Leading with Innovation
Maggie Hsu presented “Leading with Innovation” at Leadership By Design: Home Edition. Enjoy!
The following transcript may contain typographical errors. Please forgive any mistakes!
My name is Maggie, and today I’ll be talking about the concept of engineered serendipity. So engineering serendipity is really the process of bringing together diverse view points and letting them interact in unstructured way with the goal of getting to an outcome that wouldn’t have emerged if each person or team was stuck in their traditional silos or ways of thinking.
And the two fundamental principles that are aligned with engineering serendipity, one is to design the right conditions, not necessarily prescribe the right output, and the second is to allow for intentional inefficiency, and I’ll talk a bit about each in the following slides.
The first principle, as designers, we think about it similar to a greenhouse with the green house, you’re setting the right temperature, you’re watering the plants, but you’re not necessarily dictating how they’re growing or how fast they’re growing, I guess you dictate what they become, but the notion of really setting these conditions and not saying where you need to go exactly, but hoping that the group can actually get to a better outcome, and so the important thing years to focus on the purpose of the Y and not the methodology to have… So if there is no purpose and there is no methodology, you kind of end up with chaos, but if you are aligned in your purpose, the organization knows generally where they’re supposed to get. Then it’s, I think, more interesting to see how they get there.
The second principal is to allow for intentional inefficiency, so by doing this process, you are by default going to have a lot of overlapping initiatives or initiatives that might not be successful, so that feel fast mentality. And so that’s one of the things to keep in mind with engineering serendipity that not every single connection or event will build something amazing, but it’s really about putting those seeds and planting them and seeing how they’ll grow.
So I’ll talk about how this was applied at my former employers as quick refresher as is an online shunting retailer based in Los Vegas, founded in 1999, its CEO, Tony, she led the company through its acquisition by Amazon in 2009 for Orillia. Today’s, Aloha about 1500 employees, and most of them are in-house call center, so actually, when you call the Apis customer service line, you’re calling speaking to someone in Las Vegas, and Apis is very well known for its customer service focus, so one interesting example I like to give is that the longest recorded call between a customer and a customer service rep was actually over 11 hours, the longer than a shift, and they just had a great connection and they wanted to keep talking and as an informal rule, you don’t hang up if the customer wants to keep engaging, and I think that’s probably different than most call center experiences that you’ve had where you’re waiting on hold for an hour and then… It’s quite a frustrating experience.
The Zappos really wants it to be a really wonderful customer service experience, and I used to joke that causing a small issue and leading people to call in can actually yield more brand loyalty after that touch point.
So the Zappos purpose again, it’s about choose and clothing and delivering that, but really what we thought about was it’s about delivering this great customer service and delivering a low moment, so when you get that box, those shoes are for an occasion, the closer for something, and that’s delivering happiness or delivering a wow moment, so it’s not just the process of ordering these items, and we ended up coining a phrase that that was tracking this engineering serendipity, and we called it return on collision. And so the notion is helping employees physically collide with each other and talk to each other in order to increase innovation, and you may have heard of the traditional return on investment or ROI, and so we wanted to come up with a term that it’s obviously harder to quantify return on collision, a similar term that we coined was return on luck, so how can you quantify that serendipity, but just even having it was really helpful to reframe mindsets and conversations around not thinking through short-term benefit, but really thinking through that longer term, that longer term, mild.
And so a couple of practical ways in which this happened, we were looking to replicate what happens at a water cooler when two people meet or a smoke break, and people are coming together across the company for a brief moment, they are at all different levels. In all different departments, and they’re having those collisional moments, and so one example is that for most companies, the new higher orientation is a one-day affair, and you spend most of the time trying to get into your email that post, it’s actually about a month long, and so every single person from the general council to an entry level intern goes through the same training, and I sitting essentially a class for that month and learn how to look the phones and have that customer touch point.
