"What is Innovation?" is back with Episode 76! In this episode, Jared sits down with Alex Goryachev, former managing director of Cisco’s global Co-Innovation Center and author of the book "Fearless Innovation." In this episode, they discuss innovation's role as the natural enemy of bureaucracy and how constrained environments stifle innovation. How do you keep up with change to continue innovating? How can you adopt a mindset of "playful pragmatism" in your businesses and day-to-day life? Alex's expertise and insights will help guide you to a more mindful and decentralized view of structured innovation processes.
Alex Goryachev is the former managing director of Cisco’s global Co-Innovation Center, where he spearheaded programs and initiatives to accelerate innovation. He is a Silicon Valley veteran who is a sought-after speaker on innovation and is often referred to as the ‘innovation therapist’. This episode dives into innovation's role as the natural enemy of bureaucracy and how constrained environments stifle innovation.
More about our guest:
Over the past 20 years, Alex made it his business to turn disruptive concepts into successful ecosystem-centric business models. He has an extensive track record of building and leading global cross-industry business & technology teams focused on revenue and market share growth, increasing customer acquisition and profitability through new digital products and offerings.
Alex is passionate about leveraging innovation purposefully and pragmatically to create opportunities for all. Today, he is serving as Innovator-in-Residence at the Center for Entrepreneurship and Innovation, Tulane University. He is an active venture partner with Interlock Capital, a community-driven venture fund primarily investing in underrepresented founders and geographies. Alex is also a US delegate and Technical Advisory Group member in the International Standards Association (ISO), defining global common standards for Innovation Management.
1:01 - What is Innovation?
2:21 - Innovation: playful pragmatism
4:50 - Bureaucracy vs Innovation
7:06 - Ability in adapting to change
8:50 - What isn't innovation?
10:25 - Conflations and implications: Idea and Innovation ; Invention and Innovation
12:20 - Quantifying Innovation and Metrics
16:10 - Innovation Indicator: 'Spent'
17:29 - Employee Sentiment Metrics
19:43 - Innovation: Shaping Careers
21:24 - Life outside Work
22:38 - Advice to Innovators
OUTLAST Consulting offers professional development and strategic advisory services in the areas of innovation and diversity management.
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Jared Simmons 00:05
Hello, and welcome to what is innovation. The podcast that explores the reality of a word that is in danger of losing its meaning altogether. This podcast is produced by Outlast consulting, LLC, a boutique consultancy that helps companies use innovation principles to solve their toughest business problems. I'm your host, Jared Simmons. And I'm so excited to have Alex Goryachev.
Jared Simmons 00:30
Alex Goryachev is the former managing director of Cisco's global CO Innovation Center, where he spearheaded programs and initiatives to accelerate innovation, where Jeff is a Silicon Valley veteran who is a sought after speaker on innovation and is often referred to as the innovation therapist. Alex, I am so excited for this conversation. Thank you for joining us today.
Alex Goryachev 00:53
Hi, Jarrett. It's good to see you. That's good to hear your voice.
Jared Simmons 00:56
Likewise, likewise. Well, why don't we just dive right in then tell me what in your mind is innovation?
Alex Goryachev 01:04
That's a great question. And usually, when you think about any large company or organization, that you really should have a committee and the subcommittee and the multiple tracks to define what innovation is for their organization. At least, that's what I've observed in a lot of companies. But in my point of view, innovation is something much easier. And it's actually an environment where all of those committees and subcommittees do not happen. I think innovation is really a mindset. And it's our ability to adapt to change, or take advantage to the opportunity is for a particular purpose, right? We innovate as people. But what feels like recently, I became a parent, and I was thinking about it, it was like only eight years ago, Wow, congratulations. And I still innovate every day as a parent. We innovate as families, we innovate as community as a society. So as organizations, businesses, that it's really, I think it's really about keeping up with the change, making change when necessary, and doing what's right, and being honest and transparent. And that really what creates an innovation.
Jared Simmons 02:15
Yeah, that is fantastic. There's so much in that definition in that sort of picture you painted. To me, as you're talking, I'm thinking about what innovation feels like, as much as what it looks like. When you talk about values. You talk about family, you talk about an environment, mindset, adaptability to change to me that paints a three dimensional four dimensional picture of what an environment should be and what that feels like to inhabit.
