How to Spark Innovation: Practical Tips for Managers and Business Owners with Vanessa Thompson

Competition in today's marketplace is absolutely brutal. Blink and your competitors are miles ahead of you. Businesses everywhere are grappling with the same big question. How do we stay ahead of the curve without burning out our team or running out of ideas? And that's what we're talking about today on Experience Leadership.

Welcome to Experience Leadership, a podcast That challenges small business owners and entrepreneurs just like you to dare to be the exception. Join our host, customer experience expert Marc Haine, as he uncovers relevant and timely content to help you script and direct your business and teams to create jaw-dropping experiences your customers and staff deserve. Here is the host of Experience Leadership, author of Lights! Camera! Action!, customer experience expert Marc Haine. Hello, Marc.

Thank you for joining me today. I am your host, Customer and Employee Experience Strategist Marc Haine. And today, we will be pulling back the curtains on how leaders can unlock creativity, foster a culture of innovation, and tackle the challenges of staying competitive in a rapidly evolving business landscape. So, stick with us. If this is the first time With us, please do make sure that you subscribe to this podcast. That way, you'll get notifications when brand new episodes pop up each and every week. You know, if you are like most leaders, you've probably felt the crushing pressure to keep up with your competition. Maybe you're stuck in the hamster wheel of the day-to-day operations, leaving little time to get more creative. Or maybe your team seems hesitant to think outside the box. Either way, You know deep down, the status quo just isn't cutting it anymore. And that brings me to our Question of the Day. So, are you losing market share because your business is stuck playing it safe? Are you sure? Go ahead and share your experience. I'd love you to share this episode on your favorite social media platform. #ExperienceLeadership and be part of this conversation. This is going to be a great one because this is one of the things I think a lot of times we're holding ourselves back. Today's guest is someone who knows a thing or two about breaking the mold and rethinking what's possible in business. Vanessa Thompson is a globally recognized expert in innovation, sustainability, and ESG strategy with an impressive career spanning roles at organizations like United Nations Foundation, NASA's Omega Project, and climate tech leaders like Joby Aviation. She's a little bit of an underachiever. Vanessa has dedicated her career to answering one question: what makes companies truly innovative? Growing up in Silicon Valley and working in startups and venture capital, she's seen firsthand what separates the trailblazers from the ones stuck in neutral. From conducting due diligence on breakthrough technologies to helping companies integrate ESG metrics, that drive both financial and environmental value, Vanessa brings a rare combination of strategic insight and hands-on experience. Her work has been featured in things, places like Forbes, and she's inspired audiences around the globe as a speaker and a podcast host. Vanessa, welcome to the show. It's so great to have you.

Thank you so much for having me.

So, maybe you could start off telling us a little bit about what you do for your clients. If somebody was to reach out to you, how do you serve them?

Yeah, absolutely. So, I grew up in Silicon Valley, which is known as being a very innovative place, and that being certainly part of our culture. So, I kind of got into this work, you know, first looking at what is it about certain organizations that are able to develop IP quicker, build better teams, and go to market faster? Why is it that certain organizations are able to do that? And so, with my clients, I really break down how can we innovate? How can we innovate faster? And then, what is kind of causing a lot of those inefficiencies? So, we break that down, and a huge part of it is product development, but also looking at case studies of successful businesses that have really been able to break the mold and lead in the industry.

Hmm, I love that. You know, and it's funny because innovation is such a buzzword in business today. How do you define it in a way that's practical for leaders to understand and to start thinking about implementation?

Yeah, absolutely. Well, I actually define it specifically, I'll define breakthrough innovation, where I think it's really about seeing problems or where other people see challenges or roadblocks actually as opportunities. So, a true innovator or a true leader who's able to be creative and build teams around that is someone who's able to see where other someone sees a challenge or a roadblock and actually see an opportunity, a new product idea, a new service in the market, So it's really about that transition and the process of transitioning to that.

Yeah. You know, when I think, when I think my background's in hospitality, and a lot of times when I think about innovation or I talk about innovation to like restaurant owners, they say, well, I make burgers. So I'm going to innovate and I'm going to beat out my competition. I'm putting 2 slices of cheese on the burger. We're talking about something more substantial, aren't we?

Yes, absolutely. We're talking about a new type of value creation in the market. So, we're thinking about a need that may be not met yet and really serving that. Of course, there's kind of these, these really funny case studies like that, like the burger. I've seen other ones where, you know, I've seen a shower company that created a remote control in it so you could, from the other room, you know, change the temperature of your shower, you know, things that are not necessarily creating value for the customer. But truly, I think that what innovation is, and when we see great innovators, it's someone who actually truly understands the needs of the market, truly understands their customers on a much deeper level. To be able to understand what are their needs truly, not just what's the next product that I can sell to my customers, you know, for the next quarter, but really what do they need and then being able to meet that demand.

And so, it's not just meeting that demand though, it's also looking at ways to think differently about what you are doing.

Mm-hmm.

Yeah.

Absolutely. One of the things that, you know, I always like to look at is, you know, companies that I see that have kind of dual value creation or maybe even triple value creation. And one of them that I think is interesting is, actually a paint company. And I think this is an interesting case study of what innovation is and what innovation could be, is looking at this very kind of abstract industry that maybe a lot of us are not a part of. And they're located in the Appalachian Mountains in the United States. And they had this huge problem there with pollution. There's huge amounts of toxic iron pollution in the Appalachians that was causing all sorts of harm to both the animals and the people living around it. And this water engineer and a painter decided to collaborate and work together to remove this toxic iron from the river and bake it so that it's safe and turn it into safe paints. And different temperatures that they would bake it at would create different colors that artists could use. So this is an interesting innovation because it's solving multiple forms of problems. It's solving a problem that was true to that community, as well as creating an entirely new type of paint for artists. That gave a very unique color profile to artists who wanted to paint particular types of paintings. So, I think what's interesting about thinking about innovation, you know, in the 21st century is that you really need to be thinking about value creation on multiple levels. And that's what I think about when we think about really connecting with your customer on a deep level. It's not just about always solving the problems with that product. It's really about solving their problems. And that's normally where the innovation comes from.

