Strategy. Innovation. Brand.


Button-Down Innovation

Liberty Bell Collar Roll (

Liberty Bell Collar Roll (

Men’s fashions change very slowly. By and large, the shirts I wore in high school are still in fashion. (Too bad they don’t fit). In fact, I bet that many of the shirts my Dad wore in high school would still be in fashion. So, there’s not much room for innovation in men’s shirts, is there? If it ain’t broke, don’t fix it.

It’s a good thing that Elliot Gant didn’t get the memo. Elliot, who started Gant Shirtmakers with his brother Martin in 1949, died a few days ago at age 89. The Gant brothers innovated where most other managers never even thought about it. The Gants observed closely and made a series of innovative enhancements. Though each innovation was small, the cumulative effect was huge (as they say in New York).

Here’s how the New York Times describes how the Gant brothers changed and enhanced the traditional button down shirt.

The Gant brothers perfected the collar’s shape, known as the perfect roll, formed by the front edges of the buttoned collar. They introduced the box pleat in the back to allow more freedom of movement, the extra button in the back of the collar to keep the tie in place, and the patented button tab that connects beneath the necktie to push the knot up and out. (The tab won an award from Esquire magazine.)

They also introduced the hanger loop on the back of the shirt so that it could be hung on a hook — in a locker, say — without wrinkling.

The Times writes that the locker loop became, “…a collegiate and high school totem: A young man would remove it from his shirt to signal that he was going steady.” I remember it somewhat differently. If a girl liked you, she would walk up behind you in the high school hallway, pull the loop off the back of your shirt, and keep it as a memento. Sadly, most of my shirts still had their loops.

How did the Gant brothers create a teenage totem from something as unoriginal as a shirt? According to the Gant website, the Gant brothers knew their customer well and focused on a very specific segment: young, preppy men. They never let their gaze wander. They also dedicated themselves to quality as an important differentiator in a largely undifferentiated market.

They also innovated in advertising and marketing communications. They relocated their company from Brooklyn to New Haven, Connecticut largely because New Haven had a large population of skilled tailors. It also, of course, had Yale University. As the website notes, the Gant brothers used Yale for design inspiration and also for marketing. They created the American East Coast University look, which was “distinctive and debonair”. It was what the cool kids wore.

Gant chose to market in nontraditional ways as well. They started with the Yale Co-op, a campus store “…where [students] went to buy clothing and as the Ivy League Look exploded the Yale Co-op was the nexus of the new style.”

Gant also advertised in non-traditional media – non-traditional for men’s clothing at least. They started with small one-eighth page ads in The New Yorker, a magazine for the smart set. They grew upward and outward from here.

When we think of innovation today, we of then think of big, audacious game-changers – artificial intelligence, robots, automatons, and so on. But let’s remember that we can innovate on a smaller scale as well. Changing where and how you place a button on a shirt can create a valuable brand, important differentiation, and even a teenage totem. Innovation doesn’t require large-scale genius. It simply requires observation, imagination, and dedication. Thinking small is just as important as thinking big.

Innovation’s Speech Impediment

It's not a good idea if I don't understand it.

It’s not a good idea if I don’t understand it.

One of the most important obstacles to innovation is the cultural rift between technical and non-technical managers. The problem is not the technology per se, but the communication of the technology. Simply put, technologists often baffle non-technical executives and baffled executives won’t support change.

To promote innovation, we need to master the art of speaking between two different cultures: technical and non-technical. We need to find a common language and vocabulary. Most importantly, we need to speak to business needs and opportunities, not to the technology itself.

In my Managing Technology class, my students act as the CIO of a fictional company called Vair. The students study Vair’s operations (in a 12-page case study) and then recommend how technical innovations could improve business operations.

Among other things, they present a technical innovation to a non-technical audience. They always come up with interesting ideas and useful technologies. And they frequently err on the side of being too technical. Their presentations are technically sound but would be baffling to most non-technical executives.

Here are the tips I give to my students on giving a persuasive presentation to a non-technical audience. I thought you might find them useful as well.

Benefits and the so what question – we often state intermediary benefits that are meaningful to technologists but not meaningful to non-technical executives. Here’s an example, “By moving to the cloud, we can consolidate our applications”. Technologists know what that means and can intuit the benefits. Non-technical managers can’t. To get your message across, run a so what dialogue in your head,

Statement: “By moving to the cloud, we can consolidate our applications.”

Question: “So what?”

Statement: “That will allow us to achieve X.”

Question: “So what?”

Statement: “That means we can increase Y and reduce Z.”

Question: “So what?”

Statement: “Our stock price will increase by 12%”

Asking so what three or four times is usually enough to get to a logical end point that both technical and non-technical managers can easily understand.