But what’s really great is that it’s a multi-disciplinary class, so I was sticking excision in the finance department, load behold, after training a few weeks later, I had a question for the finance department, I had my contact there, I knew exactly who to turn to, so some interesting research has been done that shows that, and this was actually done out of the interest of Michigan, they looked at research scientists and they showed that for every 100 feet of zonal overlap, so for every 100 feet at their lab spaces were overlapping, they actually increased collaborations by up to 20%, and they could measure this because scientists published papers… They’re able to easily track that.
It’s interesting, I just read that this was also replicated at a research facility in Paris, and there they actually… They did the same thing where I think due to construction and different labs had to be moved around, and they found that that proximity effect actually yielded a three to five times increase in collaboration there as well.
And so on the reverse side, if you sit twice as far away from someone, you would imagine that you see them half as often, but you actually don’t… You see them… Half is often square. Do you see them? A quarter of his. Not so, but this is really interesting because it’s unexpected, you would think, again, it’s a linear relationship, but it ends up be more than that, and so he was looking for a new headquarters. They ended up moving into the old City Hall in downtown Las Vegas. And so this is the snapshot of the building, and it was a traditional design with lots of offices, and so we ended up knocking down all the offices, created an open for plan and had actually closed off all the entrances, so everyone had to go in the front entrance and physically see or live with each other and have those interactions, obviously, in the age of Cova, this would change quite a bit, and I’ve been interested in thinking through this really advocates the non-work-from-home component, and that the reason that you have to go into the office because of these collisional moments, I do think that in the virtual world, we’re in this hybrid world, there are opportunities to create that on phone calls, on Zoom calls that we haven’t definitely figured out, but maybe one of you here will be able to help with that… So one of the other things we did was create intentional inefficiency, so the high value snacks were actually placed on every other floor, so people had to go up and down the stairs to get them.
We also beta-tested physical space, so you oftentimes see apps coming out in beta form, but very rarely, at least I don’t often see a building that is not done and is open to the public, and I think that having that willingness to see how people are actually using this space and not having to finish this space, but really being able to see that… I think the example that we have here is pairs that are able to move… One idea was actually to make everyone switched desks every month, that turned out to be a little bit too extreme, but things like that were ideas that we played around with, this is a ball pit room, so also adding a little windy, and I’ve had many conference in this conference room, writing in the elevator is actually a perfect collisional moment, it’s the short moment of time you’re in the elevator, but almost nobody actually has a conversation, it’s… At least for me, it’s quite an awkward moment, so we installed TVs in all the elevators and added games like in reber and pan, and you’d be surprised that one person playing a game and there’s just an invitation to join, and that created these… Again, club moments, two great books that talk about this more detail, one is Where Good Ideas Come From by Steven Johnson, and he talks about innovation at the fuzzy edge of different disciplines. So when you think about how DNA was discovered, was discovered by Watson and Crick, who are biologists, but they were having trouble figuring out the double helix structure, and it was only until they ran across Ross in Franklin and a chemist who was able to help them, see their data in a different way that they actually cracked code of Dean.
Another book is called linked by Rose, and that talks a lot about the power of we ties. And so if you think about something like getting information for your next job, everyone in your immediate network has access to the same information, so it’s not actually the best source of getting that information, it’s much better to draw on the weak ties of other networks, and as someone who’s gotten many a job that way, I think it’s really interesting to think about that power of week tie, Balinese who writes a lot about the concept of engineering serendipity as well. And he was writing a lot when there was that big, again, work from home at should people come in, what’s the actual value of having everyone in the office and these unscheduled on plan moments. I do think that in like Slack are able to help with that and have that water cooler conversation and that unstructured time, and I just wanted to share with my last few minutes, a few examples of how we saw this in action. So the first one, going back to the apes purpose, about delivering great customer service and delivering low… So the first example is actually from… Salis had never run any sort of television commercial, and rather than hire a creative agency or talk to the communications team, we actually didn’t exercise where we took every employee in the company and divided them into random teams of about five people, and each of those teams was tasked with creating a commercial for Zappos that would potentially be aired, and so as you can imagine, most of the teams did not have great ideas and they kind of played out, but I’ll show you the commercial that we ended up using, and it was actually created a team with mostly no visual design experience or production experience, but they actually produced this entire commercial themselves, and I just think it’s a really great example, I kind of an innovation that wouldn’t have happened if it was done, I think more traditionally. So I’ll share that video now I…
Life is a book full of chapters.