Yeah. And sometimes, sometimes some of those problems are something that is maybe a spin-off of what we're already doing. Maybe we're in itself by servicing one part of the market creating huge gaps in another part that we just don't understand. What are some of the misconceptions that leaders have about innovation and what innovation actually involves?

Yeah, absolutely. So, I think one of the biggest ones is that they have to invest huge amounts of capital into R&D. And really think about, you know, how can we just make our R&D, you know, team more resourced? How can we really enable them to, to create a new product that might be useful to our customers? And I think that what that fails to understand is that the most innovative teams and the most innovative companies actually started out resource constrained. And this is one of the key pillars of actually creating an innovative team and an innovative company is having very specific resource constraints, which is counterintuitive. Mm-hmm. To what you might think. You might think, okay, let's resource this R&D team with everything they want. Actually, you need to be resource constrained in a few particular ways. When you think of the stereotype of the innovative startup, you think of a bunch of people, maybe bright young kids in their mom's garage, trying to create a prototype for something and having very limited resources. And that's actually true. A lot of incredibly innovative startups actually started out very resource constrained. So, you have to be highly motivated, but resource constrained. It's an interesting tension and balance that you have to create. And so, you know, one example I think that's great for this is actually a doctor who's also an inventor, Dr. Chisti. He created a $3 respirator in a market where most health respirators cost $20,000. So, this was a really, really big innovation in the market, taking something that was traditionally $20,000, And bringing it down to a $3 cost. And the way that he did that is he actually was very resource constrained. He was working in a hospital that had very limited resources. He wanted to save lives, but he didn't have a lot of money to do that. And he wanted to help other hospitals that wanted to save lives, but didn't have those resources. And what that enabled him to do is he threw out the old playbook entirely. He entirely threw that out and said, I'm going to start from scratch. And I'm going to really think about the big picture and the systems thinking here. I'm not going to obsess over one detail of the old system. I'm actually going to think about the big picture and what we really need from that old system. And so, what that enabled him to do is to create a huge breakthrough in the market and a huge amount of value creation for all these hospitals that needed respirators and otherwise couldn't get them. So, I think that's a perfect example of how constraints— he had a huge motivation. He was very motivated by that cause of saving lives, and he was resource constrained. So, it's this interesting tension that I see. with a lot of successful companies that are able to become more innovative, having that healthy dynamic.

And so, you know, they say necessity is the mother of invention. And so really, that, that's what we're talking about here. It's like, we, we don't have to have the most money. In fact, I read a story about the Wright brothers that they were actually— they weren't the only ones working on, on flight at the time. They had— there was— they were up against a company who was resourced to the hilt, but because they had the resource constraint, they kept looking at what if each and every time without— by not saying, you know, let's throw more money on it. Let's really get down to the nuts and bolts of what we're trying to achieve. So, you know—

Yeah.

Of course, as you were talking, a company came into mind here in Calgary, Alberta. It's called Executive Mat where he had a mat cleaning service. But the big machines that he bought to clean the mats People were getting hurt because he's cleaning mats that are 45, 50 feet, 60 feet long. And people, they were getting all wrapped up and people were actually getting hurt on the job. And so, he invented a brand new machine that would wash, sanitize, rinse, and roll at the very end of it. And because he did that, his mindset was like he kept thinking about, okay, what's the next possibility? And so then, he started looking at the waste stream and he fixed the waste stream. And then, he looked at other avenues of his business.

Yeah.

And because of that, hugely, hugely innovative in the industry because he kept asking that one question, what if?

Yeah, absolutely. And I think the other part of that story is that he was also really mission-driven, right? He was somebody who really cared about his people and that he wouldn't have looked all that way if he didn't care deeply about his people too. And I see that with a lot of innovative teams. They really believe in their missions deeply. And that's what also helps them go the extra mile to look at every avenue, like you mentioned.

Yeah. And, and so is, you know, to that one belief system is there because so many different operators, business operators will look at their industry and go, there's nothing I can do. This is a machine they sold me. I can't do anything. So what is the mindset differential there? I mean, you might still care about your people, but being able to take that extra step and, and be able to move into this mindset of innovation, that if it's not impossible, what will it take mindset? How does one shake that up?

Yeah, absolutely. Well, I think the first question to ask yourself is to really ask, what is an authentic mission that I care about deeply? And it has to be authentic to who you are and to your story as well. Because if it is, actually, people will resonate with that and they'll jump on board with you and they'll go down that avenue with you. But you have to start asking yourself the question is, what is the mission? And it might be a bigger question. than just your industry in particular, but what is the big picture of what you really want to accomplish and what mission really resonates with you? Because what that does is enables you to fit that into your, you know, puzzle piece, if you will, of your industry and think about how you can lead. What is the unique way that you specifically are going to lead in your industry? Because that actually will drive what type of innovation you end up going down. And actually, it might resonate with a lot of your customers as well too. So, there's One very famous example, at least here in the States, it's called Interface. They were also a carpet manufacturing company and they're a pretty large company. They were about a mid-cap stock on the open stock exchange, so they would be public. And what was interesting is that Ray Anderson, who was the CEO at the time, he decided that he was going to become a completely mission-driven organization. He was already a public company. He had already established everything. They weren't leaders in the market, but they were up there. And he said, you know what? I'm willing to risk everything in order to become a mission-driven business that cares about the community and the environment and things like that. And of course, this, you know, came as a surprise to many people, but what that enabled him to do, because it came from an authentic place, is it actually helped him push all of his teams to come up with new IP that his competitors would've never thought of, lead in the market, And survive in a few recessions that his competitors didn't. So, what's interesting about this is that when you have this mission that's even above the company, and you're willing to risk even the company towards that mission, you're able to take the necessary risks that you need for innovation, because innovation is messy. There's a lot of failure involved, and you have to be somewhat risk tolerant in order to be able to come up with a true breakthrough in the market. And so, that mission gives you the courage to do that oftentimes.