Give context and comparisons – sometimes we have an idea in mind and present only that idea, with no comparisons. We might, for instance, present J.D. Edwards as if it’s the only choice in ERP software. If you were buying a house, you would probably look at more than one option. You want to make comparisons and judge relative value. The same holds true in a technology presentation. Executives want to believe that they’re making a choice rather than simply rubber-stamping a recommendation. You can certainly guide them toward your preferred solution. By giving them a choice, however, the executives will feel more confident that they’ve chosen wisely and, therefore, will support the recommendation more strongly.

Show, don’t tell – chances are that technologists have coined new jargon and acronyms to describe the innovation. Chances are that non-technical people in the audience won’t understand the jargon — even if they’re nodding their heads. Solution: use stories, analogies, or examples:

  • Stories – explain how the innovation came about, who invented it, and why. Put real people in the story. Explain what problems existed before the innovation arrived. How is the world better now?
  • Analogies – compare it to something that the audience knows and understands. A Service Oriented Architecture (SOA), for instance, is remarkably similar to a modular stereo system.
  • Examples – tell the story of other companies that are using the technology. What benefits have they gained?

Words, words, words – often times we prepare a script for a presentation and then put most of it on our slides. The problem is that the audience will either listen to you or read your slides. They won’t do both. You want them to listen to you – you’re much more important than the slides. You’ll need to simplify your slides. The text on the slide should capture the headline. You should tell the rest of the story.

If you follow these tips, the executives in your audience are much more likely to comprehend the innovation’s benefits. If they comprehend the benefits, they’re much more likely to support the innovation.

(If you’d like a copy of the Vair case study, just send me an e-mail. I’m happy to share it.)

Human 2.0

Human 2.0

Human 2.0

When I worked for business-to-business software vendors, I often met companies that were simply out of date. They hadn’t caught up with the latest trends and buzzwords. They used inefficient processes and outdated business practices.

Why were they so far behind? Because that’s the way their software worked. They had loaded an early version of a software system (perhaps from my company) and never upgraded it. The system became comfortable. It was the ways they had always done it. If it ain’t broke, don’t fix it.

I’ve often wondered if we humans don’t do the same thing. Perhaps we load the software called Human 1.0 during childhood and then just forget about it. It works. It gets us through the day. It’s comfortable. Don’t mess with success.

Fixing the problem for companies was easy: just buy my new software. But how do we solve the problem (if it is a problem) for humans? How do we load Human 2.0? What patches do we need? What new processes do we need to learn? What new practices do we need to adopt?

As a teacher of critical thinking, I’d like to think that critical thinking is one element of such an upgrade. When we learn most skills – ice skating, piano playing, cooking, driving, etc. – we seek out a teacher to help us master the craft. We use a teacher – and perhaps a coach – to help us upgrade our skills to a new level.

But not so with thinking. We think we know how to think; we’ve been doing it all our lives. We don’t realize that thinking is a skill like any other. If we want to get better at basketball, we practice. If we want to get better at thinking, ….well, we don’t really want to get better at thinking, do we? We assume that we’re good enough. If the only thinking we know is the thinking that we do, then we don’t see the need to change our thinking.

So how do we help people realize that they can upgrade their thinking? Focusing on fallacies often works. I often start my classes by asking students to think through the way we make mistakes. For instance, we often use short cuts – more formally known as heuristics – to reach decisions quickly. Most of the time they work – we make good decisions and save time in the process. But when they don’t work, we make very predictable errors. We invade the wrong country, marry the wrong person, or take the wrong job.

When we make big mistakes, we can draw one of two conclusions. On the one hand, we might conclude that we made a mistake and need to rethink our thinking. On the other hand, we might conclude that our thinking was just fine but that our political opponents undermined our noble efforts. If not for them, everything would be peachy. The second conclusion is lazy and popular. We’re not responsible for the mess – someone else is.

But let’s focus for a moment on the first conclusion – we realize that we need to upgrade our thinking. Then what? Well… I suppose that everyone could sign up for my critical thinking class. But what if that’s not enough? As people realize that there are better ways to think, they’ll ask for coaches, and teachers, and gurus.

If you’re an entrepreneur, there’s an opportunity here. I expect that many companies and non-profit organizations will emerge to promote the need and service the demand. The first one I’ve spotted is the Center for Applied Rationality (CFAR). Based in Berkeley (of course), CFAR’s motto is “Turning Cognitive Science Into Cognitive Practice”. I’ve browsed through their web site and read a very interesting article in the New York Times (click here). CFAR seems to touch on many of the same concepts that I use in my critical thinking class – but they do it on a much grander scale.

If I’m right, CFAR is at the leading edge of an interesting new wave. I expect to see many more organizations pop up to promote rationality, cognitive enhancements, behavioral economics, or … to us traditional practitioners, critical thinking. Get ready. Critical thinking is about to be industrialized. Time to put your critical thinking cap on.

Questions or Answers?

Question or answer?

Question or answer?

Which is more important: questions or answers?