Alex Goryachev 02:43
Yeah, I think it's about being curious. I think it's about being playful. And open. And, and certainly, especially when it comes to business, innovation is being pragmatic. And it's kind of hard to be playful and pragmatic at the same time. But when you think about kids, they're playful, and yet they're pragmatic, they're very persistent. They know what they want, right? And they know how to get there in a playful manner. Right? So can successful organizations,
Jared Simmons 03:12
playful pragmatism, I love that. That's something to strive for. I think that also gives you this feeling of gives me the feeling of a restorative approach. I think a lot of what's been going on in the business world lately has been very draining a lot of talk about burnout, all these things. And I wonder if a playful approach to pragmatism cost optimization, structuring organizations properly, bringing an element of play curiosity and openness to that might help.
Alex Goryachev 03:41
You know, I love the way you say, the restorative, because I think this is so spot on. I mean, I think all of us are born innovators. All of us were playful kids, or most of us were. And then something happened regretfully with most of us, and not to get in a lot of detail there. But same happens in relationships. Same happens in communities. And the same happens in the organizations. I mean, if you think about a startup, startup as a playful, fun place, where everyone works very hard, and that seems sport. And the more the organization matures, the more conservative and disengaged it becomes. And it kind of shifts from a team sport to a political process. And I feel that's where the innovation dies.
Jared Simmons 04:29
Interesting, where the team aspect, the team sport is replaced by the political process that almost sustains itself. It's almost sort of a bureaucracy is what I'm imagining, as you're talking about that. It's nice to create things to preserve itself versus to solve a problem or deliver a benefit.
Alex Goryachev 04:47
Absolutely. Yeah. And I think the bureaucracy is something that certainly kills innovation.
Jared Simmons 04:53
You know, as I think back to the way you described innovation in terms of environment, mindset, ability to adapt to change. Change. Bureaucracy is the opposite of adapting to change, the politics almost come into play to preserve the status quo. And so that adaptability to change, I can see how that might suffer as that evolution occurs. So, yeah, that makes a lot of sense to me. Yeah.
Alex Goryachev 05:17
Look, there's a purpose and bureaucracy. It's a broad term. But when we think about highly regulated industries, what I call bureaucracy, is in reality, a system that's out there to protect you and me, and protect consumers and protect so many things. So it exists for a particular reason. And I feel that director sees grades for scaling things, and making sure that the same thing is produced over and over and over. But when we think about, again, innovative environment and innovative companies, it's good to have structure, and it's good to have see bureaucracy light. Yeah. And at the same time, give voice to every employee, and help every employee innovate.
Jared Simmons 05:58
Hmm. Sounds like it's about balance, because bureaucracy has its place. Innovation team sport mindset has its place. But it almost sounds like it's about seeking the right balance, almost in that phrase of playful pragmatism, being able to be playful, but pragmatic at the same time.
Alex Goryachev 06:16
Yeah, I mean, then that innovation industry bureaucracy exists for the purpose that people do not disassemble the plane while flying. Right. Right. Right. So there has to be pragmatic limits for accuracy and the pragmatic limits to innovation in this uncertain environment?
Jared Simmons 06:32
Hmm. Yeah, it's almost like the constraints, people talk a lot about creativity, almost fiving in a constrained environment, where if you have the right guard, Rails, creativity, curiosity, innovation, and those things can thrive in just pragmatically applying those in a way that doesn't stifle innovation, but channels it you mentioned, an ability to adapt to change as part of your definition of innovation. I really love that phrase, mostly because it takes it out of the business context, the ability to adapt to change is something that is hardwired in our DNA. Can you talk to me a bit more about what that looks like? And how you came to see that as part of your definition of innovation.
Alex Goryachev 07:13
adapting to change, I feel is the prerequisite to innovation for a couple of reasons. One is, in order to innovate, we need to be able to notice change, and actually pay attention to what's around us. And I feel a lot of companies that fail to innovate, are the ones that stopped paying attention to whatever happened in the industry. Right? They became too complacent and a bit numb. Right? So they were not noticing change, or they were shaming and ignoring change. Right? And when I think about the second step is actually our ability to respond to change. What happens if we don't? And I think the business case for responding to change is very clear. If we don't respond to change as organizations, we die, yes. So we ignore change or shame change or regulate change, we die. We don't pay attention to change, we die. It's almost like we have to do this. Right, wherever we want that or not.
Jared Simmons 08:18
I see. So innovation is less a choice and more a survival imperative.
Alex Goryachev 08:23
Yeah, it's definitely a business imperative. And when I really think about bureaucracy, we just talked about it. The bureaucracy exists to protect the status quo. And that's why it's kind of natural enemy of innovation.
