Niron Hashai: Inovação não é assim tão simples | vídeo

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Hello and welcome to another episode of It’s not that simple great to have you on board for another high level conversation today’s topic is innovation and our star guest is niron hashai he’s an Israeli business scholar he’s currently professor of strategy and international business and the dean of

The Arizona School of Business at the reichmann University in Tel Aviv Asha has done a lot of work in the areas of multinational corporations Innovation diversification and is worse his work has been published in a variety of top management and business journals he has also worked with the international

Universities around the world such as the stern School of Business NYU Oxford University and the alliance Manchester business school as well neon it’s an absolute pleasure to have you on the show let’s start off with the simple question please tell us according to you how you would Define innovation in your

Area of work so for me Innovation is something that either adds value to the products or services that the company is producing and when I say adds value it means that customers are merely I mean are willing to pay more for the product or service because of something that is embedded in

Them it can also be something that cuts or reduces the costs of these companies by making them more efficient and I think in this uh space where Innovation can either lead customers to pay more for the pro for the company’s products or services or reduce the company’s cost days

Their lies the true value of innovation and this is essentially what companies should be having in mind when they are thinking about being more Innovative it shouldn’t be Innovation for the sake of innovation okay so I would like you to give us maybe some good examples of companies that have been able to

Innovate and maybe some not so good examples of companies that haven’t been able to innovate and therefore paid the price so to speak in the market yeah so uh you know uh we have so many uh cases throughout history maybe uh you know a classic example all of us use uh

You know the smartphone so uh Apple was uh uh very good or Steve Jobs in 2007 introducing uh the iPhone uh this was something that was not so clear in the beginning but uh you know now it’s clear to everyone that it created so much utility you know we cannot imagine our

Life without this device it’s everything uh and Google followed them shortly after with you know the Android operating system in contrast companies like Nokia or Blackberry rim sort of thought of it as something that customers will not really value will not really be willing to pay

For and you know I remember the funny um headline in the newspaper in 2011 or something when Blackberry ring came with their first smartphone nice of you to remember so and you know they’re out of the market and I think this is a classic example it’s funny when you talk about

Blackberry because I think I still miss it sometimes because to to to speed to speed the text uh sometimes it was still uh great to have those little keys but anyway I I think so much of the process of innovation has to do with the culture

Of of a company and the culture of maybe also the country it’s in do you agree how would you assess that absolutely agree and you know I come from Israel Israel is well known as the startup nation and in that respect I think many of our cultural or national

Cultural traits uh translate into cultural traits that organizationally contribute uh to Innovation and for companies being more able than others to uh uh produce Innovative products and services I can give you a few examples of such cultural traits so one thing and very very true in Israel disobey your

Superiors like you know hierarchy is not the most important thing why is that important because if you as a manager are are willing to accept the fact that you’re subordinates I telling you that you are wrong we should think of it from another angle there is maybe another

Thing to consider Etc this debate actually breeds a lot of discussion and sort of virtualizes the Innovation so this is one thing the other thing is understanding that uh earlier is part of the learning process let me repeat this sentence because I think it’s critical failure is part of

The learning process and it’s okay to fail this encourages companies and individuals within companies to uh take risk and without risk taking you won’t be able to innovate you know In some cultures like you know the Japanese they commit if they fail in other cultures you know it’s really you know you are

Ashamed of being or failing in many Israeli companies that are one of most of the most Innovative one it’s okay to try something in a you know felinity we have so many entrepreneurs putting in their CVS yeah I’ve been in this startup close this startup close this and then

You know they succeed because they have been there and they took risk I have one third thing that I want to add in that respect being able to correctly um combine individualism meaning being taking a proactive action Etc but also collectivism meaning learn how to collaborate with your team members

Because always the teams uh combine efforts are stronger from the single contribution of each and every one of us yeah it’s interesting you were talking about that and I I remember speaking with a friend of mine who said who was working in a startup and and and the

Boss the CEO would say if you’re going to screw up screw up cheap but don’t be but don’t be afraid of screwing up right because that’s part of the of the whole process and and and I think accountability sometimes as well is is a cultural value that that sometimes is

