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And if you survive this journey, okay, good ideas, good technologies. I do think that if you take
machine learning and A.I. it will become a topic for many many organizations. In the middle of the
new business model bonanza stands Alex Osterwalder. When we started this whole work during my
PhD and we had one goal: to help entrepreneurs at the very beginning. So I don’t like blaming
companies and saying, they don’t know how to do this. And I remember a couple of neuroscientists
saying, wow, through this iCore program, I’ve saved years of research because I would have gone off
into the wrong direction. So, we created the business model canvas, which comes out of my PhD
dissertation and the tool and the book took off like crazy. I’m not saying innovation strategy, but the
core strategy. And then, you know, we build technology enabled services on top. In practice, the firm
will retire 70% of projects within three months, so that it only invests in 30% of the ideas that
showed some evidence of viability in terms of customer demand. The inspiration always comes from
there first and then second just from what we’ve done so far: we know how to make tools and we
build on that. And he doesn’t mean when you build a new warehouse, he means, right. Something
better is needed, and that can be achieved only through innovation. He mentioned Tesla as a great
example of this; while they are scaling their automotive business, they are already creating a new
solar business. “Experimentation is in the DNA of Tesla. Right? So, when a leader says, we need to
innovate, everybody needs to be an innovator. World-class innovators, build exploration portfolios.
With audit, tax, and consulting services, RSM is your business advisor who takes the time to
understand your industry, your goals, and your opportunities. Right? So, use the Horizon model by
McKinsey, right. All my talks and keynotes are engaging and hands on. The business plan is the
death penalty of innovation because you’re forcing people to sketch out a fantasy and build an
implementation plan for a fantasy. Companies that invest for the future during a crisis tend to come
out the other side. Nordic Business Report had an extremely productive discussion with Alex about
companies’ growing need to reinvent themselves in today’s rapidly changing world. And here’s
another big thing that people mistake, they think, Oh, innovation is about technology. The thing that
is clear across the board, you need an exploit and an explore culture, doing everything outside, not
going to work. They built Nespresso, but I don’t think they systematically reinvent themselves,”
Osterwalder ends. It is hard work and we also screw up a lot, but then we re-test and re-think. All
books are visual and practical and help solve key business challenges. They don’t have to work
through multiple managerial layers to present their ideas and be heard. What's more, the staff
turnover was below industry averages due to the level of care the firm gave to its people. So they’re
catapulted to the forefront, those who built innovation infrastructure.
With this model, five staff could manage 180 rooms, excluding cleaning, with excellent service
ratings. He’s an academic. And I went out into the business world and our idea was, you know,
bringing a better way to describe and change business models to the world. They cut back as little as
they had to 25% of their workforce. I think that’s really exciting when I see social entrepreneurs
trying to build substantial, big businesses that make enormous profits but that want to work on
poverty, sustainability, global health. I’m your host, Brian Ardinger and as always, we have another
amazing guest. That’s why we wrote Testing Business Ideas because there’s a whole library of
experiments. How do you feel when you see it’s widespread and adoption all across the world. It’s
still growing and probably pretty well protected from disruption. It's not enough to get better at what
you have been doing. You only invest based on the evidence that the team brought to the table. That
will also have, I believe once we come out of this, an extremely positive impact because it resets the
way we think. The company disregarded specific job roles in favor of having staff who were all-
rounders, with only one task - to make customers happy. In the Exploit world, you have some
relative certainty in the sense that, you know, the business model, you know, the value proposition,
you know, the customers over time, but now everybody was kind of pulled over here, back to the
Explore world. And is this something that has to be driven from the top down with the management
coming on board with this methodology or can the average employee within the organization start
applying some of these methodologies. For instance I see entrepreneurs still struggling with
interviews and idea validation. Out of these, the cookies that are categorized as necessary are stored
on your browser as they are essential for the working of basic functionalities of the website. New
ideas typically come with high levels of uncertainty and risk because you are in unchartered territory.
The business let go of 25% of its staff to keep the firm afloat. So the question is why can’t
pharmaceutical companies innovate beyond molecules. Not based on which ideas you like but based
on which ideas brought most evidence to the table, you’re going to give the team, teams that got
evidence follow up investments. They didn’t have a choice and they did it in a very humane way. He
mentioned Tesla as a great example of this; while they are scaling their automotive business, they are
already creating a new solar business. “Experimentation is in the DNA of Tesla. But opting out of
some of these cookies may affect your browsing experience. Isn't coming up with not only an
innovative product but also an innovative business model the first thing you have to do in a startup.
Let’s say you have a product idea, you should think through several business models. Together with
my kids I also published a business comic. The balancing act is about allocating the resources to
create new solutions. So, what happened is that this year Exploit is it’s stronger than ever before at
risk of disruption. So, I remember projects we were doing with Bayer, a pharmaceutical company.
But a lot of ideas are killed too early because of false measurements or measuring the wrong things.
I'm most passionate about simplifying complex challenges that today's leaders face. Nevertheless,
Osterwalder is a very charismatic speaker, and he has created a successful business with his his book,
iPad app, and keynotes and workshops. You’re going to have homeless ideas coming in and homeless
ideas going out. However, not allowing these services may impact your experience. I believe that
Nordic companies are trying to adapt to new ways of approaching innovation, but that it will take
time to change the sometimes conservative and risk-averse leadership.“ Osterwalder stresses that
innovating organizations need to pursue multiple ideas to find the one great idea that is an outlier and
has the potential to work. After co-founding his first startup in 1999, he wrote “Business Model
Generation”, with Yves Pigneur, changing the way startups across the world design and develop their
products. You can even take a Nestle, biggest food company of the world, they started with an idea.
So, I remember projects we were doing with Bayer, a pharmaceutical company. So then you test it,
you fail probably, you redesign it, you go through a couple of iterations. Large companies also have
huge potential and the ability to create significant value for stakeholders. It is a very practical book
for doers and was written together with David Bland. You also have the option to opt-out of these
cookies. That’s the key thing and companies that bought back their shares that paid bonuses, focus
completely on exploit, but you know, it didn’t build up the Explorer skills and now don’t have the
money it’s going to be very tough. So we see these things in the field or by working a lot with
established companies. In innovation, you need to invest in many ideas, a little bit of money, and
then only invest in those that bring evidence to the table. Because every time I see something not
working, I try to put something new out there, so our books are always a layer on top. You can do
remarkable things with existing technology which does not have to even have patents anymore.
Right now, they’re giving it, they’re holding their handout. Here’s the Explore, the explore space,
same thing when you’re exploring new ideas. In conferences I engage thousands in live exercises to
make innovation tangible. What comes next is more difficult: Take a critical look at the innovations
your leadership team identified and ask if they’re placed in the right box. It’s two boxes. And on the
top side here we have what we call the Exploit portfolio. All my talks and keynotes are engaging and
hands on. Ideas today can come from anywhere, and they can change the world. Jeff Bezos publicly
saying to his shareholders, Amazon is the best place in the world to fail. We need to create that
context where the team gets the right incentive. There’s always a good business model and great
business model for any specific situation, specific industry, specific objective: some want to build a
small business some want to build a scalable business, so it really depends. They said we should
actually mix internal teams and startup teams earlier on at least, both, right. We also use third-party
cookies that help us analyze and understand how you use this website. So, you can see the great
leaders emerging and they’re now visible.