Saul Kaplan: Calling All Entrepreneurs

Institutional America has knocked the start out of us. We need to get back to being great at starting things in our country. Calling all entrepreneurs. This means you.  Yes, you.  In talking with some of the most entrepreneurial people on the planet I am surprised by how many don’t think of themselves as entrepreneurs.  When did that happen?  Our economic history is all about starting stuff but we have gotten away from our entrepreneurial heritage. We need a national entrepreneurship movement, one that transforms our current entrepreneurship conversation.

Many visitors to the Entrepreneur StoryBooth, an on-line platform the Business Innovation Factory (BIF) launched with Babson College to capture the voice and experience of entrepreneurs, have shared that despite significant experience in starting stuff they don’t think of themselves as entrepreneurs. The prevailing definition of an entrepreneur just doesn’t seem to apply.  I consistently reply asserting the opposite, their experience is exactly what we need in the mix. These diverse stories are critical to changing our national entrepreneurship conversation and launching a new economic era. It’s a big ‘aha’ for me so many entrepreneurs don’t think of themselves that way.  I have to admit, upon personal reflection, as much as I love to start new projects, ventures, and movements, I too don’t think of myself as an entrepreneur.  Go figure.  Clearly, we have serious work to do if our economic future is about entrepreneurship.

Saul KaplanWhen did we reserve the entrepreneur moniker solely for technology ventures started by iconic college dropouts like Bill Gates and Mark Zuckerberg? I know we all love a good company origin story but by elevating these stories to mythical proportions aren’t we placing entrepreneurship out of reach for the rest of us mere mortals.

When did we so completely buy into a national invention narrative suggesting that if we invest enough in university based research it will produce a steady supply of new technologies, companies, and high-wage jobs. We have structured our entire national entrepreneur support system around an invention narrative in the hopes that tech transfer, venture capital, and technology company incubators will give rise to the promised new economy. It’s hard to see it happening any time soon with such a narrow definition of entrepreneurship. Maybe it’s time for a new expanded entrepreneurship narrative and support system.

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Saul Kaplan: Calling All Entrepreneurs

Saul Kaplan: Innovate By Hacking Capabilities

Capabilities are the amino acids of innovation.  They are the building blocks that enable value delivery.  Innovation is a better way to deliver value and is often the result of repurposing existing capabilities.  Locking capabilities into rigid organization structures and proprietary closed systems gets in the way of unleashing new sources of value and solving many of the important challenges of our time.  Innovation is about hacking capabilities.

A capability is simply the power to do something and is comprised of three elements, people, process, and technology.  You might have the capability or power to make a mean western omelet.  You possess the skill (people) thanks to hands-on training from mom, a recipe (process) handed down for generations, and a great cook top range, non-stick pan, and spatula (technology).  Hacking the capability is easy.  A Google search for western omelet recipes yields almost 25 thousand hits.  That’s more variety than a lifetime of Sunday brunches.  To stretch the analogy a western omelet capability can also be combined with other capabilities to open a cool restaurant, launch a cooking blog or cable television show, or to commercialize a new cooking utensil.  Innovation happens when we enable random capability collisions resulting in new and unexpected ways to deliver value.

Saul KaplanPerhaps a more relevant and timely example of the power and potential of hacking capabilities is Microsoft’s Kinect. Microsoft introduced Kinect on November 4th as a product extension to its Xbox franchise.  Kinect adds a very cool capability for Xbox game players by getting rid of the hand held game controller and turning players into their own controllers.  It lets players ‘be the controller’ with gesture recognition technology. On-screen menus are navigated by voice and hand waves.  Game avatars are manipulated through body gestures.  Microsoft and cool haven’t been used in the same sentence for a long time. Kinect is cool.

Microsoft predictably launched Kinect with it’s deeply ingrained proprietary product mind set.  You could buy Kinect as a bundle with an Xbox or as a separate component to attach to an existing Xbox for $150.  While Microsoft views Kinect as a product the global geek community views it as a capability.  To geeks, Kinect is a powerful capability screaming to be hacked and repurposed for exciting new uses beyond its use as an Xbox extension.  Hackers view Kinect as an interesting voice and gesture recognition platform complete with sophisticated cameras, software, and sensors with the power to detect movement, depth, shape, and position of the human body. What a bargain for only $150. It’s a hackers dream.

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Saul Kaplan: Innovate By Hacking Capabilities

Saul Kaplan: If All the World were Gamified

Need to turn around your company? Trying to start a movement? Want to change the world? Easy Peasy! Just turn it in to a game. Everywhere we turn, it seems there are experts claiming that the best path forward is to engage people with elements of competitive play. The business world in particular has gone gaga for gamification.