Being a good systems thinker, I used to think the answer was obvious: answers are more important than questions. You’re given a problem, you pull it apart into its subsystems, you analyze them, and you develop solutions.

But what if you’re analyzing the wrong problem?

I thought about this yesterday when I read a profile of Alejandro Aravena, the Chilean architect who just won the Pritzker Prize. Aravena and his colleagues – as you might imagine – develop some very creative ideas. They do so by focusing on questions rather than answers. (Aravena’s building at the Universidad Católica de Chile is pictured).

In 2010, for instance, Aravena’s firm, Elemental, was selected to help rebuild the city of Constitución after it was hit by an earthquake and tsunami. I would have thought that they would focus on the built environment – buildings, infrastructure, and so on. They’re architects, after all. Isn’t that what architects do?

But Aravena explains it differently:

“We asked the community to identify not the answer, but what was the question,” Mr. Aravena said. This, it turned out, was how to manage rainfall, so the firm designed a forest that could help prevent flooding.

Architects, then, designed a forest instead of a building. If they were thinking about answers rather than questions, they might have missed this altogether.

On a smaller scale, I had a similar experience early in my career when I worked for Solbourne Computer. We build very fast computers – in 1988, Electronics magazine named our high-end machine the computer of the year. Naturally, we positioned our messages around speed, advanced technology, and throughput.

But our early customers were actually buying something else. When we interviewed our first dozen customers, we found that they were all men, in their early thirties, and that they had recently been promoted to replace an executive who had been in place for many years. They bought our computers to mark the changeover from the old regime to the new regime. They were meeting a sociological need as much as a technical need.

When you go to a gas station to fill your car’s tank, you may imagine that you’re buying gasoline. But, as the marketing guru Ted Levitt pointed out long ago, you’re really buying the right to continue driving your car. It’s a different question and a broader perspective and may well lead you to more creative ways to continue driving.

More recently, another marketing guru, Daniel Pink, wrote that products and services “… are far more valuable when your prospect is mistaken, confused or completely clueless about their true problem.” So often our market research focuses on simple questions about obvious problems. The classic question is, “What keeps you up at night?” We identify an obvious problem and then propose a solution. Meanwhile, our competitors are identifying the same problem and proposing their solutions. We’re locked into the same problem space.

But if we step back, look around, dig a little deeper, observe more creatively, and ask non-obvious questions, we may find that the customer actually needs something completely different. Different than what they imagined – or we imagined or our competitors imagined. They may, in fact, need a forest not a building.

Disrupting the Lawyers

Filling out unemployment forms.

Filling out unemployment forms.

Last week, I wrote about the process of disintermediation and how it will disrupt banks and bankers. By encrypting transactions and distributing them across a peer-to-peer network, we will no longer need banks to serve as trusted intermediaries in financial transactions. We can eliminate the middleman.

Can we eliminate lawyers as well? You bethca.

We have lawyers for the same reasons that we have bankers: we don’t trust each other. I don’t trust that you’ll pay me; I want your bank to guarantee it. Similarly, I don’t trust that you’ll honor our contract; I want a lawyer to enforce it.

But what if we could create a contract that didn’t need a lawyer to interpret and execute it? We could eliminate the lawyer as an intermediary. That’s exactly the idea behind smart contracts (also known as self-enforcing or self-executing contracts).

First proposed by Nick Szabo back in 1993, smart contracts use software to ensure that agreements are properly executed. Not surprisingly, smart contracts use blockchain technologies spread across peer-to-peer networks. If you think that sounds like Bitcoin, you’re right. Indeed many people think that Szabo created Bitcoin using the pseudonym Satoshi Nakamoto.

So how do smart contracts work? Here’s how Josh Blatchford explains it:

“… imagine a red-widget factory receives an order from a new customer to produce 100 of a new type of blue widget. This requires the factory to invest in a new machine and they will only recoup this investment if the customer follows through on their order.

Instead of trusting the customer or hiring an expensive lawyer, the company could create a smart property with a self-executing contract. Such a contract might look like this: For every blue widget delivered, transfer price per item from the customer’s bank account to the factory’s bank account. Not only does this eliminate the need for a deposit or escrow — which places trust in a third party — the customer is protected from the factory under-delivering.”

Smart contracts, in other words, precisely define the conditions of an agreement — not unlike dumb contracts. They also execute the terms of the contract by automatically (and irrevocably) transferring assets as the contract is fulfilled.

Blatchford wrote his description in VentureBeat – an online magazine that helps venture capitalists identify and invest in leading edge technologies. This suggests that the money to fund smart contract platforms is already flowing.

Indeed, the first smart contract platform – Ethereum – launched in July 2015. Ethereum’s website describes the endeavor as “… a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.”

Ethereum seems to be essentially a developer’s platform today. Developers can use the platform to develop applications that eliminate the need for trusted (human) intermediaries. Should lawyers be worried? Not yet. But soon.

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