How to inspire an environment for innovation APRIL 30, 2014

Big Companies Suffer With The Innovator’s Dilemma

Business Requirements vs. Innovation Requirements Strong ROI Proven Returns Efficiency Smart Capital Allocation Expertise in area of focus Innovation Requirements Non-traditional measures of value Willingness to take risks Failure Fresh perspective – appreciation for lack of expertise To achieve both requires a culture accepting of both driven from the top

Is An Innovation Environment Created By Nurture or Nature?

Recipe For Inspiring Innovation – 1 Part Nature, 2 Parts Nurture Understand what will work in your organization (nature) Emphasize behaviors – not just process (nurture) Get leaders to do their part (nurture)

The Innovation Sumo Bout Setting up the right infrastructure can determine if it will be a fair fight

Identifying Who We Are Helps Determine How We Should Think About Innovation DEDICATED THE ENABLER THE PRODUCER Provides funding and senior executive attention to prospective projects Employees or teams pursue Breakthrough innovation on their own. Establishes dedicated funding for breakthrough innovation Operates a full-service group mandated for Breakthrough Innovation. FUNDING DIFFUSED OWNERSHIP FOCUSED THE OPPORTUNIST THE ADVOCATE The question becomes – what strategic organizational decisions can Pfizer make to effectively deliver our 10%? In exploring various innovation models, there’s no single answer – but a framework that emerges, revealing two critical decisions that consistently differentiate how companies approach Breakthrough Innovation: Funding: Where does the money come from? Who funds an innovation initiative? Ownership: Who actually DOES the innovation work? No deliberate organizational approach to Innovation. Breakthrough innovation is driven by the efforts of a few intrepid “project champions.” Evangelizes for innovation through a small internal group Funding is primarily provided from business units Ad Hoc

Innovation Experimentation STAGE Identify Insight Idea Impact Implement Inform Plan for internal traction & sharing learnings A clearly scoped and aligned challenge statement Opportunity areas for focused ideation Assumptions & Designed experiments Action plan for testing & learning and Launched experiments Prioritized Ideas OUTPUT Tools & Techniques

Frameworks Tell What To Do, But Not How to Play the Game

Protect and nurture our ideas Risk falling on our face 3 Rules of the game Look in new places Protect and nurture our ideas Risk falling on our face FRESHNESS GREENHOUSING BRAVERY “Tell me more…” “Yes..and” “What if we also...”

“ ” nobody has thought everybody has seen seeing what and thinking what ” nobody has thought Now that you have better understanding of the I and the E and have seen how it can be practically applied. I want to signal to you that the Doing, or in other the words, the framework, tools and techniques are not enough by themselves. - Attributed to Jonathan Swift

RIVERS OF THINKING Provocation Provocation 12

FRESHNESS The first of these attributes is Greenhousing. This attribute is represented by a baby elephant because just like new ideas, they need to be sheltered and protected until they grow enough to defend themselves. Baby elephants are nurtured and protected by the herd for up to 2 years before they are released into the wild. New ideas also need to be protected so that they can be expanded upon and grow before they face judgment. Very often we judge very early stage ideas, and these ideas are dismissed or killed. We lose a lot of potential good ideas because we evaluated them before they were fully formed ideas.

“ To have a great idea, have a lot of them ” - Thomas Edison

Increasing the Number of Ideas and Degree of Provocation… Our Ideas Become “Fresher” High Fresh Ideas Degree of Provocation Familiar Ideas Low Low High Number of Ideas

GREENHOUSING The first of these attributes is Greenhousing. This attribute is represented by a baby elephant because just like new ideas, they need to be sheltered and protected until they grow enough to defend themselves. Baby elephants are nurtured and protected by the herd for up to 2 years before they are released into the wild. New ideas also need to be protected so that they can be expanded upon and grow before they face judgment. Very often we judge very early stage ideas, and these ideas are dismissed or killed. We lose a lot of potential good ideas because we evaluated them before they were fully formed ideas.

We can use a

3 Simple Expressions for Greenhousing “Yes… And” “…and what if we…” “Tell me more…” We’re going to replace these expressions, which we hear way to often, with some simple phrases “ Yes…And” This is the language of building…we are not debating or critiquing, we are building and strengthening. And if an idea falls flat, we move on to the next one… no need to apologize or eulogize the idea.

Leaders Must Clear The Way

Leaders Clear The Way By: Creating Enablers Modeling the right behaviors Articulating Ambition Removing Barriers Accelerating Action Linking Failure to Learning Reinforce points they make and land any they don’t

Most Important Behavior… Be Brave! Innovation can live anywhere, you just have to be willing to dare to try new things