I thought games were mainly for kids, and the occasional ice-breaker or temporary escape from reality. Why encourage more of them? As adults, aren’t we supposed to set aside childish things and get down to work on the problems of the real world?

Truth be told, I have always loved games. Stratego was a mainstay among my school buddies. We spent hour upon hour lining up red and blue soldiers to protect our flags. My family’s Monopoly  games were epic battles, beginning with the fight over game pieces. (No, I get the Scottish Terrier!) The side deals we struck and the arguments that ensued still liven up family gatherings. In college I became a professional Risk player. Tell me you didn’t learn about the challenges of fighting a multi-front war from playing Risk. Who among us hasn’t attempted to conquer the world by way of Kamchatka?

Saul KaplanGames ruled – till it was time to make my way in the real world where they didn’t. By the time online games exploded onto the scene, I was so immersed in reality that I managed to ignore them. I’ve never created a level-80 character in World of Warcraft, won the staff of life in Spore, mastered an artichoke crop in Farmville, or knocked over any pigs with Angry Birds. But others have – hundreds of millions of them around the world. Already, 5.93 million years of total time has been spent playing World of Warcraft alone.

One response to this is to despair of all that wasted time. Imagine if only a fraction of it had been focused on improving our education, health care, energy, and economic systems. Another response, though, is to say: if you can’t beat them, why not join them?

Jane McGonigal’s Reality is Broken makes a strong case for leveraging game design and mechanics to work on the big social challenges of our time. McGonigal suggests that the four defining traits of any game – a goal, clear rules, a feedback system, and voluntary participation – can be applied to any challenge. She even says game-playing makes us better people. The book is a passionate articulation of why we should pay attention to what is going on in the world of games.

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Saul Kaplan: If All the World were Gamified

Saul Kaplan: Innovation 101 — Develop Talent

If the goal is to develop markets start by developing talent. If you want to accomplish the most amazing things focus on developing the talent of amazing people. Mentoring and coaching are the most important leadership roles. Innovation starts by surrounding yourself and connecting with the best talent. If you want to attract the best talent develop a reputation as the best talent developer.

Put growth opportunities for others ahead of your own. Put growth opportunities for others ahead of your organization and your community. If you put developing talent first you will attract the best talent. If you consistently encourage and prepare talented individuals to grow into the best opportunities, wherever they are, you will become a talent magnet. People who want to get better will want to work for, with, and near you. If you prioritize talent development people will trust their talents to you.

When talented people move on to other great opportunities don’t think of it as a hole you need to fill. Don’t think of it as a transition inconvenience or a burden to take on additional tasks while filling a role. Be proud when people you mentor go on to new opportunities. High potential people will seek you out if you have a track record of celebrating and supporting the success of others. Talent development is self-fulfilling.

Too many managers think only about the work that needs to be done and how to keep people focused on the task at hand. When employees leave organizations it’s viewed as a management challenge. The difference between a manager and a leader is managers try to hold on to people assigned to them at all costs and leaders try to develop people assigned to them at all costs. Leaders encourage new personal and professional development opportunities for their best people even if they are outside of the organization. Leaders who build a reputation for talent development always attract the best people.

Saul KaplanIt’s the same for community leadership. Communities should worry less about “brain drain” and worry more about building the capacity for talent development. Communities should worry less about company incentives for job creation and more about investments in education and workforce development. Differentiate your community by its commitment to talent development. Don’t worry if talented people move on to explore opportunities in other communities. Encourage it. Stay focused on making your community the best it can be at helping it’s citizens be the best they can be. Talent development is the best economic development.

Talent development is on my mind this week as Melissa Withers, who I have worked closely with, mentored, and learned from for the last five years, was named by the newly elected Mayor of Providence, Rhode Island, Angel Taveras, as his Director of Communication.

I could not be more proud and happy for Melissa and the exciting growth opportunity that lies ahead for her. Throughout my career nothing has been more important than mentoring and supporting the personal and professional development of those I am fortunate enough to work with. I have enjoyed the privilege of mentoring and working closely with Melissa at both the Rhode Island Economic Development Corporation and at the Business Innovation Factory and know she will be successful in her new job. I am grateful for Melissa’s contribution to our success at BIF and I’m confident, thanks to Melissa, we are positioned to continue our growth and make progress on our mission to transform the next decade. As a resident of Providence and a big fan of Melissa’s I am rooting for her continued success.

