Innovator Interview: Daryl Dunbar, Reed Elsevier

Daryl Dunbar
SVP, Innovation
Reed Elsevier

the
innovator’s
interview
The Innovator’s Interview highlights unique innovations from a wide range of industries, and is an
opportunity for futurethink and some of today’s leading innovations to share insights and ideas.
May 2009

Turn innovation into action
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the innovator’s interview 2

Daryl Dunbar
the background
This Innovator Interview series highlights leading innovators at Fortune
500 companies. In contrast to past interviews, focusing on a single
innovation, this series examines the state of innovation at global
organizations. We spoke with both innovation leaders and practitioners,
within varying business units and organizational structures, across a
broad range of industries both for–profit and not–for–profit.
The interviews offer a unique insider’s view into the world of
innovation—what makes it work, what holds organizations back,
and what critical advice new innovators need to know to be more
successful with innovation overall.

the interview
Daryl Dunbar, SVP-Innovation for Reed Elsevier, recently shared his
insights on how innovation happens at his organization. Read on to
learn more about why innovation feeds on freedom, the importance of
pull vs. push as a success metric for your program, and why ‘internal
innovation’ is so important during these economic times.

How did the current innovation program at Reed Elsevier get started?
Innovation is a core value at Reed Elsevier. It has been for a number
of years. About five years ago, Reed Elsevier embarked on a really big
innovation effort and launched a central innovation program. They put
a lot of internal press out about it and generated a bunch of ideas. If
the ideas were big enough, good and Crispin Davis (the CEO at the
time) liked them, they got funding.

And then, it all just sort of fell flat. The ideas became part of business
as usual, and there was a lack of follow-up and new ides stopped
coming in. So about three years ago, the company asked itself the
question, “What can we do to get innovation back on the agenda and
to be serious about embedding it in the business?” They then formed a
small committee, chaired by one of our Board members, Erik Engstrom,
who’s the CEO of Elsevier, to first ask some interesting questions, like:
“What are the best practices? What can we learn from the past? What
can we learn from what other companies are doing? And what should
we do, going forward?” They set about this process in a very thoughtful
way; they interviewed loads of organizations, answered those questions,
and devised the program that I now head.

I was recruited in the beginning of 2008 to run this program, which
is a fairly nimble, small centralized innovation team that really, in
my mind, acts like innovation consultants more than any sort of
centralized innovators or futurologists, or strategy people, for that
matter. I met with Crispin on a regular basis, and now with Ian Smith,
our new CEO. The key take-away is that innovation still figures very
highly on the CEO’s agenda.
Anticipate. Innovate.
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Daryl Dunbar
You mentioned that your office is like the ‘innovation consultant’ of
Reed Elsevier. Why would you say that Reed has elected for your team
to serve more as a facilitator of innovation versus leveraging more of “There is no one magic bullet
the incubator model, where innovations are grown by the innovation
team and then distributed to other business when more proven? or solution, but the method
I think the answer lies in the organization itself, both structurally and that we undertook was to
culturally. This is a company that’s made up of many acquisitions and
has a very diverse set of cultures. For example, LexisNexis is very begin with a toolkit and
different from Elsevier from a cultural perspective and from the way
that they do business. Prior to the last two years, Reed Elsevier acted
provide divisions with best
largely like a holding company, with all the power delegated to the practice tools that can be
divisions, which allowed for quite a bit of autonomy provided that they
made the financial returns and the numbers that they’re expected to used to embed and continually
deliver. As a result, anything from ‘corporate’ is treated with a certain
amount of healthy skepticism. I don’t think our overall culture would
facilitate innovation.”
accept innovations that were incubated elsewhere and then handed
over, as if saying to a division: “Here, go do this.” This is a culture that
needs innovation to be organic. When it comes to innovation, the focus
is primarily on organic growth by utilizing best practices, and sharing
across the businesses.

