and now we have Gary joining us from Boston here with us. Gary, how do you do? Gary H. Meryl, great. Fantastic to be with you this morning here in Boston. Afternoon for you in Zurich. Delighted to be with you today. Gary H. Meryl, really, really, really happy and looking forward to talk with you about innovation. Gary H. Meryl, really, really, really special about this interview because Gary, you have become some sort of icon in the community of leaders that is really enthusiastic about bringing innovation together with strategy. And that would also be that kind of my first takeoff question. Why are you so passionate about innovation and what has it to do with strategy? Where's the link there? Gary H. Meryl, really, really, really? Well, you know, I've been passionate about innovation my entire career and I'm spanning now almost 40 years. I think for me, innovation, you know, it drives so much of our daily life, our well-being. If you think about, you know, companies that grow or economies that succeed, it's always, for me, seems to come back to their capacity and their ability to innovate. And if you think about us as a society, why as a species, as humans, do we do pretty well? It's because, you know, we've been innovating through our whole human history. And when we face big challenges like the kinds we're facing, you know, today, it seems to be that, you know, innovation at the end of the day, you know, carries us forward, gets us through it and makes life better. And so for me, it's just so fundamental to our lives as humans and fundamental to the life of any business. Really, really cool, inspiring. And the question for me would be, if you have a three-week virtual course at HBR, which is called Strategic Agility, and you do that together with Francesca Cino, how do you link innovation there to strategy? Like, like, what's, what's the link there? How do we get agile in that equation? Yeah, I mean, you know, agility is all about your ability to change. And it's change with respect to things that happen in your environment, your competitive environment. And for me, innovation is just one very important form of agility. There are other forms of agility. But, you know, look at what's happened in the last, you know, two years with the pandemic. It created a shock to almost every business. And required businesses to innovate, to innovate on the fly, whether you're a grocer, a small restaurant that had a shift to takeout, or a pharmaceutical company that had to shift its research. It's this capacity to change and adapt that is, to me, fundamental to innovation. But it's kind of the heart and soul of what it means to be agile. I can't think of a single innovative company that I know that is not agile. I think they go together in a very deep way. Yes, I agree there. So, it really matches my experience as well. And maybe that brings us a little bit into segue, right? So, so being agile, being innovative, doing that, I mean, let's, let's take that tour, get a little bit deeper in there. Our audience is an audience of practitioners. So they work day by day on innovation, on strategy, of course, they understand it that way. So you are talking to many, many C-levels as well in your, in your daily work and research. So what, what, what do these very successful practitioners as, as leaders, what, what do they, what do they do? What, I mean, what, what is the, what is the secret sauce, so to speak, of success? I think they, I think they do three things really well. And they do all three of them. And I always think of this as the kind of checklist for a leader, if you, if you will, around innovation. The first is they're really clear about the innovation strategy. So how do they want innovation to help them compete? So it's not just innovation is a great thing. Let's go do it. But it's innovation is going to give us an advantage in these ways. And this is the type of innovation we have to pursue. And they're really clear and articulate about it. So that's the innovation strategy. The second thing they do well is to recognize that you have to build the right systems for innovation. You know, innovation doesn't happen automatically. Organizations, which are good at it, build systems. And I think good leaders are really, they almost think of themselves as the architects of that, of that system. And then third, and very importantly, very, very importantly, maybe most importantly, is they spend a lot of time on, on fostering the right kind of culture to support innovation. So it's strategy, systems and culture. Those are the three things they do well. Can you help me with an anecdote on this cultural element? I think, so it's an anecdote of good behavior. Well, I think, I mean, many of them, of course, but, you know, I think when leaders look at their organizations, and they think about the kind of behaviors they want to see in the organization, they spend an awful lot of time trying to model those behaviors. And I think maybe one of my best, anecdotes that I can tell, I mean, I've seen many that some of which are private, so I probably can't describe them all. But this is one that I describe in my book, Creative