Lessons from an Innovation Superstar

Under Armour 2 - croppedUnder Armour founder and CEO Kevin Plank is nothing if not an entrepreneur. He started the company in 1995 in his grandmother’s basement.  His inspiration was to find an alternative to the cotton shirts he wore under his pads when he played football at the University of Maryland.  Those shirts got soaking wet, heavy and slowed down the players.

Under Armour logo - cropped

His creation now has nearly $4 billion in annual sales, 13,500 employees and is an innovation superstar. Not satisfied, Plank is setting out to create an entirely new component at Under Armour.  He is leading a charge into fitness technology.  Along the way, he has invested nearly $1 billion buying three activity-tracking and diet-tracking mobile app companies.  He sees this effort aligning well with the Under Armour’s mantra to “make all athletes better.”

Whether he will succeed in this effort is unknown. What is fascinating is the culture he has created in the last twenty years that so thoroughly embraces innovation to the point that it created an entirely new market segment – high performance athletic wear.

Not surprisingly, Plank is into continually sending the message that innovation is prized and desired. (As obvious as this seems, my experience with client organizations shows that this is astonishingly rare.)  One of the ways he continually sends the message is by having admonitions prominently displayed around the Under Armour headquarters in Baltimore.  They include:

Perfection is the enemy of innovation. 

Respect everyone. Fear no one.

And my favorite:

Think like an entrepreneur. Create like an innovator.  Perform like a teammate.

A simple but powerful concept he promotes at Under Armour is called “guardrails.” He promotes the idea of providing his people with figurative guardrails that establish the boundaries within which they operate.  Presumably some guardrails apply to all and some are specific to individuals.  Regardless, it is a brilliant concept.  Guardrails allow creative and motivated team members the latitude to do exciting things with boundary clarity.  Brilliant.  The results of the organization speak for themselves.

But We Really are Afraid!

Fear - cropped

Contemplate this statement for a moment:

“We cannot respond [to threats or risks or change] with pure emotion, but leaders can’t omit emotions entirely.  If only because people need validation of their legitimate fear and anger before they will listen to arguments for measured action.”

While this was written in reference to political leaders responding to threats from terrorism, it offers interesting insights about leading organizations through change and innovation. These words, slightly paraphrased, were written by Washington Post editorial writer Charles Lane.  The bracketed phrase is my addition.

Change is rarely welcomed or well-received. I have long contended that people ascend to leadership positions within organizations in part because they have superior risk-taking talents.  Part of utilizing those talents is helping those they lead to move past their limiting fears – to embrace the changes the leaders realize are unavoidable.

It is easy to say that taking risks well requires removing the emotion from the process and being more empirical. And you would be right.  But Lane provides us with a valuable insight.  You will be well-served to acknowledge and honor the fears and concerns of your team before moving forward with analyzing and deciding.

Risk Homeostasis – the impact on organizations

Leap-Cropped-SmallerIn the previous post, we talked about people risking more if they have an increased sense of protection from the possible negative outcomes of their actions.

The significance of this in organizations is obvious and powerful. If the leaders in an organization genuinely support their people when risks do not yield the desired results, they will get more initiative and innovation.

In this setting, the “safety devices” are not automobile airbags or seat belts, but a culture and leadership team that values initiative even when the results may not be as intended. The important qualifier is that poor outcomes cannot be due to flawed execution. Clearly, that is not acceptable. But if the execution was sound yet the results were not as intended, it is vital that the person or team that took the initiative be praised and rewarded. Not doing so will send the clear message that only successful risks are acceptable and since risk-taking is inherently an uncertain process, initiative and innovation will be stifled.

So, provide your people with “initiative & innovation airbags” and they will be much more inclined to drive assertively towards your organizations goals.

Risk Homeostasis – the more things change the more they stay the same

bubble wrapped car, croppedLet’s talk for a few minutes about risk homeostasis – a fascinating concept put forth by Gerald J. S. Wilde. The premise is that every person has a certain level of risk with which they are comfortable then use risk protection measures not to be safer, but to increase their risk taking so their level of acceptable risk stays the same.

An example would be driving a car with lots of safety features such as seat belts, front and side airbags, ABS brakes and sideview (blind spot) assist that lets you know a vehicle is next to you but hard to see with your peripheral vision or mirrors.

Now compare driving this car with driving a car from the late 1950s or early 1960s with none of these safety features. Risk homeostasis tells us that the same person would drive the car loaded with safety features in a riskier manner. The idea is that all the protection provided by the safety features allows for more risks to be taken yet the original level of risk tolerance is still maintained.

If risk homeostasis is valid, the same person would drive the older car without the safety features more cautiously and as a result achieve the same level of risk as driving the safety feature loaded car in a riskier manner.

