Tag Archives: Insight2

February 5, 2013 · 10:43 am

Overcoming Confirmation Bias

I’ve been in a couple of different meetings lately where I’ve been surprised at people’s reactions to new findings.  In both cases the results of a study were shared with a diverse group of people.   While I found the information shared to be highly insightful and illuminating, others in the group heard the same information and replied “there’s nothing new here… it’s exactly what I expected to see”.  The result?  I’m ready to go change everything, and others in the room are feeling confirmed that everything is okay exactly as is.  How can different people see the exact same results and come to such different conclusions?

There’s a psychological term called Confirmation Bias.   Simply stated “there  is a tendency of people to favor information that confirms their beliefs or hypotheses”.  In the case of the above meetings, I (naturally looking to change things up) focus on the information that demonstrates dissatisfaction or problems.  The people in the meeting that are fine with the status quo focus on the comments that are more positive and  dismiss the negative comments as irrelevant.

I know there is a world of Brain Science research out there that explains this in great detail.  In a nutshell, our brains save countless time by looking for patterns and putting new found information into existing “buckets”.  Therefore, it is physically easier to apply new learning to an existing belief than to open up new storage areas for unique thoughts.  (I apologize to all of my neuro-science friends for this gross oversimplification). 

So what can we do about it?  Awareness is the key.  Don’t limit your understanding to the first glance of new findings.  Knowing your brain is filtering this information can allow you to look a second time and attempt to see the information as it truly is.  Listening (with an open mind) to others’ opinions on the same data can also benefit you.  

This is no different than physical exercise.  It’s hard at first and it makes you very fatigued.  But before long it becomes a habit and your body comes to appreciate it.

Watch for this in your next meeting.  Once you are aware of it, you’ll see it everywhere.  If you can learn to see past your own natural bias, you will be able to add value that is appreciated by everyone in your organization.

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January 29, 2013 · 11:02 am

Get out of your cocoon

I recently wrote a blog for a group in Indianapolis called Centric.  It’s a group focused on innovation and draws people from a diverse set of organizations.  Service providers, not-for-profit reps, entrepreneurs, manufacturers and corporate personnel all meet once a month to listen to a speaker and share lunch.     It has gotten a lot of play, so I wanted to repurpose it here.
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I spent the first half of my career at Whirlpool Corporation with all of the blessings and trappings that come with working at a huge company.  From a personal development standpoint, they provided everything I needed.  I would attend four or five company held training workshops every year ranging in topics from Brand Marketing to Leading Effective Teams.  I even took a full year of Italian Language Classes right at the corporate headquarters.  Every month we had a Management Club meeting, where a distinguished author or an internal executive would speak.  Every couple of years, I might break out to attend a national conference, but that was typically only when I was speaking.  I lived in a giant cocoon with all the life-sustaining nutrients I could ever need.  I honestly believed that whatever I could need to know, they would provide for me.
The second half of my career (so far), I’ve been a small business owner.  Without having the company provided resources that I was used to, I found that I had to get out and meet people and find alternative means of expanding my influence.  Networking (a concept it turns out that extends beyond meeting people down the hall) became a necessity to get my business up and going.  Now my business is established and I keep busy… But I still seek out opportunities to network and meet with thought leaders beyond my four walls.  Not so much for business sustainability, but more for personal enrichment (which by the way, leads to business growth).  Centric is a tremendous organization that serves this purpose.  Such a wealth of diversity exists at every meeting, I never come away without new learning.
What I wish I’d known then what I know now… Can a big-business person learn from a small service provider?  Yes!  In fact, they pay them for professional services on a regular basis.  But what about the invaluable, top of mind stuff?  What about the life experiences that get shared only over a shared meal?  You don’t get that in a typical consulting engagement.  Looking back, I wish I had had a Centric-type organization available to me during my corporate years.    Instead of just hearing what all of my colleagues were hearing, I could have gained unique perspectives and brought them back to my job. It would have given me an edge that others didn’t have.  Today, I firmly believe that the information shared readily at a Centric meeting could make the average corporate employee a  superstar within their own company.
Today, I find that most “corporate-types” continue to think like I once did.  ”Networking is for realtors, financial planners and small business owners, it’s not something I need in my life.  My company teaches me everything I need to know…”.  Yeah, keep drinking that Kool-Aid.
Kudos to the big company folks that have tried out Centric and have made it a home.  I’m sure it has benefited you in your careers.  But be careful… If word gets out, it might just catch on with other corporate employees.
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You may not be near Indianapolis, so attending a Centric event might not be an option for you.  But have you checked to see what might be available in your area?  When is the last time you had coffee with someone to share thoughts and ideas outside of your own company?  No one organization has a lock on innovation.  The wider you cast your net, the more likely you are to catch a great idea!

