The best leaders know how to make the most with what they've got.

By G. Michael Maddock and Raphael Louis Vitón

Ooooh, that is a big idea—a really, really BIG idea. The other guys have ideas, but theirs are soooo small. You better watch out or you may hurt someone with that big thing. And I can see you’re very excited about it too!

We know what you are thinking. An article written by guys, who are overly amused by sophomoric humor, making a lame attempt to get your attention and some cheap laughs—right? Well, kinda.

We admit to not taking ourselves too seriously, but before you rush to judgment, let us make a simple point that leaders too often miss when it comes to innovation: It is easy to make a big idea small and nearly impossible to make a small idea big.

We’ll explain.

By making a big idea small, we mean coming up with a complicated game-changing concept and explaining it in a way that people get instantly. For example, in 2009, Hyundai introduced an “Assurance” program that allowed you to return your new car if you got laid off. The result was that while most of its competitors posted double digit loses, Hyundai’s 2009 February sales increased 14.3 percent over February 2008. What made this a big idea was the marriage of a powerful insight—a creative insurance mechanism that would have been almost impossible to explain on its own—and spot-on marketing that talked directly to the consumer’s worry about being laid off. It was a big idea that garnered immediate attention from both potential customers and the media, and it produced impressive results.

Staying with the automotive theme, we see many insurers spending millions on advertising programs that give you discounts when you choose their company for multiple policies. In other words, if you bring them more business, they will charge you less. In our opinion, with the advent of companies like Priceline.com, consumers now expect a discount when things are bundled, and pointing this out is potentially a recipe for cannibalization, not sales growth. There may be some other added consumer value to bundling, but just giving a discount for buying multiple products and then overhyping the idea is an example of trying to make a small idea big. It rarely resonates.

Objects in the Rearview Mirror Were Smaller Than They Appeared

So when it comes to industry-changing ideas, the size of the ideas—and the resolve behind them—really do matter.

We believe leaders should talk about big ideas. Big ideas get your company attention. They demand a higher price. They increase loyalty. They demonstrate that you know how to listen, invent and take risks. Great leaders know how to recognize, promote and successfully launch big ideas.

Small ideas do just the opposite. While you may get someone to look at them with big talk, in the end, they will cost you your reputation, your team’s loyalty and your customer. Far too often, leaders make the mistake of talking about their big ideas when they are really embarrassingly small. 

All Talk and No Action?

As we have said in the past, we believe that companies should manage their innovation portfolios just like they manage their financial portfolios.

By definition, this means that innovation leaders are intentionally taking some small risks with small ideas. We call these ideas evolutionary innovation. Good leaders do NOT brag about these ideas because, in addition to being lower risk, these ideas provide a lower ROI, and they are usually being done by all of your competitors, as well. If these are the only ideas you are working on AND your head of innovation is bragging about how they are going to change the world, then, yes, we suspect that there is some overcompensating going on.

Because of the hype, your customers will be interested at first but will quickly turn their head toward the big, sexy ideas of your competition. You can’t tell them you have big things in store and then not deliver.

Innovating Like a Drunken Sailor

Perhaps it is the size of the leaders resolve and courage that matter the most. Leaders with too much courage will quickly move beyond talk and, like wide-eyed sailors, jump right into action. They have big ideas all right, and everyone in the world is going to know it TONIGHT! Ready. Fire. Aim. The climax? You guessed it: extremely high-risk ideas. More accurately, they blast through YOUR budgets since they are playing with team’s time and company resources. But it is OK, says your leader, because these are revolutionary ideas! We define revolutionary ideas as ones that your company doesn’t know how to do while also targeting a yet-to-be quantified market need.

Question: If you don’t know the market needs, and you don’t know how to do it, then why are you so focused on this idea? Too often Dr. Freud would be best able to answer this question. Ironically, the “Dot.gone” crash of the late 90s was fueled by twenty-somethings with something to prove. The defense rests.

Finding Balance

We all make mistakes. Failing forward is part of growing up. In many ways, the best innovation leaders have sewn their oats in their youth with semicalculated, low-risk attempts at innovation. Perhaps they even bragged about these adventures, but as they grew older, they realized that actions speak louder than words—that if they were going to tell the world that big things were about to happen, they needed to make sure they were able to back it up with creativity AND performance.

When it comes to creating new products and services, courage isn’t bad, it is necessary. In our experience, the companies that have more courage in the C-suite do better than those that just have discipline because they encourage failing forward. In fact, without courage, a leader will allow his team to fall into the trap of only launching safe, undifferentiated ideas or worse, launching no ideas at all. Remember, if nothing gets launched, nothing gets measured. (So you can go on just talking a big game.)

Although slightly out of context, we are reminded of this quote by Teddy Roosevelt, which is to say that the people with the biggest sticks usually speak the softest. But in this case, we’re talking about ideas, not what you were thinking.

G. Michael Maddock is chief executive, and Raphael Louis Vitón is president of Maddock Douglas, an innovation consultancy that helps clients invent, brand, and launch new products, services, and business models. Maddock is author of the book Brand New: Solving the Innovation Paradox—How Great Brands Invent and Launch New Products, Services, and Business Models (Wiley, April 2011) and coming in January of 2012, Free the Idea Monkey to Focus on What Matters Most.

This article originally published in Bloomberg Businessweek

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