511: Product insights from employee #1 after a $2.3 billion exit – with Chris Elmore

How product managers can foster a culture of innovation Watch on YouTube https://youtu.be/14cLrVAu7BA TLDR In this episode of Product Mastery Now, I’m interviewing Chris Elmore, a tech entrepreneur and college professor who helped found Avid Exchange, a unicorn startup that went public in 2021. Chris brings years of experience in product innovation and management, and he’s here to share his thoughts on driving innovation and keeping businesses growing for the long haul. Here are the key points from our conversation: * A simple definition of innovation: “It’s better than what it was” * Rethinking organizational structure can improve the flow of innovative ideas * Hiring should focus on cultural fit and alignment around organization mission and purpose * Everyone in an organization can be an innovator The Importance of Innovation in Today’s Business World As we start our chat, Chris highlights why innovation matters so much in today’s fast-moving business world. Products and services don’t stay relevant as long as they used to. Because of this, companies can’t just rely on what worked in the past. Innovation is key to keeping a business growing and thriving. Building a Culture That Supports Innovation One of the main topics we explore in this episode is how a company’s culture can help or hinder innovation. Culture is the unwritten rules of an organization – what people are allowed and expected to do. Chris shares his experience of keeping a strong culture, and even improving it, as his company grew. This challenges the common idea that company culture always gets worse as a business gets bigger. Chris says that the quickest way to destroy culture is to put someone in charge of it. When someone is in charge of culture, the culture becomes that person’s version of culture. Instead of taking charge of culture, leaders can use stories to reinforce a culture of innovation. For example, Chris tells his teams a story of how he tells his kids that he doesn’t care about their grades as long as they’re putting in full effort, but usually full effort leads to good grades. This communicates to his team that effort will eventually lead to the desired outcome. Rethinking How Companies Are Structured to Support Innovation We also discuss Chris’s thoughts on how company structure can affect innovation. He critiques traditional hierarchies, suggesting they can make it hard for innovative ideas to flow, especially ideas from employees who work closely with customers. Chris observes that most good ideas come from the middle third of an organizational chart. Often, people in the middle or bottom third of an organization try to communicate their ideas to leadership who don’t understand the idea or are scared of innovation, so many great ideas fail. Instead of a traditional org chart, Chris proposes thinking of the organization as a curve that represents everyone’s understanding of where the organization is going. The beginning of the curve represents where the organization is today, and the end represents where the organization needs to go. The goal of a leader is to get the organization over the valleys to go further down the curve. This approach focuses on aligning everyone in the organization towards common goals and outcomes, rather than rigid reporting structures. Producing Alignment To explain what the organization is working toward and get a team aligned around common goals, Chris concentrates on three things: mission, purpose, and outcome. The mission and purpose should be aligned with the organization’s outcomes. If not, we have work to do. If someone can’t get behind the mission and purpose, they can’t be in the organization anymore.