The Startup Balance – How the Wrong Mindset Destroys Innovation

Working in a startup surely differs from working in a big cooperation. You work on a big idea or vision that most of the time no one else pursued before. There is just no wrong or right in doing what you are doing, especially when working on an idea that has not been worked on before. While in a big cooperation the process and structure is given and usually has been followed for years, whether successful or not, pursuing innovation requires not only organizational change but moreover personal change, I call this the “startup balance”.

Coming from a long background as marketing and innovation consultant, I got to work on many projects for some major brands. We worked on innovative projects such as developing the next big mobility service, as well as on how AI could be implemented to simplify complicated and heavy-duty work procedures, or how communication could be used to redefine the purpose of a huge food brand. However, most of those ideas never made it. The question is why not? You might think the ideas were bad – and trust me they were not. Like with so many great ideas out their, they never picked up, they simply never found a “leader” that unleashed their true potential to get those brands the promising results they wanted.

Now being part of IONIQ and talking about my journey from day one and what we work on I most of the time get to hear: “Wow, how progressive and innovative – must be cool working in such an agile environment! In our company this would not be possible.” I always answer: “What do you personally do to facilitate innovation in your company? Have you ever risked anything to push an idea forward?”

I got to see how big corporations pursue to be more agile, they implement a failure culture by hosting a Fuckup-Night once a year and might do some brainstorming but never follow their gut. It is very common to hear “Honestly, good try but sorry we cannot take this further. There is no budget or we need to focus on fixing other issues”. Most companies only talk about innovation – some of them even hire expensive consultants to talk about how innovation could be achieved – but most of them fail in the implementation because many people are open for change as long as they do not have to change.

Entrepreneurs in theory

Sure, the first step is to recognize that change is needed. Tick in the box. Many people seem to understand the issue and see the need for change. Nevertheless, somehow the majority cannot step out of their comfort zone and try out new and different ways. What is even worse, many people demand change, but do not see the need to start with themselves.

As always, the fish stinks from the top. If your company wants change, you got to have people that lead the new way as a role model. See them as architects and construction worker in one person. You build a new street that was reliable but bumpy. You want to renew the street. Some people will be annoyed that they cannot take the old street. I mean they used it for years. Others will be happy to get a new street that they can use in the future to get easier to their destination. But if you show how important the new street is, also actively help building the street and also involve your employees to do so, skepticism will decrease.

Our journey of spinning of a cosmetics company out of a mid-sized German company certainly shows that a crazy vision can become reality. I want to share my personal view on the success factors of hardcore innovation within an existing company. This is how we facilitate innovation and how we want to maintain our disruptive character while growing.

What we at IONIQ are trying to implement is an organizational hybrid; merging the stability of a grown company with the speed and creativity of a startup. We started in the incubator “freiraum” of the J.Wagner GmbH. While we have not launched our product yet, we have gone a very fast pace in getting an idea to life that has been created many years ago within J. Wagner GmbH, a leader in surface coating systems. While finding the right path has been tough, the more pleasant it is going today.

Finding the right people is surely a huge part of being able to go on the pace of developing and showcasing an innovative and smart skincare sprayer, smart cosmetic products and a skincare consultant app. However, our IONIQ One prototype skincare sprayer has been a huge success at CES 2019 in Las Vegas, the world biggest consumer electronics show, the global stage for innovation. Most of the people and also many employees of huge well-known cosmetics and technology companies that tested our technology have been truly astonished by what we accomplished so far.

How did we get there? Within the past year we have been growing in a very fast pace and keeping up the spirit of disruption has been tough. I guess this is what many organizations want these days. But sorry now comes the bummer: In my experience, achieving the things we did so far has not been about a special form of organization, a ton load of money or the world experts of certain fields. In my opinion, is has been about finding a balance perfection and united mindsets.

Balance perfection

First of all, I have the theory of keeping things in balance. This is nothing new to the world. Extremes have proven to be bad in every disciplines. Too much sport causes physical damage, extreme political views can cause war and even too much love can cause distance.  Why should a fully agile company be super innovative?

Hence, we need to keep things in balance. Meaning you need the creative people that are working alongside the more structured people. You need a balance between pace and quality, new methods and established processes as well as a balance between vision and implementation. While striving for perfection you also need to find the balance between, what is acceptable, accomplishable and what not.

Pursuing perfection will make you and your employees just mad. Go for the things that have an impact for your employees or customers. Trust me, when your company launched an innovation successfully, the maintainer gene will emerge and you will have enough time to make your innovation efficient and work on the last few percent to make it ideal. This may sound simple but it is not. Go for a balanced mix of safety and risk. If you are not willing to take risks, I guess you are not entrepreneurial enough to pursue innovation. Grown and well-established corporations are used to excellence and would not accept any potential risk or in-efficiency. But Tesla has a fully automatous car on the road today, the German OEMs do not.

United Mindset

However, the difficult thing is to define where to take the risk and on which side of scale to put what item. That is where the mindset comes into play. Every company in every industry is only as strong as their people are. Employees shape the company with everything they do, they define and impact strategies, the product or service and everything that a business brings with it. Finding the right talents is probably one of the biggest challenge of a business. When it comes to a startup and change, having the right talents along with the right mindset is crucial to the entrepreneurial success.

