily basis, so he has assigned Chad Gillette to work with us on a day to day basis.  Chad is a good guy, one of George’s protégés, and George has assured me that he understands the importance of this effort.”

That lurch in my stomach was the first car going over the lip of the descent.  We hadn’t really started and already there were changes.  No matter how close a relationship, no matter how well communicated, Chad would want to place his stamp on the work.  It would be another few weeks before we sized each other up and got working in earnest. In a matter of a few days the project’s engaged sponsor and active participant had shifted from the COO, who it now appeared had never expected innovation to catch fire, to the CEO, then to the CFO, and now to a guy who reported to the CFO.  The only people with enough “bandwidth” to actively participate weren’t senior enough to speed our work.

Susan recognized my discomfort and added “Look, it’s not what I had hoped for, but we have momentum and the opportunity to build a real innovation program.  Let’s see what Chad has to say.”

“In my experience” I said “we need to keep the channels open to Brockwell and Dowdy.  Those two have given us the vision, and regardless of Chad’s responsibilities on this project, we need to set the expectation that we want to meet with Brockwell and Dowdy regularly.”

Susan frowned but said nothing.  There was no way I was going to allow the reporting structures and politics get in the way of achieving what Brockwell and Dowdy wanted, because it seemed that everyone else had a different perspective or intent for our project.

We met Chad later that morning.  Chad, on the whole, was a bright, earnest young guy, a fast climber who had impressed Brockwell with his hard work and smarts.  Chad was a fairly newly minted MBA, which meant in my book that he knew a little about a lot of things, and practically nothing about actual work.  Given that he was a finance major and worked in finance, that just compounded the issues in my head. I was convinced all Chad was going to worry about was the money.  Boy, was I wrong.

After the usual pleasantries, Susan and I set out an ambitious plan to build an innovation team, encourage incremental and disruptive innovation throughout the organization and start building innovation communities by training high potential people in the organization. It was a very carefully designed program, one she and I had been building for months in anticipation of the approval from Brockwell and Dowdy.  I made sure to impress upon Chad that Brockwell and Dowdy were supportive of our plans and the goals of innovation.

Once we finished our presentation, Chad had a few questions.

“What’s it going to take to accomplish all of this work?  How quickly can we get some new ideas into the product development pipeline?”

I liked what I was hearing so far.  Speed and urgency are so important in an innovation program.  Let’s get going while we have the ear of the CEO and some momentum.

“We can start generating ideas in specific product groups in just a few weeks” I said. “Clearly we won’t have a chance to train the teams on innovation processes, but Susan and I can work with them to identify key opportunities and issues and start generating ideas.”

“Great.  Do you think we can have new products in the pipeline so we can get budgets in place during the annual planning cycle?”

The annual planning cycle, that recurring monster better known to innovation experts as the idea killing process.  There’s no business process or decision making apparatus less welcoming to innovation than the annual planning process, a place where great ideas go to die.  Every year every large business basically shuts down to re-enact the development of next year’s plan, which comprises a set of presentations where the numbers move slightly from last year’s plan.  A rigid, microscopically managed process with no ambiguity and no room for error.  In the annual planning process, only two things are certain:  the revenue numbers projected will be larger than last year’s, and nothing gets approved without a spreadsheet that details the return on investment.  While the revenue numbers may be a bit inflated and fanciful, the projects that get approved go under a ROI microscope, which inevitably means that many innovative ideas are rejected.

“Well, if we move quickly we can have ideas in our pipeline before the annual planning cycle” I said “but I’d like to encourage you and the rest of Accipiter to think about funding ideas within the annual plan, and to provide funds for ideas that are generated but don’t align to the annual plan.  In other words, let’s be prepared to fund good ideas when they occur, rather than simply sign off on several in the annual plan.”

“Yes, but I think we’ll need to consider how to acquire funds for the idea within the annual plan, as well as outside the plan.  Our experience is that new ideas seldom have much success in an annual planning cycle.  Additionally, we may have good ideas that should be launched before the planning cycle, and may need to find the funds for those ideas instead of waiting for the plan.”

You’d have thought I’d questioned the validity of the Black-Scholes equation or burned a tract on financial theory of markets to see the disbelief in his eyes.  There was no consideration for funding outside of the annual plan from his perspective.  And that’s the way the rest of the morning progressed.  We’d recommend changes to the way Accipiter worked, to further an innovation goal, and he’d reinforce the existing processes.  What I came to discover, very quickly, was that even though he was relatively new to the company, and had worked in other firms and industries before his MBA, he was actually very invested in the existing processes and methods.  He understood the need for innovation and different results, he just didn’t seem to understand that new thinking and new ideas might require different processes, people with new skills and changes in the way Accipiter worked.

It was odd to see such attachment to a dysfunctional corporate process and culture by someone who had not served much time within Accipiter.  From a corporate lifer I would have expected the adherence to the existing order, but not from a fresh-faced MBA.  Yet Chad battled us on every recommendation, trying to water down our approach and align the approach to existing methods and processes, intent on keeping the work as close to what Accipiter already did as possible.  Don’t get me wrong, he was very supportive of innovation goals, and knew that Brockwell and Dowdy wanted more innovation.  He was just determined to see innovation happen within the typical “business as usual” processes if at all possible.

By the end of our first meeting I’d reached the bottom of the roller coaster.  My stomach didn’t lurch so much as heave.  Just on the brink of success, we were being pulled back into the existing order.  Even though we had open channels to Brockwell, I didn’t think it would matter.  One of us would have to go.  Either Accipiter wanted to move forward with innovation, and was willing to change, or Accipiter wanted to act interested in innovation while reinforcing the status quo.  I wasn’t going to stick around for the second option, and Chad seemed unwilling to commit to the first.  I wondered why Chad, and several other executives before him, were so wedded to the current structures and so concerned about change.

At the end of a completely frustrating meeting, where Chad and I had increasingly talked past each other, and both recognized the futility of further discussions without clear direction from the top, we broke the meeting.  Susan had been relatively quiet for a while and had a pensive look on her face.

“OK, we go back to Brockwell and tell him the fair haired boy doesn’t see eye to eye with us, and find another person.”

She shook her head, not saying no, just in resignation and disbelief.

“I didn’t realize how powerful the status quo really is, and how difficult introducing innovation as a sustaining capability was going to be.”

It’s not a hopeless cause, I thought, but we need a burning platform to get the company’s attention.

“What would draw significant attention to this issue and get everyone on board?”  I asked.

“I’ve been thinking about that myself.  Perhaps we should recruit Mr. Kasamis.”

“Doug Kasamis, the chairman?”

“Yes, he was the founder and a real entrepreneur.  He is still very respected within the organization.  If we can get him as a spokesperson, if he is willing, he could rally most of the organization to a significant change.”

We knew what to do.  We’d need to meet with Brockwell to educate him on the need for extending or modifying the existing processes to sustain innovation.  If he agreed, we’d need him to communicate his approval to Chad, or replace Chad.  If he didn’t agree, we could probably go back to Dowdy one last time.  Kasamis was a card I’d play only if I absolutely had to.

By Jeffrey Phillips