It's so amazing because of course, Star Wars kicks into my head. Do, do not, there is no try. But to a lot of organizations, I'd like to roll back just a little bit because I see so many organizations stuck in kind of the status quo thing, right? They've been doing the same thing for 20 years. And it's like, I don't understand why I should have to change. And I don't know. There's all this justification. Are there any warning signs?

Yeah.

that when somebody's looking at their business, there would be an indicator that they're stuck in a cycle of complacency and really not growing all that much on the innovation front?

Yeah, as soon as you feel comfortable. That's the biggest warning sign that you can possibly have. Uh, it's as, you know, as Peter Drucker and a lot of famous, you know, innovation authors has always said, it's not safe to play it safe anymore.

Yeah.

And as soon as you feel bold, that's when your competitor's planning something new. You mentioned, you know, competition at the beginning of this. What we see here is, you know, in the 1950s, a company could be on the Fortune 500 list for maybe 65 years or more. And, you know, nowadays, every 2 weeks, a company's getting kicked off. So, it's very difficult to maintain that success. So, you have to constantly be looking around at what your competitors are doing and also looking internally for your innovation teams to come up with new creative ideas constantly. So, I think the warning signs are, unfortunately, you won't know until it's too late. So, you have to start being proactive, even when you're starting to get comfortable, to start to think about what are some KPIs that I can use to measure innovation? And one of those KPIs might be along the lines of, I want 20% of my revenue creation next year to be from products that I currently don't have, or something like that.

Mm-hmm.

Where you can start to create KPIs to continually push yourself. So that you can continue to innovate and survive in the market because you're going to have to continue to adapt in order to survive. So that's kind of one of the things that I talk about with my clients. But there's certainly, you know, not as many risk factors and warning signs as there would need to be.

I get a sense that from a corporate culture standpoint, there's a lot of different elements at play here. One is we need high-trust environments. We also need the humility of the leadership to be able to turn around and say we don't have all the answers. And we also need to be able to support failing forward, which to a lot of business organizations, a lot of entrepreneurs and people who've been in business for a while, these are like 3 key components that I really find are lacking in today's business environment. Am I off the mark?

No, absolutely. They are definitely struggling with it. And I think that there are a lot of ways that you can start to think about how can we implement some successful structures in our organization Mm-hmm. And one company actually comes to mind, which is Pixar. Pixar has been voted as a very innovative company. And one of the reasons for that is they actually have a structure around innovation, which I think is particularly interesting. They actually have 3 different types of rooms. And it comes back to your idea of trust, which is that you need to have psychological safety, as it's called academically, or trust, in order to have all those creative ideas. You know, if you raise your hand in a meeting and you come up with that amazing wild idea, you have to feel like you're not going to get shot down at the first, you know, go of it. And so, you have to have trust, you have to have psychological safety. So, they actually created a structure around that. So, they have 3 different separate physical rooms in their offices. One is for wild ideas, crazy off-the-wall ideas, just completely radical. And the next one is screening all of those ideas and thinking about which ideas they're actually going to implement. And the third is actual implementation.

Yeah.

So, what's interesting about that is it enables people to actually organize their creativity in a certain way. So, they're saying, okay, I have a crazy idea. I'm going to book a special room for that. I'm actually going to have a special meeting for that, where people are actually coming in with the mindset of, I'm going to be wild and crazy, and I'm actually going to listen to the most creative, wild idea. Because if they're coming into the meeting saying, hey, we have to just get this done for the next quarter, of course, they're going to shut down your idea because they have a deadline and a priority that's different than your own. So, I think what's great about that, I think what a lot of our, you know, your listeners can be thinking about is how can we create a structure and a series of KPIs for actually changing a mindset? Can it be that we actually have a different type of meeting for certain levels of creativity? Or can we actually, you know, think about measuring how creativity, you know, works in our organization? So, those are the kind of things that I think people should start to think about if they wanna think about, you know, creating new products and new product development to meet market demands and, and be more adaptive.

I love that. You know, there's so many different ways that we've done this. You know, when you were talking about that, you know, we've done sticky notes where, you know, we'll just for 30 minutes, it's like, just write anything. It doesn't matter. We're not gonna filter. Just go, go, go. And we do it like in 2 to 3 minute increments of people just sitting down, just driving stuff out. And it was really amazing to see at the very beginning, it went, you know, some of the ideas went from real to super absurd. But then other things started taking shape, and by doing it, we were able to really come up and uncover some really cool solutions that we could put this mindset on and go, hey, this is not half bad. And a lot of times you need to get all the ridiculous thoughts out of the way in order to find something that's really viable.

Yeah, absolutely. And it's sometimes a lot of those crazy ideas actually end up being really good, but you have to always be thinking of Okay, let's take an inventory of all of those wild ideas and then think about how do they connect to the business model and constantly be asking ourselves that question of, okay, how could we actually make that crazy idea work? We have to start to get to that mindset where we're not going to just dismiss it saying, oh, that doesn't work with our current operations, but saying, how can we make each of these ideas work? And actually have a separate meeting for really exploring them. How will this work? How will this work if we could? potentially make this work? How would that work? And then, have a separate meeting for actual implementation and thinking about what are our priorities.

