Four Innovation Lessons from Anheuser-Busch
Scott Anthony
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On Tuesday [February 9, 2010], I attended the Front End of Innovation conference in Amsterdam. It was good to see innovation leaders from a wide range of companies in attendance — to me it was a small but important sign of an increasingly stable global economy.
I provided a few thoughts in the morning, and then heard a fascinating presentation from Patrick O’Riordan — global director of innovation at Anheuser-Busch InBev. Here are some of his lessons for innovators:
Explain strategic objectives in simple terms. AB InBev is the world’s largest beer company. Its strategic objectives are to increase SOB (share of beer) and SOT (share of throat). It can achieve these objectives by getting consumers to switch to its products, consume its products in new locations, or attract new consumers. I’m guessing that the simple and immediately memorable language brings great clarity to AB InBev’s innovation efforts. Importantly, it clarifies things that InBev won’t do, which is an overlooked innovation enabler.
Have defined types of innovation strategies. Patrick described two basic innovation strategies. “Renovations” involve strengthening existing product lines through new marketing campaigns or mild formulation changes. “Innovations” involve completely new products. Patrick noted that you needed both. As he said, “You wouldn’t add an extension to your house if your foundation was crumbling.”
Again, I bet you most people in AB InBev could recite these strategic choices easily. My experience suggests that clarity about strategic intent helps to spur productive dialogues around innovation.
Have a clear but robust innovation process. AB InBev breaks innovation into a front-end process — which involves consumer discovery work, idea formulation, idea qualification, and so on — and a back-end process. The front-end process doesn’t have fixed stage gates given its “fuzzy” and iterative nature. The back-end process is, appropriately, more rigid.
Draw insight from non-obvious places. Patrick showed a slide describing the evolution of the Apple iPod. Clearly Apple isn’t in the beverage industry. But the point was that Apple followed a clear platform strategy that mixed line extensions, new product forms, and supporting services, which allowed the company to realize the full potential of the iPod. Patrick described how AB InBev similarly seeks to develop beverage platforms.
I think the message of clarity that comprises AB InBev’s innovation efforts is well worth remembering.
Scott Anthony is the Managing Director of Innosight Ventures. Scott has written three books on innovation, the latest being The Silver Lining: An Innovation Playbook for Uncertain Times.
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Interview: Maribeth Kuzmeski
Maribeth Kuzmeski
Kuzmeski is the author of The Connectors: How the World’s Most Successful Businesspeople Build Relationships and Win Clients for Life (Wiley, September 2009). Creating strong business relationships has been the focus of Kuzmeski’s business and career. The Connectors is packed full of tools and techniques aimed at helping her reader develop better, more profitable connections—tools and techniques proven effective by some of the world’s most successful professionals. She is the founder of Red Zone Marketing, LLC, which consults to Fortune 500 firms on strategic marketing planning and business growth. Kuzmeski has personally consulted with some of the world’s most successful CEO’s, entrepreneurs, and professionals.
An internationally recognized speaker, she shares the tactics that businesspeople use today to create more sustainable business relationships and sales and marketing successes. She is a regular media contributor appearing on FoxNews, ABC News, WGN-TV, The New York Times, BusinessWeek, Entrepreneur, and Forbes. She graduated with a degree in journalism from Syracuse University and an MBA from The George Washington University. Kuzmeski lives in the Chicago area with her husband Rich and two teenagers.
Here is an excerpt from my interview of Kuzmeski. The complete interview is also available.
Morris: For those who have not as yet read The Connectors, what are the most effective strategies for building relationships, especially with one’s workplace associates and clients?
Kuzmeski: Being a great connector is really all about having focused attention on the other person. If you are obviously focused on yourself first and do a lot of talking, you are probably not endearing yourself to others. And, likely you are not connecting with them. The five main principles in the book revolve around that premise. They are (1) Develop a true “What’s In It For Them” mentality, (2) Listen, curiously and intently, (3) Ask others important questions that encourage and support connections, (4) Manage the selling process so that the sale closes itself – that is, use creative strategies “to sell without selling,” and finally, (5) Create a memorable multi-sensory experience so that you differentiate yourself by the enduring impact you have on others.
And probably the most important of these five principles is listening. We know we should do it better, but most often fall short. It is HARD to listen, but the benefits are overwhelmingly positive in terms of the connections that can be forged with others. If you are really listening and listening intently, people will know you care and will like you more than if you did the talking.
