Innovator Interview: Daryl Dunbar, Reed Elsevier


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Daryl Dunbar, SVP-Innovation for Reed Elsevier, recently shared his insights on how innovation happens at his organization. Read on to learn more about why innovation feeds on freedom, the importance of pull vs. push as a success metric for your program, and why ‘internal innovation’ is so important during these economic times.

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Innovator Interview: Daryl Dunbar, Reed Elsevier

  1. 1. Daryl Dunbar SVP, Innovation Reed Elsevier the innovator’s interview The Innovator’s Interview highlights unique innovations from a wide range of industries, and is an opportunity for futurethink and some of today’s leading innovations to share insights and ideas. May 2009 Turn innovation into action | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  2. 2. the innovator’s interview 2 Daryl Dunbar the background This Innovator Interview series highlights leading innovators at Fortune 500 companies. In contrast to past interviews, focusing on a single innovation, this series examines the state of innovation at global organizations. We spoke with both innovation leaders and practitioners, within varying business units and organizational structures, across a broad range of industries both for–profit and not–for–profit. The interviews offer a unique insider’s view into the world of innovation—what makes it work, what holds organizations back, and what critical advice new innovators need to know to be more successful with innovation overall. the interview Daryl Dunbar, SVP-Innovation for Reed Elsevier, recently shared his insights on how innovation happens at his organization. Read on to learn more about why innovation feeds on freedom, the importance of pull vs. push as a success metric for your program, and why ‘internal innovation’ is so important during these economic times. How did the current innovation program at Reed Elsevier get started? Innovation is a core value at Reed Elsevier. It has been for a number of years. About five years ago, Reed Elsevier embarked on a really big innovation effort and launched a central innovation program. They put a lot of internal press out about it and generated a bunch of ideas. If the ideas were big enough, good and Crispin Davis (the CEO at the time) liked them, they got funding. And then, it all just sort of fell flat. The ideas became part of business as usual, and there was a lack of follow-up and new ides stopped coming in. So about three years ago, the company asked itself the question, “What can we do to get innovation back on the agenda and to be serious about embedding it in the business?” They then formed a small committee, chaired by one of our Board members, Erik Engstrom, who’s the CEO of Elsevier, to first ask some interesting questions, like: “What are the best practices? What can we learn from the past? What can we learn from what other companies are doing? And what should we do, going forward?” They set about this process in a very thoughtful way; they interviewed loads of organizations, answered those questions, and devised the program that I now head. I was recruited in the beginning of 2008 to run this program, which is a fairly nimble, small centralized innovation team that really, in my mind, acts like innovation consultants more than any sort of centralized innovators or futurologists, or strategy people, for that matter. I met with Crispin on a regular basis, and now with Ian Smith, our new CEO. The key take-away is that innovation still figures very highly on the CEO’s agenda. Anticipate. Innovate. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  3. 3. the innovator’s interview 3 Daryl Dunbar You mentioned that your office is like the ‘innovation consultant’ of Reed Elsevier. Why would you say that Reed has elected for your team to serve more as a facilitator of innovation versus leveraging more of “There is no one magic bullet the incubator model, where innovations are grown by the innovation team and then distributed to other business when more proven? or solution, but the method I think the answer lies in the organization itself, both structurally and that we undertook was to culturally. This is a company that’s made up of many acquisitions and has a very diverse set of cultures. For example, LexisNexis is very begin with a toolkit and different from Elsevier from a cultural perspective and from the way that they do business. Prior to the last two years, Reed Elsevier acted provide divisions with best largely like a holding company, with all the power delegated to the practice tools that can be divisions, which allowed for quite a bit of autonomy provided that they made the financial returns and the numbers that they’re expected to used to embed and continually deliver. As a result, anything from ‘corporate’ is treated with a certain amount of healthy skepticism. I don’t think our overall culture would facilitate innovation.” accept innovations that were incubated elsewhere and then handed over, as if saying to a division: “Here, go do this.” This is a culture that needs innovation to be organic. When it comes to innovation, the focus is primarily on organic growth by utilizing best practices, and sharing across the businesses. How exactly have you gotten different business units to talk to one another? There is no one magic bullet or solution, but the method that we undertook was to begin with a toolkit and provide divisions with best practice tools that can be used to embed and continually facilitate innovation. From my perspective, there are two tasks here. One is to embed the innovation capability into the businesses. The other is to facilitate those businesses in actually innovating. These two things can happen somewhat in parallel or be completely autonomous, but we think it’s most effective if you have a process and then you utilize that process to generate innovations as opposed to just random ad hoc innovation. When we began our efforts, we had a “ideas can come from anywhere, so let’s just create a bunch of tools” mentality. Let’s facilitate, open the doors, throw it wide open and tell people to have at it. That was really our phase one. Phase two, was about marketing and awareness. It was really about selling ourselves and marketing the availability of the toolkit and the capabilities in the business. Then, by talking to the individual business units, we gradually became a bit of a hub in the sense that we knew what was going on in various business units and could pull A and B together and say, “Did you guys know that you’re working on the same problem?” or “you have similar challenges”, or “you’re thinking the same way”, and then get them talking to each other. Then, finally, we held a couple of innovation symposia events made up of about 100 people from all across Reed Elsevier. These events were a combination of outside stimulus speakers, outside providers, suppliers, toolkit people, and internal stories about what the divisions were doing. The real power of all this was simply getting people to meet and share and understand. We raised awareness that they’re actually working on similar problems, or they’re thinking alike and they had no idea that, in Anticipate. Innovate. a company of nearly 39,000 people, anybody else was working on the same problem that they were. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  4. 4. the innovator’s interview 4 Daryl Dunbar Are you noticing more people actively trying to connect with other business units to try and solve some of their ongoing issues? I think there are a couple of outputs. One is that there’s a small-but- growing informal network. This is a bit of an innovation community made up of people who’ve attended these events and others who know about them who are beginning to interact more online and in a community fashion. We have ad hoc opportunities where someone in one division would ring up someone to innovate together and solve a given problem. For example, someone who wants to do something in LexisNexis would ring up someone they met at Elsevier and say, “Hey, you’ve run a workshop like this, using this kind of method. Could you come over and help us run that?” or, “Could you put us in contact with that training capability?” The second real type of impact that we’re seeing from this is business units coming to us and saying, “We want your help in embedding innovation into our existing processes and tools.” So, we’re actually engaging now, moving from our phase one focus of building the toolkit and phase two marketing, evangelizing and sharing to phase three, which is now engaging with our sleeves rolled up in the businesses and actually embedding the innovation capability into the business while helping them innovate. What do you view as the number one indicator of a healthy innovation program? My number one indicator of a healthy program is viewed very much from the position that I sit in. So, were I in a different organization or were I in a different phase of my program, my answer would probably be different. But, it’s the keen recognition that we are in phases and we’re now moving into the pull phase – having people from throughout the organization actively asking for help from my team – and I’m getting pull, which is great. The program as a whole existed for a year and a half before I came on board, and the first six months was spent really just building the toolkit, and going out and learning a little bit about the various business units needs. Then, we spent a total of about a year on the marketing effort. After that, the big shift from push to pull began to happen with the help of the global symposiums. Once the businesses started calling me, I knew we were in good shape. All told, there was about a year and a half to two years to go from scratch to where we are today. Anticipate. Innovate. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  5. 5. the innovator’s interview 5 Daryl Dunbar One of the other things that we’ve spoken about in the past is the tension between Business As Usual (BAU) and innovation activities, and the fact that in any relatively healthy organization, you have “There’s a belief that the processes in place designed to protect BAU and essentially stifle innovation. So how do you work within the confines of your ratio between discipline and organization and the existing set of measure it has in place to freedom is fixed, meaning protect itself while trying to move innovation forward? There’s a belief that the ratio between discipline and freedom is fixed, that, the more discipline meaning that, the more discipline you get, the less freedom you have, you get, the less freedom and vice-versa. Innovation feeds on freedom, and therefore it’s very, very difficult to break down all the very good discipline that’s in place to you have, and vice-versa... keep us from doing riskier things. Things like ROI and detailed business cases are important, but they can hinder innovation and creativity. You Things like ROI and detailed have to find a way to build an innovation process around the business business cases are important, process. It’s a bit like juggling, or a balance between understanding when it’s okay to carve out a little time, or a little resource or a little but they can hinder money. Sometimes you even have to take the ultimate risk that your innovative idea might destroy business as usual (as is the case with innovation and creativity. You disruptive innovation). have to find a way to build Should innovation metrics change over time? And early on in your an innovation process around innovation efforts, how much emphasis should be put on ‘hard metrics’? the business process.” I think it comes down to the core belief that innovation is core to our future growth and the fact that it is a key value for us, going forward. So, while our CEO and other senior managers would love to hear tangible hard metrics, because that’s what they’re used to, they are willing to accept it when we tell them, “We’re not going to measure certain innovations with hard, outcome-only metrics because we believe it will stifle potential ideas.” It comes down to your senior management being willing to accept that. That said, I wouldn’t expect any reasonable senior manager of a business to just throw all hard metrics away. It doesn’t make sense. But, in certain circumstances, and in our case in new activities, we think it does make sense to throw away hard metrics for a while in order to give an idea a chance. Anticipate. Innovate. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  6. 6. the innovator’s interview 6 Daryl Dunbar What have you done to really get traction and buy-in both from senior management and from the people on the ground? I call it “Top-Down and Bottom-Up Innovation,” because it’s very much a two pronged effort at our organization. You have to have the support of top-down,but, if all you do is stand up and say how important innovation is and talk about the theory and lecture from the books you run the risk of becoming a talking head, becoming very academic, and disconnected from the business. At the same time, you need to find opportunities in the business where you can move in, have an impact, and show something positive that happens. We engaged early on in one program with a business unit that wanted to develop a seed fund, a small amount of money set aside that people could bring their ideas and get them funded. We engaged with another business unit who took on the tool that we internally call Action Labs, which is a three-day intensive, almost graduate-course-style engagement of teams working very, very hard on their ideas. Action Labs end in a Venture Board, where they can get funding or the green light to go ahead and develop their idea further, or whatever the case may be. By simply being involved in those things, and then pointing to activities or products that are either