Construction. It's Paul Stoffels, who at that time was the head of J&J's pharmaceutical unit, Janssen Pharmaceuticals. Now he's just retiring as the corporate chief scientific officer. Terrific guy. He really played an important role in turning around that business unit 10 to 15 years ago. They always had a problem with their culture. People were afraid to fail. They were afraid that if you failed, you'd get fired. So they were very conservative. And they had a major drug development program fail relatively late in the clinical trial process. Very expensive. It was like a several hundred million dollar write-off. And, you know, he's called before the board of directors, and they want to know who's responsible. And he said that was code word for who are we going to fire. Like, who was running this project? Who are we going to fire? And he basically said, look, I'm the, at that time he was the president of R&D. He said, I'm the president of R&D. I'm responsible. If you want to fire someone, you fire me. And he said, you know, they didn't fire me. And he goes around, he tells this story. They didn't fire me. But my attitude hasn't changed, which is, you take the risk, I take the blame. And that's for him what good leadership was about. That is he, and he said, but then I expect that of you as well. So he, and he cascades. He created that through his organization. If you want to work for me, you have to be the kind of leader who says to their people, you take the risk, I take the blame. I've got your back. And, and that event and that story completely changed, I believe, the culture of that business unit and has made that now, you know, that's an, that's a very, very successful pharmaceutical company. So, so, so, I mean, this is so enlightening. So once we get concrete, right, the, the behavior you may need to see, it seems you gave the perfect recipe. You said, these are the three things a leader should have. Don't model it, show it. Yet in, in the book, in your book, creative disruption, creative, sorry, creative construction, you also, you also were making the point that, but somehow that's not easy. I mean, it's all laid out there. So now we know it, but why isn't it easy? Why can't we just adapt that in the corporate world? Yeah. And as I point out in the beginning of the book, look, innovation's never going to be easy and it never should be easy. The thing that makes innovation valuable competitively is because it's hard. Okay. So my, my goal is to make it a little bit less hard. I never pretend that you're going to read my book and there's, you know, I, there's too many business books like this, which is, you know, read my book here. It's like a recipe and you check it off and boom, next thing you know, you've got the perfect, whatever, you know, the perfect cake or baking. You know, you're going to be a souffle or something like that. It's never going to be easy. So what I hope to do through these guidelines is make it a little bit less hard. And, and I think one of the things to keep in mind is every organization is different. So what I try to offer are examples, but examples as principles so that folks can adapt them to the nuances of their particular industry, their particular environment, their organization, their history, et cetera. So it's, it's, it's, it's fairly bespoke. You have to sort of tailor what's right for your organization. And I think that's what ends up, making it very hard. There's a lot of, there's a lot of moving pieces, but, and there's a complex dynamic, which is, you know, like trying to build a culture. It's, it's a little like, you know, the analogy of pushing a rock up a hill. I mean, you got to keep pushing. And if you let go of the rock, it rolls back over you. And I think a lot of times innovation initiatives are viewed as exactly that, an initiative. It's kind of a one and done. We're going to do it this year. You know, this year we're about innovation. Um, and next year we're not. Well, that's ridiculous. I mean, so you work on it for a year, which is not enough time and then you're done and you're not going to be innovative. It's the organizations, which are innovative and sustain that it's every day, all the time, year after year, after year building it. That's, what's hard. It takes a huge amount of energy. Uh, it's never straightforward. It's not, you know, three steps forward. It's, it's one step forward, one step back, two forward, one back. Um, and it, it, it, it beats you up. It's, it's a tough process. Gary, how does that work with, uh, I mean, what you describe is, is an environment that allows for, for let's say, um, different opinions at the given time, ambiguity in different time, different options, different possible futures. Um, yep. And, and I, I have the feeling we built traditionally, we built our, our, uh, organizations quite differently that they, they demand for a decision, right? They, they cannot work with ambiguity. So, uh, how, how does that work? How do we bring together organizations that call for decision-making every point in time? And yet for innovation purposes, we have kind of to chuggle options. Yep. And to me, this is the essence, by