Morris: How can these same strategies also be effective in one’s personal life?
Kuzmeski: The same strategies for relationships and connecting that work in business work the same, in fact even better, with our personal relationships. Focusing intently on the other person (instead of thinking about what you are going to say next) is a great way to endear yourself to someone. If others know they have your undivided attention and that you are truly listening and care about what they are saying – it can change the way that they feel about you.
Morris: You devote an entire chapter (Chapter 18) to discussing the ten most popular social media Web sites. What advice do you have for those who wish to derive the greatest benefit from them?
Kuzmeski: The key with social media is to get started and stay focused. There are so many different activities you could take on and much of it may take up a lot of time without much return. Find out what types of social media your target marketing is using and get focused in those areas. For instance, financial advisors can’t use most social media because of their strict compliance but they can use LinkedIn. So, I have focused much of my efforts on LinkedIn. Begin my carving out 30 minutes a day to stay active with your connections.
Morris: You seem to think that almost anyone can become an effective “Connector.” Is that a fair assessment?
Kuzmeski: Well of course I think it is! The whole reason I wrote the book was to detail the tactics of the great connectors for those who want to learn and become better connectors. Whether you are already a great connector or you want to become a much better connector – it is possible! Simple strategies like placing a conscious focus on the other person can transform someone into a better connector very quickly. The book is filled with hundreds of tactics that anyone can use to connect while speaking, on a job interview, with colleagues, your boss, clients and friends and family.
Morris: Near the conclusion of your book, you assert “Your online presence defines you.” Please explain.
Kuzmeski: Today, if someone wants more information, they will look online. What is online about you and your firm becomes the reality of who you are. Your exposure online does define who you are. Does your website present you and your company in the exact way you want others to perceive you? Does it capture the personality and unique aspects? Also, Google yourself, your business name, and even your competitors. Find out what’s out there. If it’s not what you want, you need to develop and release more content so you effectively control your top 10 Google search results. Write articles, blog, update your website often, have someone evaluate your website’s SEO. And, set a Google alert on yourself so if anything new appears online about you – you are aware of it. (www.Google.com/alerts).
Morris: How is The Connectors book selling?
Kuzmeski: We have had very strong sales coming from Amazon.com, airport bookstores as well as regular bookstores. Wiley, my publisher, asked me to write another book after seeing the strong start of The Connectors. This book, …And the Clients Went Wild! How Savvy Professionals Win All The Business They Want will be released in September 2010!
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Kuzmeski invites you to sign up for her free weekly email newsletter, Marketing Audibles.
Check out the resources, free tools and free downloads at:
I’m salivating — I can’t wait to present these books…
Confession time. In the next few months at the First Friday Book Synopsis, I am presenting synopses of the following three books, and I can’t wait!
Switch: How to Change Things When Change Is Hard by Chip Heath and Dan Heath. (Read Bob Morris’ terrific review here).
The Checklist Manifesto: How to Get Things Right by Dr. Atul Gawande
{Here’s an excerpt from the Business Week review:
But the scope of the book goes well beyond medicine. With The Checklist Manifesto, Gawande has entered Gladwell-land. Fellow New Yorker writer Malcolm Gladwell has produced three best sellers—The Tipping Point, Blink, and Outliers—by stacking up detailed, seemingly unrelated anecdotes to bolster a larger, universal thesis. Gawande follows the same blueprint, examining all manner of disparate tasks, from flying a plane to building a skyscraper, to show how checklists can improve outcomes. Read this book and you might find yourself making checklists for the most mundane tasks—and be better off for it.}
and
Drive: The Surprising Truth About What Motivates Us by Daniel H. Pink.
Seldom (maybe never) have I been this jazzed about so many selections at once. Don’t get me wrong. I love the books I choose to present. And many of them are incredibly valuable. But there is “love,” and then there is “I can’t wait, I’m salivating, love,” which occurs only rarely, when I get to present a book that truly rings my bell/floats my boat/gets my juices flowing. In the next few months, I’ve got three such books – books I can’t wait to read.
Just letting you know.
Is “Information Overload” a myth – or, at least, not really a problem?
