Yes, Innovation Could Save the Planet – An Interview with Matthew Heim

Just beneath his Ph.D. credentials, his long experience as a corporate turnaround consultant, and his current work as Executive VP of innovation firm Inno360, Matthew Heim carries a fiery passion for radically reinventing capitalism.

Matthew Heim

Matthew Heim

I interviewed Matthew this past week to get his insights on what it takes to innovate and on one of the next big trends in innovation – namely how organizations can now build their own customized online platforms to systematize their process of finding and collaborating with the right innovation partners. That in itself is a fascinating new option that enables you to tap into the massive, connected world of knowledge, talent, people, and ideas, also known as the “global brain.”

But what emerged in short order was a discussion not just on how to innovate, but why we are innovating in the first place. What’s it for?

I mentioned the recent Nasa study that concluded the utter collapse of human civilization will be “difficult to avoid” if we don’t change humanity’s current course.  I asked Matthew if innovation is the way we can change that course – or if the opposite is true: is innovation itself fueling an even more voracious global appetite for consumption?  Matthew was quick to respond.

“I think that if everybody’s income rises right now where you have everybody in China and everybody in India driving an SUV, that scares the heck out of me, that really scares the heck out of me” he said. “And we’re all headed in that direction. It’s the American dream, it’s the Canadian dream, it’s the Indian dream. It’s horrible.”

To say that the current path is unsustainable is an understatement, according to Matthew. What’s needed is a total shift in how we think, a shift in consciousness.

“We need to innovate in a different way. It’s not just product innovation, like finding greener technologies. It’s also about social innovation, i.e. applying innovation to the social realm, the social structure, giving people a say, enabling this bottom-up emergence of true ideation for what’s better for our society.”

“We have to get back to more simplistic types of innovation – so innovation is not always about the most powerful or the fastest. We have to address natural capitalism as a part of that.”

“We need to be going more toward bio-mimicry type of innovation – things that work in harmony with natural capital. We don’t address natural capital as a part of the overall capital structure” Matthew lamented. (‘Natural capital,’ a term made popular by the 1999 bestseller Natural Capitalism, refers to the full range of types of capital we actually use: the natural environment, human resources, social capital, and how they intertwine in ecosystems.) Instead of looking holistically at these, Matthew says “we look at monetary capital, we look at asset types of capital. Sometimes we look at human capital, but not to the extent that we should. We really need to be looking at natural capital.”

So how do we bring about this shift in consciousness? Matthew got a glimpse of the process when he taught young MBA students new ways of thinking:

“I used to teach at the world’s first green MBA program, and one of the things we instituted was that one of the first courses students would go through was systems thinking and critical thinking. We really started to ask questions about everything that we’ve been doing. And these kids would come out of the initial course and they looked like a ghost! You could just tell their awareness had shifted dramatically, where they just realized what they’ve been doing unconsciously because of the lack of awareness of what we’re doing.”

To teach innovation, then, Matthew says it’s a lot more than just teaching new skills. The first step is to teach three key ways of thinking:  Systems thinking, critical thinking, and lateral thinking.

Systems thinking requires looking at how everything is connected, how things fit together as a system, so that you don’t end up destroying one thing when you pursue another. Critical thinking gets you to challenge the assumptions. And lateral thinking, the method initially pioneered by Edward de Bono, is quintessentially about thinking in new ways and connecting new dots.

Ironically, this major change in consciousness is both what’s needed to do innovation better and to reinvent capitalism. So, yes, innovation just could be what saves the planet and gets us back on a path of sanity. Let’s hope so.

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Matthew Heim is currently Executive Vice-President of Inno360. He was previously the President of NineSigma, and is the author or co-author of five books, including the bestseller, A Guide to Open Innovation and Crowdsourcing.

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Steven Johnson: Why Your Next Good Idea Will Likely Come from a Good Chat

Everyone knows the three things that matter in real estate: location, location, location. Steven Johnson, who wrote the bestseller Where Good Ideas Come From, explains in this TED talk how the three things that really matter for generating great ideas are these: collaboration, collaboration, collaboration.

His research and stories dispel a big myth about how great ideas are generated. The great ideas don’t suddenly appear in that so-called lightbulb moment. It’s seldom a single epiphany. Great ideas are built, and they are usually built through a process that involves iteration and sharing – or in other words, collaboration.

Louis Pasteur famously said that “chance favors the prepared mind.” The adage has helped build the myth that the lone individual toiling away can achieve a breakthrough just through relentless hard work. But Johnson sums up his research with a new take on the quote: it’s not that you shouldn’t be prepared, it’s just that “chance favors the connected mind.”

What does he mean? Johnson begins by showing that the great intellectual period we call the Enlightenment (the late 17th and 18th century) was not coincidence. It was not pure chance that the period produced so many great minds. This happened because the period produced so many connected minds, and the main reason, surprisingly, was the invention of the coffeehouse.  What “makes the coffeehouse important is the architecture of the space. It was a space where people would get together from different backgrounds, different fields of expertise, and share.”

