It is not the strongest that survives, rather the most adaptable. What structural, behavioral, cultural, and organizational factors play into a company's success in producing hit product after hit product? Examining both successful and unsuccessful examples, this talk presents a framework for teams to set themselves up for repeated innovation success

1. Organizational Dynamics of Innovation
C. Todd Lombardo
Chief Design Strategist - Fresh Tilled Soil
Adjunct Professor - IE Business School
@iamctodd

2. For Sale:
Socks. Three.
Different colors.

3. A $5M Idea?

4. A $25M Idea??

6. Why not Zara? H&M?

7. Every major corporation in the 21st
century is dealing with issues of disruption.
Steve Blank,
8-TIME ENTREPRENEUR, AUTHOR, STARTUP GURU

8. differentmeasureofperformance
time
performance
time
new market disruption
compete against nonconsumption
low end disruption
adressing overserved customers
with a low cost business model
sustaining technology
bringing a better product into
an established market
most demanding
customers
least demanding
customers

9. disruptive
innovations
low-end
disruptions
new-market
disruptions
SSD Hard Drives
JetBlue / EasyJet
Zipcar
AirBnB

10. Case Studies

15. Formula…?

16. Formula…?
○ Raise some venture backing: $16M >> $41M

17. Formula…?
○ Raise some venture backing: $16M >> $41M
○ Hire the best engineers you can find

18. Formula…?
○ Raise some venture backing: $16M >> $41M
○ Hire the best engineers you can find
○ Give them space (a 22,000 ft2)

19. Formula…?
○ Raise some venture backing: $16M >> $41M
○ Hire the best engineers you can find
○ Give them space (a 22,000 ft2)
○ Pray they make something valuable

26. H4 H3
Innovation Emerging Scaling Operating
Problem/Solution Product/Market Efficiency
(core)
H2 H1
Scale

27. H4 H3 H2 H1
Product
Development
Innovation
Services
Startup
Accelerator
DESIGN SPRINTS, WORKSHOPS, EVENTS
FIVE EXTERNAL STARTUPS

28. CORETODAY
NEWFUTURE

29. CORETODAY
NEWFUTURE

30. Organizational Factors
WHAT’S IT LIKE AT YOU COMPANY?

31. 1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Source: XPLANE

32. 1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Source: XPLANE
Peak of II
Industrial
Revolution

33. Slavery
Average
manufacturing
had less than
4 employees
Average lifespan
of S&P500 is
67 years
Pay by performance
Capital budgeting
Task design
Divisionalization
Brand management
Women
couldn’t vote
Management 1.0
90% of people
were in
agriculture
Ford makes
500K cars/yr
Social
segregation
Colonialism No
environmental
care
Communism No
Google
No
Airbnb
1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
US Steel has
$1B market
capitalization
Source: XPLANE
Peak of II
Industrial
Revolution

34. Slavery
Average
manufacturing
had less than
4 employees
US Steel has
$1B market
capitalization
Pay by performance
Capital budgeting
Task design
Divisionalization
Brand management
Women
couldn’t vote
Management 1.0
90% of people
were in
agriculture
Ford makes
500K cars/yr
Social
segregation
Colonialism No
environmental
care
Communism No
Google
No
Airbnb
Peak of II
Industrial
Revolution
1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Source: XPLANE

35. Slavery
Average
manufacturing
had less than
4 employees
US Steel has
$1B market
capitalization
Pay by performance
Capital budgeting
Task design
Divisionalization
Brand management
Women
couldn’t vote
Management 1.0
90% of people
were in
agriculture
Ford makes
500K cars/yr
Social
segregation
Colonialism No
environmental
care
Communism No
Google
No
Airbnb
Peak of II
Industrial
Revolution
2ND
Innovation
Consultants
3RD
Venture
Design
Human-Centered
Co-Creation
Ethnography
Customer Journey
1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Rise of Design for
Innovation
Source: XPLANE
1ST
Digital
change
agents

36. Slavery
Average
manufacturing
had less than
4 employees
US Steel has
$1B market
capitalization
Pay by performance
Capital budgeting
Task design
Divisionalization
Brand management
Women
couldn’t vote
Management 1.0
90% of people
were in
agriculture
Ford makes
500K cars/yr
Social
segregation
Colonialism No
environmental
care
Communism No
Google
No
Airbnb
Peak of II
Industrial
Revolution
2ND
Innovation
Consultants
3RD
Venture
Design
Human-Centered
Co-Creation
Ethnography
Customer Journey
1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Rise of Design for
Innovation
Source: XPLANE
1ST
Digital
change
agents

37. Slavery
Average
manufacturing
had less than
4 employees
US Steel has
$1B market
capitalization
Pay by performance
Capital budgeting
Task design
Divisionalization
Brand management
Women
couldn’t vote
Management 1.0
90% of people
were in
agriculture
Ford makes
500K cars/yr
Social
segregation
Colonialism No
environmental
care
Communism No
Google
No
Airbnb
Peak of II
Industrial
Revolution
2ND
Innovation
Consultants
3RD
Venture
Design
Human-Centered
Co-Creation
Ethnography
Customer Journey
1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Rise of Design for
Innovation
Source: XPLANE
Average lifespan
of S&P500 is
67 years
Average lifespan
of S&P500 is
15 years
1ST
Digital
change
agents

38. 1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030

39. 1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Traditional Organizations from the 20th Century

40. 1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Traditional Organizations from the 20th Century
Organizations with a more conscious approach

41. 1850 1890 1900 1915 1940 1960 1970 1985 1995 2005 2015 2020 2025 2030
Traditional Organizations from the 20th Century
Organizations with a more conscious approach
Modern Organizations from the 21st Century

