A spilled cup of coffee is responsible for one of the big commercial success stories of German chemical company BASF.
A BASF representative was making a sales call at a Japanese construction company when he spilled coffee on a blueprint that was open on a table. He grabbed some foam insulating material nearby to try to mop up the liquid and to his surprise it absorbed both the spill and the ink itself, erasing the blueprint wherever it touched it.
The clumsy salesman later recounted that story to colleagues and the foam—used as soundproofing and insulation—became the basis for the Mr. Clean Magic Eraser, a consumer cleaning product that has sold over one billion units.
Ben M. Bensaou recounts this story and others in his new book Built to Innovate, written with Karl Weber. Bensaou, an INSEAD professor, studies the practices that allow businesses to create breakthrough products and new business models.
The Magic Eraser story illustrates one of his key findings: that frontline workers like the salesman in Japan are tremendous sources of new ideas. “They have the most numerous opportunities to learn from customers about their unmet needs, unspoken desires, and unsolved problems—each of which represents a possible opportunity for innovation,” Bensaou writes. (p. 116)
“Unfortunately, in many organizations, frontline workers don’t get the respect they deserve,” he notes. Bensaou’s observations about innovation are yet another argument for restoring dignity to the often low-paid, low-prestige jobs on the frontlines of many organizations—and seeing them as central to improving the business and its products.
Other examples from Built to Innovate include the Starwood hotel employees who helped create a flexible check-in loyalty program. They had been fielding complaints from international guests who arrived on red-eye flights from overseas early in the morning and were desperate to get into their rooms before the 3pm check-in time.
Overall, the book makes the convincing argument that responsibility for innovation shouldn’t be parked off in corporate research and development groups, and that it’s not just creative geniuses who generate real breakthroughs. Built to Innovate is a playbook for closely marrying the execution and innovating functions within organizations rather than separating them as is often done, and empowering all employees to play a role. While many of the book’s protagonists are big industrial companies, it’s earnest and approachable and offers ideas that could be applied to most organizations.
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Bensaou defines innovating as “systematically looking for, developing, and implementing new ideas that create value for a customer and for the organization.” (p. xi.) He says a company’s innovating “engine” has three key processes, which can overlap and take place simultaneously:
- Creation. This is where the front-line employees come in especially, generating new ideas.
- Integration. This is where mid-level managers often play a central role, connecting the dots between the ideas dispersed throughout the organization and evaluating, selecting, and supporting the most promising ones. W.L. Gore, for example, uses a “Real, Win, Worth” process to review new ideas: is it a real business opportunity? Could the company win in the marketplace with it? Are the potential rewards worth it?
- Reframing. Senior leaders enable innovating by creating a culture and processes that value it, recognizing the potential value of innovation, and shifting the organization toward new approaches. A new executive at Marvel Studios, for example, discontinued the practice of licensing Marvel characters for movies—which had produced mixed results—in favor of producing its own, initiating a remarkable run starting with Iron Man in 2008.
Other useful takeaways:
- One overlooked reason that startups are good at innovating is because they, as a result of their small size, have a greater percentage of employees who are on the frontlines. That means they’re in direct touch with customers and processes, and can quickly improve things.
- Bensaou cites Gore’s core beliefs for how it treats employees, which are central to encouraging everyone to be part of innovating. They include belief in the individual, in the power of small teams, in the long-term view, and that “we’re all in the same boat.” (p. 29)
- Bensaou draws inspiration from his INSEAD colleagues’ “Blue Ocean Strategy” but says he’s agnostic as to the exact method people use for examining business challenges, as long as it involves a systematic process.
- He recommends the creation of an “innovating team” at organizations, which includes coaches (to guide individuals), coordinators (to connect people and filter ideas), and committee members (to select, invest in, and monitor the best ideas.)
- Bensaou makes the case for innovating as a “habit,” a series of systematically pursued breakthroughs as opposed to one big eureka. He cites Domino’s Pizza’s revitalization since 2010 due to a series of innovative features generated through a tight partnership between its tech and marketing teams.
To be sure:
- Built to Innovate is primarily concerned with how to make large traditional companies more innovative. It doesn’t have a lot to say about smaller firms. And it doesn’t discuss the implications of digital disruptions or technology breakthroughs like artificial intelligence. In the face of such exponential changes, corporate innovation coaches and frontline conversations with customers are likely insufficient to keep businesses in leading positions.
Memorable anecdotes and facts:
- Improving business models is another way of innovating. BASF shifted from selling paints to auto manufacturers to actually sending personnel into auto plants to do the painting itself.
- Companies including Gore, 3M, Hewlett-Packard, and Google have had success over the years by giving staff time to pursue their own ideas, known as the “15% Rule” or “20% Time.”
- Samsung has a “VIP Center” near Seoul where employees from different parts of the company come live for weeks at a time to focus on pursuing innovative ideas.
- To be able to serve the aging Boomer population, the YMCA reframed its mission to focus on community health, testing and rolling out a successful Diabetes Prevention Program.
- Fiskars, the Finnish scissors and tool maker, increased sales by 50% at stores where it reorganized the presentation of tools around specific tasks, such as planting a flower bed or installing a fence.
- Bayer, the pharma and life sciences giant, created a digital platform called WeSolve where employees post problems that colleagues from around the world suggest solutions to. An estimated 50% of the problems are solved as a result, with about two-thirds of the best solutions coming from people in different functional areas or divisions of the company than the person who posted the problem.
- “Don’t ask for permission—make others jealous!” (p. xviii)
- “Once you take innovating by anyone, anytime, anywhere as your goal, you can begin turning your organization into a true innovating engine.” (p. 22)
- “Every organization needs to operate two different engines simultaneously: an execution engine and an innovating engine.” (p. 25)
- “Each employee must be encouraged and expected to regularly step away from the daily execution routine and engage in innovating activities.” (p. 45)
- “The image of a lone inventor is alluring, but almost always wrong. Innovation actually happens in teams, in cross-functional workshops, and through the involvement of many. It is also highly contagious.” —Dr. Monika Lessl, Bayer (p. 186)
- “It’s hard to overstate the value that in-depth observation and interviewing of customers can have for teams trying to generate useful innovating ideas.” (p. 206)
The bottom line is that Built to Innovate lays out a process for innovating that helpfully acknowledges the important role of front-line workers and provides structured methods for filtering, evaluating, and pursuing their ideas.