You know, I find up until now, we started talking about what the core problem is and then, we jump into solutions and come back a little bit to what the core of them. So, what I'd like to do is after our break, I'd really love to uncover and really look at what it's going to take to drive change in businesses where complacency is more the rule When the spotlight shines on your business, are customers applauding or yawning? In other words, how is your business performing? Make your business a star with a new book, Lights! Camera! Action!, Business Operational Excellence Through the Lens of Live Theater by Marc Haine. Marc uses his business and acting experience to help you see your business like a live show so you can create a performance-driven culture that delivers results. Performance your customers will never forget. Buy Lights! Camera! Action! today at your favorite online retailer or directly at marchaine.com. Welcome back! As you could tell, I am really tickled about today's topic. And I'm speaking with the fabulous Vanessa Thompson. And we're talking about innovation. And all too often, we do get too comfortable in our places, in our businesses, and we do fail to start innovating. And then, we sit back years later looking and going, How did they do that and why didn't we think of it first? So Vanessa, what prompts innovation? Like, you know, when you're in a business, sometimes we can't see the forest for the trees. You mentioned market need. Obviously, if we listen to the market, sometimes our customers will tell us what we need. But, you know, Henry Ford said, hey, if I asked people what they wanted, they would have just said faster horses, right? So, so, so what helps prompt innovation?

Yeah, absolutely. Well, I think that kind of seeing past that, what ends up happening is looking at value kind of just beyond what the product needs. And I mentioned this before, it's not always about looking at what is the value that this product serves, but what are the needs of the customer? The needs of the customer are that they need to get somewhere quickly, right? So, beyond the product itself, we have to actually start to ask the questions a little differently when we are asking questions of customers is, what are your actual needs? And driving down, what are the values that are being harmed by not having those needs met? And that ends up actually getting to something much deeper that the most successful companies and businesses are really able to harness. And there's quite a few factors that go into a successful organization that's very innovative. One of them, of course, we mentioned being mission-driven. Another one is being resource-constrained. But another one is also really understanding the market and really understanding the customer very deeply.

So, that means that we need to really have our pulse on our industry. When businesses have their heads down, they're running the hamster wheel of day-to-day tasks and everything else, how do they become intentional to make this happen?

Yeah, absolutely. Well, the thing is that oftentimes the case studies that you see of companies that completely miss the bus or miss the train in terms of some the technological changes, actually, they normally knew about a lot of these inventions long before it took over their industry. And so, when you're thinking about, as a leader, how do you really tune into some of the emerging technologies or trends that you need to be adaptive to in order to stay in business, you actually have to create systems around listening, which is somewhat surprising. You have to be thinking about listening to all of your stakeholders, And I'm not just talking about your employees, but I'm talking about truly all of your stakeholders. I'm talking about your investors, your communities, anyone who touches the business, listening to each and every one of them. I think there's actually a really interesting example of this, and it's very surprising. I don't think a lot of people will think about listening quite in this way, but I think the case study showcases that listening and going above and beyond to listen shows to be a very successful strategy. And it's in the hospitality industry, like you mentioned earlier. It's called Red Sea Global, and they're a hotel development company. They go in and they develop hotel chains all around the Red Sea, but also all around the world now. And they said, we're going to go in and we're going to come in with a completely different mindset of anyone in our industry. We are going to truly listen to the locals before we come in to this particular area. So they're stakeholders, but they're stakeholders that normally people don't listen to when they first come in. And they said, okay, we're going to really listen to them. And we're going to listen to their ideas. And they gave 2 pretty wild ideas that I think any other business would've just dismissed as, this is not something that's relevant to our industry. They asked for 2 things. They asked for a banana farm and they asked for sailboats. That's what the villagers asked for. And any other business in their right mind probably would've said, that's not what we do. Good for you, but that's really not relevant to what we do. But they really tried to think about how is this going to connect with our business model? How does this connect with our product offering? And they really went through that process. And so, they ended up investing in miles and miles and miles of wonderful agricultural land around their hotel, which provided a very unique farm-to-table experience at each and every one of their hotels. And so, now people go, you know, from all around the world to their hotels for this very unique culinary experience. The second thing they did is they actually did invest in those sailboats and they actually taught the locals on how to give a tourist experience on those sailboats. And so now people who love sailing specifically go to their hotels and they were able to drive much more traffic to their hotels than they otherwise would've. So what I think of, you know, when I think of innovation is you normally think of a specific type, but this ends up being a really innovative solution where it ended up helping them lead in the market. You know, tourists are now specifically going to their hotels for those 2 very unique experiences. But if you first heard that idea, you would've completely dismissed it out of hand. Anyone in their right mind would've said, you know, that just doesn't have anything to do with our industry. But I think what this shows is that you have to start to listen as a leader. You have to listen to all your stakeholders, because oftentimes that's where the most innovative ideas come up. And that's also where you normally get a hint of what's coming up. What are the emerging technologies that are coming up? And it may come from a source that you may have not expected before. So, you have to really listen to everyone and then really actually be active listening enough to think about how do all of these ideas tie into my core business model.

And again, when you have a value system, that becomes easier when you can define what your values are because then you can test against it. I mean, I got goosebumps when you talked about they actually went out and bought sailboats and they taught the community how to create tour. You know, they created a synergy. Which not only impacted them as a business, but it created economic well-being for the community outside of the hotel. And it reminded me of G Adventure Tourism. G Adventure does all sorts of bookings. And one of the things that the owner of G Adventures found was that women in Peru no longer wanted to do weaving because there was no rationale to do it. And he convinced a village—

Wow.

That if they could start teaching the women how to do weaving again because they were losing it within their generation, he would bring tourists in to celebrate and be able to purchase the weavings. And because of that, the village was able then to create enough economic stability to build schools and to build healthcare. And it created its own set of economies. And this is something magical that I don't think entrepreneurs really think about. When they're looking at their financials going, how are we going to make a profit this month?

