Sunday, December 4, 2011

Celebrating Innovation at EMC

Can innovation be fostered or facilitated? Can it be measured? Is it a formal or informal process? Can you have an innovation competition? Is it limited to Engineering? 

These were not the topics I was expecting at last week's EMC Innovation Conference. Rather, I thought it was going to be a geek fest with lots of greasy-haired, propeller-hat-wearing attendees drinking diet-Coke and speaking mostly PERL, C++ or Greek.

Instead, the event was attended by a few hundred local Silicon-valley EMC-ers, with hundreds more globally watching simulcast. It was business-casual with execs and technologists alike, and kicked off with none other than EMC's COO Pat Gelsinger (and former Intel CTO) and MC'd by SVP/CTO Jeff Nick. Rather than a siloed techno event, the importance of innovation at EMC was supported at the very highest levels of the company. Now that's refreshing.

Guest stars attended too - one Scott McNealy - in his usual humorous, politically- and sports-charged manner.

But First: Did the COO "Get It"?
Resounding yes on this one. Pat opened with a real command of what innovation means to the company - Innovation can mean disruption... and even destruction of old ideas. And that's good (if you don't agree, read the Innovator's Dilemma). But Pat also pointed out that without being coupled with commercialization/monetization, innovation doesn't count for much. And knowing how to commercialize an innovation can be just as challenging as coming up with the idea in the first place. More on that later.

Pat was also insightful in that innovation isn't just about technology. You can have organizational, marketing, and  process innovation, in addition to product-based innovation. And innovation can be top-down and/or bottom-up (EMC does both).  To help accomplish systematic, company-wide innovation, EMC uses the Golden Triangle: Organic innovation, University research/relations, and EMC Ventures. More on these later, too.

Can Innovation Be Measured?
Both Jeff Nick and Steve Todd (Director of EMC's Innovation Network) focused on this question, and there are many perspectives. Patents, for one, are a useful metric for organic innovation, but as Pat pointed out, they don't necessarily indicate that an idea has been monetized. Nonetheless, there is a rough norm of patents per employee per year that the company is striving towards. Intellectual Property in-and-of itself can be valued, as we've seen from recent acquisitions of IP by IBM, Google, and others.

Jeff also pointed out that another indicator of innovation is of course the monetization itself. What's the ROI on an organic development group? Did an acquisition recoup its cost?  Did a a venture investment create a useful return, or even better, might it have been a profitable acquisition? 

While measuring innovation might still be tricky, knowing how to facilitate indicators gets part-way there.  So when Steve pointed out that another indicator tended to be when small groups work together to solve a problem, there was an "aha" moment.  How to constantly encourage groups to form, and information to flow? Therein lies his "day job"...

Can you Compete for Innovation?
Thus, Steve realized that encouraging groups to form with a common purpose might spur organic innovation. And, for the past few years, he's been conducting an annual innovation contest within and across the company. Participation has been growing at a healthy clip. Topics can be many - some were geeky, but some were clearly for social betterment. 

To his credit, Steve also used a dose of data analytics to map every individual and every project across the company. He confirmed, in fact, that finalists tended to work in groups or "Cliques".Which begged the question, how to facilitate and accelerate this behavior in the future.

Formal or Informal?
The other aspect I really appreciated about the day was the intentional mix of formal and informal innovation the company strives to maintain. As I mentioned, the company emphasizes the concept of the "Golden Triangle". In addition to internal/organic innovation, we also work informally with external universities and research... and of course, formally with many prominent VCs and startups.

Mark Lewis, EMC's Chief Strategy Officer and leader of EMC's Venture group, gave a fantastic overview of how we regularly look at the startup community, and place measured investments with them. The ideas is to discover great ideas both ahead of the competition, and early enough such that we don't have to pay huge premiums to acquire should we deem them valuable.

The strategy behind these investments is broad, but what I heard was a 2-pronged approach:
(a) Pursuing the technologies that are complementary to EMC's product set - technologies and ideas that are net-new to the company, yet extend our leadership in the data center market
(b) Pursuing products that might eventually replace or cannibalize existing EMC products.  Like the Innovator's Dilemma points out, better to cannibalize your own products than have someone else do it for you.

Limited to Engineering?
Capping off was another surprising panel... of marketers. Could Innovation extend into how we market EMC and our products? Absolutely.

Two fascinating points stood out, and hopefully made a huge impression on the audience and EMC as a whole.  First, the panel chosen consisted entirely of recently-acquired marketing leadership located locally in the Bay Area. Scott McNealy had pointed out that "Silicon Valley DNA" was somehow different of that from the rest of the country - and EMC (based in Hopkinton MA) was making a concerted effort to graft that DNA into the rest of the company.

Second, was the attitude of corporate marketing. Do things differently. Use metrics. Understand the trends of the "new" buyers... (Hint: they don't pay attention to marketers using traditional email, snail-mail or traditional TV). Innovation here had to do with how social marketing, new/viral media, and fast-paced imagery was the way to both get attention as well as to change the face of the company brand.

For me, this day definitely served to change how I thought of the CTO's office, how I related to the concept of innovation, and how I think of corporate development.  As EMC further pursues these paths, hopefully other leading companies will as well -- it's good for them, for careers and personal development, and frankly for the economy as a whole.

More Resources
Jeff Nick (CTO): About  Article
Mark Lewis: About  Blog 
Steve Todd:  Twitter: @SteveTodd     Blog: Information Playground
Chuck's Blog: The Challenge Of "Innovating Innovation" In Large Corporations

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