I just had coffee with Anthony, a friend who was just hired as the CTO of a large company (over 30,000 people). He’s cofounded several enterprise software startups, and his previous job involved building a new innovation organization from scratch inside another large company. But this is his first time working as the CTO of a company this size.
Good news and bad
His good news was that his new company provides essential services and, regardless of how much they stumbled, they were going to be in business for a long time. But the bad news was that the company wasn’t keeping up with new technologies and new competitors who were moving faster. And the fact that they were an essential service made the internal cultural obstacles for change and innovation that much harder.
We both laughed when he said that the senior execs told him that all the existing processes and policies were working just fine. It was clear that at least two of the four divisions did not really want him there. Some groups think he’s going to muck with their empires. Some of the groups are dysfunctional. Some are, as he said, “world-class people and organizations for a world that no longer exists.”
So the question is: How do you quickly infiltrate a large, complex company of that size? How do you put wins on the board and get a coalition working? Perhaps by getting people to agree to common problems and strategies? And finding the existing organizational islands of innovation that were already delivering and helping them scale?
The journey begins
In his first week, the exec staff had pointed him to the existing corporate incubator. Anthony had long come to the same conclusion I had, that highly visible corporate incubators do a good job of shaping culture and getting great press, but most often their biggest products are demos that never get deployed to the field. Anthony concluded that the incubator in his new company was no exception. Successful organizations recognize that innovation isn’t a single activity (incubators, accelerators, hackathons); it is a strategically organized end-to-end process from idea to deployment.
In addition, he was already discovering that almost every division and function was building groups for innovation, incubation, and technology scouting, yet no one had a single road map for who was doing what across the enterprise. And, more importantly, it wasn’t clear which, if any, of those groups were actually continuously delivering products and services at high speed. His first job was to build a map of all those activities.
Innovation heroes are not repeatable or scalable
Over coffee, Anthony offered that, in a company the size of his, he knew he would find “innovation heroes” –the individuals others in the company point to who single-handedly fought the system and got a new product, project, or service delivered. But if that was all his company had, his work was going to be much tougher than he thought, as innovation heroics as the sole source of deployment of new capabilities are a sign of a dysfunctional organization.
Anthony believed one of his roles as CTO was to:
- Map and evaluate all the innovation, incubation, and technology scouting activities.
- Help the company understand they need innovation and execution to occur simultaneously. (This is the concept of an ambidextrous organization.)
- Educate the company that innovation and execution have different processes, people, and culture. They need each other – and need to respect and depend on each other.
- Create an innovation pipeline – from problem to deployment – and get it adopted at scale.
Anthony was hoping that somewhere three, four, or five levels down the organization were the real centers of innovation, where existing departments / groups—Not individuals — were already accelerating mission / delivering innovative products / services at high speed. His challenge was to find these islands of innovation and who was running them and understand if / how they:
- Leveraged existing company competencies and assets.
- Understand if / how they co-opted / bypassed existing processes and procedures.
- Had a continuous customer discovery to create products that customers need and want.
- Figured out how to deliver with speed and urgency.
- And if they somehow had made this a repeatable process.
If these groups existed, his job as CTO was to take their learning and to:
- Figure out what barriers the innovation groups were running into and help build innovation processes in parallel to those for execution.
- Use their work to create a common language and tools for innovation around rapid acceleration of existing mission and delivery.
- Make permanent delivering products and services at speed with a written innovation doctrine and policy.
- Instrument the process with metrics and diagnostics.
Get out of the office
So, with another cup of coffee, the question we were trying to answer was, how does a newly hired CTO find the real islands of innovation in a company his size?
The first place to start was with the innovation heroes / rebels. They often know where all the innovation bodies are buried. But Anthony’s insight was he needed to get out of his eighth-floor office and spend time where his company’s products and services were being developed and delivered.
It was likely that most innovative groups were not simply talking about innovation, but were the ones who rapidly delivering innovative solutions to customer’s needs.
One last thing
At one point Anthony said, “I’m going to let a few of the execs know I’m not out for turf because I only intend to be here for a few years.” I almost spit out the rest of my coffee. I asked how many years the division C-level staff has been at the company. “Some of them for decades,” he replied. I pointed out that in a large organization saying you’re just “visiting” will set you up for failure, as the executives who have made the company their career will simply wait you out.
As he left, he looked at a bit more concerned than when we started. “Looks like I have my work cut out for me,” he admitted.
Steve Blank is an adjunct professor at Stanford University and cofounder of the Gordian Knot Center for National Security Innovation.