the way, getting back to the, the art of agility, which is knowing when you, you can wait and when you have to wait. And finally, when you, you, you can no longer wait. And when do you pull the trigger on a decision? Because you can't put off every decision forever, even in a highly ambiguous environment. But what we have to get leaders comfortable with, uh, is the idea that, look, you, you don't have perfect data and you're not going to have perfect information. And the world is not predictable. And, and, and, and you're making bets. Strategies about making bets, making informed bets, hedging as best you can. Uh, and then being able to recognize when those bets are not working, going awry, that you had it wrong. And again, that comes back to culture. So you, new leaders, you could say, we're doing this. You know what? I don't think that's working. Um, that's, we're making a mistake. I, I made a mistake. I'm changing my mind. I remember this wonderful interview with Steve Jobs about, um, when the, iPhone was first introduced, many people forget that Apple, Steve Jobs in particular was dead set against putting, uh, apps on the iPhone, third-party apps, that there was going to be no app store. Apple wasn't the first to do that. Um, they recognized though, that that's what people wanted to use the iPhone for. They wanted to load it with apps and they wanted a convenient way to do it. So they, he was asked about that, you know, a year later, they, they went the other way. They opened the app store and it did very well. And he was asked about, you know, you changed your mind. And he said, well, of course I changed my mind. He goes, you know, we changed my mind. We changed our minds all the time here at Apple. If it's a better decision, we're going another way. And I find really good leaders are just very humble. They're actually, it takes a degree of humble to say, I got it wrong. We're going another way. Um, and that's good decision-making. Uh, that's good to see. And it's, it's key to agility. Agility. You have to be able to change your mind. All right. And, uh, it seems to me it's great fun. So also the way you say it, it's not just, uh, it's not just dire and hopeless, but it's quite funny if we apply it. Maybe let's shift gear a little bit because I have one question that burns, uh, with me. So many times when we have, uh, strategic dialogues about the future of a company, uh, we have met many times we end up in a, in a dialogue of, we need to radically innovate our business. We need to have some far out innovation. So, so we are good at the core innovating. Uh, maybe we even applied some of the, um, of the lean principles there, lean innovation principles, but, but how do we get far out innovation, right? Can you quickly elaborate on that? Yeah, it's a very different art. I mean, and I, I've, I've quite recently been, been studying that, uh, more than in the past. I've always looked at it, but it's become a real passion of mine. Um, uh, some of the work I've done recently case study and art, I flagship, uh, pioneering here in Boston, an organization I've worked with there. They're well known for having started Moderna, but they started other, many other companies and full disclosure, I've, I've worked with them. I serve on some of their boards. So let me just disclose that, uh, off the top. But, uh, recently wrote an article with, uh, their founder, New Baratheon, about the way they do radical innovation, breakthrough innovation. Um, and you know, it's interesting. I, I think it starts with a mindset of when you, when you're going to do, first of all, it's got to be a strategy. So you're not going to do breakthrough innovation if you don't allocate resources to it. I mean, a lot of times I see organizations saying we want to do breakthrough and it's very important that we transform, et cetera, et cetera. And then I just say, show me your list of projects and your budget. Just show me your aggregate project plan. Um, and, and, and I, you know, label the projects by type and there's no money going to any project that is not incremental. And then I said, well, you know, you said your strategy was you want to do breakthroughs and you're not spending money on breakthroughs. And then they'll use some vague term, like it's our strategic intent. And I'm like that there's, you know, strategy is not about intent. It's strategy is actually pretty simple. It's where you spend your money. If you're not spending money on breakthrough innovation, you're not going to get breakthrough innovation. It's not going to happen magically. So again, starts with strategy, but then, but then systems, you need a different approach to doing breakthrough. You, you, it's a much more iterative process and it ties back to the third part of culture as well, a mindset so that when you do breakthrough, um, you're never right the first time what you do. In fact, it's, and it's even more so than that. I challenge anyone to think of a breakthrough innovation they know of today that that was a successful breakthrough at any point in history that wasn't originally viewed as a totally crazy, ridiculous idea. Okay. When the Wright brothers