Episode 9 – Innovation accountability and the CVO with Stephen Angus

May 27, 2022

About this episode

In our discussion with Stephen Angus, of Snowy Advisory, we hear about some of his experiences and reflections on the importance of accountability in innovation and we explore a new role for companies actively investing and undertaking innovation – the CVO.

This podcast is particularly timely in our view. Innovation, as a word, is arguably becoming tired, misplaced and misused in a range of government and private sector forums. What we are also seeing is innovation tending towards a performative activity, with social media and contests providing stages on which actors can perform. The short timeframe programs that abound across the private and public sectors are tending towards the vanilla and undifferentiated, producing many applicants, some participants, few winners and occasional successes. However, businesses are rarely built in 12 weeks! And when the innovation actors have left the stage and the day-to-day needs to be implemented, with operational realities replacing the euphoria of presentations, pitches and performances, how do participants perform in the mid to long term? Not just with today’s idea, but do they have the tools to seek out and secure success for the next ideas that emerge through their experiences?

From these observations, this podcast has sprung to seek out what could be missing to drive success beyond the performative innovation that we are seeing. We see the need for honest conversations, business discipline and accountability. We believe that these (cultural) settings, embodied in the notion of role of the CVO – Chief Veracity Officer, can start to reorientate these phenomena over the mid-term. We hope that catalysing this discussion will contribute to that process.

Transcript

CB: Hello, everyone, and welcome to Tech Transfer Talk. My name is Cameron Begley and joining me today from Melbourne, instead of his property in East Gippsland, is Stephen Angus; a man who has been on quite a journey from musician to restaurateur to senior executive roles at Air Services Australia, and all the way back into the world of entrepreneurship. Stephen Angus, welcome to the show.

SA: Thanks, Cameron. Thanks for that lovely introduction.

CB: That’s quite all right and quite the journey it’s been, I imagine. I expect that all those experiences give you a certain grounding when you look at the things that go on around us in tech transfer and commercialisation and entrepreneurship.

SA: Yeah, absolutely. It’s amazing what you draw on in terms of your past experience, especially when you’re working with enthusiastic founders who got their special idea and bringing them a little bit down to earth again as part of the trick I think without crushing them, if you know what I mean.

CB: No, absolutely. I think this is one of the challenges that you might talk about today, mate, is how to say ‘no’ gently.

SA: Yeah. And in the entrepreneur world, one of the things we’re encouraged to do when we’re coaching people and mentoring them is to be able to explain to them why no, right now, is actually a very good idea and they’d be better to take their entrepreneurial spirit and enthusiasm and creativity and maybe put it to something else.

CB: Yeah, absolutely. One of the things that certainly struck me around tech transfer is timing is everything. The best idea at the wrong time doesn’t get there, but an average idea at the right time could well win the day.

SA: Yeah. And there’s a pretty well understood adage that it’s a lot about the people and there’s nothing new about what I’m about to say. And that is you can have an average idea with a fantastic team that will be highly successful, and then you’ll have someone with an amazing idea, but they haven’t got the right team or the right attitude or the right mindset, and it’ll just frizzle up on the barbecue.

CB: I think that’s that well-trodden argument of strategy versus execution. And I suspect that while there’ll always be that discussion, the culture eats strategy bit sort of trumps that narrative completely, particularly in small teams innovating.

SA: Yeah. Look, as you know, I’ve spent a lot of time with mentoring startups and being involved in startup programs and entrepreneurial programs. And one of the things that I think sometimes gets glossed over and missed, is that whilst there’s all this joy and enthusiasm of being a cohort of people with a new business idea, in the end you’ve actually got to knuckle down and you’ve actually got to get back to the fundamentals and do the hard work of understanding the problem you’re solving. Doing the hard work, getting out to customers. Being brave and getting into the marketplace quickly, all those things. And it’s a skill, it takes a lot of courage and a lot of startup founders like the idea of talking about their ideas but not necessarily got that oomph to actually step into the space, work hard. And I reckon at some stage during this discussion we’ll talk about accountability.

CB: I suspect that’s where we will go. And it is interesting that idea generation and the characteristics, if you like, of idea generation are not necessarily the same characteristics that get you into that operational steady state.

SA: Yeah, and I think that’s one of the challenges when you are helping entrepreneurs and founders is that they typically have 5,000 ideas screaming out of their head and you can get into that what I call ‘hamster wheel’ of just generating another fantastic shiny idea. But ultimately, you’ve got to stop doing that because I don’t know anyone that still doesn’t have to eat and need a bed to sleep in and do all those fundamental things in life. And so even if you want to be a highly successful entrepreneur, you ultimately got to have the courage to say this is the one I’m going to go after and I’m going to push all my other ideas to the side for a while. And that’s where the method, the processes around startups and that lean approach to getting onto an idea becomes really important because as you know, many ideas turn out not to be viable and as you said earlier, wrong place, wrong time, it’s a really key facet. And then having the courage to say not this time, this is not the right time, and not the right place.

