E31: Solve Internal Problems by Looking Externally

What if the best way to finding solutions to your internal business challenges is to look externally? Welcome to Invisible Solutions. I'm your host, Steven Shapiro. Each week we tackle your most complex problems using the lenses from my book, Invisible Solutions. If you need the lenses, go to get lenses the lenses dot com. With that, let's get started with today's episode. And this week I'm thrilled to be joined by my colleague and friend, John Fredrickson. John is the Chief Innovation Officer for Innocentive. And if you're not familiar with Innocentive, you really should check them out. They are the leading external crowdsourcing platform for finding solutions to difficult problems. They've solved business problems, technical problems, marketing problems, even even societal and government challenges. The problems that they solve are wide ranging and impactful. And John has been with them for 15 years. I've known him that entire time. He has a wealth of stories and real world experience on the topic of open innovation. Well, John, welcome to the Invisible Solutions podcast.

Thanks Steve. I'm excited to be here. This is great to be with you and hopefully contribute a little bit to what you're doing out here. Fantastic.

Well, I appreciate that and what you do is fantastic. We've known each other now for about 15 years from your work at Innocentive and I've just always been, been blown away by the types of problems that you found solutions to. So let's just dive in. Since this is a problem solving show, what's the problem that you would like to solve?

Well, I, I think the problem that we get asked about a lot is why and how do you use open innovation effectively?

Great. So how can we most effectively leverage open innovation? I love that as a starting point. We'll just dance with it, you know, and I'm just curious, let me, let me turn it over to you since you've, this has been your life for, you know, decades. What, what a lot. As Indiana Jones once said, it's not the age, it's the mileage. And I know you put on a lot of miles. So just, I'm just curious your thoughts on open innovation, crowdsourcing, collaboration, things of these nature, what have you seen and what's the power of it?

Well, it's, it's really interesting that my, my story in getting here now into my 15th year. So we've known each other a long time. In dog years, I think it's about 107 that I would be today. But over those years, what it really attracted me in before I got here was a challenge that Innocent of was running on Finding a biomarker for Lou Gehrig's disease, a horrific neurological disorder. And for me it was personal because 10 to 12 years prior to that my, my mother had passed away from something very similar to it. And when I saw that there was this company that could take these big problems and put it out to the world and get people answering them. And by the way, there was a solution to this that made all the sense in the world to me. We've got this hyper connected universe of people because of the Internet and because of lots of different things, geography and pandemics or just life. We have a hyper disconnected workforce, people who are scattered everywhere but have this connection through the Internet. So to me this made incredible sense. And I said I want to be part of that. I want to be part of something where we, we can deliver life saving drugs and vaccines, better food, we can work with world vision on improved sanitation that will impact tens of millions of people around the world or Habitat for Humanity and buildings that are resistant to hurricanes, typhoons and earthquakes. I wanted to have that impact and I see it in open innovation. It's interesting Steve, Harvard studied innocent of when we came out of lilly years ago, 20 years ago now, and they studied who are the winning solvers in these open innovation challenges. And to their amazement then, but it's really normal to us now when we look at the winners, over 80% of winning solvers to these open innovation challenges for big companies and governments that have really talented people, over 80% of the winning solvers win would not fit the hiring profile of the client. Can you imagine that? That kind of diversity, that kind of inclusive market to drive people from very different disciplines who have a different angle of attack at the problem is incredible. And there's tons of stories I can share with you about some of the results from this. But this is a real for business and for humanity. This is a real for force multiplier of bright minds who are prepared, curious, ready to solve problems and they get on and they do it every day. It's amazing.

And the stories are really, you know, truly mind blowing. Some of the solutions that have been found and let me just break down a couple of things that you said there. One is that the whole point of open innovation is that we get access to people we wouldn't have had access to otherwise. And if you come back to the invisible solutions, lenses, that would be lens number 12, which is the reassign lens. What we tend to do is assume that the people who are going to solve our problems are our People. But as you just pointed out, in many cases, the best people to find a solution aren't going to be inside of our organization. In fact, one of the things that we know is that some of the best solutions in incentive solutions are actually from people in completely different areas of expertise who brought a solution from one industry or one discipline to another one. And so it's that diversity that you talked about that becomes so incredibly valuable in trying to make these types of solutions happen.

