[EO Chicago] Embracing Innovation and Conquering Business Plateaus With Mike Maddock

Mike Maddock is the Founder of Flourish Advisory Boards, hyper-curated virtual peer advisory forums for CEOs and business leaders who are focused on professional and personal growth. He is a serial entrepreneur, international public speaker, expert in innovation, and best-selling author. Mike has served over 25% of the Fortune 500 companies, helping them envision and create new growth avenues. As the Founder of Maddock Douglas, a globally recognized innovation consulting firm, he has also assisted in developing and launching new products, services, and business models for over 25% of the Fortune 100 companies.

Here’s a glimpse of what you’ll learn:

[3:56] Mike Maddock’s background and leadership influences
[6:22] Lessons from successful disruptors
[11:24] The tension between the operator and the visionary
[14:05] The importance of diverse perspectives for creating a breakthrough team dynamic
[16:42] How Flourish Advisory Boards facilitates breakthroughs for business leaders facing challenges
[24:21] The partnership paradox and its impact on business success
[31:58] Key strategies for successfully launching new products and services
[44:37] Mike shares a profoundly personal lesson on love and purpose he learned from his late wife

In this episode…

What does it take for a company to embrace innovation and breakthrough business plateaus? In the face of stagnation and resistance to change, how can leaders cultivate an environment that encourages fresh ideas and growth?

According to Mike Maddock, a seasoned entrepreneur and best-selling author, the answer lies in the diversity of perspectives within a team. He highlights that successful companies embrace their customers’ pain points and seek to innovate around what people hate about their industry. He also emphasizes the importance of avoiding the “expertise trap,” where internal knowledge can blind leaders to new possibilities. The main effect of this approach is that companies become more agile, learning to spot and capitalize on market gaps. Mike also underscores the critical role of reframing a business’ purpose, asking not just, “What do we sell?” but also, “What business do we have the right to be in?”

In this episode of the Rising Entrepreneurs Podcast, host Dr. Jeremy Weisz sits down with Mike Maddock, Founder of Flourish Advisory Boards, to discuss the key factors that drive innovation and help companies break through plateaus. They explore how to assemble effective teams with diverse roles, tackle the fear of risk in established companies, and embrace market gaps for new growth. Mike also shares the personal story of how his wife’s strength and love influenced his perspective.

Resources mentioned in this episode:

Special Mentions

Related Episodes

Quotable Moments

“Embrace the hate to innovate. You have to go to things that people absolutely hate about your customer experience or product.”
“You can’t read the label while sitting inside the jar.”
“Marketing and advertising are a tax you pay for a bad idea.”
“The greatest teams surround themselves with people that see problems differently.”
“Love is the answer. It’s the only thing that matters.”

Action Steps

Embrace customer feedback, especially negative criticism, to identify opportunities for innovation: By focusing on pain points, businesses can craft solutions that resonate with consumers and drive growth.
Infuse outside perspectives into your business strategy to avoid the “expertise trap”: Diverse insights can help companies recognize and seize opportunities they might have missed.
Diversify your approach with a “portfolio of experiments”: This strategy allows businesses to balance risk and explore various avenues for innovation and differentiation.
Form a balanced team of visionary and operational talents to drive sustainable innovation: The dynamic interplay between these skill sets can lead to a more robust and holistic approach to problem-solving and business growth.
Nurture an understanding of your company’s core purpose beyond its current products or services: By recognizing the broader market you are part of, you can unlock new realms of opportunity and expansion.

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Episode Transcript

Intro 0:03

Welcome to the Rising Entrepreneurs Podcast, where we feature top founders and entrepreneurs and their journey. Now let’s get started with the show.

