About the Episode
Elijah Eilert is talking to Peter LePiane about innovation within large organizations. Part 2 of the podcast explores various aspects of innovation related decision-making. Peter opens up about his background in science and computer science, his Startup journey and how he nearly founded Airbnb and Shopify. He introduces Estimatic, his latest venture, software designed to model uncertain projects and ideas.
The episode addresses the concept of innovation accounting, common misconceptions in business case analysis, and the value of information by connecting learning to financial outcomes. The episode challenges traditional practices in organizations and focuses on the importance of understanding human behaviour to achieve success for new products and organisational change management.
Throughout this episode, the duo explores a myriad of topics central to innovation-related decision-making and highlights the value of information, connecting it to financial outcomes. Unravelling the concept of innovation accounting, Peter debunks the common misconceptions prevalent in business case analysis. The episode challenges traditional practices and underscores the pivotal role of comprehending human behaviour in achieving success, whether for new products or the intricacies of change management within organizations.
Topics and Insights
[01:43] Understanding Human Behavior in Change Management
- Products succeed or fail based on human behavior, as do organizational changes. Understanding human behavior is therefore crucial.
- Peter recommends checking out Lean Change Management and gives a shoutout to Jason Little!
[05:23] Peter’s Background
- Peter’s background as a software engineer.
- How he transitioned from science to computer science at the University of Waterloo.
- His journey into the startup world.
- How Peter launched Airbnb and Shopify (kinda).
- Peter’s experience working on web development and e-commerce projects.
[16:15] Estimatic
- Peter explains his startup, Estimatic, a Monte Carlo tool for modelling uncertainties.
- The importance of accurately depicting uncertainty in business models.
- Critique of the misleading hockey stick growth projections in startup presentations.
- The need to provide a range with a probability of future outcomes instead of point predictions.
[25:51] Challenges in Corporate Innovation Decision-Making
- Addressing the challenges of making decisions in large corporations.
- Mentioning the lack of recognition for risk management in decision-making.
- Highlighting the absence of structures rewarding risk management.
[26:53] The Concept of Innovation Accounting
- Elijah and Peter delve into the concept of innovation accounting and its evolution.
- Explain how innovation accounting combines the uncertain nature of innovation with concrete numerical measurements.
- Emphasize the importance of connecting learning to financial outcomes.
- Discussing the use of Monte Carlo simulations in innovation accounting.
Quantifying Learning and Progress (32:43)
- Discussing the measurement of progress in innovation accounting.
- Mentioning the value of reducing the range of uncertainty.
- Emphasizing the value and significance of measuring uncertainty reduction.
- Discussing the impact of reducing uncertainty on decision-making.
- Linking uncertainty reduction to financial value and decision-making processes.
[39:55] Common Misconceptions in Business Case Analysis
[44:14] The Value of Quantification in Decision-Making
- Emphasizing the importance of quantifying assumptions and outcomes.
- Discussing the misleading nature of averaging best and worst-case scenarios.
- Challenging the common practice of this approach in organizations.
About the Guests
Meet Peter LePiane, the accomplished management consultant with a track record of helping organizations transform how they validate and launch products and services. With a background in start-ups, incubators, venture capital, and professional coaching, Peter has spent the last two and a half decades refining his consulting toolbox serving a diverse range of clients from midsize companies to large, multinational corporations in industries including financial services, insurance, retail, telecommunications, consumer packaged goods, and fragrance manufacturing. Do you need to create the next big breakthrough but don’t know how to discover what your customer wants with certainty? Feel like you need to redesign how your organization thinks and operates but you don’t know where to start? Do you know that culture follows structure but don’t know what part of the structure to change first? Peter is the innovation change maker who can empower you to break through the status quo.
Peter’s professional coaching background differentiates and allows him to be the brave champion required in the face of drastic organizational mindshifts. It equips Peter to help both leaders and teams of innovation change shape their habits towards:
- Generating and investing in ideas that align to the organization’s Innovation Thesis
- Recognizing and challenging assumptions
- Outcome-based and disciplined experimentation
- Designing from a customer and human-centred perspective
- Acknowledging learning as the most valuable corporate currency
- Trading the dream of future assumed success for the reality of current customer feedback
Peter’s most prominent innovation transformation accomplishments include:
- Co-created an internal innovation services organization within Canada’s most valuable and respected telecommunications company with annual revenues of $17B.
- Ingraining assumption-challenging, experimentation, and customer-centric habits into a highly regulated, multinational organization’s culture.
- Transforming two of Canada’s big five banks to a culture of innovation and agility.
- Creating leading-edge Lean Innovation and Agile training content delivered across Canada and at Queen’s University School of Business.
- Transitioning one of Canada’s largest TSX listed insurers and wealth managers with over $36B in assets under administration to agility.
Connect with Peter
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