Innovation means converting the intention to change into action and outcomes. Despite the importance of change agents, however, many organizations struggle to develop the skills required to embrace change. This episode presents a Change Maker's Playbook with Amy Radin, author of this important book.

Amy Radin has been at the forefront of rewiring brands for the future that is upon us. She built a track record of success moving ideas to performance at American Express, Citi, E*TRADE, and AXA. From her experience as a marketing, digital, and innovation executive and advisor, Amy has developed an insight-driven, down-to-earth approach that enables innovation under today’s uncertain, complex, and rapidly changing conditions.

Early on, Amy recognized that her expertise as a data-driven marketer could meet rising demands for large-scale digital transformation. She established one of the first corporate innovation teams, piloting business model breakthroughs, and building capabilities in risk-focused, highly regulated financial services companies. She pioneered 21st-century marketing and digital practices within the insurance sector.

Seeing pervasive and accelerating disruption as an opportunity to amplify the impact of her unique experiences, Amy launched a second career, helping leaders at startup to top Fortune brands advance their innovation priorities. Additionally, she serves on the Board of Directors of the AICPA. There, she advises on marketing strategy and implications of technology and workforce disruption for over 675,000 finance and accounting professionals worldwide. She is an active advisor to CEOs at select, leading startups.

Transcript

Michael Krigsman: We talk a lot about change, innovation, transformation. It's one of the hot topics that everybody cares about, but how do you drive change, and what's the difference between somebody who is, shall I say, merely a change agent versus somebody who is actually making change? That's our topic today on CXOTalk.

I'm Michael Krigsman. I'm an industry analyst and the host of CXOTalk.

Before I introduce our guest, please, please, right now, subscribe on YouTube. That helps us a lot.

I'm very thrilled. I'm really happy today to introduce Amy Radin, who is the author of the book The Change Maker's Playbook. Previously, she was the chief innovation officer at Citi, so she knows of what she speaks.

Amy, how are you? I'm so thrilled that you're here. Welcome to CXOTalk.

Amy Radin: I'm great, Michael. Great to be here. Thanks for having me.

Michael Krigsman: Amy, tell us about your book, The Change Maker's Playbook.

Amy Radin: Well, I got this idea about five or six years ago to write the book from a friend of mine who is a journalist. A few years ago, I decided to leave the corporate world where, as you said, I held some big innovation and digital transformation roles, and really had developed a passion for the hows of innovation.

To me, ideas are easy. The hard part is actually driving the change and driving the implementation through these tough, tough organizations. I really wanted to share my expertise with other people facing similar challenges, and that's what really led me to write the book.

Michael Krigsman: Okay, so I'm going to hold up a copy of the book. I've been reading it and really enjoying the book. I think the best place to start is, you talk about the change maker's playbook, and so maybe we need to talk about what is a changemaker.

Amy Radin: Right. It's a great question. The literature and language student in me, I think words are very important. I searched around for quite a while to say, "How do you actually characterize this persona, who I'm thinking about?"

Really, changemaker, it's a very empowering word. It's a word that thinks about how do you actually make change real. It's about execution and it's about change with a purpose because change by itself is just about making something different.

When I talk about innovation, it's really making change very purposefully to solve the problems that real people have. A changemaker is the person who makes that happen.

Michael Krigsman: Tell us. You say purpose, so what is purposeful change? Is that even the right way to talk about it, Amy, to use that term "purposeful"?

Amy Radin: Yeah, purpose is really important to me. The notion of purpose is having a destination, having a sense of what's the impact that you want to have and then aiming all of your energies at it with great passion. I think, without a purpose, that destination of where you want to go and what's the impact that you want to have, you could end up for change for change's sake, but not an outcome that represents the answer to, as I said before, a real problem, which for me is what innovation is all about.

Michael Krigsman: You need to drive that desire for change to some type of specific outcome that's related to whatever it is you're trying to accomplish in your business, your organization, whatever.

Amy Radin: Yeah, what I talk about in the Change Maker's Playbook is, the starting point, really for innovation, is about discovery, so being immersed out in the world with people you're interested in. If you think about startup founders, oftentimes when you ask them, "How did you get the idea?" whatever they're doing, they hit upon a real problem that was confounding them in their own lives. Being immersed among people who interest you, who have real problems that you care about, is sort of what discovery is about, and then going after the answers.