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Saul Kaplan: Innovation 101 — Develop Talent

Saul Kaplan: Genome of an Innovation Movement

I highly recommend mapping your organization or community genome.  Understanding the basic genetic code or wiring of any organization is key to understanding what drives the behavior of both internal and external stakeholders.  Intimate knowledge of the genome’s chromosomal makeup is a prerequisite for alignment and making meaningful progress.  It explains why employees, customers, and collaborators are attracted to an organization or why they aren’t.  Passion for an organization, community, or movement is coded at the genetic level.  If you want to transform an organization or a system, forget process reengineering and think genetic reengineering.  If you want to launch a movement make your genome transparent and accessible to anyone with a similar genetic make-up.

I offer up the BIF genome as an example and with the hope you will improve it. The Business Innovation Factory (BIF) is catalyzing a movement to transform the next decade. This is no time to think small! Together with a growing community of passionate innovators we are re-imagining the future of education, health care, energy, and entrepreneurship. We have identified and mapped 11 chromosomes that comprise the genome of the BIF innovation community and transformation movement.  Do they resonate with you?  Do you share a similar genetic make-up?  If yes, do we have a movement for you!

Saul KaplanBIF Innovation Community Genome

1)   Off the whiteboard and into the real world. Experiment all the time.

Work fast, make mistakes, push into territories of the unknown.Taking risks is an essential part of innovation. Exceed your own expectations.

2)   Business model innovation is itself a creative act.

Design better ways to create, deliver, and capture value.   Tweaking won’t work. Transformation is about new business models and systems.

3)   Stories can change the world.

Storytelling is magic. Share compelling stories to create stronger emotional connections and purposeful networks.

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Saul Kaplan: Genome of an Innovation Movement

Saul Kaplan: Innovators Are Bracket Busters

 

That hungry whirring noise heard around offices across the U.S. is the sound of March Madness brackets being fed to paper shredders everywhere. Bracket busting is reaching historic levels in this year’s NCAA Division 1 Men’s Basketball National Championship Tournament. Since the tournament was created in 1939 this is the first time there are no number 1 or 2 seeds in the Final Four. All of the country’s top eight teams, as annointed by the experts, will watch the Final Four from home.

That’s amazing. It’s the first time in March Madness history that two teams, Butler (8) and VCU (11), seeded 8 or worse in their bracket will play each other in the Final Four. So if you shredded your bracket, you’re not alone. According to ESPN Research only two people out of the 5.9 million who filled out and submitted brackets in the ESPN Tournament Challenge have the Final Four correct. Only two. That’s .000034%.

As I shredded my bracket I couldn’t help thinking about the parallels between innovation and bracket busting.

Saul KaplanIn many ways, from the time we are born, we are seeded into brackets. Education tracks, organization charts, and industry value chains are all brackets waiting to be busted. Experts are always telling us where we fit and what our role is. We are tracked into school programs at an early age based on perceived academic ability. We are placed into boxes in organization charts based on age and tenure, constrained from contributing beyond our “seed.” We work for too many organizations that only fight for market share within well-defined and accepted industry value chains.

Not only are we seeded into brackets created by someone else, we are expected to play our defined roles. Top seeds are supposed to win. Lower seeds make a valiant effort but lose to top seeds in the end. Most of us don’t even get an invite to the “big dance.” That’s the way it’s supposed to work because the experts say so…

Innovators, in their way, are bracket busters. While incremental improvements can be accomplished by working within current brackets and seeds, the biggest opportunities to create value come from transformational change, the kind of change that requires bracket busting. Solutions for the big social system challenges we face, including education, health care, energy, and entrepreneurship, require more than incremental change. The solutions we need require transformative bracket-busting business models and systems.

We need a new education system that doesn’t seed children into tracks and is designed to provide every student with a customized pathway to success. We need a new health care system that doesn’t track citizens through institutional and insurance sick care labyrinths and is designed for patients to champion their own pathways to wellness. We need organization structures that don’t constrain talent in boxes unleashing talent networks that enable everyone to contribute up to the limits of their imaginations. We need to transform industry value chains into value networks that break down boundaries between disciplines, organizations, and sectors to deliver value in completely new ways to students, patients, citizens, and consumers. We need more bracket busters.

So don’t be discouraged by your March Madness bracket now sitting at the bottom of the paper shredder. Celebrate the fact that none of the top seeds made it to the Final Four. Don’t settle for where you and your organization are seeded by so-called experts. Don’t allow anyone to say you aren’t allowed to go to the big dance. Don’t be constrained by brackets created by someone else. Create your own dance. Be the top seed in your own bracket. Be an innovator. Be a bracket buster.

