Every company wants to be more innovative in order to stay relevant, to be successful, to bring in the best talent, and to help the world become a better place. But innovation takes planning, effort, focus, and intentionality. So what is keepin companies from being innovative and how do we fix that? To find out, I spoke with Mark Johnson who co-founded the consulting for Innosight with Clayton M. Christensen in 2000. Mark also has a new book out called Lead From the Future which was the topic of our conversation.
Barriers to Breakthrough Innovation
Mark has been an advisor and consultant to many Global 1000 and start-up companies and one thing that companies keep coming to him to figure out is how they can foster disruptive breakthrough innovation. Mark says, “you’ll hear companies talk about, we’ve gotta be more innovative. And what they really mean is, a specific kind of innovation, they mean, how do we get beyond our core? How do we get out from underneath ourselves and do something that really gets us into the new and different? And so, they’re looking for that more disruptive breakthrough kind of innovation. And what we find is, most breakthrough innovation efforts stall or breakdown or fail, either because:
1) There are not enough resources invested upfront to really give it the kind of wherewithal it needs to succeed.
2) When there are challenges at the core, or there are just general difficulties and priorities to do other things then resources will get pulled from breakthrough innovation efforts.
3) Leadership tends to get impatient with the incubation and development period that these growth efforts take. So leadership teams themselves just suffer from being very short-sighted and short-term-ism, the importance of profitability over sustainability.
There are all these incentives and biases that crop up in the way that further break these things down.”
In response to these challenges Mark formalized a way of thinking that can help leaders overcome these barriers and stay relevant. We need to move away from how we traditionally think about vision statements, strategy and long term planning and start leading from the future.
How Companies Normally Think About the Future and Why it Needs to Change
Traditionally when trying to plan for the future companies have used what has been termed as a “present forward mindset.” What does that mindset look like? Mark says, “basically you take the existing structure and processes and rules and norms of today and you put that within a business, and you try to continue to extend that forward by both incremental and breakthrough innovations that are tied towards improvement of the core. And there’s nothing wrong with that, in fact, organizations do need to operate and execute, they need to continue to do product development, they need to drive marketing and R&D for the sake of continuing to serve the current set of customers or consumers, that is something that needs to move forward. But the challenge is, if that’s all that you do, you’re making this huge assumption that businesses can be extended out indefinitely over time, and as we know, if you take the horizon far enough, there’s likely to be severe commoditization to a business or real disruption, things that create discontinuities just like in the crisis today.”What mindset does Mark suggest we move to? He termed it “future back,” where you look out to the future (about 5-10 years) to develop your vision and you work your way back to present day to see what strategy you need to put in place to get there. How far you look into the future will vary from company to company, so it is important that you and your team work together to come up with the appropriate time horizon for your type of business.
No matter how far you look out, one important thing to note, you cannot come up with a future picture and a long term plan and think that’s it. Companies who either come up with this plan once and never revisit it, or who think they can come up with one plan and keep their heads down for several years getting there are not going to succeed.
Use this long term goal as a north star that gives hope and inspiration, but you have to bring that narrative to life by revisiting it often, be in the mode for learning, experiment with different things. It has to be able to be adjusted as time goes on as the rest of the world changes.
How to Implement Future Back Thinking in Three Phases
In his book (and in our discussion), Mark shares the three phases we go through to implement future back thinking. They are:
1) Develop an inspiring vision: This is not your typical 1-2 sentence vision statement. It’s about developing a clear-eyed view about what the next 5-10 years look like for the world and then for your specific company
2) Translate it into a clear strategy: If vision is about being a storyteller, then strategy is about becoming an engineer. After creating inspiration, hope, and purpose behind what the organization wants to achieve you have to translate that into something tangible that you can act on
3) Prepare for and manage its implementation: This step is about implementation and milestones, but a huge piece of this is also about setting the organization up for success. You have to have the right leaders in place and you have to carve out the resources (and keep them carved out) needed.
What Non-Leaders Can Do to Move Their Company to Future Back Thinking
If you are not a leader inside of your organization is there a way you can help push your team to start using future back thinking? Mark says, “I think we all have an opportunity to spread language and a way of thinking, and hopefully, leadership will pick up on that. I think reinforcing the importance based on case examples of visionary organizations that are able to… Be able to inspire the organization and then practically think of ways to anticipate alternative paths in the short-term, like what we do in the COVID crisis. And then do not think of anything as one and done, but remain agile and willing to pivot and that think in the sense of humility as being behind learning and learning being behind innovation. All of this, I think, by language alone and principles can turn an organization, and it’s not just leadership that can do that, people everywhere can influence by what they say and what they talk about.”
Adapted from article by Jacob Morgan