I talk a lot about passion. I think it's very much linked to purpose because innovation is so hard.

Michael Krigsman: We talk a lot about change, innovation, transformation. It's one of the hot topics that everybody cares about, but how do you drive change, and what's the difference between somebody who is, shall I say, merely a change agent versus somebody who is actually making change? That's our topic today on CXOTalk.

I'm Michael Krigsman. I'm an industry analyst and the host of CXOTalk.

Before I introduce our guest, please, please, right now, subscribe on YouTube. That helps us a lot.

I'm very thrilled. I'm really happy today to introduce Amy Radin, who is the author of the book The Change Maker's Playbook. Previously, she was the chief innovation officer at Citi, so she knows of what she speaks.

Amy, how are you? I'm so thrilled that you're here. Welcome to CXOTalk.

Amy Radin: I'm great, Michael. Great to be here. Thanks for having me.

Michael Krigsman: Amy, tell us about your book, The Change Maker's Playbook.

Amy Radin: Well, I got this idea about five or six years ago to write the book from a friend of mine who is a journalist. A few years ago, I decided to leave the corporate world where, as you said, I held some big innovation and digital transformation roles, and really had developed a passion for the hows of innovation.

To me, ideas are easy. The hard part is actually driving the change and driving the implementation through these tough, tough organizations. I really wanted to share my expertise with other people facing similar challenges, and that's what really led me to write the book.

Michael Krigsman: Okay, so I'm going to hold up a copy of the book. I've been reading it and really enjoying the book. I think the best place to start is, you talk about the change maker's playbook, and so maybe we need to talk about what is a changemaker.

Amy Radin: Right. It's a great question. The literature and language student in me, I think words are very important. I searched around for quite a while to say, "How do you actually characterize this persona, who I'm thinking about?"

Really, changemaker, it's a very empowering word. It's a word that thinks about how do you actually make change real. It's about execution and it's about change with a purpose because change by itself is just about making something different.

When I talk about innovation, it's really making change very purposefully to solve the problems that real people have. A changemaker is the person who makes that happen.

Michael Krigsman: Tell us. You say purpose, so what is purposeful change? Is that even the right way to talk about it, Amy, to use that term "purposeful"?

Amy Radin: Yeah, purpose is really important to me. The notion of purpose is having a destination, having a sense of what's the impact that you want to have and then aiming all of your energies at it with great passion. I think, without a purpose, that destination of where you want to go and what's the impact that you want to have, you could end up for change for change's sake, but not an outcome that represents the answer to, as I said before, a real problem, which for me is what innovation is all about.

Michael Krigsman: You need to drive that desire for change to some type of specific outcome that's related to whatever it is you're trying to accomplish in your business, your organization, whatever.

Amy Radin: Yeah, what I talk about in the Change Maker's Playbook is, the starting point, really for innovation, is about discovery, so being immersed out in the world with people you're interested in. If you think about startup founders, oftentimes when you ask them, "How did you get the idea?" whatever they're doing, they hit upon a real problem that was confounding them in their own lives. Being immersed among people who interest you, who have real problems that you care about, is sort of what discovery is about, and then going after the answers.

I talk a lot about passion. I think it's very much linked to purpose because innovation is so hard. Now, when you're trying to drive change and do something new, you're trying to coax people or a way of doing things out of some form of inertia. To me, passion is that fuel that helps you have the energy to actually overcome the inertia. That's just kind of natural. It's human nature.

Michael Krigsman: This raises a really very, very interesting question. Actually, I forgot to tell everybody that right now there's a tweet chat happening. Come on Twitter. Use the hashtag #CXOTalk, and you can join this conversation. You can share your thoughts on innovation and ask Amy Radin any questions that you might have.

Amy, this notion of passion being the fuel that drives innovation, I'm just thinking about large companies that so often seem to have a way of kind of weeding the passion out. Maybe tough on that.

Amy Radin: It's definitely a mindset and a type of person who goes at things. I often credit my own persistence as an innovator in big companies with the fact that I was raised in the middle of five children, five pretty competitive children. You kind of learn to stand up and stand out and speak up for your beliefs. It definitely takes a personality and a mindset to go after things.

