I was teaching about innovation and new business creation this week in an Executive program at a Danish university. Eight Danish companies sent teams of 2-3 people each, expecting that by the end of the course they’ll have a jumpstart on a new business platform that will invigorate new growth in their firms via game-changing innovation. Companies sponsor teams to come into the program because they are seeking new methods for developing new businesses.
Here’s the jist of part of the conversation, which has played out in nearly every executive class I’ve taught:
Project team members are extremely concerned with being able to show senior management hard numbers, because, they tell me, ‘that’s what senior management expects.’ This means sales predictions, market share, Return on Investment….at the Concept stage of development!!! When I ask if they realize they’d be lying, since the markets they’re supposed to forecast don’t even exist yet, they laugh and admit it’s true. When I ask if senior management realizes they’re lying, they admit this, too, is likely the case. So why, I ask, do we keep doing this?
“What is the option???”
How about admitting you don’t know, I suggest, and working out a plan for learning?
“We’re supposed to know before we go speak with management”, they tell me.
How? You have no funding for the project, and learning takes resources.
“What should we do ?”, they ask.
Learn how to learn, and let senior management know what you’re doing. Get funding to learn a little, then evaluate, then decide, with senior leadership, whether or not what you need to do next.
“Ah!”, they say. “Makes sense… Who’s going to convince our senior leadership that this approach is appropriate?”
Good question. Here is one approach: We need a course for senior management as well. Not all senior leaders are clueless about this. IBM’s Emerging Business Opportunities program is run and sponsored by senior leadership. IBM states that an EBO focuses on ‘white space’ opportunities that can become profitable, billion-dollar businesses within five to seven years. Their senior leaders conduct project reviews as problem solving sessions…not as evaluation sessions. Pretty cool. Others are catching on as well. But it’s not easy when they’ve been rewarded for being decisive in the face of inadequate data. When that’s how you’re trained, the easiest response to risk and uncertainty is to kill the project before it gets off the ground.
I know that the companies that have participated in the program in Denmark have benefited, because they continue to send teams year after year. Perhaps these people will one day be the senior managers in those companies.