Heavier In some cultures and I think in Latin cultures from my experience sometimes people have a problem with taking accountability when something goes wrong and you you lose opportunities to innovate because people are scared of taking that risk right absolutely I agree it’s taking risks but also being

Accountable yeah it felt because I did not consider XYZ yeah and that’s okay I can I will I’m willing to continue and maybe fix my mistake maybe go elsewhere um it is something that you know I can think of many national cultures you are right about like Latin America also I

Think in Asia some of Central Europe cultures with very very difficult to let go to to understand that uh it’s okay to make mistake mistakes it’s okay to fail the reward will come at some point yeah I noticed that here I mean Portugal Spain France Latin European countries as

Well I had an opportunity to to live and work in the States live and work in the UK in Switzerland and in these environments I saw there was more of an openness to go for it even if it don’t get the 100 that you’re looking for rather than wait wait wait for someone

To you know make a last minute decision that then ends up being a reactive decision rather than a proactive decision so tell us about this this culture of innovation and how you feel it can allow companies to be and I guess here is is agile as way a a word even

Though they’re big companies sometimes which you mentioned Apple you mentioned Google these are huge companies and I mean we could use the AI example now for for a new product and a new wave where companies also were trying to adjust right so even these big companies so

What is that what does that successful culture of innovation look like regardless of the size of the company You Know It uh mainly gives the individual the space to take initiative on the one hand but on the other also be able to leverage on the corporate uh resources be it financial resources or

Human capital to uh come up with new Innovations so I’ll give you a few examples so for instance Google give their employees one day a week so one out of five days where they can work on any project they’d like to work and they can do whatever basically whatever they

Like on this on this day okay and if this idea will be conceived as successful as profitable Etc and Google will go with this uh individual maybe open as a you know a spin-off a subsidiary or something and he can he or she can manage this so some of Google’s

Products like Gmail came up from something like that by domain this uh a way of fostering Innovation is not Google’s idea there is a company that I assume all of us know 3M is ticket yeah post it yeah we know so they have more than 60 000 uh

Products and they use this strategy for many many years now Microsoft on the other hand for example are doing something else in Microsoft uh not only they are encouraging you know startups to come to accelerators within uh Microsoft which is their way to tap into you know the wisdom of entrepreneurs Etc

But they also encourage employees to come up with startup initiatives and to shop within the corporation on a Division unit something that we want to sponsor their ideas and in that way they kind of uh virtualize within cooperation and Entrepreneurship what we call entrepreneurship which in

My view is as important at least maybe sometimes more important than entrepreneurship what about the diversification because I know I know obviously that’s another area of expertise and we’ve seen so many and I’m thinking about retail companies many times being able to diversify where they’re selling T-shirts then they’re

Selling perfume then they’re selling watches then they’re selling so what are some examples that you have seen within the business and I mean retail business maybe or multinational companies that have Diversified in a in a proactive and successful way so actually first I want to bring in international diversification okay that

Respect because many of the large corporations uh diversify internationally understanding that there are centers of excellence or knowledge reservoirs that are very very different between countries I think only in Israel there are more than 500 research and development units of multinational corporations and why are they coming

Here some of these companies are very Innovative you know Google is innovative enough without having Israel and so is a Microsoft and Intel and Samsung et cetera et cetera et cetera but they understand there is some kind of different knowledge created in Israel for instance because of the special geopolitical uh geopolitical situation

Israel we are strong in cyber we are strong in homeland security et cetera et cetera et cetera but this come you know this brings different types of knowledge into the cooperation which can be used elsewhere so this is one thing I will give you another example uh for instance the

You know Intel which used to be leading in semiconductor production sort of lost dominance in the last few years for many reasons one of them is you know not anticipating the mobile Revolution and the fact that many of the uh chips we are buying the the processors will be

For mobile phones they are trying to compensate for that for instance they have Diversified into autonomous cars they’ve acquired a company called mobili which has uh which is a leading company in terms of you know a driver assistant Technologies which at its peak it will be autonomous driving

This is Intel’s way through their visification to come up with new growth engines that help it become a more Innovative like you know Google Now is not only the search engine that we know Google is has now you know also activity in autonomous cars they have a very lay which is about digital