Jeremy Weisz 0:13

Dr. Jeremy Weisz here, Founder of InspiredInsider.com, where I talk with inspirational entrepreneurs and leaders today, is no different. I have Mike Maddock. He has too many companies to mention, but I will mention them in the bio. So Mike, before I formally introduce you, I always like to point out other episodes people should check out the podcast I had. This is in the kind of EO world. Big. Thank you to Andrea Herrera, Amazing Edibles Gourmet Catering for making sure that Mike and I met, even though we live very not so far from each other, we did an amazing episode together. Check that out. It’s kind of in the midst of the pandemic, and she had pivoted and started a new business by experience during that time. So it was a really interesting interview to see her innovation and what she did. So check that out. Also on the topic of EO, I had Verne Harnish on the show, author of Scaling Up one of the original founders of EO. That was a really interesting episode. Anthony Standifer in EO Chicago, how to start a beauty brand. He’s co founder of mSEED Group, and you’ll like the Mike Maddock, you know, I had Mark Bealin on Mark Bealin is sort of SearchLab Digital, but he talked about how EO was critical for him and the EO Accelerator group, and he runs, now heads the accelerator group for EO. So that was that was a great one. And Rafi Arbell of Market JD talked about just online marketing strategies for law firms so that and many more on inspiredinsider.com, and this episode is brought to you by Rise25. At Rise25 we help businesses give to and connect to their dream relationships and partnerships. And how do we do that? We do that by helping you run your podcast. We’re an easy button for a company to launch and run a podcast. We do the accountability, the strategy and the full execution. So Mike, we call ourselves kind of the magic elves that run in the background and make it look easy for the host so they can run their company, develop amazing relationships and create great content. You know, for me and Mike, I know you’re you’re very much similar. The number one thing in my life is relationships. I’m always looking at ways to give to my best relationships, and I’ve found no better way, over the past 15 years, to profile the people and companies and I most admire on this planet and share with the world what they’re working on. So if you’ve thought about podcasting, you should if questions go to rise25.com or email us at support@rise25.com I am super excited to introduce Mike Maddock. He’s an entrepreneur, keynote speaker, Best Selling Author, CEO coach. He’s got several companies, which we’ll talk about. On the book front, Mike, Plan D: How to Dream, Drive, and Deliver – Lessons from the World’s Most Successful Disruptors. I’m a terrible reader, so I was really excited to listen to this on Audible. Went to buy it and it’s not there, so hopefully I’m somehow going to force you to create that also Free the Idea Monkey… to focus on what matters most! He’s also the Founder of Flourish Advisory Boards, which we’ll talk about, virtual CEO peer groups, McGuffin Creative Group, and the innovation consultancy Maddock Douglas. Over 25 is a fun fact. Well, Mike, over 25% of the Fortune 500 have trusted Mike Maddock and his team to help them envision and create new sources of growth. And Mike, thanks for joining me.

Mike Maddock 3:35

Mostly my team, not me, but thank you. Jeremy, it’s great to be here. And thank you too, for mentioning Verne Harnish and Andrea Herrera, two great leaders who have made me a better leader. It’s better than coffee in the morning. So thank you.

Jeremy Weisz 3:50

I’ll cut that for a second. How have each of them made you a better leader?

Mike Maddock 3:56

So I’ll start with Verne. I mean, I met Verne probably 30 years ago. I remember this moment, I was at MIT, and Verne was teaching, and he think about like, Psych 101, room, and there’s this big whiteboard. And he drew a line and said, 2, 6, 8, 10, 20, 30, all the way up to 200 and he said, at two employees, this is going to be your problem. At four employees, this is going to be your problem. At 20 employees, at 50 employees, at 200 employees. And then he put the dry erase marker down and said, Does anybody have any questions? And I was in a room with about 80 different entrepreneurs and a young lady from California jumped up and said, Oh my God, it’s like you’re you’re my psychic, which I thought was amusing, but it the lesson for me was that even though we have, we all have what we think are really unique businesses. We share so many of the same business. Issues. And that was a huge learning for me, because, you know, I’ve been in boardrooms where the CEO of a company will say, Well, tell me what you’ve done in the toilet paper industry, like they want to know, or tell me your experience with B2B businesses. And Verne, one of the first lessons he taught me was that we have more in common than not as business owners, and that opened me up to listen and go looking for wisdom in the EO community, and it’s been an amazing blessing for me. Andrea Herrera has a brain almost, almost, almost as big as her heart, and she’s taught me that, you know, love is the answer. She responds with love and care in moments when people really need it. She’s just really good at that. So it’s no small mistake that she owns a really good events company. She she makes moments more magical, and she’s she’s she’s perfectly engineered to do that as a as a human.

Jeremy Weisz 6:02

We’ll get into the timeline your businesses. But I know when people write a book, they really pour their heart and soul, and it’s a lot of work. So I’d love for you to talk about Plan D a little bit, and some of the lessons from the world’s most successful disruptors.

Mike Maddock 6:22

So Plan D is, is one of my favorite books, because I essentially wrote it about my friends. So having been in business for a long time, I could the thread was, what are the superhero powers that give people the ability to pivot while other people are panicking. You know what? What is it about, specifically entrepreneurs, or entrepreneurial thinkers, that under pressure, they reinvent, they, you know, they break things better. They for the good of the whole and so I, what I did was I had a list of tendencies after working in an innovation consulting firm, and I saw these people in companies that would just leave awake, and I started to take notes, and then I reverse engineered those superhero powers back into friends that I had, like good friends who had done use that, You know, that method to transform. So some of the things are frameworks. For example, I have friends that are just masters at using a framework. They have a model or a framework for everything. Mike Michalowicz is like that. Dan hiriz is like that. So that’s number one. I have noticed, I’ve never met a an incredibly successful business person that isn’t either being chased by a ghost or chasing one. The question is, who’s got who great disruptors are very aware of that that ghost and that maybe it’s a coach, maybe it’s their English teacher, maybe it’s their dad or mom that has them working harder, longer, faster. They won’t give up. Purpose is a superhero power of a lot of disruptors. They’re all about purpose. They repeat. They refuse to play the role of the victim. You know, they just won’t play the victim. They’re always in the Creator mode. So there’s just some of the things that are covered in the in the book. But more importantly, it’s how they do it, you know, like, What are the methods they do? They use, when under pressure, to disrupt things.

