As a leader, how great would it be to have an army of highly motivated, engaged, entrepreneurial-minded thought leaders helping you to solve the most challenging problems impeding your businesses' success? Even better, what if that same army could discover business opportunities that you hadn't even thought of? Michael Harris will teach you how Ecommerce Inc. did it through a program implemented within the company called “The Innovation Initiative.” In this talk he will demonstrate the practical steps the company took to empower the minds of many to think like leaders within the company, resulting in highly motivated and vested employees as well as significant financial gain.

1. The Innovation Initiative
How to get your whole company thinking and acting like owners.
Michael Harris
VP of Information Technology, Ecommerce Inc.

2. My Contact Info
@mikeharris22
mharris22
michael.harris@ecommerce.com

3. Goals For This Talk
• Inspire business improvement through
innovation
• Introduce a methodology for driving
innovation within your company
• Share an example Ecommerce Inc
innovation initiative

4. What Is Innovation?
Merriam-Webster defines innovation as:
1 : the introduction of something new
2 : a new idea,
method or device

5. “Innovation is the specific instrument
of entrepreneurship...
the act that endows resources with a
new capacity to create wealth.”
— Peter Drucker

6. Innovation On Purpose
• “Real” innovation is about truly
understanding a problem and delivering
solutions... consistently, deliberately
and methodically
• The most successful companies have
learned how to innovate with purpose
using repeatable processes

7. Fast Company’s Most
Innovative Companies of 2012
Source: http://www.fastcompany.com/most-innovative-companies/2012/full-list

8. Why Innovation Matters
• Innovation is often the difference between
OK and Great
• A culture of innovation leads to engaged,
passionate, motivated employees
• A culture of innovation denounces
complacency
• Innovation will positively affect your bottom
line

9. What Innovation
Means To Apple (#1)
"Innovation distinguishes between a leader and a follower."
— Apple co-founder Steve Jobs
"Innovation has nothing to do with how many R&D dollars you have.
When Apple came up with the Mac, IBM was spending at least
100 times more on R&D. It's not about money. It's about the
people you have, how you're led, and how much you get it."
— Apple co-founder Steve Jobs

10. How Most Companies
Attempt To Innovate
• Pay Consulting Firms To Help (Mentor)
• Rely on Leadership To Make The Right
Decisions (Smartest Guy In The Room)
• Go With Their Gut (WAG)

11. We Needed a Better Way
To Innovate ...
• We needed cost effective solutions
• We needed fresh ideas
• We wanted to create opportunity and
excitement within the organization
• We needed a sustainable, organic
solution
• We wanted to win :)

12. The Innovation Initiative Was Born
Primary Goals
• Create a culture of innovation and
continuous improvement
• Focus the company’s best and brightest
talent on our most challenging business
problems and our most interesting
opportunities
• Increase revenue and/or reduce costs

13. Program Structure
• Bring together small, cross functional
teams (4-8 members)
• Each team receives a specific challenge to
solve
• Teams operate in an entrepreneurial, “think
tank” environment
• Teams are given full autonomy to innovate
with full resource support (within reason)

14. Team Formation
• Select the best and brightest from each
functional area (IT, Marketing, Sales,
Operations, CR etc)
• Purposefully mix it up - experts and
newbies
• No declared leader - let the team decide
• Celebrate the privilege of being selected

15. Advisory Board
Form an advisory board (AB) from company Sr.
Leadership
• AB provides an experienced sounding board
• AB’s job is to support and challenge, not
lead or restrict
• AB creates team accountability
• AB authorizes additional resource requests

16. Innovation Team Principals
• Prove Success or Fail Fast (either is a win)
• Leave your day job at the door (you are co-
owners/partners)
• Wear Many Hats (do whatever it takes)
• Work Hard and Have Fun (make a difference)
• Think Outside The Box (be creative and
innovative)
• Leverage Your Advisory Board (benefit from past
experience)

17. Innovation Team Process
• Self organize (you create the process)
• Brainstorm and collaborate (all ideas count)
• Meet in person whenever possible
• Dedicate at least 20 focused hours per week (ideally 100%)
• Publicize progress (weekly status)
• Time box problems/solutions
• Seek out subject matter experts (SME’s) as needed
• Meet with your advisory board frequently
• Plan for small, frequent wins (eventually they will snowball into
bigger wins)