(This post originally appeared here on the Harvard Business Review site.)

Saul Kaplan: Will the Sun Shine Bright on Kentucky Innovation?

My friend Eric Patrick Marr, a passionate social entrepreneur, has been working to promote entrepreneurship in the Bluegrass Region of Kentucky. At his invitation, I went  to the state’s two largest cities, Lexington and Louisville, to talk with local entrepreneurs and community leaders about what it takes to spur more innovation and entrepreneurship in a region.

It’s a goal that nearly every locale seems to have these days, but here there’s a particular sense of urgency given the recent election of new mayors in both towns. Lexington Mayor Jim Gray and Louisville Mayor Greg Fischer are both first-time office holders coming to public service directly from successful private sector business careers. Both new mayors ran and won on economic development platforms. Like me, they believe it’s vital to think about the challenge of fostering entrepreneurship and innovation at the level of the city — and that their cities have the potential to lead the way by becoming innovation hotspots.

Each has a deep and rich economic heritage to draw on — and to overcome — in that quest.Louisville’s economic legacy is that of a classic industrial-era city; Lexington, only 75 miles north, has a predominantly agrarian heritage, centered on the region’s many beautiful and expansive horse farms. In both cities, even as people take pride in the past, some worry that it hasn’t equipped them to build new engines of regional prosperity and job creation. It’s a concern I see in cities in every mature economy that once lived in high-growth prosperity but no longer do. Like Dorothy in The Wizard of Oz, they yearn to get back to it, but think it might take something magical, the economic equivalent of ruby red slippers, to effect the change.

Saul KaplanMy take is that they already have the power within them. I’ll admit this is based on a quick impression. But in my 24 hour visit I met individually with Mayor Gray and Mayor Fischer, talked with the Lexington City Council, taught a class on business model innovation at the University of Kentucky, and met with over 150 local entrepreneurs at several sessions bouncing back and forth between Lexington and Louisville. Talk about total immersion. It was incredibly energizing.

What I perceived was a critical mass of entrepreneurs and innovators who are passionate about the local community and stand ready to co-create their region’s economic future. This really hit me during that class session at the University of Kentucky. When I asked, “How many of you are fromKentucky?” every hand in the room went up. These students constitute a network with deep roots in the community and deep commitment to it. Soon to be part of the local workforce, they are also trained to be entrepreneurial in whatever they do, and eager to make a difference. They are the net-generation, with an unprecedented ability to self-organize, mobilize social change, and create their own economic opportunities. They don’t need ruby red slippers.

My message to them, and to the entrepreneurs and innovators I met, was this: don’t wait for local institutions to clear a path. You have to lead. And once you demonstrate real progress, the institutions will get on board. They will not want to be left behind.

Meanwhile, my advice to community leaders was to play a catalyst role. What does that mean? I like to think of the work of the catalyst as having three parts:

Connect. Winning communities enable random collisions among unusual suspects. They know the most important value-creating opportunities are found in the gray areas between sectors, silos, and disciplines. So, get better at enabling the cross-community connections that will give rise to productive collaborations.

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Saul Kaplan: Will the Sun Shine Bright on Kentucky Innovation?

Saul Kaplan: Dear Avis, Please Don’t Screw Up Zipcar

Dear Avis: If you want to win big with the Zipcar acquisition you will have to try harder.

Resist the temptation to impose your core car rental business model on the upstart transformer. Zipcar is your sandbox to scale a car-sharing model with potential to disrupt the automotive and car rental industry. Stop with the number two shtick, Zipcar can help Avis become a market maker instead of a share taker. Your main competitor, Hertz, is a share-taker demonstrated by its recent acquisition of Dollar Thrifty. Your opportunity is tremendous but throw away the classic post-merger integration playbook. Here are five ways to do that:

It isn’t about Avis. It’s about Zipcar

Saul KaplanChange your lens. It isn’t about you. Zipsters aren’t your current customers. Your business model, renting cars by the day or week, isn’t designed for Zipsters. Start by understanding their experience and view the world through the lens of Zipcar’s business model, which provides members with access by the hour to a network of shared cars. You aren’t buying a platform to improve the Avis business model. You are buying a new business model that will benefit from access to Avis capabilities. ZipCar was struggling to scale its model and Avis can help. This is about enabling more Zipsters and improving their car sharing experience.

Innovate Through A Connected Adjacency
Scaling Zipcar without suffocating its nascent business model will require both autonomy as well as access to resources and capabilities from the core. Set Zipcar up as a sand box adjacent to the core. Give it plenty of room to operate independently. The more disruptive the new model the more line-executives from the core will try to undermine its success. Autonomy doesn’t mean Zipcar should operate in isolation to the core. It’s imperative to build strong connections so that people, ideas and capabilities can flow in both directions. This tricky balance requires significant CEO involvement to run interference on what will be many inevitable conflicts and tension points.