Jeremy Weisz 8:36

Like, there was one story I remember you telling. I think you were, I don’t know if you were at a board meeting or a meeting, and you went up to someone, I think it was you, and said, Wow, you’re so creative.

Mike Maddock 8:52

Oh yeah. Yeah, that’s Joe Kim. He I worked with Joe for many years. And Joe is a wonderful guy. He now leads a creative firm, and he we had this meeting, and he immediately began brainstorming and and came up with dozens of ideas on the spot. And afterwards, I said, Joe, you’re the best Ideator, I think I’ve ever been with that that was amazing. And he’s like, I suck at ideas. Mike, I was actually using a framework, which he showed me later. It’s covered in the book. He was literally using an acronym to come up with another idea and another idea and another idea. And that was his go to bunch because he realized on the spot he wasn’t good at brainstorming, so he found a framework that helped him do that.

Jeremy Weisz 9:44

What was something in that framework?

Mike Maddock 9:48

Well, so I’ll give you a framework, one of my favorites, Brett Miller, I’ll give him credit for this. He came to work one day and he said, Hey, I saw what would Jesus do? Bumper sticker? Yeah. And he goes, You made me think, What would Jesus do, or what would Elon Musk do, or what would Oprah do, or what would and so we we created, uh, dozens and dozens of cards with famous thinkers. They picture in the front, and then a little bio and some of the things that they had come up with on the back. And when we were with clients, we’d say, Okay, let’s stop thinking about this problem ourselves. Come up with an idea that Oprah would have embraced, or Steve Wozniak, etc, and that is a framework that anyone could use. Another simple framework is taking money off the table. You know, people get stuck because they can’t afford it. So to say, you know, okay, it’s the magic wand. If you had a magic wand, what would you do? I’ve got ten million if I give you a ten million budget, how might you solve this problem? And once you have that solution, you can reverse engineer it and find ways to do it less expensively.

Jeremy Weisz 10:57

I love it. I can’t wait for it to come out on audio. I’m just gonna keep planning this. What about Free the Idea Monkey. I love. And by the way, there is a video version of this if you are listening to the audio. We do have it pulled up here. You could find the books, probably on Amazon, but mike-maddock.com, also on the author page. I love the cover here. Talk about free the idea monkey well,

Mike Maddock 11:24

so here, let me see you, Jeremy, because I do better when I look at someone. Thank you for promoting the books. I’d rather look at you the free the idea monkeys, about the tension between the operator and the visionary. I call them idea monkeys and ring leaders. This preceded Gino Wickman’s book where he calls them, you know, the integrator and Yeah. And what I’ve noticed is there’s a tension between great partners and somewhat so many of us as entrepreneurs make two great decisions, usually unwittingly. We pick the right way when we pick the right partner. You know, it’s amazing how if you pick, if a surfer picks the right wave, they look like the greatest surfer in the world, but if the greatest surfer in the world picks a lousy wave, they look like they can’t surf. So picking a business trend that is the right way is so important, and most of us get lucky if we pick the right wave. Same thing with partners. When you’re just starting a business, it’s so critical to pick the right partner. And some of us get lucky. Some of us pick if you’re a visionary, they pick a great operator. The thing is that we tend to pick people we like that laugh at our jokes and think like us. So you wake up one morning and like I did, and you’re surrounded by a bunch of visionaries who are really good at starting things and really, really bad at finishing them. So that book, it just after that book became a best seller, I was in a room with a company that had gone from five to $20 million inside of three years, we thought we could do no wrong, and then we went to 18 million and 15 million and 12 million, and my hair was on fire, and we hired an outside coach who gave us the Colby test. And I was stunned and embarrassed to find that everyone on our team was a quick start, except for our CFO. And so it was really that moment, incredible, incredibly humbling moment that was the seed that started flourish advisory boards. And the whole the basic thesis there is the greatest team surround themselves with people that see problems differently, and that’s how they breakthrough one plateau after another.

Jeremy Weisz 13:45

So maybe we’ll go in reverse order for a second, and start with Flourish Advisory Boards. But I do want to kind of hear the inception, the growth of, you know, Maddock Douglas as well. So start with Flourish Advisory Boards, and what made you decide to start it?