decided, they want to try to fly airplanes, people thought they were out of their minds. Okay. Um, this is true throughout history. Um, you know, people thought Steve Jobs was out of his mind. Um, uh, you know, this isn't going to work. Uh, when, um, uh, you know, there's just, by the way, uh, the same with, um, the vaccines, which are effective messenger RNA vaccines. It go back and look at the press just a year and a half ago before those were introduced. You had some of the world's leading experts saying they're not going to work. You can't, develop a vaccine that way. They can't develop them that fast. So you fight a lot of dogma. So the first thing you have to realize when you're in the breakthrough business, um, you are, you have to have a thick skin, uh, because people are going to say you're crazy. They may say you're irresponsible. Um, you know, you're dangerous, whatever it is, uh, you're fighting dogma. Uh, so that's the first thing you have to get really comfortable with. The organization itself has to be comfortable with that whatever they're first proposing as they kind of conject, their, conjecture, get the thing started. Those are not likely to be right. So you have to have a willingness to say we're starting somewhere. And it's not necessarily, in fact, it's, it's very unlikely that our initial thought is the, is what we're going to wind up with, but we've got to get the ball started. And then there's a, a rigorous process of, of experimentation, learning iterations, very evolutionary. And, and you want, you wind up with something. It may not be what you thought it was, but it, it, it, it, you, you do wind up with something big and powerful. And I think that's the essence of, of a breakthrough approach. It's, it's a mentality. It's, it's a strategy, but it's, it's also a process. It seems to me it's more about taking the right turns on the way, not, not being right in first. So taking the right turns. Exactly. Exactly. It's not, you're never going to be right the first time. And again, that's very uncomfortable for some organizations and for some people. All right. Maybe, maybe a last question to you, shifting here, gears again. So, so a little bit more, maybe in the research area that you're working at, at Harvard. So if you look at the innovation strategy space, what is in your opinion, like the upcoming topic? What are you, what are you researching? And what do you see also here establishing itself as interesting study objects or thoughts and paradigms that come up? Yeah. I mean, I can only, I think I can only speak a little bit for my own work because that's what sort of occupies my time. And I think of it as important, but that's probably a biased view. And there's a lot of really interesting stuff going on. You know, I'm, I still am very passionate about this question about breakthrough innovation and how you do breakthrough innovation in a lot of contexts, not just life sciences, but others. I think, you know, every business has to figure out how to do, how to do breakthroughs. And I think our societies need to learn how to do breakthroughs. So if we think about some of the challenges like climate change, you know, we really got to figure out how to get really good at bigger leaps. And, and so that's an area of, I'm still very interested in. The other part of my research now, what I'm starting my next book on is, is looking at, which ties to innovation, but it's broader than that, is a corporate growth strategy. So how do corporations go? Why do companies stop growing? What causes companies to stop growing? I think part of that is innovation. It's not a corporation, by the way, but it's also when they, the scaling, as organizations get larger, what happens to them? What causes them to lose that vitality that they had when they were younger and smaller? And, and how can you reinvigorate companies for growth? So that's work that's being done. I've been working on that the last several years, writing, you know, many case studies, thinking about the issues of company growth, and particularly as it relates to culture, you know, how do you scale really effective cultures and organizations? And how do you sustain those cultures? It seems to be quite, quite elusive. So those are the kind of areas that at least I'm thinking about that I'm, I'm super excited about. Right. Yep. Me as well. I'm a, I'm a huge fan of, of the writings of yours, of course. And I always interested to find out kind of what, why does this, why does a startup at some point not, is not called anymore a startup, right? At some point it becomes a corporate. And I think in 20 years from now, that shouldn't be the case anymore. Shouldn't talk about. That's right. There shouldn't be, I mean, corporations grow and they want to grow and that's a good thing, but it shouldn't involve the fact that they lose their vitality. It's, it's, that's, that's a theme that's in the creative construction book, but it's one I really want to pick up on in the future work. Really cool. So let's conclude it with this. Thank you very much again for joining us from the US. It was a pleasure to have you here talking with us. Many thanks, Gary.