I also think, sometimes, and I hear this a lot from startup founders sometimes, that they can be a little dismissive of big companies and the employees of big companies who sort of said, "Oh, they're just dinosaurs. They're not going to get anything done. They can't lumber."

But, you have to kind of look beyond the name over the door. I know, in my own experience working at places like Citi, American Express, AXA, there are lots of people who have career runways who are very talented and skilled who really need to see that the CEO is behind innovation, that there's a psychological safety net, so they can try things and fail -- a word that nobody ever likes to use in our society. That they will be empowered and that somebody will help them overcome the inevitable bureaucracy that's sort of laced into big companies just because they have a way of doing things.

They have rules. They have policies. They have procedures. They have regulations. Your average, even high performing, person in the middle or bottom of the organization simply doesn't have the authority to get past that stuff. So, they need to see that sort of umbrella of support over them and you unleash a lot of innovation energy in any of these companies.

Michael Krigsman: I guess my question, as I'm listening to you talk, is, yeah, it all sounds great. Motherhood and apple pie also is really great, but how do we get there?

Amy Radin: I've learned you start small. I can share some stories with you about my own experiences. I spent most of my career as a marker in very traditional, direct marketing and brand management roles. One day, my CEO came to me. He said, "You know, you need to make this business more innovative because we're not innovative and we need to be."

I started to think about, well, what does that mean? Literally, our starting point at the time was, like a lot of CEOs, he asked me to take on this challenge with no extra budget or resources. I got a few volunteers on my team. I said, "Who wants to help me figure this out?"

We said, "Well, hey, let's understand what are the trends impacting our industry." This was a $5 billion bottom line credit card industry. What are the trends? What can we understand about the unmet needs of our customers? What technologies can be applied to our business?

We literally started to sort of prioritize. What do we think could be of value? Then getting at it as quickly as possible with experiments and as close to live tests. I think there's no substitute.

Innovation doesn't come about from PowerPoints. It comes about from, as closely as possible, prototyping and bringing to life a real manifestation of what you mean and getting feedback from your potential customers.

Michael Krigsman: The passion that you described earlier then needs to be applied to understanding customer needs, number one, and then to solving those needs. Then the mechanism or the method you were just describing is essentially to be iterative, experimenting. Let's try something. Let's see if it works. Let's try the next thing. Is that correct?

Amy Radin: Absolutely. In the book, I talk about this sort of three-part framework. Seeking, which is all about discovering the insights about the unsolved problems that you want to solve and framing a purpose around there. Figuring out how you're going to do that in a way that's quite scrappy because, no matter where you are, unless you've got a trust fund, you're not going to have a lot of resources at that point.

Then seed it. It's all about prototyping, like iterating. How can you put together even paper or cardboard or just Band-Aids and rubber bands kind of manifestations of what you mean? Put your idea in the hands of potential users and keep listening, getting feedback, improving, getting to the point where you have an understanding of feasibility. Not only do people want it, but can you build it, and is it operationally possible?

Then the magic moment when you do have enough resources to actually create what you've got, moving to the third phase, which is scaling. You're really going to market and building a meaningful user base. But, throughout the entire innovation journey, you're always iterating and experimenting.

Michael Krigsman: Why is scale so important and rise to the level that you included it as part of your basic framework?

Amy Radin: Well, as I said before, innovation has many, many definitions. It's one of those used and abused phrases in the business lexicon. The definition that I adhere to is the viable solutions to real-world problems. A big aspect of viability is, is it economically, legally, operationally feasible? If you're not going to have scale, it'll be hard to have something that's economically feasible but, also, you're not really solving the problem. In the end, you want to reach user groups that you're meaningfully helping people.

I guess I also focused on it because what I see oftentimes, and you've probably had this experience as well, is that sometimes the people who are really great at the vision, coming up with the concept, doing the prototyping, may not be the people or may not, by themselves, have the skill set to move up to scale. And so, I think it's important to take into account, how am I going to get there and have the impact I want to have? That's where scale really comes to bat.

Michael Krigsman: I want to remind everybody we're taking with Amy Radin, who is the author, you can see, of The Change Maker's Playbook. There's a tweet chat right now taking place where you can join us. Go to Twitter using the hashtag #CXOTalk.