Mike Maddock 14:05

Well, I told you about the moment where, you know, we had grown tremendously, and then we started to shrink and we couldn’t figure out why. The reason why was because I had an incredible team of brilliant people that that were great at pivoting and not so good at execution. And so Flourish is about my and forums, EO, YPO, Vistage are so incredible, and they tend to be unintentional. So the thought was, what if you took the intimacy and the confidentiality of a forum had a professional moderator and tested members so that you had not a bunch of visionaries that laughed at your jokes, but an operator, a strategist, a rainmaker, a visionary, a tech futures. Person and an orchestrator, along with an operator and a professional coach. And the thesis was that if if people looked at your challenge and saw it differently, you’d be able to get unstuck more quickly. And that has turned out to be very true. So that’s what flourish is. It’s a virtual group of CEOs or PNL owners that meet once a month, and they take on their toughest personal and business challenges together, and it’s in the seeing the challenge differently, where the breakthroughs happen.

Jeremy Weisz 15:33

Who’s a fit for Flourish Advisory Boards?

Mike Maddock 15:37

Um, well, you have to be a curious learner. You have to be generous in terms of wanting to help others. You have to run a PNL no victims. You need to be able to to take an idea that or a problem or a challenge or put it on the ground. You can’t complain that your your boss, your dad, your mom, won’t let you do it. And then I have groups. One of my groups, the average revenue is about 600 million. I have another group, the average revenue is 5 million. I have a $20 million group. I have a $75 million group. So it’s up to me to place you in a group that fits is in the same zip code as your revenue. And then there has to be a seat for you there. If you’re a strategist, there has to be a strategist seen available. So it’s in terms of a business model. It’s pretty clunky, but once the members are together in a group, great things happen.

Jeremy Weisz 16:31

Are there any stories that stick out from flourish of a breakthrough? I know you can’t share the company or person, but maybe a breakthrough someone had?

Mike Maddock 16:42

Yeah, I sure. And again, it is highly confidential, but I’ll tell a story that has a theme that most of your listeners will recognize. It’s really difficult to scale heroics, and most companies are started by a visionary leader who carries the water like they they inspire, they sell, they they get, make everyone believe people want to be around this person, and at some point that What Got You Here Won’t Get You There, as my friend Marshall Goldsmith says, and they have this wake up moment where their go to punch is no longer working. So there is a member that had grown a company to a couple 100 million dollars, and I would say that they were able to do that, and all of a sudden, things stop that member having the the benefit of listening to an operator and a visionary and a rainmaker and a orchestrator all view his issues differently. Decided to completely reorganize his board, hire a new CEO and replace himself as the president of this company. This last year, he doubled his EBITDA and added 200 million to his top line. So he had hit a plateau. He great, great leader, great company. But it’s that plateau, you know here, symptomatically, if you are showing up in your group and talking about the same problem over and over and over again to the point where you’re embarrassed to bring it up anymore. You are probably working on the wrong problem, and it’s up to the group to see it differently than you do, and it has to be a group that you respect and love and are willing to learn from. And that’s really, really hard. You know, your baby’s ugly, or maybe that’s, you know, my favorite innovator joke is, how many innovators does it take to change a light bulb? Does it have to be a light bulb, you know?

Jeremy Weisz 18:51

So it’s funny Mike, because we, or my business partner, John, implemented this. We do an intervention meeting. And the intervention meeting is on me, by the way, every two weeks to see what I should not be doing, even if I like doing it, right. And so they kind of forced me to take stuff off my plate that I like. No, I like that. No, get rid of it. You should not be doing that. So I appreciate you. It rings rings home to me for sure. Talk about Marshall Goldsmith a little bit and his influence, what you learned from from him.

Mike Maddock 19:27

So I’m a member of I went through the EMP program, birthing of giants, which is started by Vern. It was in conjunction, excuse me, conjunction with Inc Magazine and MIT and half the three year program. And after that three years was a bunch of us got together and said, We want to keep going. We want to keep meeting. So we went to Vernon, said, We want to keep meeting. And he said, No, it’s a three year program. So we gave him a Rolex inscribed from our class. We collected credit cards, nominated chairperson, and we’ve been getting together now for 21 years. And I have chaired that conference five times, and one of the people that I asked to come speak to us is Marshall. For those of you that don’t know, Marshall is lauded as the number one business coach in the world by and he charges a million dollars and offers a money back guarantee if he doesn’t give you that value. So you know, he was the coach of Bill Ford and people you’ve heard of, and he’s a an incredibly humble guy. He started a as part of his legacy. He started a group called 100 coaches and invited people that were coaching to come and be one of his 100 coaches, and in turn, he would teach what he knew to those coaches. I I was fortunate to be nominated and selected. So I’ve spent enough time with Marshall to know that he’s a WYSIWYG, What You See Is What You Get the best kind of person. He is very direct, and he’s very kind, and most importantly, he’s curious. So what I’ve learned about Marshall is curiosity is the ultimate superhero power for a coach.

Jeremy Weisz 21:18

I’m curious some of your favorite book because he obviously has some great books as well. What are some of your favorites throughout the years?

