Excerpts from my book, The Innovation Superstar Playbook

From the previous discussion (and the title of this section) you’re already starting to gather what I look for in the corporate anatomy in my search for innovation success: Customer, Process, and Culture. The “CPC” model, if you will.

1. Customer

“Love thy customer” is a core idea of innovation superstardom. As the name implies, it’s about forming a caring observance and relationship with customers, individually and as a whole, that is “special” enough to get true insight into what they need and want. Of course, such “conduits of connectivity” are the first big step to delivering net customer value.

As an example, I had the privilege of working with a large ophthalmology practice, MECA located in Memphis, Tennessee. They had a policy they called “High Tech, High Touch.” At the time it was considered to be absolutely ridiculous, the idea that an ophthalmologic surgery center would have something as arcane as the word “touch” in their mission statement.

The bottom line though is—they knew something amazing. The owner of the practice Dr. Jerre Minor Freeman, MD, is one of the smartest people I’ve ever met in my life. He realized he wasn’t in the treatment of ophthalmologic disease business, he was in the experience business. Wow—what a breakthrough for an ophthalmologist. To step away from what could have been an ego-centric mentality based on his efficacy as a surgeon—but he realized his business was about taking care of people, and that the only purpose of technology as another tool in his quiver he could use to deliver wonderful value.

So what’s the flip side of “love thy customer?” Well, you guessed it: it’s “hate thy customer,” and unfortunately, that’s where many companies wind up. I was recently at a resort in Lake Tahoe, California. I was surprised after listening to some of the people working in the resort to find that they referred to “tourists” as “terrorists.” They hated their own customers, and it showed. The end result for that resort, by the way, was financial collapse.

Hating your customer is a very bad business policy. But it’s easy to do. The first time a customer comes into your supermarket, slips on a grape and sues you, all of a sudden your focus changes to grape risk management, and everyone who walks in the door is no longer a customer, but rather, a perpetrator. Or a terrorist.

It is important to realize, perhaps as a part of the cost of doing business, that some customers are bad. The problem is that many companies will reference the bad customer with every interaction, experience and decision. They become centered on loss prevention rather than customer acquisition or retention. The reality is that hating your customer will have a long term and inevitable effect on the financial viability of your business. Such “failure referencing” is a bad habit, and a hard one to get out of.

It’s interesting to note that doctors who treat their patients extremely well, regardless their medical efficacy, have a significantly lower incidence of malpractice lawsuits, and a lower incidence of “problem” patients. It’s also interesting to note that people who have a hard time communicating and connecting with and serving their customers have more problems. The more you hate your customer—believe me—the more you’re going to hate your customer!

As a reader of hundreds of books on innovation and creativity, it is interesting to me how conspicuously absent the discussion of the customer really is from these books. There are systems, there are methods, there are spreadsheets, there are formulas, there are processes, policies and checklists, you name it, but again, where’s the customer?

Hating thy customer is a problem similar to risk management. You can suffer from customer hate creep! Eventually, day by day, one bad customer at a time, you can change your whole business: your products, your services, your packaging, your delivery strategy, your support strategy—everything—to try to target that minority, that rare instance, of a bad customer. You live in fear.

Have you ever noticed that you can very easily have two very accurate vantage points? You can assume that most people are good and generally do the right thing. You can also accurately do the same thing about, generally, people being bad. And of course, you’d be right in both instances. However, there’s a phenomenon that is difficult to put my finger on, but when we focus on the idea that customers are generally good, it’s incredible how customers tend to be—generally good. Whereas when we think of customers being bad, well, you get the idea, customers are generally bad.

I know this sounds like “kinder science” but it really gets to the core of innovation. The ability to connect and to have the assumption that your customers are good and worthy of your quality and innovation and ultimately, your experience—that’s what makes this all worthwhile. Even more importantly, it’s the key to driving the organization’s culture.