StartUp Balance

For each discipline, you can hire the best professional in his field. Your candidate might have the best education, an amazing CV and can draw you the perfect way in a perfect world. This is definitely helpful and an easy KPI in the application process. This person might not have the right mindset though. Then there is this other fraction. Those people who might not have the typical career path, but can fetch on their experience and understand coherences, have the entrepreneurial thinking and are simply willing to do whatever it takes to get things done. Those people who do not care about their individual success, but see a purpose in what they are doing. They put the company success above their own, as their highest goal is to be part of something bigger.

A good example of how innovation is steered by mindset happened in the warehouse department of the J. Wagner GmbH. Our colleagues are regularly handling large and heavy cable drums. It was quite time consuming, challenging and also heavy and uncomfortable to carry cable drums: they had to move these cable drums by hand from pallet to pallet to a certain picking station and back again. To improve this cumbersome process, they invented a construction that significantly increased safety and speed of the picking process: in doing so, they will probably achieve an efficiency increase of more than 20 man-days per year. In addition, this new construction supports a more efficient way of storing pallets and simplifies the picking process.

No manager has asked them to do so, nor did they do it during regular working time. They have no engineering education now have they been trained in process optimization. They just saw a problem and came up with a creative solution. That is why I believe that the solution to become more innovative is to hire people with an adaptive and problem solving mindset in each hierarchy of an organization.

It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do. – Steve Jobs

Unfortunately, many people stick to what they know best, are not willing to change, or simply do not have the right mindset for change. I truly believe that the managers, leader and entrepreneurs of today must not only focus on people who bring an entrepreneurial mindset in, but also try to change themselves to be able to guide their employees. They must be able to give them the freedom to find their way to the goal. Managing those people is not about controlling tasks or micromanagement. It is about creating the freedom for their employees to fill out the blanks. As Steve Jobs once said: “It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.”

In my world, smart employees are defined by three key competences: empathy, entrepreneurial mindset and bravery.

Empathy

You need people with an understanding of needs and emotions. If people have the ability to read, understand and approach other people, they will not only anticipate problems at an early stage, they will also have a reliable network to source knowledge for a quick solution. In addition, employees need to have and find some kind of social relevance in what they are doing. We once had this job interview, where the applicant told us how a friend suffered from skin cancer and how he/she wants to fight for better sun protection. Even though, this was a university absolvent without many years of experience, we hired this employee for potential and are proud to have such a good performing colleague in our team now.

Entrepreneurial mindset

In my opinion, having an entrepreneurial mindset is the most severe one. During my time as a consultant, I often experienced how project teams did not bother to question a process or a decision and accepted what was given to them. Such people never tried to find a better and more efficient way to get things done. I once was told: “Philipp, working here is a marathon, not a sprint”. All those characters are focusing only on their own good – they are takers and not givers. In critical phases they are not reliable and will not focus on problem fixing.

At IONIQ I see everyday how challenging real innovation is. We try to remove silo thinking and facilitate interdisciplinary teamwork. Nevertheless, it leads to frustration because sometimes you solve one problem and three others appear. Sometimes things go wrong because responsibilities have not been clear from the beginning or at that point we did not know how to do things better. Working on topics that not many people have worked on before leads to frustration and sometimes it is tough to keep the motivation level up. Hence, you need people who can handle frustration and have a high level of intrinsic motivation. People who can adapt quickly to those problems and find creative solutions even though it may not be your field of expertise. People who detect a task and proactively ask, if someone is onto it and do it in the case no one is.

Bravery

Problem solving also means to decide what way to take. Mostly there are hundred ways. This triggers many people to panic. Either you are one of those who believe only your way is the right one, or you are one of those who can only decide, if basically every piece of information is laid out. Either way, both is inefficient.

That is why I believe that people need bravery to make decisions. For me personally the hardest thing is not about making the decision, but about letting loose. No one in the entire world will do the things exactly the same way. Hence, I had to learn to guide people in my direction and provide them a blank frame. Then letting loose and give them the trust and freedom to fill out the frame.

In my previous roles, I always wanted to do the things perfectly and tried to adapt to my boss or customers thinking. However, this completely restricted me in my creativity and the outcome was often not, what it could have been.

That is why I totally do what I think is best within the given frame. I also ignore orders or de-priorize tasks if necessary. I believe the people who have bravery also carry enough self-confidence and responsibility to find their own way to get the best results.

To sum up my thoughts. Having big talents on your team is crucial for every company’s success. Yet, when it comes to change and innovation your first key players and their entrepreneurial thinking and personal skills will define whether you will be successful or not. I strongly believe that innovation and change requires the right mindset first. Everyone can learn methods, expertise and processes. However, changing human thinking is probably one of the toughest things in the world. You need good diversification of characters and expertise. But those people need to be united by the same purpose and the same mindset. If you can create this balance of people, all the buzzwords in innovation you have the right people who make and archive.