Mike Maddock 21:27

One of my favorite books is What Happy People Know by Dr. Dan Baker. And the reason I love it is because it is, it is the perfect combination for me, of storytelling and science, and it talks about things like, it’s impossible for the human brain, impossible for the human brain to be afraid and grateful at the same time. And I I love if I could give two things to my children, they would be, let me make it three. It would be a strong faith, high self esteem and gratitude as a go to punch. I learned from my mom and Baker about gratitude, and it’s really been it sustained me. Grateful people are curious, grateful people are happy, grateful people are inventive. Grateful people make the world better. So what happy people know is one of my favorite books. I love you know, some of the classics built Alas, Good to Great. I can’t read those enough. I like Mike Michalowicz his books because he is the hilarious too. Yeah, he’s a good buddy. He’s actually, I know Mike because he sat next to me in my first BOG class, like, right next to me. And Mike has the distinction of making me snort beer, milk and coffee out of my nose, because he’s so funny, we’ve become very good friends. So Mike, Mike has the ability number one. Mike is a true entrepreneur. He has driven planes in the mountains in terms of his own companies. So when he and he’s done, and he’s had a couple exits, so when he talks about a business, he’s speaking from his own experience. He’s not an academic. He is. This is what happened to me. I love people that are willing to share wisdoms along with intelligence. Yeah, I mean, I’ll stop there, but yeah.

Jeremy Weisz 23:44

I could keep listening. I have three audible credits. So Mike Michalowicz was on the podcast. People can check that out. He’s in books like Profit First and several others too. So he’s fantastic, and it’s great. And the the audio version, because you use a sense of humor comes through on those. So check those out for sure. You know, we talk about flourish, and it makes me think, because you’ve also very heavily involved in YPO and EO, and you’ve been around run a lot of business teams. So talk a little bit about what makes a good business

Mike Maddock 24:21

team. Okay, so there’s this paradox that I call it the partnership paradox. If you get along with your partner all the time, you’ve got the wrong partner. The same is true for business teams, and the reason is because.

Jeremy Weisz 24:38

Well I definitely don’t have the wrong partner.

Mike Maddock 24:42

I hope he’s listening. No. I mean, it’s like, it’s, it’s like a marriage almost. It’s, it’s a love affair in that you you so deeply respect how they see the world differently, and you love them for it. You know, they keep you out of trouble, but under pressure, you go different directions, you know. Yeah, and that’s why, when I started with free the idea monkey, the classic example are the operator and the visionary. It’s Ray and Walt Disney, who didn’t speak for three years, by the way, because Ray was so mad at Walt so but then expanding on it, you have a the characters that I’ve seen and when I formed. First round, there’s a great operator, there’s a great strategist, there is a great Rainmaker, there’s a really good visionary. But you know, who’s under control, tech futurist, a technology expert, has become more and more important on an executive team, and then finally, the orchestrator, who is the glue that holds the team together. So just by way of example, Jeremy, if I came to you, or I came to my flourish group and said, you know, oh my God, we’ve we hit 20 million, and now we’re at 18. Now we’re at 16. Now we’re at 14. We’re not profitable. I’m going to lose everything. A good advisory group will say that. The operator will say, let me look at the P now, I want to punish every line, and I’m going to have you profitable in a quarter. The strategist will say, what are our KPIs look like? What are we measuring? The Rainmaker will say is, how, what are we selling? What’s our pipeline looking like? Maybe we should 8020 maybe we should sell something different. Maybe our margins are wrong. The visionary that’s me will say we need to buy someone. We need to launch something different. We need to change everything. Sometimes, occasionally the tech futurists will go right to these days, we’ll go right to generative AI or bots or something we’re like, well, maybe we can. Our tech stack is inefficient. How can we be more efficient using technology? And then the orchestrator will say something like, I think we have a trust issue. We’re rescuing each other. We’re not, you know, we’re not holding each other accountable, because maybe we love each other too much. Until we work on that trust issue, we’re never going to be profitable? And the question is, who’s right? The answer is, everybody at a different moment in time. But unless you have all those perspectives on your executive team, you can be a bunch of hammers looking for a nail, and that, that is what happened to me. I did it. I am responsible for surrounding myself with all these beautiful people who I loved and who were brilliant, who saw the world a lot like I did. We were hammers looking for a nail.

Jeremy Weisz 27:26

Was that in Maddock Douglas, or one of the peer groups>

Mike Maddock 27:31

Maddock Douglas, that was at Maddock Douglas. Yeah. And you know, Maddock Douglas is responsible for that. That group of people has made such a huge impact in the world. I mean, billions and billions and billions of dollars of innovations that we helped our clients with. It spawned three different companies. Former Maddock Douglas people are chief creative officers all over the country. I mean wonderfully brilliant people who I care deeply about and love. And I guess what I’m most proud of is people that have come to the Maddock Douglas sausage machine speak lovingly about it like it was a it remains and was an incredibly great place to work and flawed because of me as a leader. How about that? I’ll take all the blame.