You're absolutely right. And you get amazed every day when you see the diversity of insights and thoughts and somebody's different angle of attack at something. We had a pharmaceutical company that has used this huge brand global name and it's been written about publicly, it was Roche. So I can talk about it. But in one challenge that they did with innocentive, they replicated 15 years of R and D history in this problem area in a 60 day challenge and they got a better answer from it. Now, it doesn't mean their people were poor at doing their job. It means that for them, this could reduce the time, cost and risk of innovation just in a 60 day period from people they didn't know. We had another medical device company that, that was a little, you know, their employees were a little offended that they were going to go out to the rest of the world, to be honest. And so the company allowed employees actually to compete in their own challenge. They were able to submit to try and win this challenge. And the interesting thing was everybody that internally had submitted versus the people, the answers they got from the outside, the answers from the outside were judged to be better. And again, it had nothing to do with these employees being poor employees. It just happened to be that somebody had a diverse point of view, a different background to give a different insight that was really incredible for the client. So that, that lens that you spoke of is really important for why innovate. Open innovation works as well as it does.

Well, it leads me to another lens, which is lens number 11, which is the resequence lens. And I know in a lot of cases, not all cases, but it seems like in a lot of cases people turn to Innocentive or open innovation or external crowdsourcing as sort of a last resort. Okay. We spent 20 years trying to solve a problem. We can't solve it, we've given up. Let's see if maybe somebody else can find it. And one of the things which I've always suggested to my clients is maybe you go open first. Like what if when you start a program, instead of looking for the final solution internally or a final solution even externally, starting externally as a way of at least getting what's already known so you can get maybe a 70% solution, 80% solution so that when you bring it internally, your team now is able to take it that last mile. And we know that last mile is the hardest mile, but it's going to be that level of differentiation that becomes so important. So what have you seen with that in terms of sequencing, timing of when people try to do this?

Yeah, that's a great question, Steve, and it's a great lens to look through. So we had a have a client who is one of the world's largest seed and crop companies in the world that had used us and they made strategic decisions around just this, this thought that you shared at the beginning. So they decided when they first engaged with us, they were going to do 20 external challenges. They wanted us to train in our methodology that is exactly like what you have in your book and with invisible lenses and reframing problems appropriately. And they made strategic choices on their challenges. They knew for sure in some areas they were going to go outside first so that the people on the inside could go that last mile with answers they found or that there wasn't an answer on the outside. So they made that strategic choice in a number of their challenges. And because of internal idea management or solution management tools that, that are in the market today, like our parent company Wasoku has, there's an opportunity to make the strategic choice. Let's make sure we exhaust inside too. So strategically, the company that says if I can make choices, if I can choose a channel and I can use outside, maybe to eliminate the chaff and find things that we didn't know existed. And I can use inside maybe to say, let's not resolve the same problem. If one of the businesses three years ago solved this problem and it could just be handed off to the person who's facing it today. Those kind of choices are critical for big enterprise businesses when the speed of their competition is moving as quickly as they do. Last comment. And I want to turn it back to you because I want to hear your thoughts, but I was at a speech that I heard somebody giving the other day and they were saying, if you think back 15 years ago, Twitter was a bird in a tree and Facebook was grandma's photo album. And if you look at that as a metaphor for how quickly the world can change, Facebook and Twitter are facing competition. They've been relevant for that in the last 15 years. But a lot of companies are Facing this. So are you going to sit and do what you always did and all, and that's all you're going to ever do, or are you going to make a change and make these kinds of choices that you talked about? Steve?

Well, I like that you use the word relevance. Because to me, when somebody asks me what my definition of innovation is, it is relevance. That is it. It's not about novelty, it's not about being different. It really is providing something that the market needs in a way that they need it. I want to come back to something that you said, and I want to dig even deeper into the reassign and the resequence lens, because I think these are just really two good ones. And you talked about using Wizoku's idea Spotlight, for example, to exhaust internal opportunities, find solutions internally. And I want to be clear to people when we use the term open innovation, open innovation is not necessarily the same as external innovation. External means external to the company. Open means it's really just open beyond the four walls of the department. So if you have a marketing challenge and you only talk to the marketing department and it's maybe probably even a small subset of the marketing department that has a team working on the problem, well, that's closed. But if you open it up to all of your employees, well, that's still a form of internal open innovation. So I just wanted to make that just that one point clear, because I think that's an important distinction. But I also want to go back to the resequence lens. We talked about timing in terms of before or after. But there's one other aspect to resequencing that really, I think is also one of the key values of open innovation or external innovation or crowdsourcing is parallelism. And that to me is like, and you know how this works. You post a challenge, it's not like you've got one small team working on it and they failed and another team works on it and they fail and another team works on it. They keep on failing, failing, failing. And you've got hundreds or thousands of individuals or teams working. So talk about that environment of parallelism in terms of the problem solving.

