Chris Trimble of Tuck Business School, on importance of innovation
Innovation has long been hailed as the holy grail of success. There are enough case studies of how companies have grown and scaled newer heights due to innovation, but the same enthusiasm is not found in documenting and publicizing examples of failure. Peter Drucker once famously said, “Innovate or Die” and that pretty much summarizes things as they are.
Another well-known thought leader who has advised many Fortune 500 companies and made them think out-of-the-box is Chris Trimble. From being a submarine officer in the United States Navy, to now a faculty at the Tuck School of Business at Dartmouth and at The Dartmouth Center for Health Care Delivery Science, Chris has a good blend of academic research and practical experience. Some of the companies that he has advised include General Electric, IBM, Intel, Microsoft, The New York Times Company, Genencor, Corning, Thomson Reuters, eBay, Fidelity and Unilever among others.
Chris is also the author of the best selling book ‘Reverse Innovation’ which he co-authored with Vijay Govindarajan. The latest book from the duo is titled ‘How Stella Saved The Farm’. We caught up Chris recently to talk about his books and his thoughts on innovation in general. Excerpts.
What is the book all about?
It is a simple tale about making innovations happen. The book is about a farm in trouble and includes different twists in plot like an unexpected leadership challenge, an ambitious call to action, a bold new idea, many challenges, obstacles, triumphs and even a love interest. The book demonstrates that innovation is risky, a bet and one should always remember that failure is possible. The purpose of the book is to show how companies should avoid common managerial mistakes from coming in the way. When you are an established company, you face a challenge of not just building something new, but building something new while simultaneously gaining excellence in the business you are already in. And doing both together is hard and it is difficult for managerial talent, and How Stella Saved The Farm illustrates how to do it. It is a new venture which the business was not doing in the past, but once the need to innovate has been identified, it is important to see it to the end.
In the book Einsten, the rooster comes at a critical juncture to put systems and processes in place to measure success. Shouldn't businesses take care of that from the beginning?Yes it is important to measure success. Business by and large is done in a very disciplined way and there are enormous benefits in understanding the way you do things. Outputs have to be measured and kept, to make things accountable. Therefore if you are able to zero in on some kind of success, then you need to quickly take it to the next level. Else if you realize that your efforts are not yielding results, it is best to exit the business before it gets too expensive. So you work early and quit rather than put more money and continue to be expensive.
In the very beginning the leader should take decisions and lay ground rules that innovation and day to day operations have to complement each other. It is not possible to succeed as a whole, until we have do business in that way.
What is the connection between frugal innovation and reverse innovation?
Reverse innovation is any innovation that is adopted first in the developing world and later adopted in the rich world. Frugal innovation is something that has been well thought. Some frugal innovation is also reverse innovation, but not all reverse innovation is frugal innovation. In the book we have one example that starts with a frugal innovation, of a low cost product that is at first of low quality and not of interest in the rich world, but over time technology improves, quality of product improves and it becomes of interest to the rich world. That’s just one possible way for reverse innovation.
For example developed countries can build new infrastructure at a rapid pace, because they have the capability to do that. But to develop a fully blown infrastructure in developing countries will take a lot of time. But at the same time, they will be better placed to take a lead in technology or telecommunications and we often see that developing technologies are first adopted by the developing world.
Our study for the book did not happen in the developing world, what we looked at was established global corporations and what the importance of reverse innovation has for them. So incase of GE, it has developed products in most cases for markets beyond the US and then exported these products around the world. So it innovates at home and then exports around the world. But if you think of the world of reverse innovation, there are some cases where an innovation is first adopted in the developing world and then in the rich world. So if GE wants to stay ahead in the market, it will have to innovate abroad and then sell it around the world. And most of our book is about why it is difficult for an MNC to do it and how to overcome the challenge?
How can startups innovate and be successful, when they are still dealing with micro problems like cash flow and even getting the right talent?
There is a threat in small startups that big corporate should take note. It is to do with the weakness of the large corporations, in the way they organize themselves and have been working for over many many years. Big corporations may overlook reverse innovation opportunity altogether, or even if they see them they are very unlikely to be able to be able to organize them against the rapid changes. Reverse innovations to happen inside a big corporation is extremely difficult and therefore it opens the door for startups to come through.
You are right, there are hurdles for startups as well and perhaps the most insurmountable hurdle is the global reach and global scale that big corporations already have. So if a large MNC is successful in India, they can bring a reverse innovation to the market much faster than an startup would be able to do. But they have to first take those few steps towards innovating.
R&D teams in big corporations are working on problems defined by the global HQ. They are doing engineering or design work and reporting back to a boss who sits in US, Japan or Europe based on problems they know and have knowledge of their home countries. There startups have an edge as they are more open in their communication with each other and changes can be brought about faster.