Yeah, absolutely. And I think particularly this is normally something when you're thinking about, do I want to lead in the market, right? Because oftentimes when we're thinking about staying ahead of the curve, we also have to think about how can we lead in the market. This is normally the prompt to get there. You have to be thinking about defining a value set and then risking quite a bit in order to pursue that. And that's actually normally a lot less risky than some other risks you might take as a business person saying, okay, I'm going to define a value set. I'm going to create a core mission that's authentic, and I'm going to pursue it. Because oftentimes, you normally end up creating an impact that normally people want to be a part of. So, out of all the risks that you can take as a business in order to lead, that's a much safer one to take. So, when you're thinking about leading in the industry, you have to think about, okay, this is a much safer risk to take. In order to create that value set. And the way you do that and the way you innovate is you actually listen.

And who knew that having non-negotiables in your business based on your value system would help you overcome things like hiring challenges, labor market shortages, skill set challenges, and so on? Because all of a sudden, people want to work for you and with you.

Yeah, absolutely. And that's what I've seen pretty much with all of the people and individuals that I've worked with in corporations is that all of the mission-driven companies, they have incredible retention rates. And people don't talk about how much you lose as a business when you lose people. You're not just losing that knowledge, but it's about 30% of your overall salary of that individual that you lose trying to replace them. It's a huge cost to businesses. And so, the businesses that actually have that vision, that have that authentic core purpose, are able to retain people and actually reduce costs. In a lot of senses. So, Interface is, you know, it's a very traditional business. It's a Georgia-based company. It's a carpet manufacturing company, but they get, you know, brilliant kids out of the best colleges and they stay there for 40 years. And that's unheard of today, right? You normally see people jumping jobs every 2 or 3 years. And I think as a business leader, you'll definitely start feeling that once you start to get a certain level of experience, that actually can really hurt the bottom line. And one of the case studies that we used in the book is actually TaskUs, which they're actually customer service call lines. That's something that's entirely based on people, but it's also about cutting costs. And I think when we normally talk about mission, we talk about vision, we normally think about adding costs. That's not always the case. Actually, in some cases, we're actually reducing costs by having that core vision. And retention is a huge part of it. And normally what you do with, with a call center is you normally outsource to another place that has cheaper labor. You try to have people work as long as they possibly can so that you can get, you know, the most out of each employee, right? That's normally how you reduce costs. TaskUs said, we are actually going to reduce costs by treating people better.

Yeah.

So that they stay with us and we're going to actually reduce our retention loss costs. And that's what they ended up doing. They ended up underpricing all of their competitors by treating their employees better, giving them healthy, you know, times to work. They gave them the best maternity leave policies. They gave paid vacations for their top performers. They gave Google-type offices to call centers, which is unheard of, things that have snacks 24/7 and all of these things, all these benefits they gave to them. And everyone said, this is going to be wildly expensive, but they showed that they could actually reduce their turnover rate, which for a lot of call centers is upwards of 40%, almost down to 20% to 10%. And just that change paid for everything. And so, I think this is what we think of when we think about having a vision, having a mission, really authentically empowering everyone on it, and then treating everyone well. That doesn't always mean giving them a fancy office. Sometimes that actually means speaking to them and what they need specifically. But all of those things actually end up saving you money in a lot of cases. So, definitely don't dismiss the fact that if you're feeling budget cuts or things like that, that you have to necessarily cut out your mission or cut out your vision. A lot of times that ends up helping you save money, be more efficient, and take the necessary risks you need for innovation.

Brilliant, brilliant, brilliant, brilliant. Could you let everybody know how they can get in touch with you? Because I have a sneaking suspicion people will want to know more information.

Yeah, absolutely. You can visit my website, which is vanessathomson.com. You can also connect with me on LinkedIn, Vanessa Thompson. There's also our consulting website, which is called the-sustainability-experts.com. And we have our podcast, which is also called The Sustainability Experts.

Love it! And all the links are going to be in the show notes. I know to a lot of people, this is something— it's easier said than done. I know it's way too easy just to say, okay, we're just going to create an innovative culture. From the top down, what's involved in really making this happen? We mentioned some criteria required.

Yeah.

But from a business part where we are being driven, I think the enemy a lot of times to innovation is the CFO. the Chief Financial Officer because he's looking at the numbers all the time. And some of what you talk about is not quantifiable until it actually happens.

Yeah.

Right?

Absolutely.

So, what's involved in making this change?

Yeah, absolutely. It's definitely really hard to do. And actually, all of the case studies I've mentioned, almost each and every one of those CEOs or founders had a challenge making that transition. And it ended up being successful. But of course, it was a challenge at first. Even when we're looking at Interface, which has been voted now as one of the most innovative companies in the United States, from making that transition, they really struggled at first. Ray Anderson, even though he was the CEO and founder of the organization, it actually took him 2 years to convince his company to come on board with his new vision. 2 years of the CEO convincing everyone to join his mission. to join his, the investors, from the engineers, everyone. And it actually normally took a small win to convince them that this was worth it. And oftentimes when you're thinking about, okay, now I've set up this core vision that I feel so strongly about, the next step after that often is a small win to really get everyone on board. Now, in the case of Interface, they actually created a very interesting patent. They were one of the first to be able to create recycling of polyester fabric in the industry, and they worked and collaborated with a bunch of other suppliers in order to make that happen. But that small win was really, really pivotal in their overall vision. Once they created that small win, all of the engineers realized, this is actually possible. We can do this. We can lead in the industry. We could change markets because of this. So, sometimes what you have to do is, Take that vision, take that speech that you might give your employees, and then say, okay, what's a small, achievable way that we can show this works? Because ultimately, that's how people start to envision it. They have to feel it viscerally. And so, in order to do that, you have to create something tangible for them to feel, and see, and talk about. And that actually really helps with a lot of your stakeholders. Once you have a small win, you can get more investors to actually see that and help you scale. Once you have a small win, you can get more customers kind of interested about what new product you're creating. So, it's all really about creating that small win first. That might be a patent, it might be a prototype, but creating that small win oftentimes is the best stepping stone next after creating that core vision.