Jeremy Weisz 28:29

It’s funny, because with what you just said, leaves me a trail of questions and no answers, because I’m like, okay, that’s really interesting. Okay, who’s right? Right? You have the tech solution, you have the orchestra solution, you have the visionary solutions. So, is there a scenario? Because, like you, I don’t know who ends up making the decision of the CEO, but one of those where everyone comes up with something. And, you know, is there a scenario we could think of? Okay, here’s what people came up with, but we went in this direction. I know every scenario is different, but it’s definitely I love how you kind of lay out each of the people’s thought process and to them it’s all right and it could be all right together. So yeah.

Mike Maddock 29:14

So the the best answer I have for you is what we tell our clients to do. If you think about your own your money, think about your finances. If I told you, Jeremy, put everything in Bitcoin, that would be irresponsible, but that’s a visionary, you know? Oh, man, it’s all Bitcoin. You got to go Bitcoin. So if you think about how you handle your financial investments, if you have a good team, you can create a portfolio of experiments. And I lay this out in both Plan D. It’s in flirting with the uninterested as well. There’s a portfolio framework where x y access we know how to do it, we don’t know how to do it. We know people want it. We don’t know if people want. On it. So we know how to do it. We know people want it. That’s evolutionary innovation. That’s what operators do. We’re just going to make what we did yesterday a bit a little bit more efficient and profitable. Today. You have to do it. It should be a big part of what you’re doing, but if that’s all you’re doing, you’re going to go out of business, because eventually your margins will shrink to nothing, and you will be out pivoted. We don’t know how to do it, but we people are demanding it. Differentiation, that’s where you lay some of your you invest in that, and margins are higher. You’re answering the needs of your current customers or consumers. And if you get really good at that and put just enough investment in it, you’ll constantly be growing. I already mentioned, we don’t know how to do it. We don’t know if people want it. That’s revolutionary. There’s your Bitcoin, maybe 5% of your investments should go in there. And then finally, where the entrepreneurs live. I know how to do it, but I don’t know if anybody wants it. That’s where you rapidly prototype, and you just run experiments. And that’s typically how entrepreneurs create Napster moments. A Napster moment is when someone with no business being in your business comes along and puts you out of business, and it’s because they’re moving much faster, running experiments more quickly than you’re able to do so with a highly functioning team that has six different lenses. You are equipped not only to have those ideas, but to have someone who will say, No, no, we have enough differentiation. We need to work on a little bit more fast fail or evolutionary innovation.

Jeremy Weisz 31:38

Thanks for closing the loop on that a little bit. That’s very helpful portfolio of experiments and having a diversified strategy in general. But you know, you mentioned this, why are some companies good at launching new products in some aren’t?

Mike Maddock 31:58

Okay? That’s a whole nother podcast. But let me give you just a few thoughts. Number one, the the if you’re on a treasure hunt for being disruptive, go to what people hate about your industry. And my friend Barry Calpino, God rest, he used to say, embrace the hate to innovate, you have to go to things that people absolutely hate about your customer experience or your product. And guess what? Nobody wants to talk about what people hate about our product or service, but that’s where all the action is. So you have to start with things that people hate about customer experience your product or service. Start there. Number two, there’s this expertise trap. I like to say you can’t read the label when you’re sitting inside the jar. You know what you’ve tried in the past, you know what you can afford. You know what your customers really need. You know what’s legal. You know it’s illegal. You know what your boss wants. You know, you know, you know. And that expertise keeps you from seeing things possibility that’s walking right in front of you, which is why companies that are really good at innovating usually hire someone from outside their company, outside their industry, to run innovation. Another axiom is that everyone thinks, if everyone thinks this is a good idea, or said differently, if you keep working on something till it offends nobody, it’s no longer a good idea. It will not get any it will not get any love in the market. I like to tell people that, and this is funny, I mean, a little bit ironic, because McGuffin is a marketing and advertising company that is amazing, so they’re going to hate me for this, but I say marketing and advertising are a tax you pay for a bad idea. Why do I say that? Because if you have, if you’ve solved a meaningful problem in the market in a really eloquent, elegant way, guess what? Jeremy, I’m calling you like, holy shit. Have you seen this? What a great solution. We tell our friends about great solutions, and you need to market them less and less in the future. So there’s a few reasons why big companies, one last reason, great companies run by wonderful operators, are designed to mitigate risk, not take it. And so you have this, the DNA of a company, these antibodies that kill risk. That’s what they do. And so innovating is risky. It takes courage and and most, most companies are ill equipped to take those risks.

Jeremy Weisz 34:42

I forgot which company it was, and it doesn’t really matter, but you were talking about working with a company, and you’re walking around the office, and the people had been there for 20 or 30 years. They were all older, white males, and you were thinking. How are we going to innovate? Can you talk about that for a second?

