Bare-Knuckle Innovation Offers Unexpected Benefits: In-House Perspective

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So much of what I read and hear about innovation feels inconsistent with my own experience.

I hear all the time about the “lightbulb moment,” a blinding burst of brilliance that comes seemingly from nowhere. These kinds of burst often happen with great artists – Picasso’s Guernica, the Rolling Stone’s Satisfaction -- but in my experience, innovation feels like trying to punch through a wall with your bare knuckles. It is painful, frustrating, and tiring. It can feel like you are wasting your time. But if you keep at it – and if you picked the right wall – you can suddenly break on through to the other side. 

...innovation feels like trying to punch through a wall with your bare knuckles.

Think about Edison’s big moment, when he was finally able to find a filament for the world’s first viable electric light. That achievement – so iconic that the very metaphor for discovery is a lightbulb – required massive trial and error. He tried 6,000 filaments before “finding” carbonized bamboo.

The innovation was not just when he flipped that last switch. It was in the 5,999 punches thrown before.

The conventional path vs. the innovative path

Most of the time, taking the conventional path is good enough. Sometimes, though, it makes sense to invest the time and energy to take the innovator’s path.

Real innovation usually starts because someone sets aside the common, conventional option and tries to create something better. It often means leaving safety and comfort behind and embracing the unknown. This may be particularly hard in Legal fields, where the wildebeest mentality (stay in the middle of the pack at all costs!) dominates. Our education, training, and mindset is hard-wired to focus backwards, on precedent and canon. Innovating requires adopting the Accelerator mindset, which feels unnatural in our industry.

A personal example: NetApp data governance

The path that my company, NetApp, took in formulating its data governance strategy feels like the innovative path.

Years ago, when we first started crafting our company’s approach for protecting employee and customer privacy, we faced a clear choice. Domestic companies were overwhelmingly counting on Safe Harbor to cover them in the ways they share information with the European Union nations. This made perfect sense. Safe Harbor was by far the fastest and easiest way to deal with the immediate problem of assuring compliance.

We made a different choice. We worried that “easy” might one day yield to something else. So, after assessing our options, we did the hard work of creating a robust compliance regime with EU nations. This meant that, among other things, we had to negotiate and adopt Binding Corporate Rules (BCRs) and Model Contract Clauses, register in the applicable countries, create data privacy consents and notifications, ensure compliance with our employees and suppliers, and implement audit procedures. All of this work put us in the company of just a few dozen enterprises, most of which (unlike us) were already in highly regulated industries.

We also faced another “easy or hard” question: which nation to turn to as an approver for the BCR. The most popular, due to its softer standard, was the United Kingdom. We chose the Netherlands, Spain, and Germany as our reviewers. We chose these nations –the most stringent in the EU – because we knew their exacting standards would ensure that our BCR would be more robust and durable.

To sum up, we made three decisions – all of which prioritized the long-term over the short-term perspective:

  • Not to rely on Safe Harbor
  • To adopt BCRs
  • To select the most demanding nation as an approver for our BCRs.

When “good enough” isn’t good enough

It was far from obvious that we should take on unnecessary work and complexity. Looking back, however, I am grateful we decided to punch through that particular wall. 

When Safe Harbor was struck down in October 2015 it was front page news. It invalidated the data governance strategies of countless companies. With the recent Brexit vote, companies that relied on the UK as their BCR approval authority faced another unpleasant surprise: the possible invalidation of their status with the EU. 

We did not know that Safe Harbor was going to be struck down, or that the UK would leave the EU. Our decisions were not informed by clairvoyance, but they were driven by an understanding that those events, or something like them, could happen… and that there was a potentially better way available to us.

For some decisions, you may need to go beyond the obvious “good enough” choice. That is where innovation happens.

Innovation offers unexpected benefits

What we did felt risky and unconventional, without leaders and templates for us to follow. We could not anticipate completely all the changes we would have to make to our practices, our technology, and our organization to make it work. Most significantly, we discovered new and unexpected opportunities.

One example…  Today, our team is deeply engaged in sharing our data governance perspectives with our customers and partners. It is rare for company lawyers to engage just with customers, yet today members of team our literally cross the world speaking with enterprise leaders such as CIOs, CISOs, and purchasers of our technology, who are seeking to instill a robust data governance system into their organization. We are directly contributing to our customers’ success, which becomes a competitive advantage for our Company, which creates shareholder value. To me, that is the essence of innovation.

You can’t spend all your time punching walls. But there are times when it is worth it, when the benefit of breaking through is worth the bloody knuckles. Find those areas of your business where the status quo or established practice isn’t good enough and get started innovating. That is where change can yield the most impact and create the most value.

*

[As senior vice president, general counsel, chief compliance counsel, and secretary for NetApp, Matthew Fawcett is responsible for all legal affairs worldwide, including corporate governance and securities law compliance, intellectual property matters, contracts, and mergers and acquisitions. He has overseen the development of NetApp Legal into a global high-performance organization with a unique commitment to innovation and transformation.]

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