The other day, my foster brother Seth and I were speaking about being innovative. Seth is a lead test engineer on a certain eXcellent gaming console in Redmond, WA.

"I don’t think I have it in me," Seth commented, "I can almost always figure out how things work, like noise canceling headsets for example, but I don’t know how people come up with those ideas in the first place."

"Maybe that’s true," I responded, "but I bet that you could be trained."

I like to tell people that creating something innovative and new is like pulling on threads until it leads you to a sweater, or even better yet, it’s like gathering threads into your hands until you finally realize that you’re already holding a sweater. In non-knitting terms, innovation is an organic process, involving questions and observations, and a lot of looking at the world differently. And one of my favorite guides for looking at the world differently is Barry Nalebuff’s and Ian Ayres’ "Why Not? How to Use Everyday Ingenuity to Solve Problems Big and Small"

In twenty years and countless adventures in growing our business, our only progress and for that matter our only interesting breakthroughs have resulted from someone asking Why not? Nalebuff and Ayres have crafted an inspiring, imaginative, informative and best of all, fun treatise that will arouse the entrepreneur in all of us. You will fly through this book, and you will never look at a problem the same way again.

—Gary Hirshberg, President and CEO,Stonyfield Farm Yogurt, Inc.

(more…)

“I start with the premise that the function of leadership is to produce more leaders, not more followers.” – Ralph Nader

Last year, we designed and launched an innovative new leadership track for a top-ranked business school. The track treats student leaders as executives, providing them with hands on leadership training in which their actions create visibile results. In other words, we created a playground for budding leaders. Well, we’re proud to say that tomorrow night the program will begin its second year; it survived and thrived after our departure. Below is an excerpt from a letter I wrote to Professor Dave Hofmann, who heads the track, on one leadership lesson I’ve encountered in the last year.

And always remember, innovation is leadership.

–

I was down in LA for an awards ceremony and my brother Bernard’s inauguration as President of the Burbank Jaycees (Junior Chamber). His vision for the organization? Leadership development, of course! It must be in the blood. He wants to radically improve the Jaycee’s use of community projects in developing leaders and attract even better people to the organization, aspiring professionals looking to develop themselves. The crowd loved his vision and he received a standing ovation, which apparently never happens. My family was thrilled, Bernard alone among the eight of us never finished college, but we’ve been so proud of everything he has done.

Which brings me to an important lesson. The keynote speaker at the event was Glenn Stearns, 39 year-old entrepreneur, owner of 26 companies, and real life millionaire (who recently played and won as the millionaire on the Real Gilligan’s Island reality show). He was not a great public speaker but his speech was fantastic. Glenn barely made it through college with 2.14 GPA, but now has a net worth of $500 million. That’s half a billion dollars. A lot of money.

His secret? Well, I believe he understood better than most the need to surround himself with brilliant people and to build a better system for business. He knew he wasn’t brilliant, so he knew he needed help. Most of us so-called "brilliant" and "successful" individuals never learn that lesson, we’ve gotten by so long on our own that we never learn how much we really need others. We tend to think it’s about us and forget that it’s really about building something that’s greater than us. And by far the most successful people are the ones that surround themselves with better people and who build better systems.

It should be obvious that there really is a limit to how much one person can do or to how much one person can earn; as leaders, we should be looking for ways to create exponential value. Remind the next batch of leaders about that every time they think about going it alone. For a developing leader, every time you succeed by going it alone is just reinforcement of a bad habit; the success blinds you from seeing how much greater your success could have been if you had looked beyond yourself. Sure you may be brilliant, but doesn’t it make so much more sense to leverage that brilliance with others?

Me? I fall into this "brilliance" trap all the time, and time will tell if I’m still in the middle of it. With all my academic and workplace success, my family has always figured I’d be the really successful one. But I’m betting on my brother. I think my brother "gets it" much better than I do. Awards or not, all my past success was mostly measured as an individual, and I can’t help but wonder what exponential value I left on the table . . .