Yeah, it's a great thought. So parallelism is critical. I remember Edison had said is quoted as saying he never was unable to solve the problem of a light bulb. He just found 10,000 ways not to make a light bulb. I butchered the quote, but the point is the same in parallel. If Edison was going to discover and make a light bulb today, he would Use open innovation in order to get many, many people from many places working on the same problem. A well defined statement about what you needed and what you wanted in the end and what you have already tried and failed at. So the more you can parallel, process or use, use a challenge to get multiple people from multiple aspects to look at the problem and to give an insight. It could be a small insight, it could be a larger. But the more open you can be both externally with using open innovation outside of the organization, or internally, or in co creation communities with your suppliers and vendors, the people that you do business with, it really makes a difference. There's a metaphor. I use just a visual metaphor. If you had a problem and you crafted your problem into a rock and you were standing by a body of water and you threw that problem in there, hoping that somewhere in that lake somebody could solve the problem, that when the rock hits the water, it creates ripples. So think of the ripples that would come from where that hits. And think of the ripples as different channels or audiences. And maybe the first ripple is outside and you want to go out to the rest of the world to say, tell me what you know about this problem. And I could define that. The first ripple could also be inside. The next ripple out is another audience. And it goes on and on in the ripples until the ripples go across the water. And you have as many insights as possible that are related to, to the problem you're trying to solve. Which is why using the lenses you talk about is so critical in understanding. Which lens do I put the problem through in order to get the most diverse and hopefully correct answer to this problem?

Well, that makes a lot of sense. I mean, it really is about. As you start those ripples that you're talking about, you are increasing not just the quantity, like each, the circumference of each of those ripples is larger and larger and larger as you go further out, out. But also you're getting more diversity. You might have more fish.

That's right.

So you have different quantities and different qualities in the mix. And so it's a very powerful way of, you know, just sort of visualizing how that all works.

It is. And the great thing about it, Steve, is this becomes then exponential when wherever you find the fish, if we use that metaphor, the fish with the solution in the, in this lake, no matter what ripple you find it in, if you then take the fish back through the ripples and you show the fish to the other audiences and say, hey, I found this fish out here, in the, in the hinterlands. And as I get closer to the center, you're saying to your employees and your partners, what else can I do with the fish that I caught? What else do I need? Where else could this solution fit into what we do as a business? The insights you'll get from people along the way by, by bringing things out and in, and almost as if it were an accordion, let people see what you're doing by bringing it out and in. That's where the difference gets made.

Well, and I think, you know, it's important to recognize that when you do open innovation or crowdsourcing, you're trying to adapt a solution that's out there, not adopt the solution. And that adaption part, that taking what's being done and really twisting and turning it and improving it and making it your own, that is the special sauce. And that's where the internal employees can really do something that no one externally could do because everything's a little more generic. As those ripples go further and further out, they're just sort of known solutions as opposed to now taking it and really turning into something special.

Exactly right, Steve. And the Internet of prepared minds, that's what I call our solvers. These people who are there whose mind is prepared, they don't know what's going to come to them, but they see something they're interested in. They may not be able to finish off the work that the, your valued employees have, but that, that relevant insight, that just little different twist to the problem is what unlocks that and brings joy to the workers at the company. Because you're working with solution work now. It's not just, geez, I don't know what to do anymore. I've worked on this for 15 years. You're now getting solutions wherever they came from and you're working with solutions, not trial and error.

Yeah, that's great. I'd love to close with one more lens and then I'd like you to.

Close with a story.