Jared Simmons 08:35
Hmm, right. Right. Yeah. That's the kind of dichotomy that was set up in my head as you were describing the two. That's very well said, This is amazing picture of what innovation is, I want to shift gears and talk a bit about what innovation isn't. What isn't innovation in your mind.
Alex Goryachev 08:52
I think an innovation is not invention. A lot of people measure innovation patents. Look, when we think about the US Patent market, I believe that less than 1% of patents are commercialized Wow. And 99% out there are not making any money. Now there might be a reason for that. Right? Right. They're there to protect certain intellectual property or territory or business model. But at the end of the day, most of them, nine out of 10 are not commercialized. So I think innovation is something that's implemented in a way you take the mindset you implemented. And invention that's not commercialized is not innovation. Idea is not innovation. Ideas are a dime a dozen. There are a lot of ideas. There are a lot of great ideas or a lot of bad ideas, right? But not a lot of people are doing something about their ideas just like much with their invention. So ideas are not innovation.
Jared Simmons 09:50
Ideas are not innovation.
Alex Goryachev 09:52
Innovation is it's a mindset where we notice something and we take action, and that action drives change.
Jared Simmons 10:00
I see. So it's that the action that drives the Adapt ation in the previous definition about the ability to adapt to change. It's the action part that is really critical to taking something from invention or idea to true innovation, correct? I see makes a lot of sense. I feel like that's such an important distinction to make, which to me then implies that a lot of people don't make it. How do you think those two things kind of get conflated over time and ideas and innovation or invention and innovation? Or what are the implications of that?
Alex Goryachev 10:35
I think it got commingled in a way. Because, regretfully, so in a highly bureaucratic environment, they go back to Baroque cracy. Right and larger organization, we celebrate a lot of ideas. But we don't actually empower people to make change. It's almost like a culture of fake innovation or innovation theater.
Jared Simmons 10:54
Alex Goryachev 10:55
Where we say, give us all your wonderful ideas, what a beautiful ideas, thank you so much. Now go back to your cubicle and go back to work. Or, we love your ideas about working from home, we don't want to hear them. So I think, again, we celebrate the ideas, and we encourage people to share the ideas. But at the end of the day, they do not translate to execution. And that's typically happens in a midsize and larger organization. Now, if you think about small businesses, that's a totally different thing. I mean, small businesses are innovators, they innovate every day, because there's a very short gap in terms of the bureaucracy, right, in coming up with idea and actually executing them.
Jared Simmons 11:37
That makes a lot of sense. So that that sort of execution gap is much narrower. In the absence of hierarchy, bureaucracy, politics, and all those things. That makes a lot of sense. Do you think the element of being able to count something has factored into that my point of view on that is very similar to yours. Innovation is something that companies have been touting, and people have been sort of talking about as Oh, this is an innovative company, this isn't an innovative company. And as you think about how you can prove your innovative, you can count patent, you can have a brainstorming session and count the post, it's on the wall, you know, we met for two days and came up with 427 ideas. Do you think the perception around the need to quantify innovation plays a part in is it all?
Well, definitely right? When we think about the market, companies need to differentiate from one another. And therefore, they come up with all the metrics to show how innovative they are. And sometimes that becomes a public relations exercise versus an innovation exercise. And I feel from a culture standpoint, the only true way of measuring innovation is measuring the employee sentiment, because employees actually know if the company is innovative or not. Because every single employee, in every single company is an innovator. And they're definitely frustrated about something. And if they have an opportunity to take that frustration out and change the process, or not to do a stupid thing, or serve a customer better, or shift and create their work environment in a way that better serves them and the company, they're able to innovate. And I think asking the employees is the best thing.
Alex Goryachev 13:25
That's why you know, there's Best Places to Work ranking, right. That's why I actually really like and respect them, because they take innovation as a culture as a core element of their employees serving, ah, and the company's where employees feel that they're innovative, and they're allowed to be innovative, right. And they're not only celebrated for their wonderful ideas, but they can actually take their ideas to market, that company has a much higher success of being a true innovator than the other.
Alex Goryachev 13:55
It's really the same thing happens in societies, right? When you think about, let's use a traditional definition of successful country. With developed economy, we have a stable system, high standard of living, that's typically a country where people actively participate in the society. When we think about democratic process and so many other things, right? When they have an idea, they can innovate and influence the government or become the government and change their environment. And those are very successful countries. We live in one, right? Right. And same happens in corporations.
