Ahead of his presentation at the Chief Innovation Officer Summit in London on October 19 & 20, we spoke to Matt Hubert, co-founder of Bitmatica.
Matt is the co-founder of Bitmatica, heads its product organization, and leads its advising, training, and workshop programs. With over a decade of experience building products in Silicon Valley, he has worked with enterprises and startups worldwide to build innovative experiences and capture new markets. He consults with dozens of organizations on product, design, and engineering strategy, advises numerous startups and accelerators worldwide, and focuses on using customer experience as the key to innovation. Prior to Bitmatica, he founded Claveo, a mobile financial services security platform, and Dashtab, a sales and lead management startup.
How would you define innovation success?
When we define innovation in general, we look at organizations large and small creating new, radical or even slightly unorthodox ideas relative to existing business units, and executing them rapidly. The successful innovators we see have of course done both of those consistently and more effectively than anyone else in their market segment (or even across segments), and as a result, have driven new revenue and often become leaders in these new markets.
What is the main differences in innovation approaches between startups and enterprises?
The two fundamental differences between enterprises and startups are size and runway -- and these completely dictate the approaches each take toward building products. With only 18 months to live in many cases, a startup is obligated to produce something of market value extraordinarily fast, as their entire business depends on it. This, in turn, creates a remarkable appetite for risk, allowing startups to take on challenges with little fear of the consequences. Simultaneously, small team sizes enable rapid decision making, a crucial aspect to delivering innovation as fast as necessary.
These are core to a startup's DNA, and therefore are often hard for enterprises with large budgets and extensive teams to replicate. Moreover, this lack of experience and size creates one additional fundamental advantage: the source of new ideas.
All (successful) startups are singularly focused on customer-driven feedback, and true innovation occurs when the brightest product thinkers tap into the needs of their customers. But as organizations grow, a peculiar shift happens: most businesses stop listening to their own customers. Perhaps due to now-internalized market insight, products begin to be built top-down, and even innovative ideas come from management, not customers. However, experience only dictates what a market wanted, not what it wants -- and to truly innovate, enterprises need to return to a startup focus of customer-driven product design.
What are the main challenges that enterprises face when trying to implement startup strategies?
We consistently see organizations challenged to implement these strategies, because while they seem fundamentally straightforward, there is still often a lack of understanding of how innovating like a startup actually materializes in practice.
Almost every innovation director has heard of, applied in a corporate setting, or even advised other startups on concepts such as agile development, rapid prototyping, and other "lean startup principles". However without actually having built a company from scratch first-hand, it's hard to fully internalize the speed and process by which products are built at a 10 person company versus a 10,000 person conglomerate. Without either having that reference point personally, or having an advisor on your team who does, it becomes very challenging to apply those principles in practice in the way that they were meant to be applied.
This gives rise to concepts we've seen such as "enterprise agile", an honest approach to moving quickly, but nowhere near the real thing, and without a proper reference point, no way to know the difference.
Every head of innovation has a drive and a mandate to innovative as fast as possible, but without a first-hand benchmark, even a 10x improvement over existing processes may only be scratching the surface of an organization's full potential.
How can a company build a culture of empathy?
Empathy in my opinion is a major key to success in all aspects of business. By empathizing with customers, you can understand their challenges, and build products to serve them even more effectively. By empathizing with co-workers, you can foster a culture of shared purpose, create incentives to allow teams to do their best work, and ultimately drive huge productivity gains.
The first aspect to creating a culture of empathy is trust. Leaders must trust their teams, listen to their opinions, and support their ideas. The best leaders focus on enabling their teams by removing barriers to productivity, instead of strict top-down management. By empathizing with the needs and perspectives of the teams on the ground and trusting their judgement, management can allow great ideas to flourish from the bottom up, which gives those with the most comprehensive understanding of the problem substantial incentive to drive change. When management listens less to their subordinates, empathy on both sides of the equation suffers, and innovation begins to stagnate.
The second aspect of building empathy is found in creating shared incentives. When entire organizations are aligned, managed, and compensated based on shared goals and values, teams naturally begin to work together, and listen to each other to help achieve a common purpose. In organizations where a rising tide lifts all ships, individuals are encouraged to find ways to collaborate even when the specific goal of a project may not directly impact their respective business units -- whereas with individualized KPIs and a culture of singular achievement, there is minimal incentive to empathize and work together with the rest of the organization if it does not impact an individual's perceived performance.
What can our audience expect to take away from your presentation?
My hope is that through a case study- and example-oriented approach, participants will be able to have a far deeper understanding of how Bitmatica and other innovative startups actually build products, and critically, how those concepts can be applied in an enterprise setting -- particularly for those who know their organization's potential to transform into an innovative digital business, but haven't yet had the opportunity to build one first-hand.
You can catch Matt's presentation at the Chief Innovation Officer Summit in London on October 19 & 20.