Provoke: Why the Global Culture of Disruption is the Only Hope for Innovation

By Linda Bernardi

“Smart” devices, big data, predictive analytics, cloud computing, the social enterprise—none of these world-changing innovations would have come to pass without a Culture of Disruption that allowed fertile minds to challenge conventional wisdom, take risks and boldly bring new technologies to light. In Provoke, “innovation provocateur”, entrepreneur and strategist Linda Bernardi reveals the discomfort with which corporations, boards of directors, investors and academics regard disruptive ideas—and why embracing this discomfort to create a Culture of Disruption is the only way that business can innovate and revitalize the global economy. In this candid, insightful book, Linda—a pioneer in fields like data analytics, digital marketing and the social enterprise—pulls back the curtain on the “innovation ecosystem” to take the major players to task. Among the issues that fall into her sights: •Why companies utterly deny the disruptive impact of new technologies until their business model is on life support... •How venture investors are playing Las Vegas roulette by throwing huge money at companies that can’t justify it... •The myth that companies can become innovators through acquisitions... •How the arrogance of many entrepreneurs dooms their companies before they even launch... •Why Innovation-Based LeadershipTM is the key to everything... In Provoke, Linda asserts that only by creating a deliberate collaborative, global Culture of Disruption, in which all the players support unconventional thinking and the work of passionate innovators, can we lay the groundwork for our economic future.

• Language: English
• Publisher: Linda Bernardi
• Release date: Mar 5, 2013

Book preview

PART I

THE FIVE STAGES OF DISRUPTION

ANGER & DENIAL

REJECTION

RECOGNITION

INSPIRATION

ACCEPTANCE & ACTION

THE CULTURE OF DISRUPTION

— Trip Hawkins, founder of Electronic Arts

When I go into an organization to speak about innovation and changing the way they do things, I always meet with emotional and psychological resistance. Much of the time, that resistance progresses through five stages, much the way it does through Elisabeth Kübler-Ross’s Five Stages of Grief. The stages of resistance:

  1.  Anger and denial

  2.  Rejection

  3.  Recognition

  4.  Acceptance

  5.  Inspiration and action

In the first half of this book, I’ll explore each of those stages in detail to try to uncover some of the reasons that we react to disruption as we do.

IPHONE? WHAT IPHONE?

I’ve heard this story from several people who were in the room, so I know it to be true. A group of important customers went to the headquarters of a big, influential software company for a meeting. They sat down in a conference room and waited for one of the bigwigs to appear to discuss some critical new business they and the software company would be conducting. But before the executive arrived, an assistant came in and asked everyone in the room to please put away all their Apple handheld devices!

Well, you can bet that a few eyebrows went skyward. As soon as they had sat down, the clients had done what businesspeople in this age do—pulled out their iPhones and iPads and checked email, text messages, and calendars. Most of the people on the client team presumed the assistant’s directive was about avoiding the distraction of a phone or an email chime going off during a meeting, so they began powering down their devices. No, said the assistant. Please put all your Apple devices away. Meaning, power them down and stow them. Pretend they don’t exist. Apparently, the software company’s management was so threatened by the specter of Apple’s products that, like vampires with garlic, it couldn’t even tolerate their presence.

The clients were furious about such a petty policy, and they pushed back and got their way. But the breach of protocol isn’t the point. The point is, management by denial is not management at all. At Harvard Business School, I don’t believe they teach executives to deal with competitive threats by sticking their fingers in their ears and going, I can’t hear you! La la la la! That’s abject denial of the worst kind, and that’s where we’re going to begin our journey into the Five Stages of Disruption.

THE HORSE WITH BLINDERS ON

One of my first ideas for the cover of this book was a horse or donkey with blinders on its eyes. In the equestrian world, you blind a horse so it can’t be spooked or distracted by things in its peripheral vision. That’s beneficial. But in business, blinders are potentially fatal.

I think hatred of disruption and denial of the need for radical change come from many places. First of all, they’re results of legacy thinking: A company was big in the past, it’s still big in terms of sheer numbers and revenues, so it will be big into the future. A equals B equals C. The trouble with that kind of thinking is that by the time the big legacy corporation gets to the point where its leaders are patting themselves on the back over how big they will remain into the future, the decline has already begun. As Jim Collins says in his book How the Mighty Fall, by the time a downward slide becomes obvious enough that an otherwise-complacent organization can see it, it’s probably too late to stop the momentum.

Something called recency bias convinces us that the way things are today is the way they will always be. If business is solid today, then forget that our stock is sliding and we’re being out-innovated by three smaller companies! Damn the torpedoes! That kind of blind denial can set a company on a collision course with some pretty harsh reality. It’s not sheer size or inherent conservatism that makes huge corporations stodgy, slow to react, and hostile to change. Those are contributing factors, but the key is this: Size creates the illusion of success. We have a hundred thousand people, sixteen offices around the globe, and twenty-three billion in annual sales—we MUST be brilliant! executives crow. Let’s give the board some more stock options!

But in this context, size does not matter. In fact, size can be detrimental because the complexity of a huge global enterprise can make it impossible to see the forces tearing it apart until it’s too late. It’s like a tiny tumor growing in the body of a 350-pound football player. Read my blog post called Going Postal at lindabernardi.com for an idea of how I feel about the utter failure of the U.S. Postal Service to innovate.

I once worked for a huge systems integrator with more than 100,000 people, and on my first day it became clear to me that nothing was happening. I had come from an entrepreneurial company of fewer than fifty of the best and the brightest people in technology, where we were innovating and creating disruptive new products. The difference was shocking. Clearly, a larger headcount did not equal innovation.

Still, the experience was invaluable. It let me know how these organizations tend to work—or, more often, not work. I don’t want to wait a year for my clients to get something done. Usually, their potential for change is huge, but it’s unseen. My job is to rip away the recency bias, denial, and comforting self-delusion, tell them what they’re really up against, and open their eyes to what they can do. We don’t innovate unless we provoke.

INTIMIDATION AND DISCOMFORT

When I engage with an organization, whether it’s a massive global enterprise or a twenty-person board of directors, one of my first actions is to begin asking questions. Why are things done this way? Is everyone working to full capacity? Where’s your investment in innovation? People quickly become intimidated and uncomfortable. No one likes being schooled in areas in which they already believed they were experts, and the people I speak to think they are experts in running their organizations.

Under these circumstances, I usually come face to face with three poisonous attitudes at the heart of organizational cultures. The first is mistaking knowledge for understanding. For example, everybody claims to be a social networking expert these days. Even my aunt and mother, who are absolutely lovely, use Facebook but have no concept of the bigger picture. Nevertheless, they think they are gurus. I think that’s sweet, but unfortunately that describes the majority of people. They believe that a small amount of knowledge makes them experts, and it’s just not