Page 177 - HBR Leader's Handbook: Make an Impact, Inspire Your Organization, and Get to the Next Level

166 HBR Leader’s Handbook

is usually difficult because your resources, processes, and decisions about
priorities and investments are geared to the existing business and won’t
accommodate or support an idea that doesn’t fit the current framework.
To overcome that and avoid the rejection of disruptive ideas out of hand,
you can set up a special team of dedicated resources, separate from the
existing business processes and pressures, to focus on the new idea. For
example, several years ago, a large pharmaceutical company that one of us
worked with set up a small full-time team, led by a senior executive, to
explore the development of an industrywide data analytics business that
could mine actionable insights about drug development from clinical trial
data, prescription sales, clinical tests, and genomic mapping. Although the
team wasn’t able to turn this idea into a stand-alone functioning business,
many of the tools and approaches that it developed were incorporated into
the core business. Another example of this approach is a technology unit
at AIG called Blackboard Insurance, run by Seraina Macia (whom we met
in chapter 4 when she was CEO of the XL North American P&C business).
Blackboard is a dedicated team, separate from mainstream AIG, focused
on disrupting insurance underwriting by incorporating artificial intelli-
gence and data algorithms into the process.
If a disruptive idea does emerge from a dedicated team, and if it can’t
be developed further within the confines of the current business, then you
can create a completely separate entity to bring it to market. The classic
example is the way IBM developed its personal computer business in the
1980s (sold to Lenovo in 2005) by setting up a skunk works unit in a sep-
arate location with its own resources and without the inhibiting strictures
and rules of the parent company that was at the time so beholden to selling
mainframe computers. This kind of freedom allowed the IBM team to do
whatever it needed to be successful, such as hiring and paying people dif-
ferently, sourcing parts in new ways, creating new partnerships, and set-
ting up separate sales channels. Another example was former CEO Jeff
Immelt’s structure for GE’s software business, focused on the internet of
things, which he created as a semiseparate entity located away from the
core businesses—once again creating a culture more geared to high-tech
innovation than the company’s standard industrial production.