Mike Maddock 35:12

I remember that well, it was General Electric, and I was asked to be on the advisory board, the innovation advisory board for General Electric, Beth Comstock, the CMO. At the time, a wonderful leader was running that program. And I remember Robert Wolcott, who teaches innovation up at Northwestern or University of Chicago now, was in it as well. Anyway, we went out to New York, went to 30 rock, took the elevator up to the top floor. I’m walking down this long white hallway with this group of advisors by all these black and white pictures of middle aged white guys who’d run this company. And one of the advisors said, you know why we’re here? And I said, Yeah, we’re here to help innovate. He’s like, Yeah, kind of, do you know, it’s been 13 years since General Electric has launched a new product or service or business model on what based on one of their patents, 13 years this is Thomas Edison’s company. They were run by a great operator, Jack Welsh, and he had, he had done such a great job at, you know, mitigating risk Six Sigma in their company that they had forgotten how to fail forward. So all their leaders were just working on, you know, tiny little margin, you know, making their business quarterly a little bit better, a little bit better until there was no more juice to squeeze, and now they had to come up with something different, and that’s why we were there. You know, I read that when Jack Welch left that business General Electric stock lost to $200 billion in value, which is a great example of what happens when one of the greatest visionaries of all time starts a company at Thomas Edison, and eventually, what happens if you are out of balance and you have an operator running the show, just an operator, so balance is where the action’s at.

Jeremy Weisz 37:17

Really interesting. So what do you do first, in that situation, and you’re walking in and it’s been 13 years?

Mike Maddock 37:24

Well, there That’s a complicated question, but you know, quarterly shareholder reviews are really hard to overcome when it comes to innovation, because you’re being judged on the value getting shareholders every quarter. And you know, so taking risks is not that’s a long, you know, Blue Ocean Strategy. It takes some years. It isn’t like, Oh, next quarter will be ready to go so that, and that’s why, oftentimes, the best thing to do is first identify gaps in the market that you have the ability to serve, that your brand can serve. And that’s a that’s research, and there’s a way to do it. I again whole nother podcast, but that’s a discipline that science and art mashed together. Once you have those needs, you can invent new ways to serve them. It could be a product, service business model, you need to be agnostic. And then for a company like General Electric, sometimes the best thing to do is go out and buy it. You know, you somebody is already, some visionary has already created this product. You can go acquire it, which is what usually happens if you want to start an innovation practice in your company, I tend I recommend making it a completely different department, making it a completely different P&L, making giving it a real budget, a real leader who is can be autonomous. And you know, tell you that your baby’s ugly, take risks without impacting you know your bottom lock quadrant of your portfolio?

Jeremy Weisz 39:04

Yeah, Mike, I had one of the founding engineers at Mobileye. Mobileye helped fuel the autonomous vehicle, and they were like the only chip in the car, besides Intel. So Intel was looking at buying them, and they ended up buying them. I think it was like $15.3 billion and they thought it was cheaper to buy them than to try and figure it out, to do it themselves at that point.

Mike Maddock 39:30

Yeah. And then then the next step is, how do you not kill what made that brand special with your own Mojo? Because, you know, food is a great example. There are a lot of big food companies that buy these granola e West Coast healthy brands, and then they just kill them by changing the ingredients, letting people know that. Now this is owned by us and people. Don’t want their food from a mass producer. Usually they change the what happens is the operators come in and say, we can make this cheaper, faster, better, and they kill the very thing that was special about the product. So that’s a whole nother conversation, and it’s hard to do.

Jeremy Weisz 40:17

There’s three things we talked about before we hit record. I’m curious which one will be the best. We talked about a great story about Telematics. We talked about Proctor and Gamble and a patent in the billing expense in AT&T. Which one is your favorite?