The same idea would suggest that a motorcyclist wearing a helmet and protective leathers with carbon fiber armor plates would drive in a riskier manner than if the same person was on the same motorcycle in shorts, a T-shirt and no helmet.

I leave it to you to decide whether you think risk homeostasis is valid. Some researchers think it is not.

Here is one last data point as you consider the validity of risk homeostasis:

When drivers see bicyclists wearing helmets, research shows that they take slightly less care with passing them than bicyclists without helmets. The results of a study published in Accident Analysis & Prevention in March 2007 tells us that drivers give a bicyclist not wearing a helmet on average 3.35 inches more room when passing them than if the bicyclist is wearing a helmet. Consider that this all happens spontaneously as the driver passes the bike without much time for the driver to contemplate their behavior in advance. They likely do it all rather intuitively.

So, do you think risk homeostasis is valid?

 

Risk Well “and Stuff”

Chevy Truck, cropped

Right after the last out of the 2014 World Series, Chevy gave a pickup to the most valuable player.  The poor guy tasked to present the keys looked like he was about to have a stroke.  He struggled to get words out, sweated profusely and started to stutter.  When he got to the part where he was supposed to tell all the world about the truck’s impressive features, he blurted out that it had “technology and stuff” then thrust the keys in the MVP’s hand – all on live national TV.

Disaster or opportunity?

Here is some of the back story.  Dan Ammann has been thand shakehe president of General Motors for about a year.  Part of his strategy is to “put the right people in place and let them make decisions.”  Oh, the risk!

Within hours a member of the empowered Chevy team was being bold.  Instead of tryi
ng run from the flub, the Chevy manager monitoring social media was tweeting with the hashtag, #TechnologyAndStuff.  This was 1:29 a.m. and Jamie Barbour was on it!

Before dawn, the U.S. marketing chief for Chevy was firing off emails to his social media, digital marketing and advertising teams so they could start to exploit the “technology and stuff” line.

By 7:30 a.m. a new voiceover was being recorded for an ad that would run that evening on an NBA game so it added “and stuff” to the script.  The team quickly bought ad time on the late night comedy shows that would air that evening anticipating that the comics would likely fry them for the flub.  They were determined to have the upper hand.GM_logo

Before they were done exploiting what could have been a disaster, they had the Chevy pickups like the one the MVP received emblazoned with #TechnologyAndStuff as they took the drivers at a NASCAR event in Texas around the track before the race.

A flub turned into a coup:  Advertising Age magazine estimates that Chevy got $5 million in free media exposure for their effort.  Risky.  Yes.  Successful.  Heck yes.

This is risking done well.  Kudos to Dan Ammann and the innovative and resourceful Chevy team.

***

This is where you can find a video of the now infamous World Series presentation:

https://www.youtube.com/watch?v=fMsqSVyXnO8

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Encourage Disobedience

Download-Button v2Here are the first two sentences in a recent article that got my attention:

“Want to be more competitive? Then empower your most technologically disobedient employees.”

The core message is that employees want to do their job and they will seek the tools to do so.  If the corporate Information Technology (IT) department does not provide them with what they need, the will find the applications they need on their own even if it means paying for them.  The proof?  According to research conducted by Frost & Sullivan referenced in the article “80% of people working for organizations with more than 1,000 employees go around the IT department and use (or even buy) software.”  The practice is referred to as “Shadow IT.”

The idea is similar to my admonition to achieve innovation by accepting failures, because you won’t get one without some of the other.  Are there risks?  Of course.  But as the article concludes, “firms concerned about the security issues of shadow IT are missing the point; the bigger risk is not embracing it in the first place.”

The article is titled “Let Staff Go Rogue on Tech.”  It was written by Christopher Mims and is available on the website of the Wall Street Journal.

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Common Perceptions of Risk

Risk takerConsider the definition of risk from the Merriam-Webster Online Dictionary:

risk

1: possibility of loss or injuryHighlighting Rewards Versus Risk

2: someone or something that creates or suggests a hazard

3 a: the chance of loss or the perils to the subject matter of an insurance contract; also: the degree of probability of such loss b: a person or thing that is a specified hazard to an insurer c: an insurance hazard from a specified cause or source

4: the chance that an investment (as a stock or commodity) will lose value

Is it any wonder that many of us have a conflicted relationship with risk and risk-taking?  Look at these definitions.  They are uniformly negative.  The thought that a risk could have a positive outcome is entirely absent.

  • Couldn’t the first definition read:  possibility of loss, injury, success or accomplishment and indeed be accurate?
  • Wouldn’t the fourth definition be more accurate if it read:  the chance that an investment (as a stock or commodity) will lose or gain value?  Certainly an investor, entrepreneur or company does not put capital at risk unless there is a reasonable chance of an increase in value.

This definition illustrates the common societal bias against taking risks – even thoughtful, intelligent ones.

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