I love that. And it shows ultimately that you're willing to take the risk to make it happen. And so, especially where you might start looking at environments where maybe at some point, trust was low. Or maybe the stakeholders are pushing back. And probably some of the most dangerous stakeholders pushing back are sometimes our own employees just going, we've been doing this for 5 years. It's like, now he wants me to do this. And I used to say water cooler talk but now, it's Keurig coffee machine talk. Where people are standing around the Keurig going, I don't know. They're on crack. They want us to do what? You know, we've been doing this like this for, I don't know why we have to change. And so that gets to be quite challenging to overcome.

Yeah, absolutely. And it's sometimes it's impossible to convince someone. Sometimes you just have to show them. And so I think that Interface is a perfect example of that. They came up with some great patents and the patent I mentioned is now actually used in Gucci and Adidas. And a lot of big brands actually use this patent now, but that small win initially, it wasn't used by any of them initially, having that small win really convinced a lot of people. that this was going to be successful. And today, you know, Interface is one of the most innovative companies because of that. But first, they had to really kind of sell their employees. So, I think that for anyone who's listening to this, they should be thinking of, okay, now I create this vision. What next? Think about something really small, really tangible, really achievable that you can do next to make that possible. Now, it may not be even a new product. Maybe it's something smaller than that. Maybe it's getting one piece of it to work. But once you can get that and you can get actually your teams doing that and having them have that win, that's when they're going to start to come up with the most creative ideas they've ever had.

And again, I think, you know, you hit the nail on the head. This idea of listening, communicating, and being open to it. In my book, I wrote about the improv philosophy of yes, and being able to look at ideas and say, yes, and let's build on the idea and let's test it against stuff, right?

Yeah.

You know, a lot of times, you know, early on you mentioned about creating kind of meaningful constraints that would help drive innovative thinking. Before we went live on this, we were talking about carbon pricing in communities and how carbon pricing kind of forces people to think differently because they don't wanna have to pay the full price of stuff. And so they start becoming innovative because they don't wanna do that. You know, and the government's figured that out with smoking taxes, you know. To put tons and tons of taxes on it and people will stop smoking. And we know it works. So how, how do you recommend that leaders who are caught in their day-to-day stuff set meaningful constraints that really help unlock creativity rather than stifle it and get us back into status quo thinking?

Yeah, absolutely. And playing with constraints can often be a very dangerous game because you have to be thinking about applying constraints, but not too many. And they also have to have A purpose, because if you just take a budget cut to the R&D department, they're not going to appreciate that, and they're probably not going to be any more creative with it. So, you have to be thinking about, these can't be external constraints. The constraint has to have a reason, and it has to have a purpose. And again, this comes back to mission and purpose as well, because if you give the purpose as the constraint, oftentimes, that's when the creativity comes. So, it can't be a needless constraint, right? You can't just say, I'm just going to pull funding, or something like this. You have to be thinking about, I'm going to cause a constraint. That's something like, we need to cut our utility bill in half to reduce electricity consumption, or something like that, so that we can be more sustainable to our community, or something like that. When you have a very purposeful, a very meaningful constraint, then people work to overcome that barrier and create a more efficient system. But if you don't have that purpose and that mission, Then just adding a constraint is not going to be helpful. And this is something I talk about in my book. I talk about actually adding something called synthetic constraints. When you have a big organization, you have complacency. You actually apply a certain level of constraints to your innovation team in order to cause more creativity and create more product development. And so, the way that you do that is you actually have to think about the most valuable and meaningful constraints possible in order to prioritize what constraints are actually going to matter. And it comes back to one we even talked about, Dr. Chisti, who his constraint was cost, but the meaning was that, say, it was saving lives. That was something that was very meaningful for him. So, he needed to have a really, really ambitious core vision where he was going to do anything to not see another patient die at the same time as having those costs. So, it's this balance of having the constraint, but also making sure that your team has enough motivation and core purpose that's I get the sense as well that the constraint is not one-sided.

Like, there are many different layers to the constraint, to the deliverable at the end. Like you mentioned with the doctor, at no point did he turn around and wake up one day and say, today I want to make $1 million with a new idea. He had many different aspects. One was that the machine was super expensive, but then he actually looked at the community of who he wants to serve. Not only does he want to save lives, but he wants to save lives for people Wants who can't afford it. to be able to go into markets that maybe have financial constraints in healthcare. And maybe, you know, in markets where medical aid is not well-rounded and well-delivered, he could create something that could go anywhere. And so, it really is. It's not about creating profit. It's not about doing necessarily one particular thing. But this is an overarching value system that services humanity, people, organizations on multiple different levels.

Yeah.

Yeah, absolutely. Yeah.

And there's also kind of different methodologies in terms of approaching that too. So, in my book, I talk about 7 different ways that you can approach that. How can you create more innovation in your teams? Well, one of the first easiest ways that I like to talk about is a principle called waste to value. And this is a very straightforward innovation technique that I think all of our listeners can, can really kind of start to take advantage of, of even today. And it's actually where you look at all of your waste streams. And you think about how can I create a new product from this? And there's one really famous example to this, which is called Barry Callebaut. They're a chocolate company. They produce 1 in every 5 bites of chocolate, and they sell to some larger name suppliers of chocolate bars and things like that. And they were in this really difficult situation. They were a very big company, but they were needing to come up with new products. So they listened to actually the farmers on the ground that told them that there was actually this wonderful fruit around the seeds that produced chocolate. There's this wonderful chocolate fruit that they were just wasting. 70% of the cacao bean they were just throwing out. And you could actually make this into food. You could eat it directly. You could make it into a liqueur. You could make it into a juice. All of these things. I think a lot of people are now seeing cacao or chocolate fruit juice in their local supermarket, and Barry Callebaut was behind that. But what enabled them to really think about this is they first listened to their stakeholders. They listened to the farmers who told them that there was this amazing fruit. But then they created this whole project around saying, how can we use this? How can we use this waste product that we're paying for, but we're just throwing away? And they found out they could make cosmetics, pharmaceuticals, and even new culinary products from this fruit they were originally throwing away. So, this is a really great kind of straightforward innovation strategy that anyone listening can start to think about today. Think about an inventory of all of your waste streams. What are you not valuing? What are you not using? Could it be a product? Ask yourself that question. I think that's one great way that you can start to think about what's the most straightforward way. Just look at what you're wasting. You've already bought it and you're already probably paying to get rid of it. So how could you make a product out of it? So that's one way to start to think about kind of a more straightforward way to start implementing a lot of these things.

