Change Agent - Issue 46

Stephen King launches his second online e-book, and it is downloaded by only about 150,000 people. Rather than laud his bravery and insight, or comment on a writer of his stature demonstrating a willingness to take a risk, people want to know why the e-book didn't receive a million downloads. The Wall Street Journal runs a snide paragraph or two suggesting that Mr. King might be better off waiting for a big corporation to back him next time. After all, this is Stephen King, and thus the critics expect instant success.

This external criticism doesn't just go after individuals, of course. When 3M launches a sequel to the Post-it, or priceline.com unveils a new service, our expectations are set very high indeed. This is partially due to all of the hype: Hype attracts criticism the way that horses attract flies. And when the product inevitably doesn't meet those expectations, we're ready to slaughter it.

It's this sort of mind-set that allows someone to get off an on-time flight from New York to San Francisco, having just flown first class (using frequent-flier miles), and bitterly complain that the nuts weren't warm enough. Success means that the critics lose perspective. Success means that nothing is good enough.

At your company, this probably means that even though there are countless ways to take your early successes and leverage them into new successes, senior management is afraid to do so. They're afraid to take the risk of being criticized by customers, competitors, or Wall Street: "We can't do that. We might fail!"

If Microsoft is good at anything, it's avoiding this trap. Microsoft fails constantly. The company is eviscerated in public for lousy products. Yet its people persist, through version after version, until they get something that's good enough. And then they can leverage the power that they've gained in other markets to enforce their standard. Most companies don't get the chance to dominate one market after another. Why not? Because they never went through the steps to build the power; they're afraid. Back in the beginning, when they had nothing to lose, it was easy to launch some big-time innovation. But not now.

Why did all of the retail giants fall to Wal-Mart? Why is Kraft so far behind in organic, nonengineered foods? Why did CBS wait years and years before launching much of anything on cable or the Net? Because market leaders are afraid.

The second criticism effect is the fear that top management (often the original innovators) has of being personally criticized. This is a fear that successful authors and actors have to deal with all the time. When people become associated with an idea or a company (especially an idea or a company that the public loves and respects), the stakes get higher. Not only will those people be open to even greater criticism, but they also may lose the asset that they've built and now treasure: the respect and devotion of the public.

Do you think that Larry Ellison or Steve Jobs or Tom Clancy or Julia Roberts wants to make a product that might flop? Not likely. It's about more than the money for these folks. It's about the aura of wisdom and insight that they've created. Approach one of these people with a daring new idea, and you're going to face quite a challenge getting it implemented.

But it's the last sort of criticism that makes it so difficult for successful companies to innovate. Whether you work for Ben & Jerry's or JC Penney or Toyota or Wal-Mart, your company is going to be staffed with people who are unfair -- and harsh -- critics of your new idea. And by the way, that's any new idea, almost anytime.

Why?

Because as companies mature and grow, they are far more likely to hire people to do jobs, as opposed to hiring people who figure out how to change their jobs for the better. And those people are there because they embrace the status quo. They like their jobs. That's why they took them.

As a result, whatever you want to change at your company has to be unfairly compared with whatever is happening there now. And the comparison goes like this: The worst possible outcome of what you're proposing must be better than the best possible outcome of what we're doing now.

I've sat through some meetings that were absolutely surreal. Someone proposes an email campaign that could dramatically increase a company's profitability and market share at the same time that it would decrease customer-service costs. Then the VP of customer service says, "But what about the people who want to call us and end up getting this email instead? What about them?" Now, simple math would show that she's talking about a tiny fraction of the audience. Worse, a quick audit would show that virtually everyone who calls in is upset about being put on hold for so long. So, while your proposal might offend a few customers, the critic ignores the thousands of customers who end up way happier.