18. Innovation Team Deliverables
A “Proof” for Success A “Proof” for Failure
•Project Proposal •Why this is a bad idea
or investment
•Marketing Plan OR
•Possible alternatives
•Sales Plan
•Working Prototypes
•Design Mocks

19. Innovation Team Conclusion
• The innovation team presents their proof to Sr.
Leadership for consideration
• The project proposal will be weighed against
competing opportunities and if approved:
- Project will be funded and moved to the “factory” for
delivery
- Team members participate in the solution delivery
as subject matter experts
• Team members get the opportunity to see their project
through from beginning to end

20. Pre-Kickoff Marketing
• We made a concerted effort to build
interest and excitement
- Email Teasers
- Posters
- Team T-Shirts
- Hand written invitations signed by the
CEO

21. Posters

22. Posters

23. Initiative Timeline
• Prioritize company challenges and create problem statements with metrics
• Started with company wide pre-initiative marketing (1 month)
• Worked with area leaders to select candidates and issue invitations (1 month)
• Kick-off meeting
• Innovation process (normally 2 - 6 months)
- No overall time box as long as progress is being made
- Timeline is relative to problem difficulty, team availability and project proposal
required level of detail
- AB meetings as needed (every other week suggested)
• Innovation team town hall (1-2 months into launch)
• Innovation team project proposal to Sr Leadership (or open invite)
• Team celebration (important to celebrate successes)
• Hand over to factory for build/implementation

24. Advice/Lessons Learned
• Limit the number of innovation teams you run
concurrently
• Try to include someone with project management skill
on each team
• Truly empower your employees and it will pay back
early and often
• Provide as much background material on the problem
as possible
• Ensure that your problem statement goals are SMART

25. Advice/Lessons Learned Continued
• Truly challenge and stretch team members; this is an
opportunity for stars to rise
• Team success is largely dictated by the effort of individuals
• Plan for increased workload on those not participating
• Reward success
- We provided iPads and a nice dinner with the AB at the
conclusion of each project
- We gave out gift cards and “pat on the backs” along the
way

26. Our Results
• We have completed 5 innovation projects to date
• We realized a sustained gain of more than $30k
per month from one team in the first 3 months of
its existence
• We created a new customer control panel
focused on usability and user insight that is
currently in beta
• We have 3 more “proven” winners queued up for
the factory

27. An Example Kickoff
Presentation

28. Team Persona
(The Teal Team)
The Innovation Initiative

29. • To earn money
• To be challenged (to learn)
• To solve interesting problems
• For fulfillment/pleasure
Why Do We • To change the world
• To build your reputation
Work? • To be part of a team and/or
mission
• To be appreciated
"Act as if what you do makes a difference. It
does."— William James

30. The Innovation Initiative
Will Enable You To
Fulfill Many Of These Goals

31. The Innovation Initiative was
created to focus the company’s
best and brightest talent on our
most challenging business
What is problems and opportunities.
theInnovationIn With this unique initiative, we
itiative? will bring together several small,
cross-functional teams. Each
will receive a specific challenge
to solve. They will then be given
all available resources – within
an atmosphere of total
creativity and innovation.

32. Opportunities Abound
Increasing Average Revenue Per
Customer (ARPU) is a largely
untapped opportunity.
Why Now?
Every day that we fail to act, we are
throwing money away.
The only way that we can seize the
opportunity and start the transition
from good to great is with your
innovation, creativity, insight and
most of all hard work.