I love that. You know, industrial symbiosis is what we worked on here in Alberta, where we were looking, we brought stakeholders together from different industries. From that, we were able to take somebody who produced glass rods and shipped glass rods in these Styrofoam things, and they paired up with a toy manufacturer to create stuffing for stuffed animals because they shredded the foam that was already there. We paired up a slaughterhouse with concrete. They formed a company to do bone meal to be able to fortify cement mixtures. So these things happen all the time, and being able to look at one's waste stream and say, you know, what can we do with this that's going to be more productive and more service-based, uh, to not only the communities, organizations, but to humanity is brilliant. And I, I love that. Before we go into pitfalls and cautionaries, tell us a little bit about your book.

Yeah, absolutely. So it's great. Yeah. So my experience has been, you know, working in startups, working at venture capital groups, and again, ask that question of what makes company most innovative? And what that led me to is when a publisher reached out to me and asked me to write a book on this topic, I said, you know what, let's delve into it. And I created 60 case studies of successful businesses that have made a pivot to become more innovative. And so, this is a very practical guide. It's a very hands-on guide for a lot of business people to utilize, where it's actually showcasing businesses that may have not been the most innovative. Maybe they were very conventional businesses that didn't even have a strong vision or purpose that we've talked about that made that transition. I think that's what's so interesting about it too, is they're talking about huge pivots. So each of these case studies are existing businesses that have been able to scale, grow, and succeed based on these 7 principles of the book. One of those principles, of course, is waste to value. There's a lot of incredible innovations that come out of that strategy alone, just looking at all of your waste products and thinking about how can you create a new product out of this? So overall there's 7 principles to our book. It should be releasing next year this time. So that's great and exciting, but yeah, that's kind of what I'm working on and what normally I do kind of consulting and speaking around as well.

We have to wait that long to get your book?

Oh no, I know, but you can, you can join the waitlist on our website, which I will give you to do.

I'll put the show— I'll put the link in the show notes. I'd like to get into some cautionaries and pitfalls. I'm always scared of business operators who find an idea. And they go, oh yeah, we could do this. This will— we'll concentrate on this this month. And then it's not life-changing. It's not business-changing.

It's—

so I'd love to get into pitfalls and cautionaries, and we'll get to that right after this.

Attention meeting and event planners. Is your company or association planning a live or virtual conference, seminar, staff retreat? Are you looking for a fresh, energetic perspective? On what it takes to put on a jaw-dropping experience for your customers or staff? Book customer experience expert Marc Haine for your next group event. Past participants have said, Marc kept us in stitches while teaching us how important and powerful actually designing our customer experience can be. Read more testimonials and find out how Marc can serve you and your group. group@marchaine.com. That's M-A-R-C-H-A-I-N-E dot com.

I hope you're getting tons of value from today's episode. As you can tell, Vanessa and I are on a mission to support businesses just like yours. If you belong to an organization that could use our help, or you or somebody you know might be planning a leadership retreat or a conference, Drop us a line. We'd love to explore how we could be of service to you and your people. Vanessa, for businesses and leaders wanting to instigate change, what pitfalls and cautionaries should we be aware of?

Absolutely. I think one of the largest ones that I see come up the most is a lack of transparency. When you're thinking about these really risky ventures, when you're thinking about implementing an entirely new product, or creating potentially a whole new industry, you're taking on a whole lot of risk. And so, in order to do that and not fail, you're going to have to have a lot of transparency and also kind of this culture of experimentation as well too. So, oftentimes, the pitfall that a lot of people fall into is not being transparent with their team, because oftentimes innovation has a lot of risk and a lot of failure. People might be embarrassed to share that with their team. But it actually is only successful when they do the exact opposite from that. When they say, hey, we're failing on this front, we don't know how to overcome this particular operational challenge, or something like that, that you actually get the creativity needed to make that a reality. So, you have to constantly be thinking about it as a leader, to be humble enough to admit to your team that something's not working. So, that's one of the biggest pitfalls I see. in this process and evolution is really being transparent enough to get the amount of help you need to rapidly change and create such a radical breakthrough.

Yeah. Again, it's putting on that hat of, if it's not impossible, what will it take? And to your point, being able to be open and honest about it. As you were talking about that, I was thinking about, you know, a lot of times the innovation side of our business is not off— it's not necessarily mission-critical to our business. Because most businesses already have a core component to their business. And so, the fact that they take a little bit, just like the mat cleaner guy, like his mat cleaning business, him trying new things didn't hurt his business. It might cost him a little bit but it didn't. His customers didn't suffer because of it. So, failure on that realm, it's almost like a side hustle thing where you can try, test, try, test. And then, right, are we onto something?

