Section 5: Disruptive Innovation in Action—Stories from the Field
In this section you will learn from a diverse array of practitioners about their experiences in launching disruptive innovation efforts. Our authors share stories here, from the importance of interdisciplinary engagement in building brand to the challenges of disrupting yourself through launching new, often cannibalizing, business models from within established enterprises to how deep customer empathy in cross-disciplinary teams can lead to unique customer relationships.
For additional perspective we spoke with Ryan Armbruster, Vice President of Innovation Competency for UnitedHealth Group. Ryan has led disruptive innovation efforts with a focus on service design in various healthcare settings. Previously, Ryan was the founding director of the Innovation Center (SPARC Lab) at the Mayo Clinic, the United States’ largest healthcare delivery innovation group working within a major academic medical center. At United, Ryan reports collectively to a group of C-level executives and is charged with identifying, incubating, and launching innovation capabilities across more than 110,000 employees. We spoke with Ryan about his experiences in launching innovation efforts in these very different settings.
Understand Your Culture First
As both Dr. Cromarty highlighted in Chapter 2, “Becoming a Strategic Organization,” and Ellen di Resta further explores in Chapter 4, “Assessing Your Innovation Capability,” the importance of understanding your organization’s personality and its collective capabilities cannot be underestimated. As Ryan emphasized, “You need to first understand the personality of the enterprise because if you don’t get it right internally first, it isn’t going to work. For example, at Mayo Clinic, as a provider of healthcare services, there is a long legacy and passion around empathy. While United is also in the healthcare space, it is a large payer and has a significant responsibility for high performance and achieving the metrics to monitor that performance. Additionally, United is a public company with obligations to serve shareholders, which adds to the emphasis on performance metrics. Understanding the raw materials you have to work with is essential. Successful innovation is built on the unique characteristics and assets of an organization.” Maryann Finiw’s chapter on branding offers tangible examples of the importance of understanding the collective capabilities of the organization, as well as its customers, embodied in the brand. Brandy Fowler’s chapter on disruptive business models explores leveraging capabilities in new markets or for new users.
Innovation Is a Contact Sport
As our book title suggests, innovation is a team sport and contact is key. In the assessment chapter Dr. Beckman shared her research on learning styles and team design with an emphasis on understanding type, composition, and integration. In this upcoming section, Yvonne Lin of Smart Design offers a look at how those interactions can bear fruit when deeply engaging with customers as part of the integrated team. In the Mayo environment, Ryan noticed that geographic proximity of the employees was key to their success. Upon reflection he said, “You will notice you don’t hear of many successful start-ups that were spawned from teleconferencing. They often start in a “garage” for a reason. The close contact and personal interactions are essential in the early stages of discovery. We are a bit more challenged to leverage proximity at United given our diversity of offerings and the geographic distribution of our 110,000 employees. I have discovered that although we can communicate effectively through telepresence, to really engage teams to collaborate on interdisciplinary teams, we need to create geographic hubs for face-to-face collaboration.”
Discovery Space Is Important
As most businesses are focused on developing and optimizing solutions that leverage their core competencies, the notion of creating space, time, and resources to discover new opportunity can be a challenge. In Chapter 14, “Interdisciplinarity, Innovation, and Transforming Healthcare,” Dr. Stahl describes the challenge in creating the operating room of the future, which required taking two operating rooms offline in order to identify, test, and prototype solutions in a real-world simulation. In Chapter 16, “Opportunities in Branding—Benefits of Cross-Functional Collaboration in Driving Identity,” Maryann Finiw describes the importance of creating a war room as a discipline-neutral space for exploring brand artifacts. Ryan described this challenge as well: “You need to carve out the space and time to probe the problem. That is often difficult for senior management to appreciate as we all live in a culture that rewards results, oftentimes even if it solves the wrong problem. I often feel I need to translate the power of problem exploration and definition; the power of using design thinking and empathy work to more deeply understand opportunities. They often don’t understand it until they see what it can do for them.”
Evidence Is Key
Because the process of discovery and formulation in opportunity recognition for disruptive innovation is inherently ambiguous and nonlinear, it is key to develop milestones that provide insights or evidence to the broader team of stakeholders. Dr. Stahl notes in his chapter that evidence is key for engagement with healthcare decision makers. Evidence can be quantitative but more often at these early stages it is qualitative as long as it is in some way validated. When constructing his innovation efforts, Ryan has learned a great deal of balancing this science and art: “I strive to keep all innovation projects under a year. When you are committing resources to exploration where the outcomes can’t be predicted, it is key to offer tangible insights or evidence of progress at a minimum of every 90 days. I have also found that projects that go on longer than a year, for the most part, run into challenges as research becomes less relevant and factors upon which you built your hypothesis have undoubtedly shifted.”
The Balancing Art of Transition to Implementation
Moving the innovation effort from exploration to implementation requires skilled leadership coordination. In Brandy Fowler’s chapter on disruptive business models, she details the challenges of managing these efforts internally, externally, or through hybrid models. Ryan’s perspective was this: “It is very important to have senior leadership that understands the difference between innovation work and operational work. These efforts must be kept separate without crossing paths as often the innovation team may be working on an effort that could threaten the current operations. A skilled senior leader will keep both running independently until the key moments of integration, when the innovation effort has matured enough for management by a development and integration team.”
The four chapters that follow offer real-world case studies, from branding to technology adoption in healthcare to launching disruptive business models from within to designing new product, service, and brand solutions by deeply engaging with customers.