33. We Believe In You!
Each of you have been
specifically selected because
you have demonstrated
Why You? excellent skill, job knowledge,
intelligence, drive and initiative.
"The innovation point is the pivotal moment
when talented and motivated people seek the
opportunity to act on their ideas and dreams."—
W. Arthur Porte

34. Innovation Team
Principles
• Prove Success or Fail Fast (either is a
win)Leave your day job at the door (you are
co-owners/partners)Wear Many Hats (do
How DoesAn whatever it takes)Work Hard and Have Fun
(make a difference)Think Outside The Box (be
InnovationTea creative and innovative)Leverage Your
Advisory Board (benefit from past
experience)
m Work?
"Innovation has nothing to do with how many
R&D dollars you have. When Apple came up
with the Mac, IBM was spending at least 100
times more on R&D. It's not about money. It's
about the people you have, how you're led, and
how much you get it." — Steve Jobs

35. Innovation Team
Process
•Self Organize (you create the process)
•Brainstorm and Collaborate (all ideas
•Dedicate at least 20 focused hours per week
What Is The •Publicize Progress (weekly status)
Innovation •Time Box Problems/Solutions
•Seek out SME’s as needed
Team Process? •Meet with your advisory board weekly
•Plan for small, frequent wins (eventually they
"One thing is sure. We have to do something.
We have to do the best we know how at the
moment . . . ; If it doesn't turn out right, we can
modify it as we go along." — Franklin
D.Roosevelt

36. Innovation Team
Deliverables
• A “Proof” for Success
- Project Proposal
- Marketing Plan
- Sales Plan
What Does An - Working Prototypes
- Design Mocks
Innovation or
- A “Proof” for FailureWhy this is a bad idea or
Team Deliver? investment
- Possible alternatives
"Discovery consists of seeing what everybody
has seen and thinking what nobody has
thought."— Albert von Szent-Gyorgy

37. Innovation Team Post
Delivery
•The innovation team will present their proof to
the Sr. Leadership team for consideration.
What Do We -The project proposal will be weighed against
competing opportunities and if approved:It will
Do With The be funded and moved to the “factory” for
delivery. Team members will participate in the
“Proof”? solution delivery as subject matter experts.
•You will have the opportunity to see this
project through from beginning to end.
"Creativity is thinking up new things. Innovation
is doing new things."— American economist
Theodore Levitt

38. Team Persona
Problem Statement
Your challenge is to provide the company with
invaluable insight, clarity and understanding of
What Is Your
our existing customer base. Explicitly stated,
we would like you to profile 50% of our
customer base within a 3 month period, 80%
Challenge? within a 6 month period and develop a strategy
to maintain the 80% level while also sustaining
a data “freshness” factor of 6 months or better.
"Innovation is the process of turning ideas into
manufacturable and marketable form."— Watts
Humphrey

39. Bonus Goal
Tackle the final 20% to move as close to 100%
customer coverage as possible.
Key Questions:
• What type of information should we collect about
our customers to best support ARPU initiatives?
But Wait - Demographics
- Persona Qualifiers
There’s More? - Product Utilization
- Customer Goals
- Customer Satisfaction
• How do we encourage customers to provide us
with additional information without pestering
them?
“The way to get good ideas is to get lots of
ideas and throw the bad ones away.”— Linus
Pauling

40. Metrics as of 3/29/2011
• Total Number of Distinct
Customers in GHCP = ###,###
Customer • Total Number of Active Hosting
Customers (Shared, VPS & Public
Cloud) = ###,###
Metrics
• Total Number of Customers With
At Least One Active Product =
###,###

41. Team Persona
Problem Background
• Personas Developed
- Pass the eye test but not yet data backed
• Customer Value Scoring
- First attempt at assessing total customer
State Of The relationship
• Surveys Attempted (limited success)
Customer • Profiling capabilities not yet built into services
or ordering
• Very Limited Voice of the Customer
"Innovation distinguishes between a leader and
a follower." — Apple co-founder Steve Jobs

42. The Five A’s:
Every time a customer interacts with our
company, it leaves an imprint on them; pushing
them either towards higher loyalty or further on
the path to abandonment
How Do
Customers
Respond?
"The essential part of creativity
is not being afraid to fail."—
Edwin H. Land

43. Next Steps:
• Assemble team and determine meeting and
project logistics
• Plan brainstorming session
• Meet with Advisory Board for additional
problem background (Fathi, Mike)
Suggested Resources:
Next Steps And • Project Proposal Template (Mike H.)
• Personas, Value Scoring and Customer
Resources Analytics (Mike H.)
• The Temkin Group (
http://experiencematters.wordpress.com)
• Basecamp Project
"If it is to be, it is up to me." - Anonymous

44. Thank You