Slate.com tackles this question in Don’t Touch That Dial! A history of media technology scares, from the printing press to Facebook by Vaughan Bell. It is a fun and enlightening read. Here’s the concluding paragraph:
The writer Douglas Adams observed how technology that existed when we were born seems normal, anything that is developed before we turn 35 is exciting, and whatever comes after that is treated with suspicion. This is not to say all media technologies are harmless, and there is an important debate to be had about how new developments affect our bodies and minds. But history has shown that we rarely consider these effects in anything except the most superficial terms because our suspicions get the better of us. In retrospect, the debates about whether schooling dulls the brain or whether newspapers damage the fabric of society seem peculiar, but our children will undoubtedly feel the same about the technology scares we entertain now. It won’t be long until they start the cycle anew.
{off topic: Here’s a favorite quote from the above quoted Douglas Adams:
A learning experience is one of those things that say, “You know that thing you just did? Don’t do that.”}
My take: I don’t worry that information overload will make me mentally ill (other things might…), or that it is going to dull my brain. And I do think that the more we know, the more we know.
But, I have never learned as much about as much as I do now at this stage in my life. It is information learning – books, articles, essays, NPR… How do I keep track of all this information – which feels like overload? That is what I wrestle with…
Book Review: Switch
Switch: How to Change Things When Change Is Hard
Chip Heath & Dan Heath
Broadway Books (2010)
Today, Chip and Dan Heath published their latest book and have once again summoned a lively writing style to present a series of compelling insights that make this book even more interesting as well as more valuable than its predecessor, Made to Stick. As they explain in the first chapter, “In this book, we argue that successful changes share a common pattern. They require the leader of change to do three things at once: To change someone’s behavior, you’ve got to change that person’s situation…[to cope with the fact that change] is hard because people wear themselves out. And that’s the second surprise about change: What looks like laziness is often exhaustion…If you want people to change, you must provide crystal clear direction [because what] looks like resistance is often a lack of clarity.” Throughout their narrative, the Heaths work within this narrative, one best viewed as a “three-part framework,” as they provide countless real-world (as opposed to hypothetical or theoretical] examples and – to their great credit – they provide a context or frame-of-reference for each.
I am especially impressed by how skillfully the Heaths invoke a few extended metaphors and the most important of these are the Rider (i.e. our rational side), the Elephant, (i.e. our emotional and instinctive side) and the Path (i.e. the surrounding environment in which change initiatives will be conducted). The challenge is to direct the Rider, motivate the Elephant, and shape the Path to make change more likely, “no matter what’s happening with the Rider and Elephant…If you can do all three at once, dramatic change can happen even if you don’t have lots of power or resources behind you.”
Consider the example of Donald Berwick. In 2004, in his position as a doctor and the CEO of the Institute for Healthcare Improvement (IHI), he had developed some ideas as to “how to save lives – massive numbers of lives” and his ideas were so well-supported by research that they were indisputable and yet “little was happening” until he spoke at a professional meeting and proposed six very specific interventions to save lives. Within two months, more than 1,000 hospitals had signed up. Eighteen months later, to the day (June 14, 2006) he had previously announced that he’d promised to return, he announced the results: “Hospitals enrolled in the 100,000 Lives Campaign have collectively prevented an estimated 122,300 avoidable deaths and, as importantly, have begun to institutionalize new standards of care that will continue to save lives and improve health outcomes into the future.” He had directed his audience’s Riders (i.e. hospital administrators), he had motivated his audience’s Elephants by making them feel the compelling need for change, and he had shaped the Path by making it easier for the hospitals to embrace the change. The Heaths offer more than a dozen other prime examples (e.g. Jerry Sternin in Vietnam, the Five-Minute Room Rescue, “Fataki” in Tanzania) that also demonstrate how the same three-part framework
resulted in the achievement of major changes elsewhere despite great difficulty.
Near the end of the book, the Heaths summarize the key points they have so thoroughly made while explaining to their reader how to make a switch. “For things to change, somebody somewhere has to start acting differently. Maybe it’s you, maybe it’s your team. Picture the person (or people). Each has an emotional Elephant side and a rational Rider side. You’ve got to reach both. And you’ve also got to clear the way for them to succeed.” By now, the Heaths have explained how others have directed the Rider, motivated the Elephant, and shaped the Path. They conclude their book with a Q&A section during which they advise how to resolve twelve problems that people encounter as they fight for change. They suggest, and I agree, that this advice “won’t make sense to anybody who hasn’t read the book.” The same can probably be said about much of what I have shared in this review.
One man’s opinion, Switch is one of the most informative, hence one of the most valuable books published in recent years. Heartiest congratulations to Chip and Dan Heath on their latest brilliant achievement!
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