Mike Maddock 40:36

Let’s do Telematics. There’s a Harvard professor 1967 I believe Theodore Levitt, who came up with the frame marketing myopia. And it is he argued that if the railroad barons at the turn of the century had thought they were in a different business, they would own everything said differently. We tend to be myopic about the business we’re in and in this so if you are making rail cars, you’re putting down railroad tracks across the country, you are negotiating for cheaper steel, cheaper engines, better laws around rail cars. You wake up one morning and you ask any employee, including the CEO, what business are you in? And they will say, we are in the railroad business. If they had said we are in the transportation business, those barons would own every plane, every ship, every car, but they forgot the business they had the right to be in marketing myopia. In the case of cnh case, New Holland, they hired us to come up with some innovation for their parks and Service Division. The first thing we did was we interviewed small, mid, large and corporate farmers to figure out what itch they wanted to scratch, what was an open insight that needed solving. And just for a second, take a step back so you have guys behind the counter who are selling oil and fan belts and you know, things that make tractors run. And what we did was reframe the business they were in. What we heard from all those farmers was, Look, man, all I want is my combine, my tractor, my fertilizer equipment to run when the sun is shining. And we came back to them and said, the business that they’re really in is the farm efficiency business. All people care about is making them more efficient. That’s the business you’re in. And with that lens, we could start saying, Okay, what are the ideas that farm that makes farms more efficient? And it turns out to be telematics. So telematics are satellites that run tractors. Now this is about a 10 year old project, maybe nine at the time. It wasn’t happening, really. But today, you can plant a seed, fertilize a seed, water a seed, and harvest seed within a quarter inch without ever touching the steering wheel on your equipment. That’s that is so I mean, and you increase efficiency by like 14% so imagine going to a guy that is used to selling motor oil and saying, Hey, we want you to sell software. It all starts with, What business do we have the right to be in? And I think that’s the most important question a company that’s trying to disrupt can ask themselves, what business are we really in? What business do we have the right to be in? When you can answer that question, it unlocks possibility that you won’t see.

Jeremy Weisz 43:47

I love that. Yeah, thanks for sharing that. And so Mike, I one last question before I ask it. I just want to point people to your websites. It’s mike-maddock.com. Mike does speak all over the place, and I know you’ve keynoted, I know you’ve also emceed conferences. You could check out maddockdouglas.com you could check out flourishadvisoryboards.com and I’m sure I’m missing three other companies, McGuffin Creative, my last question is, you know, you talked a little bit about what you learned from Andrea Herrera, Verne Harnish, Marshall Goldsmith, and this interview wouldn’t come be complete in my mind without talking a little bit about what you learned from your from your wife.

Mike Maddock 44:37

Yeah. Thank you for that. So I yeah, so I’ll tell a story. I was, our family’s had a pretty tough four years, and my son was a senior in high school when during the covid years, pretty good kicker and like, be. Recruited by colleges, and his senior year in high school is basically canceled. So he came to us one day and said, Hey, listen, I want to, I want to go to a kicking camp, because I need to get my my stats higher. I’m not going to, you know, the NCAA just gave everybody an extra year. It’s musical chairs. There are no seats left. I need to elevate my position in the world. So we went to Vegas and at a kicking camp, and he did great. And the next day, we came back, and my wife, Ruthie was cutting his hair on the back porch. I was in the office writing. She came. I heard her kind of yelp. She came stumbling in and complained about seeing light. She was trying to scoop some snacks. She couldn’t find a bowl. I asked her to I would look for my phone. I thought she was having a stroke, and I asked her to call my phone. She couldn’t use her phone. I so I rushed her to the hospital, went to the emergency room, and 20 minutes later, the doctor came out said, your wife isn’t having a stroke. There’s a mass in her brain, and we have to determine where the cancer started in her brain or somewhere else. So that was the that was the beginning of a really difficult few years for our family. Turned out she had a very rare and aggressive form of glioblastoma. I called my forum mate, actually, Ari Levy, you know, from the waiting room, just sobbing. It was, you know, just a nightmare. And, you know, he offered to, he offered to come and be with me and but what I really needed were the best experts in the world, and he helped that make that happen immediately, which was very generous of him anyway. Um, it was such a privilege. My wife was a woman of incredible faith, and she was like a shining light. People were she, you know, they were attracted to her, her joy, she and that, I guess I wrote an article, if you want to all the lessons I learned from my life about gratitude and finding your tribe and not playing victim. I wrote about it in an ink article, which I think is worthy of reading, but the number one lesson years ago, I saw Simon Sinek, we became friends, and come to Chicago a few times. And so I got, like every other entrepreneur, I’m like, What’s my purpose, what’s my why, what’s my why. And I remember wordsmithing it and spending all this time coming up with perfect words. And I went home and presented it to my wife, and she nodded, and kind of went put up with it. And she said, You know, I think, I think I know what my purpose is, too. And I said, What’s that? She said, to love I’m here to love people. And it was like this mic drop moment that I got to witness, I had the privilege of witnessing, the last 17 months of her life, where, under the harshest of circumstances, she was still able to demonstrate that love is the only thing that matters, that that’s the lesson.

Jeremy Weisz 48:14

You know, I appreciate you, Mike, sharing that I think I told you before you record, I was, you know, doing research for this interview and walking through Costco, and people were probably wondering why I was tearing up as I was walking through the aisles, because I was listening to you talk about your wife. So please check out all Mike’s companies. Check out that article he wrote. And Mike, I want to be the first one to thank you for sharing your journey with us. So thank you so much.

Mike Maddock 48:38

It’s a privilege, Jeremy. I appreciate hanging out with you, and I hope we get to do it again, maybe with a glass of wine, beer, a cup of coffee.

Jeremy Weisz 48:47

Me too. Thanks, everyone.

Outro 48:48

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