Health they have activity that relates to uh you know smart houses smart cities so in in many many aspects you go to different business areas whether your knowledge first can be exploited a bit differently but still it has to be somehow this is important thing if you

You know you do t-shirts and you go to I don’t know uh AI probably the relationship will be quite loose you need to create some connection some relatedness between your areas and this will help you combine pieces of Knowledge from different businesses to become overall more Innovative and to spawn growth engines

I wanted to ask your opinion on on uh on the the processes and the structure of companies which are normally successful at Innovation I mean what do they look like because traditionally when it comes to a board or a board supporting a CEO we know that especially with with

Companies that that have been successful for a long time there are a lot of influences from political influences from for members of the board obviously that can make the process of innovation uh uh harder to reach let’s say uh from your from your example if if

I were going to come to you as a CEO of a long-standing traditional family business that has been successful um but needs to innovate what kind of what kind of what kind of advice would you give me on the processes on the structure that I need maybe to

Reformulate or or recreate in order to allow that Innovation to happen and not be filtered too much by the political interests that there could be around me yeah so to a large extent is embracing the corporate culture the that I mentioned earlier on yeah Embrace a culture a couple culture of risk taking

Embrace the culture where debate and discussions open discussions between top level managers and you know programmers Etc are something that are welcome Embrace group work Embrace individually activity increase diversity like this is something extremely important because we know the diversity which can be achieved through International diversification

But it can be achieved through having more women right in the company people from different origin etc etc diversity breeds Innovation we know it create shortcut mechanisms let me give you an example so for instance in Nike they encourage uh employees to group you know informally so it can be me and engineer

From One Division joining forces with some marketing people from another Division and I don’t know some technician from another place and we come up with an initiative and they have this channel that allows you to go directly to the top management with their uh initiatives of course not every

Initiative will be accepted but the fact that you have this channel which you know cross Cuts all the levels of hierarchy and I have several research studies that show that hierarchy has advantages but it can also you know sort of suppress Innovation because you need to go through the levels of bureaucracy

And you know it starts with a good idea and somebody kills it in the middle but these shortcuts for instance are something that I really have being a Nike to to come up every time with some great idea yeah um we’ve talked about what needs to happen

In order for Innovation to have an opportunity of being implemented in in in the structure of a company and what some of those success paths are um when do you think is there a danger for there to be Innovation just for innovation’s sake and just moving on from products or processes that have

Been successful too early yeah it’s a good point I think one of the main challenges of companies is to know how to manage different technological Generations different technological innovations you can do it too slowly because then some of your partners will bypass you you can do it

Too quickly because you know if the whole purpose of innovation is to create more value in the sense of either increasing the utility to customers to paying customers or decreasing your costs you don’t you know once you created something that you don’t want to to destroy it so this can happen

I don’t have a recipe book for that but you know companies should be for instance a cautious not to disperse r d activity too thin or not to allow autonomy too much because then at the end of the day you know you are limited in your financial resources you are limited in

Your Human Resources once you cut uh uh your when you start to separate your efforts towards many many uh directions you can become defocused I gave you the example of 3M earlier on at some point at 3M you know they have decentralized research and development operations and

They discovered that apps we are really decentralizing it too much let’s try to you know uh do something that is more uh integrated that we can control it from also you know at the end of the day um you know I always say that management is the most complex profession because

We don’t have a a recipe or a code book to give managers but this should be the considerations how are we encouraging our employees to take risks because it’s important but of course it can it cannot be taking more and more and uh non-sensible risk because at some point

You know failing too much will leave the company itself of course of course and it’s a question of uh you know really being finding the the golden way win these things that really translate into something that uh is conducted and obviously because of your work and because of your position you’re

Obviously exposed to a lot of trends when it comes to to Innovation and and when you travel and collaborate with some of the international universities that that you work with what are some of the trends that you’re observing now and what some of the content that you’re sharing with with students around around

The world that that you think it would be valuable to share with us so uh I think to a large extent it is the ability to think to think differently from a current mainstream but not going to far from a something that is happening so uh you

Know what we need we we see now a whole uh discussion about Ai and how it’s going to change the whole uh human race and all these stuff and clearly uh AI is something that we can use and there is lots of room for Innovation Etc and what

