Tuesday, June 21, 2016

Why FUD has innovation all locked up

Ralph Ohr and I were exchanging ideas today via Twitter, and we were talking about a recent study of German executives that looked at why innovation failed in German companies.  The top three reasons why innovation didn't move forward came down to fear, uncertainty and doubt. Oh, those weren't exactly the words that were used, but in context for today's post they'll work nicely.

For those of you not old enough to remember when IBM was a real powerhouse, I'll need to introduce the idea of FUD.  When IBM ruled the mainframe market, it created FUD to keep its customers from experimenting with other mainframes, the emerging mini-computers like DEC and any other alternatives.  Basically, IBM sales people would introduce fear - what if you tried these new or unproven concepts and they don't work?  If that didn't work, they'd introduce uncertainty - who knows what these new computers can do?  Our mainframes are proven, and you have a big investment in them.  Or, they'd use doubt - can you really trust these guys?  IBM has a long history and we've been good partners with you for years.  Basically, IBM never got into a feeds and speeds discussion (often because they would have lost that debate).  Instead, they attacked the buyer's way of thinking, their perspectives and their status.  Can you afford to take a risk with unknown or unproven technology?  Will these guys be around for 100 years like IBM?  This is the sales tactic that they used and perfected, and is often used by any market leader who has presence but may be lagging in new development.

The purpose of FUD is to create complacency, to resist change and reject uncertainty.  These factors eventually lead to "lock in", where the buyer clings to any rationale to keep from changing, no matter how valuable the new options may be.  It's easier to talk yourself out of changing when a partner feeds you the things you should be afraid of.  And this, my friends, is why it is so hard to innovate in a large corporation.

While I've described "lock in" as a problem, many executives will say they want their methods, processes and decisions "locked in" and executed effectively.  In this sense, locked in means that everyone understands, everyone is behind the decision and everyone commits their entire energy to accomplishing the task - there can be no second guessing.  And if a plan is right and the opportunity is rich, this is the way you should execute.  But it isn't the way you should experiment or discover new opportunities.  As your past becomes a framework for your present and begins to dictate your future, you lose scope and breadth for thinking.  Lock in is nefarious. In an execution setting it is valuable, in an innovation setting it is deadly.  Lock in creates a host of reasons why you cannot do something.  In an innovation setting you needs lots of reasons and support to do something new.

The fact of the matter is that we know all this and it still haunts executives.  If you asked those same German leaders if they know how to innovate, they'd say yes.  What they aren't addressing directly is how difficult it is to innovate when the nature of their thinking and what they reward is so locked in, and evident in what they focus on and reward.  In the days of IBM, we could at least point the blame at IBM, who was creating FUD against competitors.  Now, executives are creating FUD themselves, and then turning that weapon against themselves and their employees, limiting discovery, experimentation and innovation.  We have met the enemy, and he is us.  Fortune 500 executives are creating innovation FUD, whether they know it or not.  Their cultures are creating FUD.  Their reward systems are creating FUD.  In fact, given the state of FUD and our expertise to create it, it's a wonder that any innovation gets done at all.

We need to break out of self-created, self-defining FUD.  This means we need to reduce the fear of innovation by making it a more consistent activity.  We need to demonstrate that innovation is important and encourage people to try.  Doing these things can reduce fear.  We need to reduce uncertainty around innovation by defining some methods and processes, to make it more evident and simpler for people to do.  Finally, we need to remove doubt about innovation by communicating its value and rewarding people who attempt innovation activities.

Otherwise lock-in will only grow stronger, and prevent any innovation from happening.  The longer we tell ourselves that the current situation is OK and everything else is risky, the more difficult it will be to attempt something new.  Innovators must move beyond FUD, by attacking each of its components and demonstrating the value of thinking beyond the locked in perspective.
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posted by Jeffrey Phillips at 7:45 AM


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