How exactly have you gotten different business units to talk to
one another?
There is no one magic bullet or solution, but the method that we
undertook was to begin with a toolkit and provide divisions with best
practice tools that can be used to embed and continually facilitate
innovation. From my perspective, there are two tasks here. One is to
embed the innovation capability into the businesses. The other is to
facilitate those businesses in actually innovating. These two things can
happen somewhat in parallel or be completely autonomous, but we think
it’s most effective if you have a process and then you utilize that process
to generate innovations as opposed to just random ad hoc innovation.

When we began our efforts, we had a “ideas can come from anywhere,
so let’s just create a bunch of tools” mentality. Let’s facilitate, open the
doors, throw it wide open and tell people to have at it. That was really
our phase one. Phase two, was about marketing and awareness. It was
really about selling ourselves and marketing the availability of the toolkit
and the capabilities in the business. Then, by talking to the individual
business units, we gradually became a bit of a hub in the sense that
we knew what was going on in various business units and could pull A
and B together and say, “Did you guys know that you’re working on the
same problem?” or “you have similar challenges”, or “you’re thinking
the same way”, and then get them talking to each other.

Then, finally, we held a couple of innovation symposia events made up
of about 100 people from all across Reed Elsevier. These events were a
combination of outside stimulus speakers, outside providers, suppliers,
toolkit people, and internal stories about what the divisions were doing.
The real power of all this was simply getting people to meet and share
and understand. We raised awareness that they’re actually working on
similar problems, or they’re thinking alike and they had no idea that, in
a company of nearly 39,000 people, anybody else was working on the
same problem that they were.
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Daryl Dunbar
Are you noticing more people actively trying to connect with other
business units to try and solve some of their ongoing issues?
I think there are a couple of outputs. One is that there’s a small-but-
growing informal network. This is a bit of an innovation community
made up of people who’ve attended these events and others who
know about them who are beginning to interact more online and in a
community fashion. We have ad hoc opportunities where someone in
one division would ring up someone to innovate together and solve a
given problem. For example, someone who wants to do something in
LexisNexis would ring up someone they met at Elsevier and say, “Hey,
you’ve run a workshop like this, using this kind of method. Could you
come over and help us run that?” or, “Could you put us in contact with
that training capability?”

The second real type of impact that we’re seeing from this is business
units coming to us and saying, “We want your help in embedding
innovation into our existing processes and tools.” So, we’re actually
engaging now, moving from our phase one focus of building the toolkit
and phase two marketing, evangelizing and sharing to phase three,
which is now engaging with our sleeves rolled up in the businesses and
actually embedding the innovation capability into the business while
helping them innovate.

What do you view as the number one indicator of a healthy
innovation program?
My number one indicator of a healthy program is viewed very much
from the position that I sit in. So, were I in a different organization or
were I in a different phase of my program, my answer would probably
be different. But, it’s the keen recognition that we are in phases and
we’re now moving into the pull phase – having people from throughout
the organization actively asking for help from my team – and I’m getting
pull, which is great. The program as a whole existed for a year and a
half before I came on board, and the first six months was spent really
just building the toolkit, and going out and learning a little bit about the
various business units needs. Then, we spent a total of about a year on
the marketing effort. After that, the big shift from push to pull began to
happen with the help of the global symposiums. Once the businesses
started calling me, I knew we were in good shape.

All told, there was about a year and a half to two years to go from
scratch to where we are today.