Let me tell you a little bit about my story.
This is a ring.
He’s my favorite.
He always gives me a list with a smile on… This is Jason.
We have a lot in common, we both come from a whole place where our customers having is this number one, but I move in to so much more beyond his work, he has a beautiful way, he… Their face is always light up when they see me, I…
I love it when I make them smile.
Especially that little one.
I brought her shoes for her very first steps, the in… Never forget that moment.
This is Kelly, I…
I helped her get dressed for her first date, and little did she know that man would be her husband one day in… This is a nice…
I brought him sneakers for his very first marathon, like isn’t always easy?
I visit at home that don’t always wanna keep me around, but then I realized things should be much more simple, it’s time for me to reconnect with my roots and do what I do best and… But we’ve been focusing a lot on growth, but we’re realizing that it’s time for change, we want to refocus on you… Yes, on you.
This is just the beginning. When we say change, we meet Ed in a big way.
I know your time is valuable and I wanna help you spend it on what’s important, we believe in family, culture and building community.
I’m so much more than a bare.
I’m here for you. Wherever you are in life, I wanna make you smile.
I want to be there for life’s picture perfect moment.
There, Bernard… You are not a box either, you are so much more.
I’m not just a one… We’re not just an online retailer, and you’re not just a really great video that showed our core values and our purpose and aligned with the fact that we don’t tend to advertise the second, the second one was around this customer service idea, so we were trying to figure out new business lines to get into, and so again, solos was selling shoes and clothing, but really wanted to emphasize a strong customer service focus, and so again, there was a team brainstorming what we could launch with, whether it was a lose hotel or is that those airline and we started thinking about the worst customer service experiences that you’ve had, and so think going to the DMV and renewing your license, things like that, and so someone actually who wasn’t even on the team, I think they were shadowing the meeting, said, Well, using the restroom at a festival is a pretty poor experience and everyone kind of left and moved on, but ESU actually kept coming back to that idea where it’s such a horrible customer sort of experience that no one then thinks about… Another one that we had was riding the elevator in the subway, and you have parents trying to get the children up and down and actually thought about having a surprise elevator… Wow, experience. But on the porthole side, we ended up coming up with something we called Not The Zappos Port-A-Potty, but at those propane… So this was an initiative that I worked on, and it was essentially a series of luxury Porta parties that we would bring to festivals, sporting events in other events, and we added these features, so… So dispenser voting at the time, I think it was Trump and Clinton, and you could pick one and you get… So there was a selfie station, so the mirror actually had LED lights and you take selfies, the Arnold had some fun games you could play that would manipulate the light, and again, in a cross-functional team, I was proud that the cost that we ended up with was actually online, other toilets, so we were able to innovate around how to develop it, and so just with my remaining time, I wanted to show a video of the porta party experience, just… You can see what that looks like.
Port that, Pete.
I think the… The… The point there is that, so we sometimes did things to the extreme, but I think they really got people thinking, and some of the quotes in that video make me laugh out loud, ’cause you would never imagine anyone saying that about that from experience. And more interestingly, has actually turned into a very viable business, so there was a market demand for this, and we got quite a bit of inbound requests for this, and so I think, again, innovation can take all different forms, and I’m excited to engage in the Slack chat I saw some the questions around how we can bring that to the virtual world, but I just wanna highlight that having that clarity of purpose, so everyone is aligned in the broader goal of organization, but leaving a bit of inefficiency at the edges will really heal some great results, so thank you so much. I will have additional reading that I can paint Slack and really appreciate it in a oneness.