Jared Simmons 14:32
Fascinating. I had not made the connection between those two structures. And the employee sentiment connection is brilliant because it connects back to an environment, a mindset, and those sorts of elements of innovation that you can't measure. But you can quantitatively assess, you can ask questions, you can survey and translate that into something quantitative that you can track and measure. So I think that's what's interesting to me about that. And it's So juxtaposed to the typical innovation metrics, so how much do you spend on innovation? How much do you spend on research and development? How many patents have you generated in the last five years? Those sorts of things, you find those in the traditional, like, most innovative company reports, that silos in my opinion to one or two functions, right? So implies that innovation comes from research and development or innovation comes from marketing, but your definition of employee sentiment expands it to how does that finance person in accounts receivable? How do they feel about their ability to identify, notice change, build a response to it, and actually see it happen? Can I change and alter my environment? To me that's so important is to take innovation out of the functional view and put it into the humanistic sort of mindset frame that you put it in.
Alex Goryachev 15:53
I so agree with you, you know, I forgot to turn off the heater the other day for a couple of days, and I was not here. Now, if I take spend the symmetric was a hitting my place? Well, uh, definitely. Now, did I waste that money? Absolutely. So when I think about spent as an indicator of innovation, I think that's kind of a very useless metric. Yeah, I agree. Especially taking out of the context. Now, I feel that you've said something very important, because often we confuse innovation with invention. And we often feel that innovation is about creating a new product, right? And they feel nothing can be further from the truth. Innovation is about nine out of 10 is about a better process. And that better process can happen in accounting, right? As much as sometimes it's not doing something versus investing money into doing something else. Right. And going back to our employees, they know the best, what are the stupid rules around there. And they probably are very ready to challenge them. They definitely know how to serve as a customer better than somebody in the boardroom with an executive cafeteria. Right? So let's give those people a voice.
Jared Simmons 17:15
Yes, yes, the democratization of that process is critical. And that's why I love the employee sentiment metric, because it does it. By definition, it makes innovation a democratic process involves everyone.
Alex Goryachev 17:29
Yes. You know, I hate this one. The companies they have like special innovation teams. Yes. Yep. Yep. Again, there's a purpose that they exist. But let's agree that everyone in the company is an innovator. And there are no two classes of citizens, innovators and all the other people, right. Once we enable everyone to innovate, we will actually see much better results. And going back to your first question that begins with a definition, what is innovation for accounting? What is innovation for engineering? What is innovation for every function, and that really forces leaders to actually take a stand, and then tell their employees this quarter, our goals are XYZ versus saying let's be innovative, and then running away somewhere that doesn't serve anybody.
Jared Simmons 18:20
Right? Right. I love that reframing of what is innovation for accounting, what is innovation for the different functions? That alone would be an amazing exercise, I think, to take a board or leadership team through to help them reframe from the product driven thinking that you highlight there. Again, that employee sentiment score would give them a metric for how innovative is your organization, not your product development program? How innovative is your organization? Just one follow up question. Okay, this is the innovation team. What are they innovating? Okay, then that should be the name of the team? You know what I mean?
Alex Goryachev 18:59
Yes. And I think that the role of the innovation team is in facilitation. Mm hmm. It's about putting people together. I've seen a lot of engineering projects that engineers are innovating without getting sales involved. Yeah. Yeah. Oh, my God, but how we're going to sell this? Yeah. Right. So I think the function of the innovation team is getting people together and ensuring that there's inclusion and everybody's included in the process. Right. And then diversity of thought is celebrated. Right? And then something good happens out of there. Right?
Jared Simmons 19:34
Yeah, that's that's a perfect framing. You've seen innovation from so many different angles, and in so many different contexts in your career. I'm wondering about your career itself. How has innovation shaped your career?
Alex Goryachev 19:47
Well, you know, I think that my upbringing shaped my thinking. I'm an immigrant. So that kind of spells innovation. Yes, I grew up in Soviet Union, which is a country where innovation On was not necessarily celebrated. But everybody has to be an innovator to survive, right? And then I've seen a large country be gone almost overnight, which really made me believe that innovation can happen anytime. Change can happen anytime. And don't believe everything you read, or hear or shun authority, and pay attention to what's going on around you. And I think that these are the traits of the innovator. So I think that influenced my childhood imprint that I wait. That's what influenced my mindset. And then obviously, being able to be in Silicon Valley in the late 90s. Right, I worked for a pioneer of music industry called Napster, and being able to transform the music industry, and actually seeing it happen. Yes. Where everybody said, That's not possible. Yes, shaming, regulating, ignoring. And seeing that happen, really allowed me to believe that everything is possible.
