An interesting component of my job as the chief innovation officer at Citigroup is the opportunity to spend time with other corporations discussing our journeys in driving innovation in big companies. These companies span multiple industries, often far afield from financial services. Since we opened Citi Ventures in Palo Alto in 2010, 200 corporates have landed teams in Silicon Valley. We often meet them as they are considering coming here and seek to learn from our experiences.
In all these meetings, I have found it striking that despite major differences in the core missions of each company, the challenges we face are far more alike than they are different. Driving change is not easy business, but in the current age of disruption, it is a business imperative. Having a community to share experiences and support one another is powerful.
Coupling this experience with my own multi-industry career across automotive, IT, aerospace, telecoms and now financial services, I want to share some thoughts that I believe are industry agnostic, and I trust helpful.
- Established companies are facing elusive growth at a time of rapidly accelerating disruption.
- This disruption is real, pervasive and upending, and the acceleration has only just begun.
- Barriers to entry are rapidly and irreversibly eroding.
- Lines are blurring between industries.
- Competitors are emerging in new and unexpected places, and establishing new categories.
- It is a seismic shift and there is no more “business as usual” – success requires embracing disruption.
1. The customer comes first. Embrace the power of design thinking. Hire the best digital savvy chief marketing officer you can find. This role becomes the bridge between deeply understanding the customer and designing brand‐defining experiences. We know that customers are demanding experiences that are simple but sophisticated as well as personalised and engaging, and they will move their business and their loyalty to get that. Building outstanding user experience and user interface skills is a must.
2. Deeply understand the millennial generation. Trust me, they have vastly different views of life than most of us currently in the business world. They want purpose in both their life and their work, they believe they can make the world a better place, and they demand authenticity. They will sacrifice a grander lifestyle to achieve their desire for meaning. This requires a complete rethink of the contract with your employees and your customers.
3. Rethink product development. Endless requirements definition exercises and long lead times focusing on perfection must move to the rapid, iterative prototyping of the perennial beta. This represents another about-face, not an incremental improvement. At first glance, it may appear that the concepts of minimal viable product (MVP) and rapid prototyping are too light for big corporations, lacking in industrial strength and, well, a bit too informal. But take a closer look, and it becomes evident that MVP is nothing of the sort. It is also a critical component of being agile enough to keep pace with customer expectations. The lean start up methodologies of Steve Blank and Eric Ries are a great place to begin.
4. Give strategic planning a new lease on life. Let’s face it, most strategic planning efforts do not yield big break-through thinking. Often they end up being an extrapolation of the existing situation. But now the exercise takes on a whole new mission – bringing the outside in. In a world where so many of the rules are being rewritten, it calls for a bolder exercise that starts from an understanding of the trends and signals that surround us. Be industry agnostic. Look for both offensive and defensive actions that arise from examining the blurring lines across industries. Become very clear about your core strengths, and look for new ways and new partners to exploit them.
5. Go horizontal. The vertical, hierarchical, power‐based systems that have traditionally run most corporations are not built for speed or sharing. Create structures and systems that are horizontal, collaborative and virtual. Give employees the opportunity to find like‐minded people who share a passion for a particular topic. It is a proven approach that can generate impactful results, both in identifying unique solutions to big challenges and driving greater retention of your best employees.
6. Build and leverage mega‐networks to create new partnerships. Be insatiably curious and relentless, with a healthy dose of paranoia. General Electric CEO Jeff Immelt said: “A software company may disintermediate GE one day, and we need to be paranoid about that.” Immelt and his team have taken some bold leaps, particularly with their new software centre in San Ramon and their investment in Pivotal.
7. Imbue a culture of learning from failure. Understand that repeated failure is vital to progress and finding success, which is not always where we expect it to be. Learning to accept failure is prob-ably one of the hardest things we do. Most large companies have practised zero tolerance for failure. In Silicon Valley it is a badge of honour.
8. Embrace the renegades and the change makers. These people can help you – if you allow them to. And make it your life’s purpose to cull out passive-aggressive players and not‐invented‐here behaviour. My former colleague from Boeing, Alan Mulally, did a masterful job of this at Ford.
9. Step boldly into disruption and lead by example. Your people are waiting to follow.
10. Culture eats strategy for breakfast. Design your go-to culture and make sure everyone understands that it is non‐negotiable. Great intent and planning can get upended in a nanosecond by a fragmented culture. Technology is the enabler, but culture will determine the outcome.
This article first appeared on LinkedIn