The question “Why do I need to Innovate?” remains the question that I answer week after week. Business leaders often tell me that they don’t need to innovate. They explain that - if we just ______ it will all go back to the way it was and all will be good.
You can fill in the blank with what ever you wish … if we just had workers who were more engaged… if we just had workers who worked harder… if we just got government out of our business…if we just had a government who cared about business and who did something about China…
The truth is we can’t go back.
We can only go forward… adapting…evolving… changing… our systems, our services or products.
Most important of all we need to transform our mindset.
Last night I attended an inspiring concert by PEI singer songwriter Lennie Gallant in one of the oldest Churches on PEI in the Acadian fishing village of Rustico. Lennie told stories of family, of community and of the sea. Last night he sang Peters Dream one of his most meaningful and famous songs. Here's a link to him singing it at a televised New Years Eve concert. https://www.youtube.com/watch?v=H1bqqdNZOy8 Listen close to the words - here's a link to the lyrics. http://www.lyricsmania.com/peters_dream_lyrics_lennie_gallant.html
Peters Dream is a very sad story. It's the story of the devastation of the Cod fishery. And while progress is good - and change is good - there is much that is wrong about what was done in this case and just as importantly not done. As the commercial fishing vessels came in - the local fishermen realized quickly there was a problem. They saw quickly that the commercial boats were over fishing. They complained - but no one listened. And today it's estimated that the cod fishery is less than 1% of what it was in the mid 50's -- that's a decline of over 99%. The fishery is now gone and may never be able to recover.
As I listened to the nearly 3 hour concert I was reminded of my family and in particular of my Great Grandfather Will Holder. He too faced challenges as a sail maker. I've told the story before but I think it bears repeating as the lessons from it are timeless.
My Great, Great Grandfather George Holder made sails for great ships 6 days a week - scrapping to make a living. When the age of sail was coming to an end… my Great Grandfather Will Holder, who worked for his dad, saw the end coming.
Young Will was not a whiner. He took responsibility for his future. He convinced his Dad , who was not as progressive, to invest in a sewing machine. Will said in an audio interview that if his Dad had said no he was going to do it anyways. He was the laughing stock of the sail making industry dubbed the “petticoat sailmaker.” NOTE: making fun of innovators is a common defense mechanism from others who don't have the courage to take responsibility for their organization's future.
He paid those workers who were courageous enough to spend the time to get educated in how to work a sewing machine extra. But as he said in the interview “with the machines we were able to make far more money from the greater productivity then it cost us.” Selling the workers on why they need to get retrained and refocused is the job of the leader.
Basically - he invested in a new system for making sails. He invested in training and technology to improve the effectiveness and efficiency of his workers. The workers helped with the process. They created a hole in the floor to stand in - so that the sewing machine could be put on the floor and the sail fed through it more easily as it lay on the floor of the sail loft.
As the world continued to change he used his advanced systems to make new products - making awnings, tarps and products for military ships.
Will Holder didn’t say… If we just ______ . Rather he took charge of his destiny.
And the benefit of innovating - the ROI - the Payout was LIFE instead of DEATH.
And that my friends is the reason you need to innovate.
The reason you need to innovate is so that you don’t go out of business.
Sadly, most leaders don’t see the urgency. Leaders of 75% of the S&P 500 over the past 20 years didn’t see it either - that’s why their companies are gone - bankrupt, acquired, merged out of existence.
As the chart above shows when the market changes faster than you do your company gets smaller. The data shows that of the 10 most valuable companies on planet earth in the year 2000 only one is actually worth more today than it was in 2000.
Interestingly the declining companies have gone down in value by a little over 4% a year...nothing to get concerned about they say...However, over 14 years the decline in values adds up to 61% !
It's fair to say that the leaders of these companies feel it's just not their fault. If we just _______ they say. My Great Grandfather didn't think this way. In his 80's he came out of retirement to help the company through a difficult time. He lived 99 years - and I was very blessed to know him. In his honor, my sailboat is named Winnijean - the name of his sail boat.
Friends, there has never been a better time to innovate. Our ability to collaborate, learn more, work faster, work smarter is incredible.
The barrier to taking advantage of this new world is that as a collective management community we don’t know how. We don’t know how to innovate because we have not had to. Until the internet created a true free market we could get away with not being competitive because customers couldn’t find other options easily. Today they can and they do. The result is if we are not meaningfully unique prices and profitability continues a downward journey.
The good news is that a movement has taken root on University Campuses, at Non Profits, at Companies Large and Small. It’s called Innovation Engineering. To learn more about it visit www.InnovationEngineering.org. or call in the USA 513.271.9911.
To get engaged - attend the Innovation Engineering Executive Program August 14 - 15 in Cincinnati or to really get engaged attend Innovation College the week of August 25 - you will learn how to approach innovation as a system - a system that everyone can learn - a system that increases innovation speed and decreases risk.
IMPORTANT: We have learned that Innovation can start from the bottom up or the top down. It's great when the leadership is engaged. However, we are seeing great success from the bottom up and from the middle out. Where ever you are in your organization - consider this your personal invitation to join the movement - to become an Innovation Engineering Black Belt. To learn more call in the USA 513.271.9911.