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Summary:

Execs from Brown Brothers Harriman,Goodyear, the Mayo Clinic and Whirlpool — organizations that have more than 500 years of experience between them — talk about how they fuel innovation.

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We always hear how smart and creative the Valley is. It’s home to hundreds of startups, thousands of apps and billions of dollars in venture money. You might think from all the hype that it has a lock on innovation.

Kitchen-AId

Not true. Companies in old-line industries — little brand names like Goodyear, which reaped $21 billion in net sales last year;  Brown Brothers Harriman, the country’s oldest and largest private bank; Whirlpool, the appliance conglomerate behind the Whirlpool, Amana, Kitchen-Aid, Jenn-Air and Maytag brands; and the Mayo Clinic, the 150-year-old hospital to the stars — know a little something about innovation too. Or they probably wouldn’t still be around.

Executives at those companies tasked with keeping them stocked with new ideas for products and services were on hand in Boston Tuesday at an Imaginatik-sponsored event to talk about how they do what they do. Here were six things I learned.

1: Make innovation a priority and put someone in charge of it.

No, you don’t have to dub this person a Chief Innovation Officer (CINO), but you’ve got to give him or her access to the top and the authority to be heard across all business units. A couple speakers invoked the name of Louis Gerstner, the former IBM CEO credited with turning that company around.

When Gerstner came into IBM at the height of the dot.com boom, he wondered why IBM hadn’t come up with web servers or search engines. “When they looked inside IBM labs, it turns out it had but [those ideas] hadn’t been surfaced,” said James Euchner, VP of Global Innovation for Goodyear, Akron, Ohio.

And given the ratio of failures to successes in any business, innovators should be allowed to try things and fail, said Whirlpool’s Global Director of Innovation Moises Norena. Lessons learned from failures, after all, can be invaluable.

2: Think outside the box

goodyear blimpWho could have predicted that a freezer manufacturer should also be in the garage organizer business? But that’s what Whirlpool figured out.

“If you want to sell appliances that go in the garage, you probably need to help [people] clean that garage out first,” said Moises Norena, global director of innovation for Whirlpool, Benton Harbor, Mich. And thus,  Whirlpool’s Gladiator Garageworks line of storage organizers was born.

New York-based Brown Brothers Harriman has done well in banking, where lending money has worked pretty much the same way for the last thousand years. “We don’t need to reinvent that wheel, but we always want new services for our clients,” said Philip Swisher, SVP of innovation for the 200-year-old private bank, which has $3 trillion in assets under custody.

Sure, $3 trillion is a lot, but BBH competitor State Street Bank is ten times bigger; so Swisher’s always on the lookout for new services.

He encourages all of the company’s 5,000 employees to pitch ideas and use Intuit’s Brainstorm cloud platform for global collaboration. “All employees have access — it has no permissions by design,” he said.

3: Research, research, research

Mayo ClinicWhen most people go to the doctor, they want to see the doctor — or that’s the conventional wisdom anyway. But in most cases, they don’t really need to see a doctor, said Lorna Ross, design manager and creative lead for the Mayo Clinic’s Center of Innovation in Rochester, Minn.

The center gathered a whole primary care team — nurses, pharmacists, a resident — to review patients every day and determine the best course of action for each. It turns out, that only 6 percent of those patients really needed a doctor. That’s admittedly a “controversial” finding for an organization that sees itself a patient care provider.  GigaOM’s Ki Mae Heussner recently detailed another medical practice with a similar holistic approach.

But, if you think about it, most people go to the doctor about a problem and if that problem can be addressed by a nurse, physician’s assistant, pharmacist, most patients are happy. Better evaluation of the patient up front can ease the primary care bottleneck and cut costs, Ross said.

4: Know how to deal with people, not just technology

It may sound creepy but successful innovators need to be social engineers. “You have to know your corporate culture to affect change,” said  BBH’s Swisher. “You can’t ‘train’ an executive, but you can ‘brief’ one. I wear a suit every day because if I showed up in jeans and spiky hair no one would take me seriously and I don’t want to provoke the immune response.”

BBH has remained private and has been remarkably stable since Brown Brothers merged with Harriman Brothers in 1931 — “we have an 80-year track record of no M&A,” Swisher said proudly. Initiating change in a way that doesn’t capsize that stable boat is his goal.

5: But technology is important too

Trends like the internet of Things (IoT) and the maker movement are of keen interest to both Whirlpool and Goodyear, for example. While Norena said he doesn’t see huge demand from customers wanting program their washing machines from their iPads, he does see other opportunities — Whirlpool already has a smartgrid effort, for example. But he is intrigued by the notion of forging a connection between the food you’re cooking and the device you use to cook it.

“What if you have a branded product you put in the microwave which reads the instructions — maybe it scans a code on the popcorn bag so it knows the size and type of corn and pops it optimally?” he asked.

Euchner said companies have to sort out business models associated with the information generated in the IoT scenario, not just on creating more data. “There needs to be enough value for everyone in the ecosystem,” he said.  For example, while tire sensors may be great for monitoring tire pressure and issuing alerts when the tires wear out. but who gets those alerts? The driver?  The car dealer? The manufacturer? If the alert goes to the auto dealership, the car may end up with non-Goodyear tires. Maybe not an earth shaker for the driver, but certainly not good for Goodyear.

6: Be creative but careful

Brown Brothers HarrimanIt’s good to improve existing products, but be careful of messing with success.  Norena and I discussed the popular Kitchen-Aid countertop mixer (pictured above left.) I don’t use mine as much as I should be cause it’s big and heavy and dragging it out of the cupboard is a pain even though it does the job better and more uniformly than my dinky hand-held mixer. Norena agreed but said it would be foolhardy to mess with something with so iconic.

Mayo Clinic photo courtesy of  Flickr user -Tripp-

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  1. Nice piece! Good to read news bringing us back to the “real world” and what mean innovation “outside of internet” :)

  2. I will make this comment… Whirlpool owns Kitchen-Aid. I live about 20 miles from the Kitchen-Aid/Whirlpool factory that is the sole provider of the stand mixers in the world.

    1. i do love my stand mixer. i’m just too weak to lift it anymore

      1. Ya it is just a pain to get out, unless you are making a batch of cookies. It just goes to show that startups get bought by other larger companies, not just in the tech world. It also goes to show that if a larger company buys a smaller one and keeps its name separate it might be more successful.

        1. if i only had more counter space i could just leave it out there.

  3. Santosh Mhatre Wednesday, May 15, 2013

    “Initiating change in a way that doesn’t capsize that stable boat is his goal” – very well said.

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