Jared Simmons 21:04
That really was a transformative period in art, technology, all the different aspects of what Napster disrupted, it really was a very transformative time. We've talked a bit about how it shaped your career and your upbringing and the impact of how you grew up on the way you view innovation. What do you do outside of work? Do you have any hobbies? Yeah, you know,
Alex Goryachev 21:28
there's a lot of things that I do outside of work. Yeah, right. Parenting, yes. To hobbies. Right, right. But I love spending time with my kids. They're definitely born innovators. Yeah. Lately, I've been really trying to understand the mind and body connection. I think that it's an innovator. I'm a lot in my head, and a lot of my mind, and I'm really interested in being more in my body. And I think there's a connection with innovation, right? Yeah, I'm trying to innovate myself. Because when we show up as a whole self, we are capable of far more. It's a cliche that way, but mindlessness and the breath work comes to mind, right? And it's really an ability to empty the mind. Because when you come from an empty mind, there, you see so many different things, right? Really stimulates the creative and pragmatic process. I mean, I do breathwork exercise, and then somewhere in the middle of it, I come up with an idea. And then I take action. Right, right. I feel it's pretty incredible. Oh, wow.
Jared Simmons 22:34
Thank you for sharing that. I appreciate that. This has been such a great conversation. I can't let you go without asking if you have any advice for innovators out there. Yeah,
Alex Goryachev 22:43
I think it's really kind of three things that I've already mentioned. But innovators out there, I feel should understand that. Innovation is a team sport. And the lonely innovator is a myth. So innovation is about getting together with other people. They're not out there to steal your idea. Finding individuals that are not like minded, but actually people who have vested interest in the success and questioning and challenging. Getting that diversity perspective. Right. I think that's point number one. I think the point number two is innovation is not only about technology, it's about people in process. And I really want to go back to mid and large sized companies and innovators. They're, they're often fixated on how do we find that million dollar or a billion dollar or $10 million idea, which I really feel as a bit of a waste of time. So my advice to them is figure out a way to save a million dollars. Yeah, it's far more easier to do that in a large organization, right? Then build a product that earns that, right. So innovation is not only in the top line, but it's in cost avoidance as well in a better process. And then I think the last one is, and I'm a bit biased here. I really don't like this term disruptive innovation. I feel that when we try to think disruptively, that doesn't necessarily create the right mindset. And we often think about we want to just shove this in this year, that industry or how do we disrupt the competition? Right? I really think that we should think, pragmatic, non disruptive, and it's all about how do we add value and solve a particular problem? I love that versus trying to disrupt the industry. Right? Right. So that's a much better approach.
Jared Simmons 24:35
Right? Right. In terms of how you guide your thinking and direct your thoughts. Definitely, definitely, you may look back 20 years from now and say, Oh, that really disrupted this industry. But that's not how you should go into it. That's not what you should go into it as a goal or objective or mindset.
Alex Goryachev 24:53
Yeah, it's all about execution. It's all about being pragmatic, and every big idea gets delivered In the smallest measurable milestones, right? Right. So going back to small and measurable milestones is something that really helps all innovators, especially if they act as a team.
Jared Simmons 25:13
Right, right. That's a really powerful message, especially coming from someone who was involved in in Napster and everything that company brought to the world to say, focusing on trying to be disruptive is not the best approach to thinking about innovation. Definitely. Yeah, there was fantastic. Such helpful advice and concrete, love focusing on a team sport, and this lonely innovator has definitely reached mythic proportions, and does not exist. I couldn't agree more with that. And then the concept of trying to attract and find people who are not like minded versus the typical advice of finding like minded people to team with. I think that's also super important because it gets to the diverse ways of thinking that you were alluding to earlier.
Alex Goryachev 26:01
Yeah. Yeah, I agree. I think those things are the key. Yeah, patents are important. Don't get me wrong, right. I feel that the the things that I've mentioned, are they kind of more important because patents are meaningless without all that structured environment.
Jared Simmons 26:17
Well said, so many great insights. Thank you. Alex Gorbachev. Innovation is an ability to adapt to change. And also talked about an environment mindset, your ability to notice change, so many great insights. Thank you for your time, and for sharing with us today.
Alex Goryachev 26:35
Thank you, Jerry. Pleasure to be here.
Jared Simmons 26:37
All right. Take care.
Jared Simmons 26:43
We'd love to hear your thoughts about this week's show. You can drop us a line on Twitter at Outlast LLC. Oh UTLAST LLC, or follow us on LinkedIn where we're at less consulting. Until next time, keep innovating. Whatever that means.