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December 4, 2012 · 10:09 am

Is B2B a Myth?

I was talking with a guy the other day whose company makes commonly-used, consumer products.  I asked him how he goes about gaining insight and understanding about his consumers.  He looked at me with a somewhat puzzled expression and informed me that my question was really irrelevant, as he was a Business to Business (B2B) company, not a Business to Consumer (B2C) firm.  After all, he stated, all of his attention and focus was on the retail buyer at the big box stores, not on the Average Joe that shopped there.  I honestly waited to see if he was being sarcastic, or would crack a smile or something, but he did not.  This was his philosophy and he was sticking with it.

While this logic seems obviously flawed, I began thinking further about this.  What business actually buys anything?  Companies don’t buy things, people do.  Granted, they may work for companies, but ultimately it’s a person that is making the decision whether or not to purchase a product or a service.  Isn’t that person ultimately a consumer?  They make their choice based upon their personal experiences, opinions and biases.  It may not be in a retail setting, but just like Average Joe, they are considering their budget, their options, and their personal preferences as they make their decision.

So my question remains… Is there really such a thing as a business to business sale?  Or aren’t we all actually selling to consumers at some level?

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October 29, 2012 · 8:31 am

Unexpected Storms

I was supposed to fly to Baltimore this morning to do in-home research throughout the week.  With the impending “perfect storm of the century” bearing down on the East Coast, that has obviously been cancelled.  I’ve been watching this storm approach since late last week trying to figure out if/how it would affect my business plans.  By mid-day yesterday (Sunday) I cancelled the trip.  The funny thing is, I got an email from the recruiting firm in Baltimore (that we use to help us line up consumers for the research) late afternoon stating that “we are fully planning to conduct business as usual both within our office and outside of our office”.  It went on to say that if we did encounter any issues (like a delayed flight in) to please advise them, and they would help us navigate through any complications.

Unexpected delays?  Really???  It turns out my flights had already been cancelled (24 hours in advance – I’ve never had that happen before).  The Eastern Seaboard has shut down almost all public transportation.  Baltimore alone had 7 Severe Weather Warnings as of this morning, predicting massive power outages, severe flooding, devastating winds, etc.  But it’s good to know that my contact there was welcoming us in and letting us know they’d help us if we ran into any inconveniences.

Optimism is one thing.  But burying your head in the sand is quite another.  I’ve never personally met the guy that sent me the email, I’m sure he’s a great person.  But how can anyone be so oblivious?  Yet having said that… I see this in business all the time.  People are warned about incoming storms, they see it on the horizon, but they remain convinced that it won’t impact them  Be it economic, or personnel related most corporate crises were obvious in coming, when looking backward.

Running a business is really not that much different than planning for a storm.  We need to be constantly watching the horizon, listening to the news and being aware of our surroundings.  When we hear of an impending storm, we need not panic, but we should put contingency plans into place.  We need to set aside ample reserves in the good times to get us through rough stretches.  And we need to invest in the future to make us more resilient for future storms.

I pray that our contacts in Baltimore all weather this storm safely.  But my guess is it won’t be business as usual, and they’ll probably have to deal with some unexpected delays.  As for me and my business, I’m going to take this as a good reminder and lesson.

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October 19, 2012 · 11:29 am

Day of Innovation a Success!

 

My company, Insight2, was a major sponsor of the first annual Day of Innovation (#dayofinnovation).  The event was put on by Centric, a local Indy-based innovation organization.   It was an incredible day featuring keynote speakers, breakout sessions, experiential activities and networking.  Capping off the evening was the second annual Indiana Innovation Awards which recognized nine companies from around the state for their successful and unique new product offerings.

The beauty of this event was in its diversity.  There are several other innovation groups around Indianapolis, but they are all very focused on their segment (e.g. tech-sector, medical products, start-ups, non-profit).  This was the first event that really reached out to all segments and provided value from a variety of sources.  One panel discussion alone included a consumer products company, an alternative energy solution and a B2B branding company.  The topic was Effective Innovation.  It was fantastic to see both the similarities and the differences between these three groups in terms of what is effective and what drives effectiveness.

Each of us should continually expose ourselves to ideas and philosophies that fall outside of our normal circles.  We learned about a non-profit that went from losing money to triple-digit growth based upon ethnographic research.  We heard about the value of conflict in the innovation process and we heard 9 key steps to successful innovation form our keynote speaker Deborah C. Stephens.  No typical conference would have each of these types of speakers or presenters.  This was truly a great day.  And I for one, and extremely proud to have been a part of it.

