Jason, CEO, Stephen Hill discussed on Killer Innovations
Continue our conversations with Stephen hill. Global head of innovation. Keep g Steve is. We went to commercial break. We were having the conversation around the challenges of sustainable innovation inside of organizations, and I shared my my experience of staying away from the word innovation. But you know, there has to be some is you said the leadership has to get it. And I'm surprised that the number is so high that seventy three percents of their survey respondents said listing their most difficult challenge. Why do you think leaders are getting? It's. Break question and part of that actually, I know we both dislike we have we have disliked the word at some ways. Part of the problem is I don't think leaders really understand what innovation is. A lot of people think that innovation is unless you come up with the, you know, the next pet rock, you're just not relevant. And that's not what innovation is the finding innovation is super important. It lays out the mandate for building corporate muscle lays out the mandate for Lear that you put in place, and I think most importantly, it lays out the mandate for the culture of the organization you want to build into the future. So let me let me jump in here. Real quick. Do you think there's a single definition for innovation or do you think every organization should craft its own definition for annexation? Well, I think you have to customize it for the reservation, right because the culture makes a huge difference and deluxe culture trumps strategy. So let's just get that on the table. But I do think your definition hassle include the notion of innovations not one thing innovation really, in my opinion is. Characterized three ways you'd have incremental innovation innovation, which, you know. I think a lot of people will consider hor, which is how do you move the ship, right? You don't turn super tanker hundred eighty degrees in in a in a matter of seconds. It takes you know, movements through the dial. That would be the the compass. And a lot of organizations you can sail the culture and the involvement in the institution around incremental innovation very easily do this contest you this. You know, asking people that are on the line to think there's only about what they do give ideas. And celebrate those ideas and drive new thinking that way. The other nation. I would say jerk Jason, which is you know, you, you know, what are the things that you're doing today that you can do that are tangential to what you're doing that as an incredible amount of value. Right. And you can see that a lot of trustworthy service where you know, especially automotive today where they used to provide his transportation providing technology, right? That's Jason technology. That's Jason to what they used to do in cars. But Jason are important Thirdly transformational. Which is you know, how you take a business that is no four walls and a bunch of people hours and into a platform business. Also, and those are all different innovation. So if an organization, I mean, yeah, I'm with you hundred fifty percent and everybody thinks that innovation is only in that. The game changer breakthrough kind of change versus you. You can't and must liver innovation across that entire spectrum of opportunities. But if an organization want is that could be a little daunting, right? What did you start? How to get started? How do I start to transform organization given both the your work your inside of KPMG and your client work and the surveys you've done. What advice would you give us on? Maybe the first two or three things of an organization is you've got an innovation leader trying to transform the organization. What would be the first? Stops. They should take to really build it ovation as sustainable activity. Not just this episode kind of you know, go to hacker fon kind of fun. Yeah. So the first thing I would do is if you don't have that CEO commitment that set but find the leader in Beijing that has if you can write this is this is a perfect scenario. Find somebody who is really famous in your organization for getting things, right? The leader that has a reputation that people respect in. No while this is important to the CEO because they put you know, canning again there who's been champion of our growth the last ten years. What have you right? Putting that. First place is important with the mandate to start building a disciplined innovation just sensing market sensing capabilities investment management in Billy's working in collaboration with the business, and then deploying and scaling capabilities the back help manage tell the stories successes. Thing. I do I was started going culture of the relational rawal. And I think this is really important, and you cultural momentum around one first year point earlier talking about it and really making it a strategic. Set of imperatives. So it can be one of your pillars of success going forward. I think that's exactly what does or should do. Secondly, I think getting them involved in contest you'd have had and or just short chain things were people that are working in the field and come together, the acknowledged and celebrated across enterprise on new ideas, and then actually guess what real money behind the investment failure. I mean, if you don't work for your ethnic group to allocate some portion of retained earnings or child back to innovation initiatives, you're doing a mysterious you're doing this. You know, amateurishly in my opinion innovation is specially in these times we're living in what they are being so fortin going forward. If you don't have a significant budget and significant run rate for major investments going forward and small incremental investments as we talked about earlier than have real funding behind them. Then. And that's also mistakes getting money matters. And how in that place is really important. So those are some things that think about well, here's the question. I know I'm gonna get and this happens every time on this show when we talk about budget for some reason, I get a lot of emails when I used to talk about what my budget and how I allocated my spent spend at HP was about four four and a half billion dollars a year in our day. Right. Only roughly about eight and a half nine percent of that was what I would call innovation spent. Right. The question that people are gonna ask as you just said okay meaningful significance. What do you mean by that? Well, it depends on on what you're trying to achieve innovation budget. Right. So I would say you want to be very clear with yourself with your with your people yours and with the marketplace wouldn't think about investor calls investors. Are you doing to invest in your future? Those numbers have to be significant for example. A lot of fortune one hundred companies they're putting hundreds of millions of dollars into a and data those those monies should be explicitly against the specific use cases efforts with the idea that, you know, our investments all the way to class three amalgamations of AI retrain that's going to be managing a disciplined way over time. Just like any other investment, whether it's an acquisition or anything else. Those are significant monies right that Bassett significant budget. And I think you even look celebrate the smaller incremental ones as cultural building exercises. And so when you talk about significant monies, I think you're talking about hundreds of millions of dollars in some cases, billions and interestingly enough looked at the supplier side of the market to see some really significant investments. I mean, what's up what's purchased or fifty five billion dollars or something like that? That's just insane. Those numbers. Are you look at somebody's acquisition say oh my God. How they justify that they didn't justify based on an incremental investment. They just wanna because phone foundationally. It's gonna have huge buildings with this. What we refer to as innovation by aquisition. Right. And it's and it's a valid strategy. So steep, thanks for coming on the show. If people want to track what you're doing and what's going on in your activities. Where's the best place for them to follow? You KPMG dot.