in the market or we’ve just announced are coming out, creates buy-in and ongoing engagement. What tools do you use to highlight these success stories and get people more involved and more aware? Well, the primary tools is that we have are a monthly e-newsletter, an intranet site dedicated to innovation, and an innovation community site with Wikis,blogs and posts. We blog about innovation-related things all the time. Also, coinciding with the monthly newsletter is what we call an Innovation Honor Roll. Honor Roll recipients are nominated typically by their management, sometimes by their peers, for having come up with some good innovation. We take them on their merits, judge them, select one to win every month, and that winner not only gets a notice in the newsletter, but they also get a personal e-mail from our CEO thanking them for the particular activity that they were engaged in. We encourage people to bring us stories out of their business units that we then republish and re-publicize. And interestingly, each of the business units has their own newsletter and website. So, often we’ll have a story in our innovation newsletter that will then get picked up by Elsevier’s newsletter or by LexisNexis’s newsletter, and those go out to an even larger distribution of people in their organizations. What makes an individual good at innovation, and what skills must they possess? What makes an innovator outside an organization successful is different than being an innovator inside of a large organization. Having done entrepreneurial things at start-ups in the past, I’m now fascinated with innovation in large organizations because it is hard. Not that innovation outside a large organization is easy, but it’s very, very hard in large organizations. As for the question can innovation be taught or are you just born with it? There are ways to nurture capabilities and Anticipate. Innovate. sow creativity within people. However, not every manager has to be ambidextrous – or able to run BAU and encourage innovation. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  7. 7. the innovator’s interview 7 Daryl Dunbar Given the current economic climate, how has the need for innovation, or the drive to innovate, changed versus a year ago? I think innovation is an imperative in tough times. I liked a quote I saw “I’m actually highlighting recently: “The best time to fish is during a storm.” Sometimes the best internal innovations more than time to invest is when there is turmoil and a tough market because those things invested in now will reap more benefits in the future. external innovation because Let’s say it takes you on average 18 months to two years to get a an external innovation is product out the door. If we stop new ideas now, two years from now what will we have? We’ll run dry of the things that were in the pipeline what always comes to mind to start with. And even if we start back a year from now when things when people use the term look better, there’ll be a year gap in there as a result. The current economy also gives us an opportunity to focus innovation not only on “Innovation.” If we then put new products and services, but on all the other facets of innovation, such as efficiency, cost saving, process, business model, and my latest more focus on the internal favorite, management innovation. side of things, the external futurethink: This idea of internal innovation versus external side of things will take care of innovation and the fact that both can be equally as powerful is themselves, or certainly won’t important. Are you highlighting to employees the fact that one is just as important as the other? be hurt in any way.” I’m actually highlighting internal innovations more than external innovation because an external innovation is what always comes to mind when people use the term “Innovation.” If we then put more focus on the internal side of things, the external side of things will take care of themselves, or certainly won’t be hurt in any way. So, I’m putting more focus on internal than I am on external in order to try to achieve a balance in the organization between the two. What would be your single biggest piece of advice you’d have for another – either an individual or an organization that’s trying to get an innovation effort going? It still has to start at the top, I think. It’s imbedded in the corporate culture and it’s very visible. Rather than a behind-the-scenes discussion, it’s an outward discussion of innovation within the company – and to the street. If you don’t really have that top sponsorship and support, it’s going to be very tough to get an effective innovation organization off the ground. Second is getting those quick wins, making sure they’re visible to the leadership, and making sure they’re commercialized well so that they are adopted well within the organization. Anticipate. Innovate. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  8. 8. the innovator’s interview 8 Daryl Dunbar Just what makes someone good at innovation? Do you think that having this framework and having this organization allows anybody to build the right skills and build the right mindset? Or do you think that innovation is something that just some people are good at and others are not? It’s a hard question, because my background’s accounting, and I’m in innovation now. So, you can’t get more different than that! We define innovation broadly in GBS…IT innovation, innovation to make our workplace more sustainable, innovation to help us “reinvent the way we work.” With a scope this broad, you need people with different personalities and with expertise in different areas to make things happen. If you have people who are just left-brain thinkers or who are just right-brain thinkers, you’re probably not going to get much done. I think any person can be a valued contributor to an innovation organization. It’s just a matter of knowing your role within that group. What can you learn from leaders like Reed Elsevier when it comes to innovation? • Facilitating cross-business unit networking: How well do your internal groups or divisions learn from one another when it comes to innovation? What forums can you provide them to better share best practices? • Balancing BAU activities with innovative ones: Do your current business processes allow for new and non-standard projects? Is there a way to create a separate process to nurture new ideas to better give them a chance? • Getting Management Buy-in: How are your senior leaders participating in innovation efforts? Are they allowing them to live outside of the standard set of metrics and measurements for awhile? • Internal vs. Externally-focused Innovation: What is the balance between developing internal vs. external innovations? Is there an equal emphasis on both? To learn more about the research, tools and training you need to better anticipate change and move innovation forward, visit us at Anticipate. Innovate. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY