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Insights for Growth: Stories of Enterprise Innovation Podcast

Ep: 6 // Kaihan Krippendorff, Outthinker // Entrepreneurs vs. Intrapreneurs

Air date: December 8, 2020

Listen now to hear Kaihan Krippendorff, Founder of Outthinker, share his thoughts on the key characteristics of intrapreneurs, why they can often be hidden in an organization, finding key paths to innovation, and tips on driving real change within your organization.

Key Insights:

  • Intrapreneurs must understand that their company is their number one core customer. Study them and their needs.
  • Intrapreneurs have three characteristics that make them look like entrepreneurs: they are innovative thinkers, they have strong customer and market awareness, and they take action without being asked, but their political acumen sets them apart.
  • The market values organic growth seven times more than acquired growth. Generating innovations internally and generating organic growth is worth much more than acquiring a small company.

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Episode Transcript

Kaihan Krippendorff:

Intrapreneurs have the opposite problem, they get yeses. And the yeses aren’t really yeses, they’re just not noes. And so the experience is more yes, yes, yes, yes, yes, yes, and then no. So if you are sensing what’s actually going on politically, that you don’t line things up, then it just takes ‘no’ for the project to get killed off.

Chris Goward:

This is Insights for Growth. The show where we hear insights from intrapreneurs who drive change within large organizations. I’m Chris Goward, founder of Widerfunnel. Widerfunnel helps great companies design digital experiences that work, proven through rigorous experimentation systems. Today on the show, we have a great conversation lined up. So, will you tell us by starting with your name and title?

Kaihan Krippendorff:

Yeah, my name’s Kaihan Krippendorff, and my title is either author or founder of either some books or Outthinker.

Chris Goward:

So tell us a little bit about that, Outthinker, and your background and your business.

Kaihan Krippendorff:

My background is strategy. I’ve been a student of strategy for most of my life. I worked at McKinsey and I published a book in 2004. And that’s when I founded the firm that eventually renamed to Outthinker. And we used to be a consulting firm, but now we primarily organize a pure group of chief strategy officers, as well as I do my content creation, my thought leadership, and speaking.

Chris Goward:

I’m a fan of your work. Actually, I have your Outthink the Competition book here.

Kaihan Krippendorff:

Excellent.

Chris Goward:

And now, I’ve picked up the Driving Innovation from Within, which is the reason that I reached out to you. The work that you’re doing now really overlaps with the mission of this podcast and what I’m really trying to help is support intrapreneurs, these innovators within large enterprise organizations. And so this interview is a little bit different than maybe the typical one that I’ve been doing in this series, which is telling the stories of intrapreneurs. And so I’ve invited you, Kaihan, to really also add your perspective from looking at intrapreneurs generally and the stories of many of them to kind of see the patterns that you’ve been looking at and share some of the frameworks that you’ve developed, and maybe the barriers they’re facing and how we can help to overcome those.

 

Kaihan Krippendorff:

That’s great. Yeah, no, I acknowledge you for the work you do. The intrapreneurs do need more cheering and more support than they get.

Chris Goward:

Well, yeah. And that’s what prompted this is realizing, a few months ago, we were doing some of our own internal analysis here at Widerfunnel, looking at all of our clients, and to identify the characteristics of the best, those that have the most success working with us. And we realized characteristics that they have could only really be described as something like an intrapreneur or a change maker in a large organization. And then I went out to try to understand who’s talking about this idea. And there really isn’t that much.

Kaihan Krippendorff:

That’s right.

Chris Goward:

People talking about entrepreneurs and they get a lot of accolades, but what about those who are doing this hard work inside large enterprises?

Kaihan Krippendorff:

An exciting opportunity. I agree. I agree. I agree, it’s a whole domain and a body of innovators that are under studied and under appreciated, I agree.

 

Chris Goward:

Yeah, so I’m curious, from your perspective, going from Outthinker, which is really a lot about strategy, and then now focusing on intrapreneurship, why intrapreneurs? Why now, for you?

Kaihan Krippendorff:

Because much of the work that I do out of Outthink the Competition, which is sort of a book with a methodology for how to come up with disruptive ideas, a lot of that work gets done inside companies, inside large enterprises. And sometimes the ideas that come out of a workshop or a talk or a consulting project, sometimes they go swimmingly and they get through the organization out into the market, but often, they don’t make it through and they hit the bureaucracy, they hit the culture, they hit the resource allocation processes and things like that. And people often like, throw up their hands. And so when I got interested about six years ago is when those things actually get through just as you did, who were the people that were successful with you and doing the work that you do with them, what do they do? And so then I spent about five years interviewing about 150 of them and pulling together all the research I could, pulling together everything that was known and tried to put it into a framework.

Chris Goward:

Yeah. It took me quite a while to realize, I’d say a few years into Widerfunnel, how difficult the job of an intrapreneur is. I see these managers inside organizations and they’ve got a good job, they’re managing their role, but to think, to realize, to make change inside of an organization, it takes a really particular skill set, like these are highly talented people that have a unique skillset to be able to manage all of the complexity of doing that. So, I’m really curious to hear some of the things that you’ve been finding.

Kaihan Krippendorff:

I looked at every research study I could find that showed a statistically significant correlation between some organizational or talent attribute and higher or lower levels of intra and entrepreneurship. If you look at entrepreneurial orientation or entrepreneurial intensity, that’s kind of like the body where you’ll find there’s been a study, you can actually measure what’s the frequency with which and the degree with which people are acting innovatively. As there are a bunch of insights, you can find a bunch of things that we believe about intrapreneurs that are just false and a lot of things that we overlooked. So one, I think that you’re pointing to is that

…one of the key differences between a successful and frustrated intrapreneur is that the successful intrapreneur views the political challenge as part of the problem-solving process.

It’s not only that, hey, politics is a necessary evil, and I know how to do it, it is I love the politics. And so if, when you sit with them, they like playing that 3D chess game of understanding. If I open up this store and talk to this person, I line up the cannons and then bring my proposal. And who’s going to give the proposal? It won’t be me, because if I have this person do their proposal instead, then they’ll get kind of more resonance. And so sometimes you don’t find them, but I did find six attributes that are shown to correlate with higher levels of, more successful internal entrepreneurs. And one of the most important ones is political acumen.

Chris Goward:

Yeah, you and I were talking the other day about the difference between intrapreneurs and entrepreneurs. And it strikes me that that what you’re describing right now is to me one of the main differences. As an entrepreneur, I find the political mindset to be almost like oil and water for me, like it’s something, I’m unhireable for that reason. I can’t go in and try to pull those leavers, and understand which ones to. I would hate to do that, but these intrapreneurs, like you’re saying, they love that.

Kaihan Krippendorff:

Yeah, and they have to, because their game is a way as the opposite, because with an entrepreneur, you just need one yes. So the experience is no, no, no, no. You talk to, on average, I think 40 investors before you get your investor, right? So what you hear is no, no, no, no, no, no, yes, boom. Intrapreneurs have the opposite problem, they get yeses. And the yeses aren’t really yeses, they’re just not noes. And so the experience is more yes, yes, yes, yes, yes, yes, and then no. So if you aren’t sensing what’s actually going on politically that, and you don’t line things up, then it just takes one no for the project to get killed off. So it does require more political nuance to get it through.

Chris Goward:

They’ve only got ultimately one buyer. So if they get one no, then it killed their image.

Kaihan Krippendorff:

And I think that’s a great way to think of it. If you’re an entrepreneur and you have one buyer and you have one investor and it’s the same person. And I love that you think about that because an entrepreneur will not, like when they test a product or test a strategy as you help them do and they get insights from it, they don’t say, oh, there’s something wrong with that customer. How come they don’t understand why this value proposition is compelling, but as an intrapreneur, who’s your customer? Your customer is your employer. And when they say no, we often want to say, oh, there’s something wrong with the company that they don’t see the value of what I’m proposing, right? So your viewing the employer as both the customer and the investor helps you make sense of why the politics are so important.

Chris Goward:

Well, it makes everything they do almost a higher stakes game because they can’t afford to hit that no. So they, like you said, really have to line up all those cannons to make sure that it’s going to work. Once they hit that first domino, it’s got to flow all the way through.

Kaihan Krippendorff:

Yeah. That’s exactly right. That’s probably a better analogy than the cannons. It’s the dominoes. They have to line up all those dominoes so that when they hit it, they all fall.

Chris Goward:

So let’s talk about that, the characteristics of great intrapreneurs, you talked about these six. What are those?

Kaihan Krippendorff:

So there are three that make them look a lot like entrepreneurs, it’s shown that they are innovative thinkers. They like coming up with new ideas. That’s obvious, right? They have strong customer and market awareness. So they like being out with the customer and they understand what the customer needs and what the market needs. They go to conferences, they know the industry, which is also makes them look like an entrepreneur. The other one is that they’re proactive, that they take action without being asked to, because they’re not going to wait for their boss to say, “Hey, here’s a good idea, why don’t you see if that could be something.” They go and look for them. So that makes them look like an entrepreneur. But then three other things make them look less like an entrepreneur. The common perception is that entrepreneurs are risk seekers, or they have a higher risk tolerance. There’s a lot of research that says actually they’re not. And I think that entrepreneurs fall in different scales, the entrepreneur that starts a franchise clothes washing shop, low risks strategies, the perception is that entrepreneurs are risk takers. Actually, intrapreneurs, they seek risk asymmetry. So they look to bet a little in order to get a lot, because they’re not betting their money, they’re betting the company’s money. Another attribute that makes them look a little different is the intrinsic value. I’ve spoken to many frustrated intrapreneurs who say, I came up with this great idea, the company is working. If I were doing this as an entrepreneur, I would be a multimillionaire, I’d be a billionaire, right? And I talked to a manager at a finance technology company that manages a whole team of intrapreneurs. And he said, yeah, when they tell me that, what I try to point out to them is, you didn’t have to eat ramen noodles, you didn’t have to put your family’s finances at risk. And so it’s natural that you wouldn’t get the full pay off. So you’re not going become billionaire by being an intrapreneur. And the ones that I found that enjoy it, they get intrinsic value from innovating. They had a kick, they feel that they’re having an impact or it’s fun. And then the last one, the sixth one, is the politics, the love of politics.

 

Chris Goward:

Yeah, okay. So they’re almost like a merger between an entrepreneur and a politician, like they’re able to do, play both of those. Most entrepreneurs are not willing to do, right? Now, are you looking in your research at certain levels of the organization? Are you looking at managers, directors, VP levels or is it across the board?

Kaihan Krippendorff:

It’s really across the board, I think for two reasons. One is it’s hard to find them, because often when, by the time their innovation makes it out to market, the baton has been passed so many times that you don’t know who the primary innovator was, someone else gets credit, right?

Chris Goward:

Yeah.

Kaihan Krippendorff:

So it’s hard to find them. So I will find, get, take whatever I can get, so to speak. But other things that they tend to operate not with that kind of manager mindset, they operate more for an entrepreneurial mindset. It’s less about hierarchy. It’s less about formal power, is more about informal power and networks. So they could sit at almost any level of the organization.

Chris Goward:

Mm-hmm (affirmative). That’s an interesting point you make about the originator, who’s the original intrapreneur in observing a lot of enterprise organizations, credit seems to go to whoever’s the last one standing who’s still on the project, right? So sometimes it’s like you say, it might be hard to trace the real intrapreneur, like who actually started this thing.

Kaihan Krippendorff:

Yes.

Chris Goward:

Everyone’s willing to raise their hand when it’s a success, “that was my idea”.

Kaihan Krippendorff:

And even that person who takes it across the finish line and gets the credit internally, externally, they get forgotten, right? The CEO ends up doing the product launch. Bill Gates launched the Xbox and we forget what was the team that actually did it, but if you’re in the company or if you’re in the industry, you know who the person that brought across. I mean, we tend to think of this as another reason why I think we talk about so much about entrepreneurs is that we use the CEO as a face for the organization. We want to personify organizations. So it is more fun to talk about Bill Gates and Jeff Bezos than it is to talk about someone in GE or someone at Pfizer, right? And when we do talk about it, we talk about Pfizer or the CEO. Pfizer discovers a vaccine, who was it? It was Pfizer, right? So they get lost for that reason as well.

 

Chris Goward:

Yeah, and do you find that there’s, is that another difference between intrapreneurs and entrepreneurs, like entrepreneurs tend to want or seek the limelight, and they’re okay taking the credit for those kinds of things. Are intrapreneurs like that as well, or do they tend to be more backroom sort of behind closed doors? Are they comfortable being kept there in some cases?

Kaihan Krippendorff:

I won’t characterize entrepreneurs as wanting this limelight or not, but I would characterize intrapreneurs as not seeking the limelight. In a way, it’s not smart for an intrapreneur to seek the limelight, because that is not using their full political capital if they can empower other people to buy into the idea. And there’s a certain phase in the entrepreneurial journey where you have to get a team of people to work on the project, but you won’t be able to get formal authority for them to work on it. So you usually have to get, build a groundswell of support around the idea. So it really needs to be, or it’s kind of like if you want your rocket ship to get through the atmosphere, you want to have as many jets on it as possible. And so you want other people, those are the jets you want other people swirling around your idea. And the way to do that is to make them feel like they’re part of the team rather than working for you.

Chris Goward:

Yeah, sure. Okay. Great. And also, you can imagine, like it makes sense why it’s been difficult to find those intrapreneurs, they seem to be well hidden in there. So, invaluable work though. I mean, clearly, intrapreneurship is very important. I’ve seen some research lately, I’ll have to dig it up, that shows the increasing level of employment from large organizations versus small businesses, whereas 20, 30 years ago, small businesses were driving a lot of the employment.

Kaihan Krippendorff:

Yeah. That’s been a long-term trend. And levels of entrepreneurship are in decline, like entrepreneurial startups per 100,000 people has been in a multi-decade decline.

Chris Goward:

Right. Okay. And the startups, like startups are the industries that are driving a lot of growth, they think of the tech companies. I mean, they’re massive companies now that are almost swallowing up little upon innovation and trying to create those internal hubs of innovation inside the organization. That seems to be a way they’re trying to operate intentionally as well.

Kaihan Krippendorff:

Yeah. Yeah. And I think that’s the smart strategy is that organic growth is valued by the market seven times acquired growth. So if you can show that you have a capability to generate new innovations internally and produce organic growth, that’s worth much more than acquiring a small company. So you want to, surely you want to, a large company wants to keep an eye on the entrepreneurial activity and acquire opportunities that would fold in nicely and be additive and all of that. But if they could create them and show they can create them, that’s worth a lot more.

 

Chris Goward:

Right. So let’s get to what you found. Now, the patterns of intrapreneurship. My listeners will know that I’m a big fan of framework thinking. Using frameworks is a way to more rigorously and have more reliable replication of results, right?

Kaihan Krippendorff:

Mm-hmm (affirmative).

Chris Goward:

But you have a framework in your book for, that’s called the Seven Step Innovate Framework. Can you tell us what’s important to understand from that?

Kaihan Krippendorff:

Yeah. So I interviewed these 150 internal innovators and asked each what is the big barrier that you see to driving innovation from within? And what’s the tool that you use to overcome that barrier? And these seven barriers surfaced as the big ones. And you can put them in a kind of a narrative. So, really briefly, INtent. Someone builds an intention to innovate. Need, they then understand what the customer needs and what the companies need, so they innovate in the right space. Options, they then generate a lot of potential solutions to that need. Then ‘V’- Value Blockers, they recognize points of business model conflict, and they re-engineer the idea so that they reduce business model conflict, then ‘A’, they design an Action that they can take, which is an experimentation. And then they ‘T’, pull together a Team to take that Action. And then E stands for environment. They identify the right place in the environment, which is the organizational environment where they have an island of a freedom to pursue the innovation. So that’s what I-N-N-O-V-A-T-E stands for.

Chris Goward:

Okay. And are you finding that it’s a pretty even distribution of barriers or other ones that several of them that really stick out as the most common?

Kaihan Krippendorff:

Whenever I give my talks or workshops, I have people rate where they are across them. I’m not seeing very many patterns in terms of like one exceeding the other. I would say that these are problems. For every problem, there are solutions. Some solutions are like well-known, some solutions are being created, but on Value Blockers and on Team, there are already many established solutions. It’s more an adoption of that. So value blockers, it’s just business model, canvas business model design, the lean canvas. That kind of tool can help you if you apply it from the perspective of it being internal, comparing your business model to the company’s business model looking for the points of conflict. You can use a tool like that to remove those. So that’s, I think, will become less and less of a problem. And under Team, there are lots of team methodologies. There’s the growth team, there’s the scrum team, there’s the accelerate, there’s lots of different frameworks that you can adopt. And there, I think it’s not a question of finding a solution, but adoption. So I think we’d see those two become less of a barrier earlier.

 

Chris Goward:

Yeah. And are value blockers also related to the organizational inertia and barriers that people face when they’re trying to bring new ideas forward?

Kaihan Krippendorff:

I would take that. I mean, it’s kind of tomato, tomato, I would take that, I would put it under E, under Environment.

Chris Goward:

Environment. Okay, got it.

Kaihan Krippendorff:

Value blockers are more like when pizza hut, no, sorry, when McDonald’s launched McPizza, which was a complete failure, because they figured out that you do the market research, and guess what? People who eat hot hamburgers also eat pizza, that with the operational analysis, they could bake pizza. But then after they launched it, they didn’t like look at the brand and they didn’t realize people aren’t going to buy pizza from a hamburger place, because they associate McDonald’s hamburger. So you can look across these different, there could be branding, could be a pricing strategy, could be your marketing promotions. So a big one is our sales force, maybe they visit the core customer companies that we want to sell this new thing to, but they don’t visit the core customer that’s in that company. So they can’t actually sell the new product. That’s a big one. So that’s what I think of Value Blockers as.

Chris Goward:

Right. Okay. So then thinking about the intrapreneurs who know they have an innovation that is the fit that they’re trying to promote. And then I guess it’s in the environment area where there’s this organizational inertia. That’s one that stood out to me, because it seems like it’s something that is common to everyone and something that our clients definitely face. What did you see or what have you found are techniques or tactics that are often successful that they’re using to overcome that organizational inertia to make cultural change or bring initiatives through?

Kaihan Krippendorff:

Gotcha. Yep. So I’ll take the cultural change and put that aside for a moment, but I say there are three kinds of approach, at least three kinds of approach, but the three that I think are the ones that we can all act on immediately. One is seek an island of freedom, which is you don’t sell it internally into the obvious place, but you find a place where we more welcome. For example, Ken Kutaragi, the intrapreneur that created PlayStation inside Sony, he could have easily gotten adoption for that or pursued adoption for that within Sony Electronics, but instead he put it into Sony Entertainment, because the cultural norms there, the way they operate will be more open to a new idea. Or there’s a gentleman that, he was an engineer, and really engineered probably the biggest leap in solar power energy improvement, taking the cost of producing a kilowatt of solar energy down 90%, but his employer was Exxon. And Exxon wasn’t going to support an alternative energy. So what he did was he created an island of freedom by reframing it as an internal solution to a problem, when that problem was that they had an energy issue in powering the offshore oil drill. So one is finding an island of freedom. Another is what you do is helping create the data, just going out and doing. 3M is filled with those stories. Someone says, no, we’re not going to launch it through a Post-it Note. Well, then they go in their basement and they make Post-it Note. And then they prove that it works. Oh, we’re not going to do masking tape, they do the same thing. The guy that created the London Tube map, he went through something like 30 different iterations internally until he got adoption. So it’s just, when you hear no, just going to get the data. And then I think those are like maybe the two most important ones.

Chris Goward:

Yeah. So sort of almost creating a pilot project to get some data, collect the evidence, get some momentum going, maybe some early adoption with a small group before releasing it to the wild or trying to get the larger adoption in some ways?

Kaihan Krippendorff:

Yes, that’s right. Yeah. I mean, you’ve got an internal adoption curve. Just like you got an external adoption curve, you got your early adopters, your advocates, you’re kind of in the middle, then you’ve got your, the people that are never going to reject you, you’ve got the same thing internally. So just pretend that you’re selling it into, you have an idea and you’ve got one customer and you’re going to get internal adoption for it.

Chris Goward:

Yeah, for sure. Do you find that most entrepreneurs or intrapreneurs, I should say, are using a tactic of building consensus in a large group to get that momentum going or starting with something under the radar, sort of a skunkworks project, sort of backdoor, that sticky note example, is there one that’s more successful than another? Are they with depending-

Kaihan Krippendorff:

No. So let’s say there are two types of innovations. There’s a strategic innovation, there’s a product innovation. Product innovation is, let’s do Amazon Web Services, and it’s a product that we’re going to carve out and sell to the market. Then there’s the strategic innovation, which is, let’s expand into asset management. If it’s a product innovation, I think you could do it either way, kind of depends on the nature. But if it’s a strategic innovation, I don’t think that the skunkworks project is helpful. I think in there, it looks much more like the broad stakeholder works. So I know one woman I interviewed, she worked at a financial services place, a big financial service company, and she thought that they should go into asset management. She spent, I followed her around for a good six, seven years as she was just slowly whispering into people’s ears, bringing it up at different meetings, doing just like little things around the edges until she built enough consensus around the idea that they bought an asset management company. And now they are one of the 10 largest asset management companies in the world. That is a very common path. And I think that’s the path if you want a strategic innovation.

Chris Goward:

Mm-hmm (affirmative).

Kaihan Krippendorff:

Sorry, I’m giving you a really long answer right now.

Chris Goward:

Yeah, no. It sounds like, again, one of the differences between that comes to mind is patience. I mean, to follow that kind of a path, to line up all the time dominoes or the cannons, it takes that sort of meticulous bit by bit drip, almost Chinese water torture. 

Kaihan Krippendorff:

Yes. I think what gives, I don’t have statistics or research to support this, but just my personal experience, I think what gives intrapreneurs that patience is a love for the company. It’s like if you have a relative and I don’t know, they have a problem, you’re not going to scream at them and say, come on, change. You got to try to see it from their perspective and try to understand what their motivations are and take the time to help them have the breakthroughs to then step into the new path. So the flip side of that is that companies that employees love create more intrapreneurship.

Chris Goward:

Really so, okay. So they’re almost sometimes less personally self-motivated all the time too, they really do feel an engagement with the organization.

Kaihan Krippendorff:

Yes.

Yeah, it’s that intrinsic value that can come from, this is fun, this can come from, I have an impact, but it’s usually either way underlined by, I care about the company.

Chris Goward:

Mm-hmm (affirmative). Interesting. Okay. So then I want to think about these innovate again. Of course, in the work that we do at Widerfunnel, it’s all about experimentation, right? And experimentation across the spectrum from innovation to optimization, really work with companies on value proposition, product testing, feature testing, painted door tests, to try to understand innovative ideas to just optimizing what already exists. And within act, when you say act in your book, you talk about experimentation. So what are you seeing in terms of the methods that these intrapreneurs are using for their experimentation work?

Kaihan Krippendorff:

So it’s rare that you can get initially formal approval to do the experimentation, because many org- established organizations, are designed for this prove, plan, execute, approach. Prove, to me, it has potential. Build a business plan, and then we’ll give you money and you’ll go and execute it. That Jim Collins saying of like shoot bullets before cannons, big companies are geared more to shoot cannons before bullets. And so when you ask for formal approval, often it gets rejected. And so there’s a lot of informal testing, I think, that goes along first. One woman that I followed, who really was the inspiration for this book. She works at a company called Macmillan, her name is Jean Feiwel. And she came up with this idea of this radically new way of publishing books by inviting authors to publish unfinished manuscripts and getting a community of readers to give feedback and do voting, and using that method to surface the best manuscripts before they’re published. And what they did was, just as you would expect an entrepreneur to do, first of all, she got a bunch of people who weren’t getting paid to be on this project to spend their time. These are people from accounting and finance all over the company. And in their spare time, they came up with mockups of websites, like using PowerPoint. And then they literally called up friends and they went out in the street and they found people that they thought would be the right profile for this. And they brought him into the office and gave him some pizza and say, “Hey, what do you think about this?” It’s that kind of, I don’t know exactly what you call it, but it’s that kind of like that prototyping. A lot of our clients liked this idea. Michael Schrage, I think is his name, he wrote The Innovator’s Hypothesis, a sticky idea of five, five, five experiments, five people, $5,000, five weeks, run an experiment one or two days a week and see what happens. That’s a way of containing the cost, but I think that what they don’t get to do in that early stage is the kind of work that you get to do, where you get to be out there and get large amounts of data from actual behavior, electronically derived. First step is five humans looking at something and giving their reaction.

Chris Goward:

Yeah. And that’s a valid method for gathering some feedback. We like to think of it in terms of, I’ve been talking lately about it in terms of a quadrant of methods for experimentation. One is, on the one hand quantitative, that’s very high confidence experimentation. So AB testing at the high data levels is statistically significant. You know which answer is correct, but you don’t know why necessarily. And more often on the other hand, the qualitative side is what you’re describing, pulling a few people together that are the right target audience really understanding in depth why they’re thinking the way they do? Why they act the way they do? And getting this rich understanding of what might be happening.

Kaihan Krippendorff:

Yes. Yes.

Chris Goward:

And then there’s the behavioral and attitudinal ends of the spectrum, but really combining those is, we’re finding, is the most powerful method. Take some of that qualitative insight and then see how to run the most efficient one of the experiment.

Kaihan Krippendorff:

Yes. Yeah, I like using old examples of this, just to take it away from the idea that this is, I mean, the methods are new, because the technology is new, but this is all like qualitative. Lee Iacocca, when CEO of Chrysler, it was proposed that they’re gonna do a big market study, should we release a convertible version of the Sebring car? And he said, before we spend the money, let’s do a qualitative, let’s take a Sebring, let’s cut the roof off and drive it around and see what people think. Quantitative tests, HP releases the first electronic calculator. And a marketing firm analyzes it and says, you know what? You should shelve that idea, because there is no market for it because there’s already an entrenched competitor that everyone’s adopted that is a radically lower price point to you, which of course is the slide rule. Why would anyone buy an electronic algo? So what did they do? They did a quantitative test, which is, they made a thousand of them and just tried to sell them. Before they know what? They’re selling a thousand a day. So I think it’s right. I think the qualitative, it makes sense. The qualitative is that early stage. And then the quantitative to get more pinpoint answers.

Chris Goward:

Sure. Yeah. Cool. Well, and I know there’s a lot more that intrapreneurs can learn from by reading your book. Great read.

Kaihan Krippendorff:

Thank you.

Chris Goward:

Highly recommended. And so, but I want to also take a step back a little bit to understand how you’ve got here, what was your experience that brought you to this point and how are you helping intrapreneurs right now? So how can intrapreneurs work with you? And what’s the pitch?

Kaihan Krippendorff:

Yeah. So I don’t have a consulting firm and don’t do kind of like large scale engagements, but what I do is I give talks, I do trainings, and we have other people that do those trainings on intrapreneurial skills. I do advise some companies in their learning and development programs, what are the things that they need to put in place in order to activate higher levels of internal innovation. And then, with my book, I’ve got like an online course and things like that. My mission really is to, I want to keep my business simple. I want to impact as many companies and intrapreneurs as I can. And more kind of arm people with the skills, because they’re not secrets anymore. They’re not, the solutions are there. It’s not like trying to solve, it’s just an adoption of the tools.

Chris Goward:

Mm-hmm (affirmative). Great. And so you’re trying to help intrapreneurs to have the skills that they need to do this work?

Kaihan Krippendorff:

Yes, yes. And inspire leaders to recognize the importance of unleashing, of releasing the entrepreneurial power within their people.

Chris Goward:

And what would you say are the types of mistakes that the organization overall is making that’s blocking the intrapreneurs, that if the leaders of the organization were to do a few things, how could they empower the intrapreneurs more?

Kaihan Krippendorff:

The first one I think we alluded to is that intrapreneurs look different. So stop looking for people that look just like entrepreneurs in your company, or asking them to come into your company, find those people that have those attributes, they love the politics, they got the intrinsic value.

The other thing is just simply resources, give people five, five, five. Give them $5,000, five weeks. Have some kind of program that allows people to get the time and money resources to be able to innovate.

The second is look at whether your incentive structures encourage that kind of early form of innovation, are you looking for, are you rewarding only revenue growth or profit growth or market share growth? Or are you rewarding experimentation and learning? And put that into people’s… Some companies do put into the the KPIs or how they judge individuals or business units, they have like percentage of revenue comes from new products, but put into those metrics the number of experiments that have failed, those kinds of things. And then the other thing I would say is ensure that you have a mechanism to allow for cross-silo collaboration, so that people in, someone in marketing who has an idea can collaborate with someone in operations to test out that idea.

Chris Goward:

Those are great insights. I’d say the one that sticks out to me is recognizing failure. I’d say that that is one of the most important cultural changes that an organization needs to have to support innovation and experimentation. And what a lot of people don’t understand, especially executives, they’re used to the waterfall process of seeing incremental improvements in a project, right? Every week people are working on a project, you can see improvements, you can ask for a report on your weekly improvements. Well, the nature of experimentation is completely different, you don’t know when an experimentation is going to produce a win. So you have to recognize the series of failures that don’t look like progress in order to get to that big breakout wins.

Kaihan Krippendorff:

Yes. Yeah, that’s exactly right. I think that a couple of things I’ve seen that are mechanisms, if you will, to start reprogramming the organization, one is to short closed-end challenges. The goal of which is not to find a viable solution, but to come up with a hypothesis of a solution. So you can say, okay, global warming is a problem, we are in the paint industry, for one week, I want every research lab to come up with an innovation that uses paint to solve global warming problem. And then we’re not going to do with anything with the idea, this is just a fun exercise to learn. So we start thinking about, hey, our activities don’t have to be only at the point of market entry, close to part of market entry. The other thing that I’ve seen that’s really clever is, don’t design your teams around a solution, define them around the problem. And that way, they can experiment with many different solutions. And when a solution fails, it actually is progress, because we’ve learned something doesn’t work that allows us to then narrow in on what works, probably is very similar to what you do. You’ve got like a hypothesis of value propositions and personas and channels, and every time one fails, what does that mean? You’re getting closer to the magic formula, right? So, but when you design your teams around solutions, then there’s a lot of pressure and they’re not going to want to drop the idea once they realize there’s something wrong with it.

Chris Goward:

Right. Yeah, yeah. There’s something about a person’s ability to understand the concept that if they’re incentivized not to understand the concept or not to understand that this is a failure..

 

Kaihan Krippendorff:

Yes. The consequences.

Chris Goward:

So, I guess, usually I end with a question about, as an intrapreneur, what would you like to know earlier in your career, but as an entrepreneur who studies intrapreneurs? Thinking about someone who has the aspiration to become an intrapreneur or is on the path to do that, what’s the most important thing they should know in getting started on that path to have success as an intrapreneur?

 

Kaihan Krippendorff:

I would say two things. First, you got to know it’s not only possible, it is the norm that 70% of society’s most transformative innovations, my research shows, the internet, email, DNA sequencing, MRIs, 70% of the big ones, they come from employees, not from entrepreneurs. So it’s not like join a big company because maybe I can make it work. It is no. Join a big company, an established company, because that is where the big innovations come from. That’s the first thing. And the second thing of all the ones, I think the one that really to start with is need. Understand what your company needs, understand your company’s strategy. Less than 55% of mid-level managers can name even two of their company’s top strategic priorities.

Consider your company, your number one core customer. And just like any entrepreneur, you want to get under their psyche, under their motivations, under their politics, and really study them to see what does this entity need that I can find it innovation for.

Chris Goward:

Absolutely. That’s great. Really wise words and good insights. So for any intrapreneur listening, this book will help to guide them. So thanks so much for stopping by.

Kaihan Krippendorff:

Thank you.

Chris Goward:

And giving us your insights. Really appreciate it.

Kaihan Krippendorff:

And thanks for the work that you do for intrapreneurs.

Chris Goward:

Yeah. We’ll keep supporting them together. Sounds good.

Kaihan Krippendorff:

Definitely.

Chris Goward:

This show is made possible by Widerfunnel. The company that designs digital experiences that work for enterprise brands, proven through experimentation. For more information, visit widerfunnel.com/tellmemore. That’s W-I-D-E-R F-U-N-N-E-L.com/tellmemore.