I would encourage my students for in that in that respect for instance is okay it is a tool we have seen tools before it has its pros and cons let’s use it in a sensible way that will allow you to build on what you know and make it something that makes you better

But don’t use it as in a way that is completely opposite to what you’ve done uh up till now forget everything that you did this will help you uh uh make something that is Meaningful out of it right in in many respects everything that you know I would I would call it a

Related diversification related Innovation something that can build on past knowledge but change it somehow is probably more promising than going into a any radical change I in our literature for instance we have this distinction between exploitation meaning incrementally improvements and exploration meaning uh coming up with something that is a brand

New and what we always teach and encourage managers is to choose a bit dexterity What is ambidexterity try to combine both you have to have some really radical project that’s good but also have these incremental Innovation projects that will help you don’t go if you do only incremental you are probably

Will fail and stay behind if you do only radical it’s too risky now try to combine them you can combine them over time sometimes do this sometimes do that you can combine them into your portfolio you mentioned diversification some really really Innovative projects some incrementally Innovative but try to keep on keep the

Balance finally how can companies measure the success of their Innovation efforts you know what kind of metrics should be put in place to to evaluate the value of what has been created at the end of the day you know we need to see who’s been short term and long-term

Metrics so a short term would probably be and then it depends uh patents patent application can be a good measure new product introduction but this is kind of a short term that allows you to see what a company Innovation looks like but I think for a longer term it would be much more

Interesting to look um you know uh sales growth uh on profitability of specific products that are based on Innovation so first as I said earlier it shouldn’t never be Innovation for the sake of innovation but there are things that we can look at in the short term yeah we cannot expect a

Product new product to be profitable from day one but if we see that we are increasing our pipeline of products probably this is a good sign something will happen uh and then after a while we want to start seeing uh profits that are generating again we all everything boils

Down to this I’m creating great difference between the utility that my products and services create and my cost which allow me to be profitable I cannot create utility but being very very costly or if I’m efficient when creating low utility this will not be good so we should combine the two gotcha gotcha

Okay so we’re going to wrap up this conversation with a series of uh four quick fire questions okay that we ask all our guests yeah it’s a surprise um and that they’re what I would like is for you to answer in one word or in one sentence okay so

Um and they’re they’re they’re General so it’s not I’m not going to ask you any uh you know difficult History questions here or anything like that um the first one is what what is one personality trait that a good leader could really benefit from having and why

Willing to accept criticism okay and why because if you are open to that you will become a better manager and if you are not allowing this environment to be there you will be very lonely at the top making your own mistakes until you fall what is the biggest challenge in your

Opinion that Humanity that humanity is facing today a global warming yeah that is that is quite a a popular answer and it’s easy to see why if you could change one thing in the world today by by Magic what what would that be what would you what would you change

Um so my second answer to global warming was uh the fact that I think the social networks are really making uh us polarized if I could change something is uh making uh us less polarized as you see in so many countries crazy polarization where you know folks are

Sunk into their Echo Chambers believing that everybody thinks like them and this is really threatening democracy into you know I have a friend who told me once the democracies won’t survive social networks well sometimes they think he’s right that was a lot longer than one word but

I’m glad I’m glad you you gave that longer answer because it’s such an important point I mean it’s kind of a topic for a different show really but it is it is because it it it’s crazy what’s happening now and and how little people are exposed to deferring opinions and

And how opinions are also more important than facts these days you know which which is so so dangerous um last question what is the most important learning of your life and career whoa what’s the most important thing you’ve learned always know that uh you don’t know enough about something

Like as much as you think that you’re an expert there is always something you can learn more improve be better so that’s I think yeah a lot of my mentality always yeah I know a lot about many things which I research Etc but yeah it’s I have both of them

I understand uh niran thank you so much for joining us on on our show it’s not that simple and for adding so much uh insight and expertise into this topic of innovation and I think I think it’s really been valuable content for for anyone who’s been in a in a in a

Management position who’s been in a structure where decisions are made I certainly find it valuable as a business owner myself so thanks a lot for that and continued success thanks for having me yeah thank you very much absolute pleasure um it was great to speak with uh niran

Hashai over the last half an hour or so and we really hope you enjoyed the latest episode of It’s not that simple see you soon foreign