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Daryl Dunbar
One of the other things that we’ve spoken about in the past is the
tension between Business As Usual (BAU) and innovation activities,
and the fact that in any relatively healthy organization, you have “There’s a belief that the
processes in place designed to protect BAU and essentially
stifle innovation. So how do you work within the confines of your
ratio between discipline and
organization and the existing set of measure it has in place to freedom is fixed, meaning
protect itself while trying to move innovation forward?
There’s a belief that the ratio between discipline and freedom is fixed, that, the more discipline
meaning that, the more discipline you get, the less freedom you have, you get, the less freedom
and vice-versa. Innovation feeds on freedom, and therefore it’s very,
very difficult to break down all the very good discipline that’s in place to you have, and vice-versa...
keep us from doing riskier things. Things like ROI and detailed business
cases are important, but they can hinder innovation and creativity. You Things like ROI and detailed
have to find a way to build an innovation process around the business business cases are important,
process. It’s a bit like juggling, or a balance between understanding
when it’s okay to carve out a little time, or a little resource or a little but they can hinder
money. Sometimes you even have to take the ultimate risk that your
innovative idea might destroy business as usual (as is the case with innovation and creativity. You
disruptive innovation). have to find a way to build
Should innovation metrics change over time? And early on in your
an innovation process around
innovation efforts, how much emphasis should be put on ‘hard metrics’? the business process.”
I think it comes down to the core belief that innovation is core to our
future growth and the fact that it is a key value for us, going forward. So,
while our CEO and other senior managers would love to hear tangible
hard metrics, because that’s what they’re used to, they are willing
to accept it when we tell them, “We’re not going to measure certain
innovations with hard, outcome-only metrics because we believe it will
stifle potential ideas.” It comes down to your senior management being
willing to accept that. That said, I wouldn’t expect any reasonable senior
manager of a business to just throw all hard metrics away. It doesn’t
make sense. But, in certain circumstances, and in our case in new
activities, we think it does make sense to throw away hard metrics for a
while in order to give an idea a chance.

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Daryl Dunbar
What have you done to really get traction and buy-in both from senior
management and from the people on the ground?
I call it “Top-Down and Bottom-Up Innovation,” because it’s very much
a two pronged effort at our organization. You have to have the support
of top-down,but, if all you do is stand up and say how important
innovation is and talk about the theory and lecture from the books you
run the risk of becoming a talking head, becoming very academic, and
disconnected from the business. At the same time, you need to find
opportunities in the business where you can move in, have an impact,
and show something positive that happens. We engaged early on in
one program with a business unit that wanted to develop a seed fund,
a small amount of money set aside that people could bring their ideas
and get them funded. We engaged with another business unit who
took on the tool that we internally call Action Labs, which is a three-day
intensive, almost graduate-course-style engagement of teams working
very, very hard on their ideas. Action Labs end in a Venture Board,
where they can get funding or the green light to go ahead and develop
their idea further, or whatever the case may be. By simply being
involved in those things, and then pointing to activities or products
that are either in the market or we’ve just announced are coming out,
creates buy-in and ongoing engagement.

What tools do you use to highlight these success stories and get
people more involved and more aware?
Well, the primary tools is that we have are a monthly e-newsletter, an
intranet site dedicated to innovation, and an innovation community site with
Wikis,blogs and posts. We blog about innovation-related things all the time.

Also, coinciding with the monthly newsletter is what we call an
Innovation Honor Roll. Honor Roll recipients are nominated typically
by their management, sometimes by their peers, for having come up
with some good innovation. We take them on their merits, judge them,
select one to win every month, and that winner not only gets a notice
in the newsletter, but they also get a personal e-mail from our CEO
thanking them for the particular activity that they were engaged in. We
encourage people to bring us stories out of their business units that we
then republish and re-publicize. And interestingly, each of the business
units has their own newsletter and website. So, often we’ll have a story
in our innovation newsletter that will then get picked up by Elsevier’s
newsletter or by LexisNexis’s newsletter, and those go out to an even
larger distribution of people in their organizations.