Innovation superstars go the distance to love their customers. Southwest, especially compared with the competition, loves their customers. They fly clean airplanes on time. They’re websites and frequent flyer programs are easy to use. They have fun with their customers on board the flights, telling jokes, even making the usual seat belt and oxygen mask lectures fun and interesting. Flying Southwest not only gets you there, it is an enjoyable experience from the time the reservation is made until the time the bag is picked up on Carousel Two.

The “Love Thy Customer” Checklist

 Does the company go the distance to really understand the customer?

Do they focus on the total customer experience, or do they just collect and measure data on customers—customer satisfaction, etc.?

 Do they place the right people—decision makers—in front of the customers?

 Do they have good processes to collect information from customer-facing personnel?

 Do they do “bonding time?”

 Do they try to understand what non-customers (future customers) want?

 Do they understand what motivates their customers to buy their products?

2. Process

Process is the major component of the superstar “anatomy.” By now you’ve read my concerns about process, and how it has a tendency to take over organizations and get in the way of innovation, rather than helping it along.

I don’t advocate getting rid of process completely. People need some structure and framework in which to operate. Project reviews must continue and products must be tested before being brought to market. From my experience, the application of process varies all over the place, but it is important to have especially in large, geographically diverse companies with complex products.

We’ve already examined the downside of process; excessive bureaucracy, slow time to market, people living in fear of getting through the next process stage, and thus watering down their projects or abandoning them completely. We’ve already observed that, in some companies, the “easier” job in the organization is to shoot ideas down or “find the fault,” actions which effectively destroy value rather than create it. We’ve already observed how process can become the focus, in lieu of the customer, and this misguided focus leads to misguided innovation, or kills innovation altogether.

We’ve also seen examples where innovation progresses at a reasonable pace, but could be faster and better if augmented with ideas and technologies from outside the organization. “Not invented here” syndrome, again, dilutes or waters down what’s possible.

While less is often more, I look not for an absence of process, but process that truly fosters the innovation process, and that the innovators in the organization are comfortable with.

Process Serves Innovation (Not The Other Way Around)

It’s hard to put this idea into a short phrase, but when I engage with a company, it doesn’t take long to assess whether the process is a help or a hindrance. When the first thing you get from the people you’re meeting with is a 68-slide presentation on their innovation processes—with little to no information on their customers, customer needs, customer involvement, innovation successes, and so forth, alarm bells start to go off.

I try to imagine myself working in the organization. Would I get so frustrated with the layers of process—the forms to fill out, the reports to write, the checkpoint meetings—that sooner or later I’d forget about what I was working on? Would I feel like my project was “guilty until proven innocent” instead of the other way around? Would I feel like I had to win the approval of nine or ten “find the fault” people to move forward with the simplest steps? If it seems that way, I’m probably not dealing with an innovation superstar.

On the other hand, if the process seems to add good ideas, connect me with customers (either directly or through the “front lines” of my organization) and provide sufficient resources to execute a breakthrough innovation, that process is serving innovation, and the company passes muster as an Innovation Superstar candidate.

The Process-Serves-Innovation Checklist

 Is the innovation management process an asset or liability?

 Do innovators spend more time serving the process or innovating and serving the customer?

 Does the customer play a significant role in the innovation process ?

 Can the process act and react quickly? Can it decide quickly? Can it add speed to critical projects?

 Is the process streamlined or bureaucratic?

3. Culture

Although I suggested earlier that today’s emphasis on “culture” as the both the creator and the solution to most business problems had become a little too pervasive, I still maintain that culture is an indispensible enabler of innovation. It’s simple—if you get the customer right and the process right, does that guarantee innovation success? Only if you’re lucky. If your organization lacks the passion, the skill sets, the talent, the personal ownership, the freedom to act where acting is needed, you’re still likely to fail. So while the customer focus “head” tells you what to do and the process “body” accomplishes tasks, the culture “legs” support it all and allow it to move forward.

I’ve identified four specific “culture” elements: Collective passion, Craftsmanship, No Fear Factor, and Right Team. I’ll discuss each below. The bottom line I try to assess with each organization is: Does the culture reward and foster innovation? Is innovation an important component of the organization’s overall business strategy? Is the organization invested (both literally and figuratively) in innovation?