Fast Talk: The Innovation Conversation

Beth Sawi: One of the things that we're finding is that you can -- and must -- innovate, even in tough times. We are trying to do some important things now for our employees. We have a set of visions and values that we talk about. It's easy to say that you believe in something when times are good. It's harder when you suddenly have to make tough choices. We have employees on two tracks: those who are going to stick around and those who are going to be asked to leave. We want both sets of employees to feel good about the experience. That's where innovation comes in. Charles Schwab is a great innovator. He said, "Let's set up a scholarship fund for people who are being laid off, so that they can go back and continue their education if they want. Or let's do hire-back bonuses of $7,500." Those kinds of ideas show commitment to the employees. And it shows that the company is innovative, even though it's going through tough times.

Mike McCue: In our performance reviews, we have a section on innovation. We actually measure our employees on it. When I first added that part, people looked at me like, "How are we going to do that?" What's interesting is that people have gotten innovative about measuring people on innovation.

Ron Beegle: In our business, the young folks are the innovators -- they have the dreams. But frankly, they would love to know where the potholes are. They've gotten a lot of inspiration from talking to the folks who have been down the road once or twice and can say, "You know what? Keep going, but beware of this, or think about that. I've seen it before."

The Opportunity for Innovation

Polly LaBarre: What are you seeing in terms of opportunities for innovation? Are there patterns that you can describe to us that say, Here's where people are looking today?

Tim Brown: Innovation is largely about making unexpected connections between things. That's one of the differences between innovation and invention. Innovation means looking for new places to make connections. We've spent the past few years developing a whole bunch of new channels for getting things to people using mobile technology and the Web and for connecting some of those channels seamlessly. People seem to be looking for opportunities to connect.

Arno Penzias: Somebody once said to me that new technologies don't create innovations. It's always two technologies coming together with a market that makes the difference. Sam Walton took the cash register and connected it to a database and changed the face of retailing. Suddenly, everything on his shelves went on spec, because he connected two things together. Any place where you can see a gap, you have an opportunity.

Rusty Rueff: I'm looking at how people have traditionally worked to find new ways of working in teams. We won't publish organizational charts -- they're too confining to the thought process. An organization works like a bad telecommunications map of the United States: People get together and do things, whether it's in the external world, raising money for a startup, or it's internal, grabbing people to brainstorm. We have org charts. But we won't publish them or give them out.

Linda Yates: That's especially useful in an organization like yours, because you're after a hierarchy of imagination as opposed to a hierarchy of experience. By doing away with the org charts, you can get people to stop focusing on, "He's above me, and therefore he must be smarter."

The How-to of Innovation

Polly LaBarre: Now it's time to get to the "how-to." How do you create a culture where innovation can thrive?

Chip Conley: The real challenge is to live with a left brain-right brain tango: to find a way for individuals and organizations to feel comfortable in a place of chaos and order simultaneously.

Simon Jeffery: It's important to recognize that innovation is relative. It happens in companies of different sizes, at different levels. Innovation can be a clerk who finds a way to make filing 20% more efficient. It's important that we notice innovation, nurture it, and reward it. The interactive-game industry has some interesting challenges. On one hand, we have the technology people who see innovation in a very binary sense: It's in the software that they are creating. Then you have the artistic guys and the game builders, who see technology as the canvas for their art. It's often hard to get those people to work side by side smoothly. But when these teams do work together, it can create a seedbed for innovation.

Ron Beegle: The folks who you expect to be the innovators aren't necessarily the ones who come up with the innovations. We spend a lot of time just free-thinking, where everybody talks about what we are doing and how we are doing it. That includes everybody from the accountants, to the operations guys, to the creative people. Let everybody think; let everybody dream.