42. Traditional Organizations More Conscious Organizations Modern Organizations
THREE ORG TYPES
Source: XPLANE

43. Traditional ORG - The “Pyramid”
Source: XPLANE

44. Rigid Organizations
○ No formal innovation framework
○ Innovation initiatives untied to company strategy
○ Siloed
○ Misaligned metrics

45. Conscious ORG - The “Family”
Source: XPLANE

46. Modern ORG - The “Organism”
Source: XPLANE

47. An Evolution?
Pyramid Family Organism
Source: XPLANE

48. 20TH TO 21ST CENTURY ORG MODELS
Change
Source: XPLANE

49. 20TH TO 21ST CENTURY ORG MODELS
Change
Source: XPLANE

50. CORETODAY
NEWFUTURE

51. Allocation of Resources
MONEY WHERE YOUR MOUTH IS?

52. Twenty percent of our new products are
now required to be driven by innovation.
CHIEF STRATEGY OFFICER, FORTUNE 500 COMPANY

53. Twenty percent of our new products are
now required to be driven by innovation.
CHIEF STRATEGY OFFICER, FORTUNE 500 COMPANY
Do you set aside 20%
of your company’s
time & resources??

54. Twenty percent of our new products are
now required to be driven by innovation.
CHIEF STRATEGY OFFICER, FORTUNE 500 COMPANY
Do you set aside 20%
of your company’s
time & resources??
ME

55. Source: Innovation LeaderTotal exceeds 100% as many respondents cited more than one reason.

56. Source: Innovation Leader
Total exceeds 100% as many respondents cited more than one reason.

57. Valuing Design
DO YOU, REALLY?

58. Design leads to innovation and innovation
demands design.
Indra Nooyi
CEO, PEPSICO

59. Source: UK Design Council

60. Creative Tension
BRUTALLY HONEST

62. What tools are you using?
21ST CENTURY TOOLS FOR 21ST CENTURY PROBLEMS

63. Source: STRATEGYZER

64. Product Roadmapping
VISION OBJECTIVES PRIORITIZE ROADMAP
USER
GOALS
SOLUTIONS
THEMES

65. Programmatic Factors
INNOVATION PROGRAMS?
WHAT CAN WE DO?

69. Top-down sponsorship and bottom-up
effort is essential to make meaningful
culture transformation progress.
Dane Howard
DIRECTOR OF USER EXPERIENCE, EBAY

70. }
}
}
DESIGN SPRINT
INTERVALS
AGILE SCRUM
Define
Understand
Build
Test
Ideate
WEEK 1
Refine
Build
Test
WEEK 2
Refine
Build
Test
WEEK 3
Refine
Build
Test
WEEK 4
Refine
Build
Test
WEEK n

71. Individual Factors
HOW DO YOU THINK?

72. You have 3 sheets of paper
Build the Tallest Tower
In 3 minutes
Challenge

73. 00:03:00

74. 00:02:30

75. 00:02:00

76. 00:01:30

77. 00:01:00

78. 00:00:30

79. 00:00:00

80. Designtist
(DESIGNER + SCIENTIST)

81. DESIGNER SCIENTIST
EMPATHIC
MAKER
FORWARD LOOKING
RIGOROUS
EXPERIMENTAL
HYPOTHESIS DRIVEN

82. Focus on a
Human
Problem

83. Focus on the “job”
NOT THE TECH, NOR THE PRODUCT

84. People Business
Technology

85. SCIENTIFIC
METHOD
DESIGN
PROCESS
AGILE
PHILOSOPHY
design
sprint

86. http://designsprintbook.com

88. OPPORTUNITY
IDENTIFICATION
PROJECT
ACCEPTANCE
V0.1 V0.2 V0.3 LAUNCH

89. OPPORTUNITY
IDENTIFICATION
PROJECT
ACCEPTANCE
INVENTOR
V0.1 V0.2 V0.3 LAUNCH
TECHNICAL
CREATIVITY

90. OPPORTUNITY
IDENTIFICATION
PROJECT
ACCEPTANCE
INVENTOR CHAMPION
V0.1 V0.2 V0.3 LAUNCH
TECHNICAL
CREATIVITY
POLITICAL
SAVVY

91. OPPORTUNITY
IDENTIFICATION
PROJECT
ACCEPTANCE
INVENTOR CHAMPION IMPLEMENTER
V0.1 V0.2 V0.3 LAUNCH
TECHNICAL
CREATIVITY
POLITICAL
SAVVY
PROJECT
MANAGEMENT

92. OPPORTUNITY
IDENTIFICATION
PROJECT
ACCEPTANCE
INVENTOR CHAMPION IMPLEMENTER
V0.1 V0.2 V0.3 LAUNCH
TECHNICAL
CREATIVITY
POLITICAL
SAVVY
PROJECT
MANAGEMENT
SERIAL INNOVATOR

94. MAKE
PEOPLE
WANT
THINGS

95. MAKE
THINGS
PEOPLE
WANT
MAKE
PEOPLE
WANT
THINGS

97. Tension Brutal Honesty. Mixed Viewpoints.

98. Tension Brutal Honesty. Mixed Viewpoints.
Agility Quickly change. Learn fast.

99. Tension Brutal Honesty. Mixed Viewpoints.
Agility Quickly change. Learn fast.
Space Experiment. Fail. Collaborate.

100. Tension Brutal Honesty. Mixed Viewpoints.
Agility Quickly change. Learn fast.
Space Experiment. Fail. Collaborate.
Mindset Designer + Scientist. FOCUS ON PEOPLE
PROBLEMS

103. C. Todd Lombardo
@iamctodd
freshtilledsoil.com
http://bit.ly/mce2016