Amy, ultimately then, based on what you're saying, you've got to ensure that the problem you're solving is a meaningful problem which can only be calibrated or understood going back to customer needs. Does that place the burden of innovation, in a sense, kind of upstream? Before you begin innovating, you've got to, the organization, or somebody has got to be understanding, working, and listening to what customers really need.

Amy Radin: I think that's absolutely right. I see that as the responsibility of everybody in a business. We should all be listening to our customers all the time. I don't see understanding people's needs as the domain of a market research department or an analytics group.

I think, if you care about your brand and want to build your business or your social endeavor, no matter where you are, what function or what industry, in a world like ours where people's needs and habits are changing from one day to the next, technology is affecting all of our lives so dramatically, we just all have to stay in touch with what our users want and how we can help them. It would be very hard for any brand to stay viable if all employees aren't doing that.

Michael Krigsman: Let me ask you another point of practical advice. I work with a lot of different companies, large companies for the most part, and some smaller ones too. Very often it's almost like anti-innovation antibodies.

Amy Radin: Right.

Michael Krigsman: I know the reason why that happens. It's because, if I'm working in a company, I have my metrics. I know what's going to get me my bonus. Now you come along, and you tell me I need to do something differently. You know what? I'm not interested because I'm not going to get my bonus if you do what you say, even if it's great for the customer.

Amy Radin: Right.

Michael Krigsman: What do I do? What do we do about that?

Amy Radin: It's a leadership challenge, Michael. I think that if you look at the stories about companies that succeed or fail at innovation, even to the point for the latter group that they disappear, there's an inability on the part of leadership up to the C-suite and the board to demonstrate through not just talk, but also behavior, goals, talent decisions that this is, in fact, a priority of the organization and that even as businesses have to deliver on short-term shareholder objectives, there's a vital need to pay attention to where we need to go. That's, for many companies, becoming a matter of survival.

The thing that's interesting, and this was something I have learned a lot in the last four or five years as I've spent a significant amount of time working with startup founders and their teams, is that sometimes we who have spent a lot of time in the corporate world may be a little too often put resourcing on the critical path. "Oh, you want me to go do that? Well, I need a team. I need a budget. I need this. I need that." It's been really eye-opening for me to work with founders and see how they get prototypes to get even that first tranche of angel funding with very few resources, and so there's a way.

I think big companies, mature companies, are engineered for predictability and continuity. It's that crank that's turning, and that's really, really important. You want to serve large customer bases with quality. You have to be compliant. You want your systems to be up and running. You have to protect from cyber threats. There are a whole lot of reasons why continuity, predictability, and stability are really, really important, and we all want that.

However, innovation introduces discontinuity. I think the reason this is a leadership challenge is that, up to the CEO and board level, we've got to sort of keep that continuity going, but not have the discontinuity of innovation feel like, "Oh, my God! They've just thrown a bolt into my gears."

How do you have both? That's leadership and also comes down to, very much, talent. Who is on the bench and what are people motivated to do? Is the CEO creating that psychological safety net? If you're not failing, if some of your experiments aren't just being totally written off, you're not pushing hard enough at real innovation.

Michael Krigsman: All right. Let me make this yet more personal, again. Okay?

Amy Radin: Okay.

Michael Krigsman: Not strictly personal about me, but personal, individual people working inside a company. Here I am. I'm a middle-level manager. I have kids in college.

Amy Radin: Right.

Michael Krigsman: You're saying, and my CEO is saying, "Innovation is our priority! We're going to do this - innovate!" Blah-blah-blah. I'm listening to this, and I'm saying, "Not interested because I need to make my bonus." You've got the entire weight of the company sort of fighting the goal of the CEO who I saying, "We're going to innovate because we're great! Not only that; we listen to our customers!" [Laughter]

Amy Radin: Yeah. If you recall, I said it's talk and action. You're right. I think it's almost counterproductive to stand up in front of your organization and wave the flag and say, "Go do this." Innovation, like any other discipline, requires skill. It requires a certain mix of talent.

The same way as you're not going to get up in front of a group of people and say, "Go fight that fire," without the right gear and skillsets or, "Go build that new system," it's not a fair challenge to send people out on that mission without equipping them and giving them the opportunity to equip themselves with the skillsets.