So let's just. The last lens I want to Talk about is 24, which is the variations lens. And this basically says let's not look for one size fits all solution. So look, you know, I'm a huge fan of open innovation and in particular external crowdsourcing, which is Innocentive's specialty. But, but it's not a solution to everything. So from your experience, when have you found what's the sweet spot for something like Innocentive? What's the time when you would use it and when wouldn't you use it what environments is it great and when is it not so great?

Yeah, the one thing that jumps out at me and when you wouldn't use it is when you don't know what problem you're trying to solve. And we've had conversations with companies before. They use us to just say, look, that sounds like a great objective, a great goal, but we don't know that you know what the problem is that you're trying to solve. And so don't spend the money trying to figure out what the problem is until we spend more time with you to really help you understand that discovery of the problem area is going to be far better for you. We have worked where it's successful is where and when people know that they have a problem, it could be very early. We've done problems challenges for companies that have beverages that they want new packaging for. It's pretty simple. We've done challenges for consumer packaged goods companies on how do you clean a baby's bottom without touching it, or how do you get young men to shave more often. So it's not all PhD level stuff, but knowing what you're trying to solve for and being able to express it in a way that can somehow take it out of its normal context to draw in that diversity, to draw in the people who normally don't look at it and can give you the answer. It's what a radiologist gave to an oil and one of the biggest oil and gas companies in the world when a radiologist solved a problem on how to identify fractures and fissures in the bottom of the Gulf of Mexico where natural gas or oil deposits might be. Only a radiologist had that, that insight because they look at X rays and fractures all the time. So the proper question from almost any company and industry can work in open innovation. But if you don't know what your problem is, it's tough.

Well, and I love that perspective, as you know, because the whole point of invisible solutions is to make sure we're asking the right question, we're solving the right problem. If you go to 7 billion people with a poorly formed problem, you're going to get 7 billion irrelevant ideas. So I think that's so critical. And what I loved about the last example that you just used, and we'll sort of put a bow on it with this, is it's a great demonstration of, I think really the lens that is the power of external innovation is the analogy lens. And some of the best stories that I think about from innocent, the best stories are those where the Radiologist is solving a problem for an oil and gas company, or, you know, the Exxon Valdez example where it was a person working with cement in the construction industry solving an oil spill problem. I mean, these are, it's that analogy lens. I just, I love the power of solving a problem from someone who's not an expert in the area of the problem.

That's right. And there are so many stories like this that it, you know, would take several different coffee and tea and cocktail parties to go through them all. But there, this is what comes out, the unexpected, the people you didn't know exist. No matter how big your company is, no matter how far you've looked, there are people who may have an insight that was just overlooked. So, yeah, I agree, Steve. The invisible lenses and what you guys are, what you've done, what you're counseling and training your clients in is critical. Understanding the problem is huge once it's articulated. You know, all problems are small when more eyes are on them. And so a well written and well designed challenge to attract people to it is giving insights to clients all the time.

Well, and I think that's a great reason why, as you know, John, I have a strategic partnership with Wazoku and Innocentive. And the reason is because we have that shared philosophy that if we get the question right, we've done a lot of the work to at least move forward in the right direction. If we start off with the wrong question, the wrong problem, the wrong, the wrong opportunity, or an irrelevant opportunity, all the work that we're talking about here doesn't really add any value. So I think that's just so critically important. And I love the word that you used, unexpected, because I think that's actually the really cool thing is we can sit here. The point of the analogy lens is to try to intellectually find analogies. But what Innocentive does is they find those analogies not through an intellectual activity of sitting back and saying who else might have solved this, but actually putting it out to the market and then letting people self select those who have the solutions. I just think it's a brilliant, brilliant concept.

Exactly. And this is why our partnership works so well. And this is what's helping our customers innovate at scale. This is how the customer who's an enterprise of almost any size can take advantage of the skills in problem formulation, the talent that's in this unexpected world of solvers, and the platform that can deliver this seamlessly to the client so that at scale you change and do things differently. Starting with that problem.

That's fantastic. John, thank you so much for being on the show today. Really appreciate your insights.

Thanks, Steve, for having me on. Look forward to the next one.

Absolutely. And with that, we are at the end of this week's episode. If you would like to submit a problem you want solved on this podcast, go to invisiblesolutionspodcast.com remember to download the lenses, go to getthelenses.com I look forward to being with you next week. And until then, happy problem solving. Sam.