 

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August 16, 2012 · 9:04 am

Innovation is born of conflict

Today I have a true Shower Musing…  My shower at home has two shower heads on opposing walls.  While this will upset water conservationists, I admit to loving to use both at the same time.  It’s a wonderful feeling to have so much water coming from two directions and totally envelope me.   It’s impossible to tell where one starts and the other stops, and I love that.

This morning after my run I jumped in the shower (typically a cool shower to help me cool down).  But one shower was turned on hot and the other turned on cold.  My first reaction was to adjust them to be the same temperature, but then I decided not to.  I adjusted the angle of the heads so that the hot shower was running on my legs (relaxing my tired muscles) and the cold shower was running on my head and shoulders (helping me to stop sweating).  It was a very different feeling from my typical experience.  The showers didn’t blend together at all.  I was continually aware of each and the unique value that it provided.  It was if each stream of water was fighting with the other to get my attention.

The analogy that came to my mind was the teams that we surround ourselves with at work.  Our natural inclination is to hire a bunch of like-minded (warm water) people that fit our existing culture.  Just like the shower, it is often hard to see where one individual’s contribution starts and another person’s ends.  That is wonderful if quick unity is the primary goal.  But effective innovation is born from conflict and difference.  It is at the intersection of where the hot and cold water meet.

How diverse is your team?  Do you have different temperatures coming together in one setting?  Are you aware of the strengths and opinions that each person brings or have you settled for a comfortable environment where every situation and conversation feels the same?  If you want to be an innovative company, surround yourself with diversity, and value the unique opinions and perspectives that surface.  Avoid the temptation to achieve homogenization and the “simplicity” that brings.  Just like the shower, it will feel strange at first, but you can come to appreciate the value that each player brings.

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July 17, 2012 · 3:11 pm

When Accountants Rule the World

Here we go again.  I spoke with a friend yesterday whose job was just eliminated.  ”We’re taking the company in a new direction” he was told.  My friend has spent the past several years focused on developing innovative new offerings, building brands and separating his company’s products from the competition.  Like most non high-tech companies, his was constantly under threat of commoditization and he spent his time in battle against that.  But… as what happens with so many mid-sized companies these days his company was sold from one equity firm to another.  The latest firm ran the numbers and decided that it would be more profitable to reduce their product offerings and focus on lowering their pricing.  On paper, this looks really good.  How often does it pan out in reality?

I’ve seen this same scenario play out in multiple companies.  ”If we just take our manufacturing off-shore, then we’ll have a tremendous price advantage…”  ”Let’s outsource our design to the Chinese manufacturer, that will further lower our cost…”  Fast forward eighteen months, and the big-box retailers that they were working so hard to please suddenly realize that the company no longer adds any value to the equation.  So, they decide to source directly from the overseas manufacturer to avoid the US mark-up and the original company finds itself without manufacturing, without engineering, without distribution and ultimately without a need to exist at all.

It’s not just a recent thing.  Back in my Whirlpool days, I helped create a very innovative product road map for one of their business units.  Internal management was quite excited about the possibility of how this product could change the market and bring unforeseen benefits to their customers.  About that time a large consulting group out of Boston was brought in.  They looked at the same business unit and suggested that Whirlpool invest no money in it, and should follow a cost-reduction strategy to become profitable.  You guessed it… within two years, the product became a complete commodity and sold off at a fraction of its former worth.

You can’t cost reduce your business to profitability.  You just can’t.  Whatever numbers you calculate that show you will have an advantage will quickly be copied by your competition forcing you into further, deeper cuts.  It’s a death spiral from which there is no recovery.  Innovation is not a buzz word, it is a critical business strategy.  Companies need to focus on adding value to their offerings, not cost reducing them.  Separate from the pack, don’t try to dive beneath it.  At what point will the number junkies look up from their spreadsheets and see what is really going on in the world?

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June 27, 2012 · 1:40 pm

Is Corporate DNA Toxic to Innovation?

True innovation is hard work and takes time.  It needs to be a part of a strategic plan, developed and launched in a deliberate manner.  There’s nothing new in that, and few would disagree.  But let’s look at some corporate reality.   There are two key factors that can essentially kill effective innovation; corporate culture and employee reality.

