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Innovator Interview: Craig Libby, Wachovia


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Craig Libby is an SVP–Innovation Engineer at Wachovia in Charlotte, NC. futurethink was fortunate to speak with him to learn what makes this seasoned innovator tick. Read on to learn why innovation teams should focus on problem–defining not just problem solving, the importance of building a foresight capability, and the need for organizations to do a better job finding their future, faster.

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Innovator Interview: Craig Libby, Wachovia

  1. 1. Craig Libby SVP, Innovation Engineer Wachovia 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 Craig Libby 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 Craig Libby is an SVP–Innovation Engineer at Wachovia in Charlotte, NC. futurethink was fortunate to speak with him to learn what makes this seasoned innovator tick. Read on to learn why innovation teams should focus on problem–defining not just problem solving, the importance of building a foresight capability, and the need for organizations to do a better job finding their future, faster. You like to stress the ‘practical’ side of innovation. Where does this need come from? The Innovation Team was started on the request of our executive leadership about a year and a half ago, although due diligence on the team was started almost three years ago. And what they had come up with is almost a desperate need to get a much better handle around innovation in a more practical sense. There are lots of conversations saying we want innovation built into the DNA of the culture of the business, and I think that’s all very admirable. But, the challenge is how do you innovate, how to you make it actually happen, in a very practical way. Where does innovation ‘fit’ within your organization? Prior to the formation of our group, our approach was very ad hoc. We didn’t have a handle on what innovation really was. In the beginning, the team itself had some challenges in understanding where it would be housed in the organization. It settled within marketing, mainly because the head of marketing at the time, who was getting ready to take on the role, was a big proponent of innovation and had asked the CEO to provide some context and support for innovation in a more formal way, both in terms of funding as well as human capital resources, so that people could know how to innovate and could help others do the same across the company. There are also roles within the group called ‘insight to innovation’ because one of the things that we’ve learned is that innovating happens well before the light bulb lights up (what I call ‘left of the light bulb’); you have to understand what insights are around your customer and Anticipate. Innovate. what these insights really mean. What is an insight and how do you | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  3. 3. the innovator’s interview 3 Craig Libby make it practical and pragmatic and usable? And so, we’re helping a lot of our folks change from being hindsight focused to more insight and foresight research focused. Our responsibilities cross whole lines “What we have seen with of businesses within the organization. We try to drive the four key pillars of innovation – strategy, ideas, process and climate – helping to mentor innovation recently is that leaders as well as practitioners on all those things. a lot of it seems to be Do you see yourselves following more of the facilitator model versus within the lines of business more of an incubator model for innovation within the company? or very IT focused. And Well, we’re here to enable, even though on our own, each one of us has had some pretty good success in innovation itself being practitioners while IT is one aspect of over the years. Our job is to help others be innovative. So, while it might be a facilitation role, it’s not without the realm that we’ve had innovation, it’s not the only executive leadership come to us directly as saying, hey, we need you thing; we’re trying to talk to try to solve for this strategic issue or that strategic issue. So, we’re doing both. The reality is, while it would be great if you had enough of a more about business models maturity model across the organization that the business units could be self sufficient, they just don’t have the wherewithal and the knowledge and operational innovation, to practically apply various innovation tools and techniques in such mergers and acquisitions a way to get an output in a consistent way. We’re here to help teach and support them. So, what we do a lot of times is we’ll have a line of innovation, and all kinds business or a strategic area where we do the work, but we’re teaching them how we do the work as we go. of stuff beyond just new products or services.” Do you see your role changing as you move forward and as get more successes under your belt and really start to spread the word more? Do you envision your role changing at all as far as how your office and team operate? With Wachovia’s merger with Wells Fargo, we’re 280,000+ people now “Most organizations are just in the combined company. That’s a lot of folks. What we have seen with innovation recently is that a lot of it seems to be within the lines of purely execution focused. I business or very IT focused. And while IT is one aspect of innovation, it’s not the only thing; we’re trying to talk more about business models believe that many of them and operational innovation, mergers and acquisitions innovation, and all feel that if you’re executing, kinds of stuff beyond just new products or services. you’re getting something So let me ask the tough question: What’s wrong with innovation today? done, whether it’s right or Most organizations are just purely execution focused. I believe that many of them feel that if you’re executing, you’re getting something wrong or rework. They don’t done, whether it’s right or wrong or rework. They don’t take the time take the time to do the to do the upfront homework necessary to get a better outcome at the back end. Short term focus may help them generate revenue today, upfront homework necessary innovation will help them generate it tomorrow. to get a better outcome at the We’ve heard from others we’ve interviewed about this tremendous back end.” pressure to focus on the short–term and to just keep showing results. Some claim their organizations would risk being punished in the marketplace for taking longer term bets. So they don’t do it. And isn’t that an innovation oxymoron? It’s that on one hand, you want short term results, but then you want consistent success. So, to me, consistency means also having a view towards the horizon and filling Anticipate. Innovate. the pipeline with lots of things – short–term and long–term. I find it | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  4. 