Michael Krigsman: All right. Fair enough. Let's say that we've sort of overcome the leadership challenge, and at least I've got a few people inside the company. Now I'm senior management who have got a few people inside the company.

Amy Radin: Right.

Michael Krigsman: Or I'm one of those few people who really believe. I know that we have to do this and, not only that, it's the right thing to do for survival and, ethically, it's the right thing to do.

Amy Radin: The right thing to do.

Michael Krigsman: I want to do it. What do I do? What are the steps? What are the steps I take? I'm willing to jump in? Forget putting together a team. I don't have any resources and they're not giving me any resources. What do I do?

Amy Radin: I certainly, over the course of my career, had people. I've had those middle managers come into my office or come to my cubicle and say, "Hey, Amy. We have this idea. There's something we think would be a really smart thing to do for our customers." Then partner with them on how you drive it forward. Can you articulate the concept inwards? Can you draw me a picture of what it looks like?

Let's understand, at least hypothetically, what are the business model drivers that you think are going to move? Let's think about the size of the market. What would you have to believe to earn 1% market share?

I think there are some very basic steps that any manager can do. It takes time. It takes effort. But, at the beginning, it can start off as a pretty rough, qualitative process, and good guesswork just based on judgment and your knowledge of your sector to find a concept.

I think what happens oftentimes is, even though we have two ears and only one mouth, we tend to be better at jumping to opinions and telling people what's wrong as opposed to listening. I think that there's a better chance of cultivating that rough, "Hey, what do you think of this conversation?" if the answer is not, "Oh, we tried that before," "No, that'll never work," "How will we ever make any money?" We've all heard those answers.

I'd say if you come back, if you're working with a manager or a team who is able to come back and say, "Well, tell me more about that," or, "What made you think of that?" or, "Gee, let's think this through." It's frightening for somebody in a very established, traditional company where it's that continuity thing is what is generally rewarded.

It is very frightening to come forward and say, "I want to do this other thing," because you're right. People have families. They have bills to pay. They may have college tuition. They have a mortgage. They have student loans. You're taking personal risk.

Part of what I think, if you want to be a changemaker and you don't see that hook in the environment that you're in where your idea can start to get a breath of life, a shot at life, you may have to ask yourself at some point, "Am I in the right culture?" and to camp to a place where there is a greater receptivity.

I was very lucky. I worked at brands and under managers, under leaders, who gave my teams and I that space.

Michael Krigsman: You raise an important point. It's funny. As you were talking earlier, I was thinking that for talented folks who are willing to take on the innovation challenge and think about customers and also to weave in business models, which you just mentioned, and do all of this with no resources because it's just the right thing to do on multiple levels, if they are not getting a receptive hearing, those are going to be the most talented employees you've got as well and the most energetic and most passionate. If you don't respond, those people will leave.

Amy Radin: I think that's absolutely right. That's kind of the hidden cost or benefit, depending upon how you look at it, of innovation. What I've always found, not just in today's world--I can think back to the beginning of my corporate career over 20 years ago--that people who have personal aspirations in their careers and who see themselves as having a career runway will always ask, "Where is this place going? Is there a commitment to a future? Am I working for a brand that respects and values its customers and that is always anticipating and building towards future opportunities?"

In today's world, that really is a matter of survival. I think the talent who can really drive growth are going to self-select into career environments where they're able to fulfill their passions and drive the kind of impact that they want to have.

Michael Krigsman: It's interesting. Today, I just read earlier that Jeff Bezos, the CEO of Amazon, said at an all-hands meeting of his employees that Amazon will go out of business because the lifetime of a large corporation to be profitable and survive is more like 30 years rather than 100 years. And so, the question becomes, he said to his employees, "What do we need to do to delay that time? We can do that only by being responsive to our customers."

My question back to you then is, we hear lots of talk about customer experience. And so, where does that link into this conversation about innovation and being a changemaker?

Amy Radin: Sure. Well, I think oftentimes the natural place that a lot of companies go when they think about innovation is product; I need to make another product. Then I'll get more shelf space, and I can get more sales, more revenue and more profits.

The problem with that is, because the cost of technology have come down and any of us can start a global business manufacturing across the world from our kitchen tables, product innovation has a pretty short shelf life. It's the easiest to copy, and so it's about the worst place to limit yourself in terms of a defensible and differentiated new market position.

Experience, on the other hand, is very broad. I think sometimes people shy away from it because it is more nuanced. It's more complex. It's not a silver bullet. But, if you can think about, from end-to-end, the experience of how somebody solves a problem where you may step in from how they even figure out they have a problem to ultimately making a buying decision and then having an after-purchase experience. There are many steps along the way.

I spent a couple of years working in the life insurance industry. That's an industry that, even in insurance at the slow end of change, is an extremely complex industry. But, if you look along the entire experience from what causes somebody to get up in the morning and think they need to own life insurance to what is it like to actually own that policy, there's almost an unlimited set of places where your innovation as an innovator in the experience can differentiate you and endear you to your policyholders. I think you have a lot more opportunity when you think about the experience and what you end up creating becomes much more ownable by your brand.

Michael Krigsman: Therefore, the implication, obviously, as it seems to me, is that organizations that are looking at innovation need to spend at least as much time on that end-to-end customer experience as they do on their product.

Amy Radin: Yes. I'm doing advisory work with some startups right now. One of the companies, which will go unnamed, is a fantastically innovative, very successful company with amazing tech capabilities, incredibly talented people, and product pushers.

The conversation I keep having with them as we talk about business development and how to increase their presence in large enterprises, which is where they want to sell, it's, we've really got to think about stand in the shoes of your potential customer. Forget about your product or your sales goals. Think about, what is their job like? What's their boss hammering them about? What do they like as a human being? They're not just a title. How can I really help them succeed?

It's that attitude of, how can I help the people I want to serve be successful versus how can I get them to buy my set? Starting with that mindset shift gets right you right into experience and, as I said, gives you a much bigger opportunity set than if you're just thinking, "Gee, I want to make another version of what I already have."

Michael Krigsman: We have a question from Twitter that's related to all of this, which is, "How do you approach business model innovation?" It's one of the things you touched on earlier, so I'm glad this question came up.

Amy Radin: Yeah, it's a great question. Business model innovation, I think, is one of the toughest nuts to crack when you think about all the different types of innovation. I'll tell you about a process that we used early days in the credit card business when we were really trying to understand what are the implications of digital on that business. A lot of stuff, now it's going to seem really old hat, but then it was pretty breakthrough.

We said, "Look, what are the customer behaviors that impact our business model today?" Obviously, a credit card is pretty straightforward. People apply for the card. They get the card. They use the card. They keep the card. They pay their bill or not. There are seven or eight behaviors. Those are all elements to the customer experience and they're very important to the business model.

We started experimenting around, if we do this. It was sort of playing out, if/then with life testing. What's really important when you think about business model innovation is, we can't just look at one line in the P&L, the balance sheet. You've got to look at the totality and not assume because many counterintuitive things can happen. I think, getting to those drives of behavior, starting to conduct experiments, and looking at the total impact can point you in new directions.

Michael Krigsman: That's interesting. Can you elaborate on this point that you have to look at the totality of customer interactions, relationships, as opposed to looking at one line item when it comes to business model innovation?

Amy Radin: Sure. I'll give you an example. Again, back to my time in credit cards, the credit card industry charges late fees. We all know about that, even though hopefully none of us are paying them. The industry charges late fees.

At one point in our business, we saw late fees going down, and so some people were speculating like, "Wow. People are paying their bills online, so late fees are going down." That might not be a good thing. Certainly, it's good for the customers, but not for our business.

Well, we went in and did the complete end-to-end analysis by customer segment. In fact, no surprise what we found out is, yes, indeed, there were a segment of people who were paying their bills more quickly and avoiding late fees. They were also more loyal to the product and had a higher, more profitable usage.

Our offering on making it easy for people to pay their bills online, a customer service innovation, moved two different spots in the P&L. But, if you only looked at one, you would have thought, "Oh, my God! I have a problem. My business model is breaking." But, when you step back and looked at the customer P&L, it's like, "Wow! This is great! I have a healthier customer relationship. Better for them; better for me."

Michael Krigsman: That's a really hard thing to do for many companies because they are siloed, right? They have a siloed bureaucracy. Maybe bureaucracy is too harsh a term, although I'm not sure that it is.