What makes an individual good at innovation, and what skills must
they possess?
What makes an innovator outside an organization successful is different
than being an innovator inside of a large organization. Having done
entrepreneurial things at start-ups in the past, I’m now fascinated
with innovation in large organizations because it is hard. Not that
innovation outside a large organization is easy, but it’s very, very hard
in large organizations. As for the question can innovation be taught or
are you just born with it? There are ways to nurture capabilities and
sow creativity within people. However, not every manager has to be
ambidextrous – or able to run BAU and encourage innovation. |
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Daryl Dunbar
Given the current economic climate, how has the need for innovation,
or the drive to innovate, changed versus a year ago?
I think innovation is an imperative in tough times. I liked a quote I saw “I’m actually highlighting
recently: “The best time to fish is during a storm.” Sometimes the best internal innovations more than
time to invest is when there is turmoil and a tough market because
those things invested in now will reap more benefits in the future. external innovation because
Let’s say it takes you on average 18 months to two years to get a an external innovation is
product out the door. If we stop new ideas now, two years from now
what will we have? We’ll run dry of the things that were in the pipeline
what always comes to mind
to start with. And even if we start back a year from now when things when people use the term
look better, there’ll be a year gap in there as a result. The current
economy also gives us an opportunity to focus innovation not only on “Innovation.” If we then put
new products and services, but on all the other facets of innovation,
such as efficiency, cost saving, process, business model, and my latest
more focus on the internal
favorite, management innovation. side of things, the external
futurethink: This idea of internal innovation versus external side of things will take care of
innovation and the fact that both can be equally as powerful is themselves, or certainly won’t
important. Are you highlighting to employees the fact that one is just
as important as the other? be hurt in any way.”
I’m actually highlighting internal innovations more than external
innovation because an external innovation is what always comes to
mind when people use the term “Innovation.” If we then put more
focus on the internal side of things, the external side of things will
take care of themselves, or certainly won’t be hurt in any way. So, I’m
putting more focus on internal than I am on external in order to try to
achieve a balance in the organization between the two.

What would be your single biggest piece of advice you’d have for
another – either an individual or an organization that’s trying to get
an innovation effort going?
It still has to start at the top, I think. It’s imbedded in the corporate
culture and it’s very visible. Rather than a behind-the-scenes
discussion, it’s an outward discussion of innovation within the company
– and to the street. If you don’t really have that top sponsorship and
support, it’s going to be very tough to get an effective innovation
organization off the ground.

Second is getting those quick wins, making sure they’re visible to the
leadership, and making sure they’re commercialized well so that they
are adopted well within the organization.

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Daryl Dunbar
Just what makes someone good at innovation? Do you think that
having this framework and having this organization allows anybody
to build the right skills and build the right mindset? Or do you think
that innovation is something that just some people are good at and
others are not?
It’s a hard question, because my background’s accounting, and I’m in
innovation now. So, you can’t get more different than that! We define
innovation broadly in GBS…IT innovation, innovation to make our
workplace more sustainable, innovation to help us “reinvent the way
we work.” With a scope this broad, you need people with different
personalities and with expertise in different areas to make things
happen. If you have people who are just left-brain thinkers or who
are just right-brain thinkers, you’re probably not going to get much
done. I think any person can be a valued contributor to an innovation
organization. It’s just a matter of knowing your role within that group.

What can you learn from leaders like Reed Elsevier when it comes to innovation?
• Facilitating cross-business unit networking: How well do your internal groups or divisions learn from
one another when it comes to innovation? What forums can you provide them to better share best
practices?
• Balancing BAU activities with innovative ones: Do your current business processes allow for new and
non-standard projects? Is there a way to create a separate process to nurture new ideas to better give
them a chance?
• Getting Management Buy-in: How are your senior leaders participating in innovation efforts? Are they
allowing them to live outside of the standard set of metrics and measurements for awhile?
• Internal vs. Externally-focused Innovation: What is the balance between developing internal vs.
external innovations? Is there an equal emphasis on both?

To learn more about the research, tools and training you need to better anticipate change and move innovation
forward, visit us at getfuturethink.com.

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Innovator Interview: Daryl Dunbar, Reed Elsevier

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Innovator Interview: Daryl Dunbar, Reed Elsevier