No, absolutely. And I think that's, again, another pitfall of a lot of businesses is they think, okay, we don't need innovation or we don't need to take this risk at this time. It's just too inconvenient. It's too big. It's gonna, you know, cost us too much time, things like that at this moment. And what we see a lot of the biggest innovations, of course, we talk about Interface being a great example of this. A lot of times they were actually taking on something that wasn't necessarily part of their innovation practice or wasn't part of that. It was actually part of their core operations. So, for Interface, again, they were a carpet manufacturing company. And one of the challenges that they faced, which wasn't a problem to their core business model, they decided to take it on as an innovation challenge, but it originally wasn't a challenge. There was nothing that prompted it. Their customers were happy, their suppliers were happy, but they decided that we're going to be more efficient, we're going to lower costs, Anyway, so they just decided to take that initiative anyway, and they came up with a very clever solution. So one of the things they wanted to do is they wanted to reduce this toxic glue that they had in their carpets. It was awful, and it's something that the whole industry did, but it was really bad. It smelled bad. It was, you know, everyone really didn't like it. And in that kind of environmental spirit, they said, okay, we need to remove the toxins from this glue. And they said, how could we do it without any glue at all? And they kind of came from the principle of biomimicry in this case, which is where they were inspired by nature to actually remove the glue. And they actually copied a gecko's hand. I don't know if you've seen a gecko hand, but they can climb up a wall without any glue at all. They create suction with the wall just based on the print on their hand. They copied that on the bottom of their carpets so they could glue the carpets down to the floor without any glue at all, reducing their glue and cutting their costs enormously and underpricing their competitors. And so, I know that it's traditionally a pitfall for a lot of businesses to not want to take that initial step to say, if something's working, why should we change it? Why should we take that risk? But certainly, that experimentation and that culture of experimentation does pay off. It certainly paid off in the case study of Interface, which I think is such a great example of being able to remove an entire input from their overall product by thinking about it more creatively. But that's something that I think that if you're thinking about developing a more innovative culture, It does end up paying off because it's really about the culture, not necessarily a department that's dedicated to product development, but constantly having that culture of experimentation, testing out all of these different ideas. Is it working the best it can? Can we be even more efficient in this area, right? Asking all those questions, having a culture where you're constantly asking those questions enables you to actually grow and scale a lot quicker.

You know, and I think we had crisis, COVID, for instance, really showcased What would happen with businesses who innovated versus the ones who went, well, you know, this is our business and now we're hooped and now we're closing our doors and now we're laying off our staff. The good ones figured out how to innovate, how to turn the corner and how to do different things in order to keep their people employed, keep revenues going, and ultimately creating new products because of it.

Yeah, absolutely. And that was all about investing initially before the pandemic in that innovative culture, in that experimentation culture. Constantly asking those questions. All of those companies really invested in that culture beforehand so that they are able to pivot and be very adaptable and be very lean at the time where it most mattered.

Yeah. You know, I talk to a lot of entrepreneurs and there are 2 main arguments against creating this innovative culture. One is, I'm too busy because our revenues are going through the roof. And it's like, why would we even get distracted by this? Because Our life is wonderful. And the flip side to that is, oh, we're so dead, we're so stretched, we don't have the resources, we don't have the money, life is terrible. I don't know how we can be like this. What would you say to both those demographics?

Well, I think it takes a moment to pause and to see what's really valuable, right? What's really necessary at the end of the day. If you can take a step back and first look at What are your really core assets in a business? What are the people that are really delivering the most value? When were they most successful? Even when you think individually, when were you the most productive as an employee in your career, right? You always thought it was when you had a leader who trusted you, who empowered you, who listened to you and said, hey, I'm going to trust your ideas on this front. When we look at even, you know, Netflix, which of course has come up, you know, is having some challenges recently, but over the past decade, it's been really revolutionary being able to pivot past all of these technological revolutions. And the way they've ever been able to do that is they actually have a very flat structure where they actually empower each of the managers to be able to sign off on different movies by themselves. You don't actually have to get that far up in the organization, that high a level, to be able to sign off on a movie, which enables them to actually meet trends a lot faster and be receptive to what people want to see. And it also means that you don't have a typical Netflix movie. You're able to actually meet different demographics and things like that. So, it normally involves taking a step back, thinking about what's important to those 2 demographics, like you mentioned, but also looking at the fact that even in their own personal life, they've probably felt the most empowered, the most creative, and the most productive, and the most sustained as an individual when they had a leader who really listened to them and empowered them.

And trust it that the creative process will take care of itself. And, you know, there's a lot of curiosity as well in this conversation, right? We have to be hugely curious of what we can achieve. This has been extraordinary conversation, Vanessa. Could you remind everybody one more time how they can get ahold of you?

Yes, absolutely. So you can look at my website, which is vanessathomson.com. You can also message me on LinkedIn, which is just Vanessa Thompson. You can also get in touch if you want any kind of innovation services or consulting. the-sustainability-experts.com or our podcast, which is on Apple Music, Spotify, everything like that, which is The Sustainability Experts.

Love it. Vanessa, thank you so much. Do you have any last thoughts about what we've been talking about today?

Well, I would certainly love if everyone could kind of take advantage of a few of the key tips that we've left them with. Obviously, kind of thinking about what's your authentic key vision that you want to pursue. And then thinking about some really straightforward innovation strategies. I shared a few. There's a lot online as well. Thinking about things like waste to value. Can you kind of go through these thought experiments of thinking about what are the first straightforward innovation tips and tricks and start to implement them today? Because you need to in this very competitive market.

Love it. Thank you so much for doing this with us today. I really appreciate your knowledge, your passion, your expertise, and I can't I can't wait now for your book. So, we'll make absolutely sure when it's published or when it's on sale, please let me know so I can put it in the show notes.

Absolutely. Thank you so much.

Thank you for having me. I loved having you here. Hey, if you have any questions about today's episode or you'd like a complimentary 30-minute brainstorming session with you and your team, feel free to book yourself on my online calendar. The link is down below. It's the one that's marked meetwith.marchaine.com. And please make sure you connect with Vanessa. There's all sorts of really great resources. Follow her podcast. The link is in the show notes. And reach out if you need help. As always, I am at your service. And if you haven't done so yet, why don't you subscribe to this feed? Follow me on social media. Lots of great content out there and I love serving you. My name is Marc Haine. I hope you stay safe, stay healthy, and I hope I hope you dare to be the exception. Thanks for joining me today.

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