The implication is profound, because we still have a lot of myths about where ideas come from, and, Johnson argues, we need to do away with many of our “conventional metaphors and language.” We need to get away from the basic assumption that an idea is a “single thing.”

That assumption can even get us into trouble. In one striking example, a group in the west had the ‘innovative’ idea of shipping $40,000 incubators to a mid-size village in Africa. The basic assumption was that this was a way to bring this western technology into Africa and save lives.

But the assumption was flawed. After a year, the incubators will have some sort of malfunction, and there’s no one there able to fix them. So they become $40,000 wasted.

What’s the solution? The local team in Africa started to think differently about the problem. They shared ideas. They saw that the local village was very adept at automobile repairs. So they wondered if you could build an incubator out of automobile parts. You can. And they did. They built one at a fraction of the cost, and they’re able to keep it operating because they have the spare parts to fix it when something breaks down. That’s the outcome of a team collaborating.

Part of the task, then, is to get rid of the myths and the old metaphors. Newton didn’t discover the laws of motion in a flash of insight when an apple fell on his head. As Newton said himself, if he saw further than others it was only because he stood on the shoulders of giants.

The myth that Darwin discovered the theory of natural selection in a single eureka moment has also been dispelled. The scholar Howard Gruber painstakingly went through Darwin’s notes and showed that he had worked out the theory “months and months and months before he had his alleged epiphany.”

Another implication is that we need to think differently about how we design workspaces. Johnson says that “if we’re trying to build organizations that are more innovative, we have to build spaces” that foster real collaboration.

We also need to rethink intellectual property, Johnson argues: “we often talk about the value of protecting intellectual property, you know, building barricades, having secretive R&D labs, patenting everything.” But the research suggests intellectual property should focus just as much on fostering collaboration: “there’s a case to be made that we should spend at least as much time, if not more, valuing the premise of connecting ideas and not just protecting them.”

To sum up, there are three key points to take away from this talk:

  1. Where do great ideas come from? Iteration, and iteration happens in collaboration.
  2. How can we build organizations that innovate? Design workspaces that foster collaboration.
  3. And how should we approach our intellectual property? Yes, some ideas need to be protected. But sharing is what likely gets you to the best ideas, so find the right balance that takes full advantage of connecting ideas and collaborating.

Or here’s another way to sum up these three takeaways: collaboration, collaboration and collaboration.

Guy Kawasaki: The First Step Is to Simplify the Goal that Gives You Meaning

Guy Kawasaki, former ‘chief evangelist’ at Apple, recently gave a colorful talk at TEDxBerkeley called The Art of Innovation.

Occasionally, Guy uses such colorful metaphors, particularly in the titles, that a humble translation may help. So here are few thoughts on Guy’s message and how to remember the key points:

1.  ‘Make meaning.’

This is number one because it’s the starting point. You need to be pursuing a real purpose, not just trying to make money. Paradoxically, the innovators who pursued a clear purpose … all made good money. And even when they didn’t, their life had meaning.

2.  ‘Make mantra.’

Translation: Guy says you should reduce your mission to 3 or 4 words – make it a mantra. He says his is “empower people.” eBay’s is “democratize commerce.” But don’t write out a long, boring mission statement and think that’s enough. The reason to have a short mantra is to make sure you really believe in your mission.

3.  ‘Jump to the next curve.’

Easier said than done. It means don’t just try to tinker. Incremental innovation is not really innovation.

“True innovation occurs when you jump to the next curve — or better yet, invent the next curve.”

4. Great products are DICEE: Deep, Intelligent, Complete, Empowering and Elegant.

The key word here, really, is intelligent. According to Guy, “intelligent means the company understood your pain and what you needed.” Translation: to innovate, have deep empathy and spend the time thinking about what your customer or client really needs.

5.  ‘Don’t worry; be crappy.’

Translation: This is an update of ‘Real artists ship,’ the phrase Steve Jobs popularized at Apple. It means don’t get nervous at deadline time: finish and deliver.

Note of course that it comes after you have already gotten your purpose right (point number 1). If your purpose is clear, it’s okay to ship even if there are a few glitches.

6. “Let a hundred flowers blossom.”

Translation: You might set out to innovate “x” and it turns out it’s better used for “y.” Let it become a product used for “y.” Let the ideas evolve. Life, and innovation, are organic. Be flexible.

7. Don’t be afraid to polarize people.

Translation: don’t try to make everyone happy. Pick your group. Make them happy. Don’t worry if you make the other side unhappy. Actually, that’s a good sign.

8. ‘Churn, baby, churn.’

This is the flip side of ‘Real artists ship’ and ‘Don’t worry, be crappy.’