CB: Certainly, since your time at Air Services Australia, you’ve really embedded yourself in this innovation system. I know from your time in Canberra and also, you’re very active now in East Gippsland, has innovation defaulted to some extent to the notion of idea generation? What does it mean now to someone such as you who looks at innovation across a number of sectors? We’re mainly Ag what we deal with, but you’re much broader than that. What does innovation mean? What’s its contemporary meaning at the moment?

SA: Yeah. And I think it’s a very tired description for the ecosystem, to be perfectly honest, because you look at any government grant condition or any business, they’ll talk about how they’re innovative, and as a result, it’s lost that shine, that spark that talks to us of truly creative problem solving. And I’ve certainly seen examples of so-called organisidgeations that believe they’re on the leading edge of innovation. And they’ll sometimes argue to me, and I’ll give you a living example of this in Gippsland that renovating a bike track somehow rather is innovative. Now, the bike track is absolutely a great piece of infrastructure for the visitor economy. It’s a good thing to do, but it’s not innovation. Not unless there’s some unique physical challenge on that particular bike track that requires some amazing new type of bridge or something. But that’s generally not the case. And I know for a fact that that’s not it. And so that blurring of that crispness of innovation has been lost. And great colleague of mine who’s highly experienced in innovation and she said to me, and it’s always stayed with me, resonated, is finding a different way to solve a problem. And I think it’s a really important part of the whole innovation, is you should be solving a problem and doing it in some interesting and unique way.

CB: So, with your bike trail example, you are solving a problem, but just not doing it differently.

SA: Yeah.

CB: Based on what you shared.

SA: Yeah, that’s right. It’s not innovation, it’s a great thing. And I have no criticism for the fact that those things go on in fact, they’re critical to tourism, visitor economy, keeping fit, but it ain’t innovation. Cameron.

CB: So have we fallen into a bit of a trap here of needing to force a whole lot of things into an innovation bucket for the sake of attracting attention to it? Scientifically, this was called nanotechnology 15 years ago. We had to have nano-something to draw in the interest and draw the funding agency in. Are we sort of at risk of a similar outcome here?

SA: So, let’s talk about the typical startup program. And people will call them igniters, incubators, all sorts of names, that are all vaguely the same in my mind. They really only reflect maybe how advanced the founder cohort is, but they’re typically twelve weeks. It. And in twelve weeks, you simply cannot generate a sustainable business that’s actually got the ability to grow and to have traction. So typically, the funding of innovation through government agencies and government processes and anything else where funding through grants ,is all around this twelve-week concept.

CB: Yeah.

SA: You tell me, anyone that has an idea at the start of twelve weeks that’s actually out on the street selling it and turning a dime. It’s a very unique proposition and it’s rare. And so, part of, I think what we need to talk about is a much more enduring program and it touches on this thing that most people in innovation call the Valley of Death. And that is you do your twelve weeks, and you sign off at the end of it. Typically, the only KPI of a grant will be, did you complete the course? There will be none of that really key metric of development growth is have you made a sale, have you employed someone? And there’ll be certainly no metrics around innovation. Something creating a novel approach to solving a problem. So typically, if you talk to anyone that’s had a reasonable amount of experience in delivering programs or mentoring, coaching, they’ll say two to three years is a typical life cycle to get a business up and running and programs are not set up for that.

CB: Yeah. So, on your observation. How did we end up consuming so much of our Kool Aid? How have we got so drunk on the word ‘innovation’ that we perhaps lost a little bit of sight on the different approaches to problem solving and defining the opportunities we’re addressing?

SA: You’ve been to meetups; you’ve been to these sessions where-

CB: I have been to those religious experiences, yes.

SA: And they’re fun. They’re a lot of fun. They’re full of energy, lots of enthusiastic people, diverse backgrounds. Everyone’s interested to talk to everyone. It’s a great place to generate energy, but typically it’s not a facade. That’s not fair to call it a facade, but it’s really a marketing activity. It’s not really ‘getting down and dirty’, as I call it. And so, it’s very easy to run lots of meetups and get people together that may or may not have a good business idea and someone who wants to invest and someone who wants to coach and someone who just hangs around because they like the atmosphere. They’re all good things. But I’m much more interested in finding those rich ideas that require hard work and personal accountability to drive them through an outcome.