First let’s look at the corporate culture.  Private and publicly held companies are both under extreme pressure to deliver financial returns for the short run.  It’s hard to convince shareholders (or banks, or holding companies) to wait two years for something great to occur.  Expectations are set on a quarterly basis.  With such intense pressure to deliver in the short term, it’s much easier pursue incremental change than to embark on a longer term innovation strategy.  Companies will begin innovation efforts with the big picture in mind, but often succumb to the pressure and pursue only those ideas that can be knocked out quickly.

From an individual employee standpoint, the pressure is very similar.  Who in corporate America expects to be in their current job two years from now?  Even if an individual doesn’t change jobs, the reality is the organization will most likely change around them shifting all priorities and efforts accordingly.  What motivates a person to embark on an effort that lasts a long time?  The person that delivers a project seems to get the credit, not the one that does the hard work on the front end.  Over the course of a typical, strategic innovation project it’s not uncommon to see multiple people at the helm, each adding their own opinion and wanting to put their mark on the effort in case it happens to be successful.

It’s not lack of interest, its lack of vision beyond the immediate future.  Companies spend considerable time and effort creating one, three and five year plans.  But the initiatives that get pursued are those that can be delivered quickly to show an immediate impact on the bottom line.  Can anything be done to shift this mindset?  Or are we doomed to a culture of incrementalism?

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June 19, 2012 · 9:59 am

The Chasm Between Perception and Reality

I’m continually amazed when I do interviews with consumers just how mis-informed they are.  Yesterday, we conducted four, in-home interviews with very affluent, well educated families.  Each of the four began telling us with absolute certainty about products that have been launched by brands (but not the right brands), and features that they’ve seen that are highly desirable (features that don’t exist on products in the market today).  They point to a product in their home and talk about the miserable experience they’ve had with it, vowing to never buy that brand again.  Ask them what brand it is, and they tell you the wrong one.

Contrast this with product and brand managers at big corporations.  They spend their time “fine-tuning’ their messages and focusing on minutia.  Because they live and breathe their products and brands, they mistakenly assume that their target customers are doing the same.  They spend countless resources on research that often serves only to validate their own opinions.  Once surrounded with these “statistics” they are ready to further tweak and refine their already complex messages and offerings.  This is especially true for products with long life cycles.  As an example, if a typical consumer replaces their refrigerator every 10 years, they are realistically not paying attention to changes in these products between buying cycles.  They’re certainly not stressed that this years model is too similar to last years.  They only care about what is different when they buy their new versus the last time they were in the market.  Unless an innovation really changes the way people live (and gets the necessary buzz to let the world know it), it will typically go unnoticed until people are in the position of buying.

Maybe it’s time to “dumb it down” a bit.  I’m not saying that your consumer base is not comprised of intelligent people.  But I am saying that no one lives and breathes your products and your brands like the corporate insiders do.  What can you do to innovate your brand or your image?  A huge step would be to ensure consumers know that they buy into your company when they buy their next product.  Obviously some companies do this very well.  No one drives a Harley without knowing exactly what it is, and no one buys an i-phone without getting caught up in the Apple mystique.  These companies didn’t get there overnight, and neither will you.  But maybe its time to start listening to your customers and hearing what they really say as opposed to generating reports in support of what you assume.

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June 11, 2012 · 3:00 pm

It’s Easier not to Innovate

I’m reading a great book called “Snap Selling” by Jill Konrath.  It is an intriguing sales strategy book that provides tactics on “getting through” to busy executives.  One of the points she makes (that I certainly find true in selling my business) is that harried professionals prefer to stay in their comfort zones whenever possible.  They may appreciate what you have to sell, but if it complicates their lives in the near term, the odds are you will be put off until “later”.

Wow.  How true is this in the world of innovation?  While an executive may be able to imagine the benefits that could be had by pursuing an innovation strategy, doing so will cause them a significant amount of stress and turmoil.    Even when led by a competent, external professional there are individuals to coordinate, other duties to re-prioritize and other personal objectives that still have to be accomplished.  Innovation becomes just another item on an already crowded plate.   Human nature dictates that we simplify today even at the expense of tomorrow.

What causes some companies to consistently innovate new products and services?

  • They overcome the inertia of inactivity and force themselves to move forward (even in chaotic, challenging times)
  • They are hyper-aware of the true cost of doing nothing (in terms of lost market share and eroding margins)
  • They establish a corporate culture where comfort zones are discouraged, and risk-taking is rewarded
  • They look past this quarters financial returns and focus on a 1-3 year strategy
  • They prioritize innovation in their schedules and eliminate less strategic initiatives instead

These things don’t just happen.  They are the result of an innovation-driven vision.  But let’s be honest.  That’s not for most companies, or for most individuals.  It really is just easier not to innovate at all.

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