Here’s to old dogs and new tricks. Best of luck with the next batch of leaders.

Patrick

"Stuart Hart was there at the beginning. Years ago when the term ’sustainability’ had not yet reached business schools, Stuart Hart stood as a beacon in the umbrage. It is clear commerce is the engine of change, design the first signal of intention, and global capitalism is at the crossroads. Stuart Hart is there again; this time lighting up the intersection."
- William McDonough, Co-author of Cradle to Cradle

Three years ago, a group of MBA prospects visited the University of North Carolina’s Kenan-Flagler Business School. We were wined & dined and offered full rides and stipends, incentives to reject offers at higher ranked business schools and earn our MBAs at Kenan-Flagler instead. The admission staff knew they had to be convincing, so they brought out the big guns. We were introduced to Stu Hart.

Naturally, we decided Carolina was a fine place to be.

At BRINQ, both Sheri Willoughby and I attribute working with Stu Hart as defining moments in our careers. Sheri, a chemist and environmental specialist from Florida, and I, a computer scientist and technologist from California, had returned to school to answer the question "How can we make companies more environmentally friendly?" However to our great fortune, Stu Hart took us in hand and convinced us to go "beyond greening", that the real opportunity for sustainability was not in better ways to comply (reducing liability and cost) but in creating new strategic business opportunities (increasing revenues and markets): "What radical new business opportunities are available for a sustainable company?"

Hart writes in his acclaimed new book, Capitalism at the Crossroads:

By moving beyond greening, companies hope not only to address mounting social and environmental concerns, but also to build the foundation for innovation and growth in the coming decades. In so doing they would outperform their competitors in today’s businesses, but even more importantly, outrun them to tomorrow’s technologies and markets. In short, sustainable global enterprises would create competitively superior strategies that simultaneously move us more rapidly toward a sustainable world.

Rather than seeking incremental improvements to what already exists, moving beyond greening often means pursuing innovations that may make obsolete what currently constitutes the company’s core business—it is an inherently disruptive act.

(more…)

“No single measure would do more to reduce disease and save lives in the developing world than bringing safe water and adequate sanitation to all.”
- UN Secretary-General Kofi Annan, Millennium Report

How do we meet the clean water needs of the world’s billions?

Connecticut based KX Industries may have the answer.

Perhaps you never heard of KX Industries (KXI), but you probably tasted the fruits of its work, they created the technology behind the PUR and BRITA "end of tap" filters: those water purifying pitchers we all know and love. Directed by CEO Dr. Evan Koslow and investor Kevin McGovern, KXI has recently developed an exciting new water filter technology, the "World Filter". Very little is publicly available about the filter, but the company claims its "nanofiber" technology is both extremely low cost and highly effective, so much so that Cornell business professor David BenDaniel called it "magic" when presenting a business case on the company. We agree with BenDaniel’s assessment, the technology was certified against strict standards: bacterial reduction of 99.9999%, viral reduction of 99.99%, and oocyst reduction of 99.95%. The company sees huge opportunities for profit and to meet the severe water needs of people in developing markets.

As magic as the technology is though, at BRINQ we know that success in Base of the Pyramid (BOP) markets is rarely about technology alone. For instance, look at Proctor & Gamble’s failure to crack the rural water purification market (as reported in a recent Wall Street Journal article). We’ve seen many demonstrations of P&G’s PUR powder, watching the swirling powder pull dirt out of muddy water looks like magic too, but its education requirement made the powder a difficult sell:

Still, the water purifier isn’t always an easy sell, even when it is free. One problem, P&G concedes, is that the product practically needs an instruction booklet. The powder, which kills bacterial diseases such as typhoid and cholera as well as various viruses, needs to be mixed with a specified amount of water and then allowed to sit for several minutes. The clean water then must be filtered through a cloth, to separate it from any debris, before it can be consumed.