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Saul Kaplan: Dear Avis, Please Don’t Screw Up Zipcar

Saul Kaplan: Experiment All the Time

Learn by doing. Constantly test new ideas. Learn, share and repeat. The world is ever changing — stay ahead of the curve. Embrace the art of discovery.

We need to try more stuff. Innovation is never about silver bullets. It’s about experimentation and doing whatever it takes, even if it means trying 1,000 things, to deliver value. Business model innovation requires a lot more experimentation than we are comfortable with today. Tweaking existing business models won’t work. Technology as a sustaining innovation may improve the efficiency of current business models but will not result in the transformation that we all want and need. We need to learn how to leverage technology for disruptive innovation and to experiment with new business models.

Geoffrey Canada, the inspiring founder of the Harlem Children’s Zone in NYC, reminds us of the importance of constant experimentation. Everyone wants to know the one thing that makes a program like Harlem Children’s Zone successful. What is the silver bullet that will allow the program to be replicated with ease across the country? We are always looking for an easy answer. There is no silver bullet and it is not easy to transform any business model or social system. According to Canada, at Harlem Children’s Zone it is doing 1,000 things with passion to help those children succeed. It is about focusing on the customer, in this case, the children within 100 city blocks in Harlem and doing what ever it takes to help them secure a bright future. There is no one thing.

Saul KaplanBusiness model innovation is all about experimentation. It is about combining and recombining capabilities from across silos until something clicks and value is delivered in a new way. It is never just one thing. It starts with a big idea that gets the juices flowing and attracts others with similar passion to the new approach. The big idea has to be translated from the white board on to a real world test bed to demonstrate that the idea is feasible. Starting small and demonstrating progress is key to building credibility and expanding a network of interested stakeholders. An ongoing portfolio of small-scale experiments to fail fast on those without merit and to prioritize those with the potential to scale is critical.

We also must get far more comfortable with hacking capabilities. Capabilities are the amino acids of innovation. They are the building blocks that enable value delivery. Innovation is a better way to deliver value and is often the result of repurposing existing capabilities. Locking capabilities into rigid organization structures and proprietary closed systems gets in the way of unleashing new sources of value and solving many of the important challenges of our time. Innovation is about hacking capabilities. Business model innovation happens when we enable random capability collisions resulting in new and unexpected ways to deliver value.

A good example of the power and potential of hacking capabilities is Microsoft’s (MSFT) Kinect. Microsoft introduced Kinect in November 2010 as a product extension to its Xbox franchise. Kinect adds a very cool capability for Xbox game players by getting rid of the hand held game controller and turning players into their own controllers. Microsoft and cool haven’t been used in the same sentence for a long time. Kinect is cool.

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Saul Kaplan: Experiment All the Time

Saul Kaplan: Put Your New Business Model to the Test

When a consumer product company wants to know how a new product or new marketing campaign will perform, it doesn’t rely solely on traditional market research surveys. It goes to test markets. It’s the right way to discover how the innovation will go over in real market conditions, without the risk of a national or global rollout. It also provides the test bed for optimizing the marketing mix to support the full-scale launch. Actual market experience, veteran marketers will tell you, never quite matches the results of quantitative and qualitative market research reports and what consumers say they will do behind the two-way glass of a focus group facility.

So here’s my question: Why don’t more firms employ the same approach to explore and test newbusiness models?

Anyone can map out new business model ideas on paper. It’s easy to do pro-forma analyses of how a new business model might work. And it’s not much more work to write up a fancy report embellishing on the potential of a hypothetical new business model. But until a business model idea sees the light of day in the real world, it is impossible to know if it will really work.

Saul KaplanJust talk to any successful serial entrepreneur about their experiences in starting new businesses. They almost never get the model right on the first try. It takes several iterations to find a business model that works on the ground and has the potential to scale. Most will tell you it’s a waste of time writing a detailed business plan outlining all the components and how they’ll interact. The better approach is to sketch out a business model concept on the back of a napkin, build a prototype, and then move as quickly as possible into the market to see whether it holds water.

The idea is to move as quickly as possible from concept to prototype to test, and then iterate until you land on a business model configuration that works and is ready to scale. Along the way there will be many failures. The trick of course is to fail fast and to capture learning that can be applied in the next round.

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Saul Kaplan: Put Your New Business Model to the Test