4. the innovator’s interview 4 Craig Libby fascinating that while many people don’t want to put all their eggs in one basket in their personal stock portfolios and they want to diversify, but yet they keep making decisions toward short term, incremental “We don’t focus enough on gains that affect the future valuation of a company. defining the real problem What can innovators do better? or issues when we begin We don’t focus enough on defining the real problem or issues when we begin innovating – we jump right to the ideation part. But ideating on innovating – we jump right what? Companies try to attack symptoms rather than the root causes to the ideation part. But of a problem. This is where they ultimately fall down. People think that because they’re brainstorming that they’re innovative. No way. ideating on what? Companies You’re spending time in meetings but you’re not spending enough time actually just thinking, taking time to think. The other thing to address try to attack symptoms rather is that we need to be better lateral thinkers. I think is that because as than the root causes of a we grow up, we lose being free from judgment and we judge more and more. And so we become very critical versus thinking laterally about problem. This is where they things: of what you liked about an idea or thought, and how you might build upon it. We knock things down and we try to defend ourselves ultimately fall down.” based on argument. Such behavior, I believe, is out of fear and being uncomfortable with anything that isn’t ‘a sure thing.’ Say the CEO were to request some sort of progress report on innovation. What metrics would you report on and why? I would provide metrics in four key areas: input metrics, process metrics, output metrics and outcome metrics. Input metrics I think are fairly straightforward in terms of the number of ideas you have, the number of concepts, the number of concepts per employee, that kind of thing, per month, per year, where you get them, how you get them. Process metrics are measured in terms of yield rates and speeds. The output metrics are the number of things that actually made it to the light of day. There’s also number of patents, which to be honest, I don’t think is a very good proxy –you could have great patents of creativity, but have no value to the business. The last area is outcome metrics, which are lag indicators such as revenue, cost efficiency, operational productivity, OER (operational effective ration), or OEL (operative effectiveness leverage ratios). Most leaders want to only know about the lagging metrics: the outcome; but I would challenge them to look across all four of these areas to be more effective. So, what would you say is the number one indicator of a healthy innovation program? If you think about strategy, ideas, process, and climate and culture, I would probably say climate and culture. I think that drives a lot of those other things, assuming that this means you’re getting the training you need, the support you need, the emphasis of participation versus judgment. Ultimately, it’s a leadership issue. I challenge business leaders to commit by behavior. Anticipate. Innovate. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  5. 5. the innovator’s interview 5 Craig Libby What are the main criteria used when choosing new ideas to move forward with? One of the things that we judge ideas against is how well it aligned “Success breeds support. So, to the insights that were identified at the start of the process. Did when leadership or skeptical we address what we needed to on a customer and strategic level? I think that there’s a huge opportunity to really blow that out in terms of business units can actually teaching people insights so that you can then ideate better. see concepts and actually see Do you mean setting a theme prior to a brainstorming session or us do innovation, watch us creating goals ahead of time? Well, it’s more about doing the homework. We do a lot of discovery do it, teach them to fish, that and immersion around the area of a topic we’re interested in. So, if breeds support.” I said I’m going to focus on small business, well, what am I going to focus on specifically? What comes to mind when it comes to small business owners and banking? Well, I have no idea, so I’ve got to go out and take a look. I’ve got to spend a ‘day in the life’, so to speak. I’ve got to do some in–depth interviews. I’ve got to understand from an ethnographic standpoint who the small business owner is and what they need. If I don’t do this, ideation sessions become nothing more than brainstorming shotgun sessions. We’ll spend anywhere between a couple months to almost a year getting those insights before we ever walk in and do ideation because if we can film it, understand it, decompose it, really get to the themes we’ll get better ideas. What are some quick win tactics that you think innovators can use to really get traction and build momentum around innovation? Success breeds support. So, when leadership or skeptical business units can actually see concepts and actually see us do innovation, watch us do it, teach them to fish, that breeds support. And we’ve seen it time again here. Work on getting your word of mouth campaign going – make it a viral effort where people get others involved from their enthusiasm. The lag indicators of revenue or cost saving will take time to actually see so focus on the input and process metrics to drive the output and outcome metrics. You’ve led innovation efforts at many companies. Is leadership typically a help or hindrance to innovation efforts? They are critical to success and often the biggest barrier that stands in the way of it. I spent a lot of time looking at other companies and how they innovate. I’ve been at Bank of America, I’ve looked at how several divisions of Johnson & Johnson handle innovation. And the issues are all similar. I interviewed 56 people at this one fairly major line of business within the bank towards the latter part of last year. And I asked them an open ended question at the end to identify their three key pain points. Do you know what I found? Nine–tenths of them were leadership related issues. And I brought that back to the executive leader of that whole organization and I just showed him. They were aghast. And talk about a change. Within that one conversation, they set out to change the vast majority of their organization based on our recommendations. Anticipate. Innovate. | Future Think LLC © 2005–09 Reproduction prohibited | New York NY
  6. 6. the innovator’s interview 6 Craig Libby Just what makes an individual good at innovation and are there certain skills that they must possess? I firmly believe that you can teach people innovation techniques and to do so in context to what they are trying to accomplish (real world). Edison’s technique was different from Einstein, but both were very successful. You need different ways to approach things to be successful. Just like you need different people and perspectives. I highly encourage every project should start off by storyboarding and thought process mapping it before diving in. Each project is unique. Those who take time to plan the effort and then focus the effort upfront tend to be more successful than those who rush. Go slower to go faster. What can you learn from Wachovia’s insights on innovation? • Problem–defining vs. problem–solving: How much time do you spend understanding the root causes of the problems you’re trying to solve vs. simply brainstorming and coming up with new ideas? • Better anticipate the future and identify opportunities for growth: What methods are you using to keep on top of long–term trends and the driving forces shaping today’s business landscape? Are there processes or resources in place to identify and focus on new growth areas for the business? Is there a shared vision for where the organization will be in 3 years? 5 years? 10 years? • Senior leadership buy–in: How are you ensuring that senior leadership plays a role in moving innovation forward? 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