Saul Kaplan: Innovate Through Connected Adjacencies

Don’t go to war with current models and systems.  Too many are in love with them and you will lose.  Create the future through connected adjacencies.

Why are innovators so quick to go to the mattresses?  Like a scene right out of The Godfather innovators are wired to assume a war footing.  Innovators start from a premise that intransigent models and systems are the enemy and the only way to win is to gear up for an inevitable fight.  Status quo is the enemy in an innovator’s cold war and must be vanquished.  Innovators prepare for war by steeling themselves, building large armamentariums, and recruiting passionate soldiers to join their fight.  War cries may get people’s attention but taking to the warpath, as a theory for change, doesn’t work.  There are too many people in love with current models and systems. Going to war might feel good but in the end you will lose.

Existing business models and systems have evolved over a long period of time.  It’s true most were built for an industrial era that is long gone.  It’s also true we need to design, prototype, and test new models and systems if we are going to solve the big social challenges of our time including health care, education, energy, and entrepreneurship.  However going to war with the current systems will not work.  Too many people are vested in them. Anything threatening status quo is too scary to contemplate for most.

Big bang approaches to change seldom work.  Occasionally we see examples of organizations that disrupt and transform themselves because they are either one payroll away from crashing nose down into the K-Mart parking lot (IBM comes to mind) or they have an other-worldly leader that personally wills the organization to transform (Steve Jobs comes to mind).  For most organizations transformative change is elusive and we need another way.  To enable transformative change consider creating connected adjacencies as innovation platforms.

Here’s how the idea works.  Instead of going to war to transform an entrenched operating model, create real world sandboxes right next door in which a new generation of transformative operating models can be explored.  The imperative is to do R&D for new business models and systems the way organizations do R&D for new products and technologies today.   The trick is to explore and test new models while at the same time continuing to pedal the bicycle of the current model.  This requires establishing adjacent innovation platforms with the freedom to explore new ways to create and deliver value, especially approaches that are disruptive to the current model.  Adjacent innovation platforms must have the freedom to experiment with different rules and financial models.  Connected adjacencies require senior leadership sponsorship, support, and protection or they will fail. They must be free to recombine and connect capabilities in new ways unconstrained by the existing organization.  Those working in the adjacencies must be empowered to borrow and flexibly deploy capabilities and technologies from inside and outside the organization in novel ways.

Innovation sandboxes must be connected to existing models and systems.  Transparent and open connections enable a two-way exchange of ideas and experience.  Connections allow inhabitants of current models to self select to play in designing new ones.  Don’t force anyone to participate.  Make involvement and assignments to play in the innovation sandbox optional.  It’s amazing how innovators will migrate to adjacent platforms. They won’t want to be left out.  Some will dive in and play in committed ways while others will want to dip their toes in the water while keeping feet firmly planted in the current model. Encourage the flow.  If we expose more people to business model experiments and demonstrate feasibility in the real world change may seem more accessible and less scary.  If we stand up new business models in safe adjacent spaces more will willingly make the leap.

My friend and Babson President Len Schlesinger is the master of leveraging connected adjacencies. When he became Babson’s president Len inherited an institution founded in 1919 with a proud and long-standing tradition.  Like most colleges Babson has a well-accepted set of operating rules and norms that define how the place works. It’s been working pretty well as Babson is perennially ranked number one in the world for teaching entrepreneurship.  And yet Len and his team know that higher education must change and Babson is no exception.  He also knows that going to war with the current Babson operating model and its 325 acres, entrenched infrastructure, bricks and mortar, and 170 faculty members with lifetime employment is a bad strategy that won’t work.  Instead Len and the Babson team work on creating the future through connected adjacencies.

I am proud the Business Innovation Factory (BIF) is one of Babson’s connected adjacencies.  BIF’s mission is to enable R&D for new business models and systems by creating real world laboratories with our partners.  We are all about creating connected adjacencies.  Together Babson and BIF are creating an Entrepreneur Experience Lab, a real world innovation platform to explore and test new entrepreneur support solutions and models.  We are just getting started but I can already see the strategy of connected adjacencies working as Babson leaders and faculty self select to play.  It’s a powerful approach.

Len Schlesinger has it exactly right when he says that we need to move from thinking our way into action to acting our way into thinking.  Let’s create the future through connected