Distribution in emerging markets is a huge and costly challenge too. Add marketing, gaining local trust, combating copycats, and protecting intellectual property to the mix and you can see that even with the most magical of technologies, the solution isn’t going to be easy. Clean water is also seen by many as a medical necessity: a perception might exist that people should get it for free. Even if the government buys your product at market value before giving it away, limiting your customer base hurts the products financial sustainability. You might even destroy local jobs by cutting out potential resellers. However, we’re not sure how toxic such “philanthropic poisioning” really is, and we know of at least one great example where free can help you reach high profit margins [Aravind Eye Care].

We believe an even worse curse for multinational companies is their financial return requirements. Though we don’t know how much KXI invested to develop the World Filter technology, chances are it was a pretty significant sum. There’s an unwritten law here: the more miraculous the technology, the more R&D dollars spent, the bigger and faster you’ll need to come out the gate to meet your Top of the Pyramid returns. With those pressures, it can feel impossible to start small and grow your business organically and smartly. Organic growth gives you time and experience to learn from your mistakes, whereas a fast and furious approach means that if you fall, you’re going to fall hard.

We have a lot of hope for KXI, the World Filter technology appears to be nothing short of amazing and Koslow and McGovern employ some incredibly brilliant individuals: their technical savvy itself borders on the magical. Still, here at BRINQ we know the world needs more than just magic, if brilliance were the only missing ingredient, wouldn’t one of us billions have figured out the answers long ago?

Past “How to Change the World” articles:
Unleashing Competitive Imagination — The Fortune at the Bottom of the Pyramid – The Model T Trap – Going Beyond Networking

The past couple of weeks have been intense travel weeks, with meetings at the Base of the Pyramid Learning Lab, hosted by Cornell University, and the 2005 Advisory Board meeting for the Center for Sustainable Enterprise at the University of North Carolina. Included below are some meeting highlights.

Base of the Pyramid Learning Lab
This latest session of the BOP Lab, held in Ithaca February 17-18, had three main agenda items, KX Industries innovative new "World Filter", the SC Johnson partnership with ApproTec in Kenya, and the field test for the Base of the Pyramid Protocol. The BOP meeting and its participants were fantastic, and we all finally got to thumb through celebrated business guru (and BOP founder) Stuart Hart’s new book "Capitalism at the Crossroads":

""This book takes the contrarian’s view that business–more than either government or civil society–is uniquely equipped, at this point in history, to lead us toward a sustainable world in the years ahead," writes Hart. "Properly focused, the profit motive can accelerate (not inhibit) the transformation toward global sustainability, with nonprofits, governments, and multilateral agencies all playing crucial roles as collaborators."

Center for Sustainable Enterprise Advisory Board Meeting
The 2005 Center for Sustainable Enterprise board meeting kicked off with a keynote address by Marc Gunther, senior writer at Fortune magazine and author of "Faith and Fortune: The Quiet Revolution to Reform American Business". We were interviewed by Marc several years ago when he visited UNC to do an article on Professor Stuart Hart and sustainable enterprise. Marc credited those meetings as one of many inspirations for "Faith and Fortune". We’re glad to have made an impact.

Another notable session was a panel discussion around "Making the Business Case for Sustainability", led by CSE Director Al Segars, with participants John Lott (DuPont), Pogo Davis (ConocoPhillips), and Tony Singarayar (Johnson & Johnson). Most memorable was Singarayar’s use of tsunami pictures to illustrate how difficult it is to recognize a change in context, even when your life is threatened. "We need a better business model lens", Singarayar commented.

Further sessions included a presentation by MBA students Dan Holt and Rebecca Swartz on the shortcomings of current sustainability indices (Calvert, Dow Jones Sustainability Index, etc.). "It’s almost impossible to do company by company comparisons," explained Swartz. The duo proposed an alternative system, which will shortly be available on the CSE White Paper page. Finally, Al Segars announced the launch of CSE Consulting. The brain child of CSE Executive Director (and BRINQ advisor) Katie Kross, the program offers fee-based consulting to organizations in need of sustainability business services.