Amy Radin: They're bureaucracies. [Laughter]

Michael Krigsman: [Laughter] They have siloed organization that looks at a piece of the customer, not at the whole customer relationship, which makes it almost impossible to understand how the pieces link together.

Amy Radin: Well, you may find that, and you're right. Then you get down to real basic nuts and bolts of accounting systems. I've been in organizations where there's no real activity-based costing. If you have one segment of your population that's more digitally engaged so their servicing costs are lower, you can't reward the product manager or segment manager for that benefit. There are all kinds of issues up and down.

I think, in a situation where the data may be siloed or people don't want to give you the data, the systems may not give it, you may have to start with a quantitative survey. You may have to start with some kind of ad hoc analysis. You may have to do something manual.

I remember early on. At one point we were bringing digital into the business and people were saying, "Well, what's the impact on the call center? Are telephone calls going up or down because of digital?" That's a really basic question.

Well, it turned out that the way the operating system was built for the call center, it literally did not capture the data that we needed in the logs so we could even do that analysis. I had an analyst doing it manually with tick sheets and Excel to do a sample of at least a couple of hundred so we could start by figuring it out.

Then, when you start to see it's worthwhile, at some point you've got to say, "Okay, I've got to change my system so I can capture a track." But even just forget about silos. Just tracking may not be in place because the systems were built for other purposes. You start with a manual sample and see if it's worth continuing.

Michael Krigsman: You've got to essentially figure out how can you collect the right type of data so that you can really understand what's going on because if you look at one piece of data without understanding the totality of that customer relationship, you may be optimizing for the wrong thing, essentially.

Amy Radin: Yes. I think the challenge a lot of businesses have is most companies are optimized for product. Now, you have to measure and reward. Product is tried and true more straightforward. It's a little bit of like twisting your arm in the wrong direction to all of a sudden say, "Well, let me understand the customer view."

I think, even in 2018, there is no CEO who will say they don't want to be customer-centric. Metrics and tracking continue to be challenging when it comes to really understanding customers as whole people and human beings in their relationship with your business. It's virtually always going to be a little jerry-rigged. Maybe not at a company like Amazon that's so advanced and sophisticated but, in general, it's going to be a little jerry-rigged, at least.

Michael Krigsman: You've mentioned metrics. What are the metrics that are associated with change making and innovation? I know, at the end, it's like, "Okay, well, the metric is, 'Are we making more money?'" but that takes time. How do you know you're going in the right direction along the way?

Amy Radin: Well, the caution I always give changemakers when they think about metrics is that one of the best ways to kill an innovation is to impose the overly precise metrics of a traditional business on your innovation. Think about this. If you are creating something that's truly innovative, how is it possible that the way you measure something else, maybe for decades, is the right set of metrics to impose? If you have no end market experience, is it appropriate to try to even build a P&L, a full P&L?

I learned this years ago, early in my career. I was working on a new product, and my team and I went to our president to show him what we had. We had the spreadsheet carried out, you know, the five-year interest, value, and everything to the penny.

He started laughing and said, "How could you possibly know this?" It was great to get that and very empowering to get that direction from a division president in a Fortune 100 company. That was very liberating.

And so, when you're early in the game, it's much more productive to say, "Okay." One of the questions I asked was, "What would you have to believe to get 1% market share?" Do a rough schematic that helps you understand, what's the demographic and profile of the people who I think would want this innovation? Tons of public data to size it.

Then say, "What if I got 1%?" It's pretty hard to get 1% market share, but it's not a credibility test. Then you can start to look at, well, what do I think the major drivers of revenue would be? You write down the line items. What do I think the major expense areas would be? Where would I have to invest capital? At least you have a list of the literals.

In one of my innovation roles, we would start those discussions out with small, medium, large. We'd have a discussion around metrics without numbers. Then we would do this 1% test.

Think about how much precision is reasonable at one point in the game and as you're iterating with your prototypes and tests, seek to gather the data that will allow you to get more and more precise. That's really what's happening in the seeding phase when you get to the business model and the greenlight moment when you're funded is sort of the results of your prototyping and your work on the business model are converging.

Michael Krigsman: Amy, I asked you earlier what should innovative employees do that are struggling for support, but what about senior managers who are innovative and they're having trouble finding employees who really want to get on that bandwagon? What should senior executives do in that case?