If you did ship and it’s not quite right, then get to work. This is the feedback process, and the feedback process is constant today. 24/7 if you listen to it. Appreciate the feedback. Correct course if you must. Then ship a better product. Keep improving.

9. ‘Niche thyself.’

Translation: a modern version of ‘Know thyself.’ It means focus on what makes you or your product unique.

It’s also the corollary of point 7 (you can’t make everyone happy). Since you can’t make everyone happy, make the people you serve very happy.

10. ‘Perfect your pitch.’

According to conductor Ben Zander, most people have pretty good pitch; it just hasn’t been developed yet.

The same is true in the art of preparing a pitch or presentation. Most people got corporatized into preparing dull powerpoint presentations.

Guy says there are three musts: First, personalize. Demonstrate why you care. Second, sell dreams not products. Explain how what you’re selling can change lives. Third, see Guy’s 10-20-30 rule. It’s right on.

And of course, since Guy promised 10 main points, he offers an 11th. This one may be the most important:

11 . ‘Don’t let the bozos grind you down.’

If you’re honest, admit it: there are bozos in your life. If you let them, they can grind you down. Guy explains who the real bozos are. Whoever they are in your life, if you let them grind you down, forget about innovating.

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These are eleven great points. Many thanks to Guy for presenting them in such living color.

Mariana Mazzucato: How Your Government Could Balance Its Budget AND Support Innovation (Yes, It’s True)

So Why Doesn’t the Private Sector Appreciate This?

The next time you use your smartphone, think of this: every feature that makes it ‘smart’ was initially created by the government. It’s true: taxpayers funded the research and development. The internet, GPS, the touch-screen display, even the voice-activated Siri – all of these were innovations created from US state-funded programs.

Google itself began thanks to a grant from the government: the US National Science Foundation financed the design of the Google search algorithm.

These are just a few of the many examples marshalled by economist Mariana Mazzucato in her thought-provoking 2013 book, The Entrepreneurial State, and in her TED talk at TEDGlobal 2013 (above).

The New Republic named Mazzucato one of the ‘most important innovation thinkers’ today.

Her book and work are a grand attempt to debunk the myth that the State is just a bloated bureaucracy and that all the praise should go to a so-called heroic, risk-taking private sector. She has examined case after case where the groundbreaking innovation came about thanks to the state, not the private sector. Private companies came in only after the hard work was done.

To continue the smartphone example, she shows how the major innovations were in fact “all government-funded. … the Internet was funded by DARPA, the U.S. Department of Defense [the ‘Defense Advanced Research Projects Agency’]. GPS was funded by the military’s Navstar program. Even Siri was actually funded by DARPA. The touchscreen display was funded by two public grants by the CIA and the NSF”.

The main upshot is that we have created a false understanding of the role of the state in innovation.  The “narrative that we’ve always been told is the state is important for the basics, but not really providing that sort of high-risk, revolutionary thinking out of the box.” So the popular narrative, particularly at election time, is that government is wasteful, inefficient, and certainly not an innovator.

But that government-bashing has a huge cost. In fact, “in all these sectors, from funding the Internet to doing the spending … the envisioning, the strategic vision … it was actually coming within the state.”

So Mazzucato argues that we need to change the narrative. We need to “really think again this juxtaposition, because it actually has massive, massive implications beyond innovation policy.”

We are paying a huge price for this false narrative, because “what we actually need are public-private partnerships.” The huge risk is that “by constantly depicting the state part as necessary but actually … dangerous kind of Leviathan … we’ve actually really stunted the possibility to build these public-private partnerships.”

The further price we’re paying is that the government bashing is hurting the state itself and only helps the rich get richer.

Mazzucato says this is “the biggest implication, and this has huge implications beyond innovation. If the state is more than just a market fixer, if it actually is a market shaper, and in doing that has had to take on this massive risk … where’s the reward for the state of having taken on these massive risks”?

She argues that we’ve messed up the risk-reward equation. Instead of ensuring a proper return on investment back to state coffers, the rewards go to the private companies who cash in on the initial innovations, reap the profits, and then unleash their tax gurus to find ways to pay zero tax.

There’s a smarter way, Mazzucato argues. The smart governments are learning to think different. Countries like Finland are not just funding new research, but they are making sure to take equity positions that will share in eventual rewards. In a word, they’re mastering how to think like an innovator, in the true entrepreneurial sense of the word.

Imagine, she says, if “the U.S. government thought about this” and had created an innovation fund where “even just .05 percent of the profits from what the Internet produced had come back to that innovation fund.” There “would be so much more money to spend today.”

Indeed, the US government might not be in quite so much debt. Such a strategy just might even have helped the US achieve balanced budgets during the last two decades.

As Mazzucato says, there are a lot of self-fulfilling prophecies going on here. By failing to pursue policies like these, the US government is in a dismal financial state, and this has only helped create more government-bashing that in turn leads to policies that further rob the state of funds. A classic vicious circle if there ever was one.

Daniel Gogek