Amy Radin: Yeah. First of all, I can tell you, having been a chief innovation officer twice at both Citi and E*TRADE, it's a lonely job. Like a lot of jobs in the C-suite, you're up there. People below may be afraid to tell you what's going on. People above are very demanding and you have to be accountable to them. Your colleagues are worried about what you're up to. It's lonely, no matter what level you're at.

What has been amazingly helpful for me always in those roles is to find like-minded people, either inside or outside, so really having a network of fellow innovators. There are lots of networking groups and professional organizations where you can find fellow innovators. They may not have the innovation title. They could be technologists. They could be marketers. They could be product people. They could be digital. It's really a mindset and a focus. Having that network of like-minded people who you can kick around problems with and with whom you can brainstorm is really important.

The other thing about finding the change making talent in the organization, it's very unlikely that all the skills and leadership qualities of a changemaker are going to be in one person. It's really a composite. And so, if you're the senior manager and you want to build some innovation capability in your organization, I would encourage you to try to assemble that small group of people who are very diverse in terms of their backgrounds, their life histories, their functional skill sets, their perspectives, but who are collaborative and good listeners. Give those people the aircover.

I've been in situations where I've come into roles where people said, "You have to get rid of those people. They are just terrible." In the end, there are always diamonds in the rough who you can identify, you can empower with the right role and some air cover, and you will find some talent. Then, for your outside network, you can fill in the gaps.

Michael Krigsman: Okay. We are winding down now, but we have another really interesting question from Twitter. How do you determine the right metrics to capture? What if that means you have to change the business?

Amy Radin: Not an easy answer to that question, but I would say, depending upon where you are with your innovation, it all goes back to a good place to focus is, who are the customers with whom I want to direct my future, what are their needs and behaviors, and how do I see them behaving even in the category in a way that would give me a fix on where there is opportunity. Conduct as many experiments as you have.

I think one of the things that holds us back on a business model, we get very trapped inside how the revenues and expenses happen. There has to be, almost for the experimentation piece in your life, a little bit of belief that you're willing to go and muck around with some ideas and not impose preconceived notions of how you're going to create the business model, but you let the data emerge from how people are behaving.

There will always be surprises. Sometimes things won't work, but there will be positive surprises if you can just sort of control yourself from letting your existing knowledge sort of filter out the new goals, the new gold nuggets.

Michael Krigsman: Okay. Excellent advice. Amy, as we finish up, you've lived this; you've studied it; you've written a book about it. If you were to sum up everything that you've learned, lo these many years and experiences that you've had, what advice would you have to share to any audience that you think would be appropriate?

Amy Radin: This has been a great journey for me because I innovated my career. I undertook a tremendous pivot personally in the last couple of years. I'd say, thinking back to my corporate roles and even more recently, you've got to connect to what it is you're passionate about. Get out into the world to see, help other people, connecting with people who share your passion and for whom you can learn.

It's very much about the network. If I had to shortlist, it's to get in touch with what you're passionate about and get out into a network to connect with like-minded people, and things will start to happen.

Michael Krigsman: Another way of saying it might be to figure out what you really care about, do it, and then find others who care about something similar who will join you in that journey.

Amy Radin: Yeah, because the idea of the lone wolf innovator is a real fallacy. It really takes a team. You can't be resourceful without a great network, and you won't have resources when you start, so everything is about your relationships, your network, and your passion as a starting point.

Michael Krigsman: I love this. You speak with somebody who has really obviously done it when you talk about you won't have resources when you start. You know that's the way it works.

Amy Radin: It is, and I'm a pragmatist. I am not a blue sky, cool stuff innovator. I'm about getting stuff done, but it starts with passion. It doesn't start with a spreadsheet.

Michael Krigsman: Okay. Amy Radin, thank you very much for spending this time with us today on CXOTalk.

Amy Radin: You're welcome, Michael. It's been really great talking to you. Thank you so much for having me.

Michael Krigsman: Wow! Another really fast conversation. I wish we had a few hours to have these discussions because the topics are very rich. We've been speaking with Amy Radin, and you can see her book here, The Change Maker's Playbook. It's a book that is obviously born of both research and personal experience, and that's the best.

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