CB: So those meetups become catalysts for things, but they don’t sustain things, I think. Is that a reasonable observation?

SA: Here’s some lived experience of that where the facilitators for said programs like this will talk about, this is your time to meet people, this is where you start to generate the next step in your problem-solving entrepreneurship program, or pathway. And I have been interested in particular people and their ideas. I will go to them, make myself known to them, talk about my interest in what they’re doing, exchange contact details and say, I look forward to hearing from you. Have a guess how many of them actually contact me.

CB: I’m backing zero.

SA: Yeah, pretty much. And so, there is no real accountability to create the relationships around an idea to really make it work. Now, maybe they’re just being polite to me and don’t really want to speak to me at all, but you got to give them that chance, I suppose. But-

CB: How could that be possible?

SA: But the reality is, if they’re being serious, they’ll say ‘look it’s great talking to you, Stephen, but I’m actually looking for a different skill set or a different sort of thing’. So, you got to practice those things when you’re a founder, being clear and determined about what you want. But when people don’t follow up and people kind of break promises, not meet the deadlines, meet the accountabilities of what they’re meant to be doing, whether it’s in a program or within their business, I kind of lose enthusiasm for them pretty quickly, and they take up a lot of people’s time.

CB: Yeah. I want to come to this notion of accountability, which you’ve raised a couple of times already, but just- the thing that struck me as you were describing, you approach people specifically and you engage with them and talk to them, yet you hear nothing. It’s funny because I sort of come from a bit of a different world where you sort of hit every bite you get right, and you hit that bite until you reach a point where you say, ‘listen, there’s nothing here for us’, which is a completely okay outcome. Not every bite is meant to be a fish.

SA: That’s right.

CB: But it strikes me as odd, particularly when you’re starting a business and we’ve each started businesses in recent times, you really do try and hit every bite you get. It is sort of a bit of a dissonance for me, I have to say. What you’ve just shared.

SA: Yeah, well, you’re building a successful consulting business. You know that the only way that that business is going to grow is if you don’t continue to network and you say, seize the day, and then recognise occasionally that the time is spent with a cup of coffee. If someone turns out to be not well spent time, you agree that that’s not right and you move on. But you go after every opportunity until you get one, really good at working out what you need and want so you know which coffees you should have. And two, you get courageous and start talking to people about what you really want for yourself rather than have people like me come up offering. There’s a lot in being an entrepreneur that is a bit boring. It’s not the sexy meetup stuff. Let me tell you about my amazing idea. It’s about fundamental life skills, about how you manage yourself, and then manage your business and its growth.

CB: So that sort of brings us into this notion of accountability because you just mentioned the business and the self there and I suspect there are a couple of levels or more there, maybe two levels of accountability to unpack here, particularly in that incubator ignition accelerator universe where there are lots of actors involved. What do you mean by accountability in this – it might be obvious to me, but I’m interested to explore what you mean by accountability in this context of innovation and the entrepreneur who’s trying to get past that initial idea.

SA: Yeah. So, let’s talk about someone that you meet that’s a founder inside what I’m calling a twelve-week incubator or accelerator type program. And there are two levels of accountability in my mind sitting inside that. There’s the person who’s facilitating or mentoring or providing support and advice, who will set standards that they want to have delivered during that program. I get this lean canvas finished by next Friday, do your customer personas by next Thursday. And everyone goes ‘yeah, yeah, yeah’. And we get to the Thursday and then, okay, let’s have a look at your lean canvas. And there’ll be two things. First of all, the founder will say, ‘oh, I was a bit busy, I had other things on, so I didn’t quite get to it’. And then the facilitator or the mentor will say, ‘look, I understand life’s a bit busy, so how about you have a crack it and try and get it to me next week?’ So, we’ve had double failure there. We haven’t held that person to account and the person who should have done the work has not held themselves to account. And you can decide for yourself what that really means. Does it mean that they truly did have a busy week? Or does it mean that actually they’re not really committed to what they’re trying to do and they’re just there for the fun of being in an entrepreneurial ecosystem? And I think most fall into that latter because if you’re not hitting hitting deadlines, as you know, as a consultant or anyone that’s got a business that’s got to supply goods, if you say you’re going to deliver it by Thursday, if you don’t, you won’t get paid, you probably won’t get repeat business. And there’s the consequence for having a lack of accountability. And so, accountability for me is very much about personal drive and pride in what you do and a really strong sense of commitment to hit the milestones of your businesses and its development.

CB: And it’s interesting that you’ve set a few different levels of accountability there, Stephen, not only to the entrepreneur or the founder, but to the mentor. You brought the customer into that. I’d even go so far as to suggest eventually investors are going to be wanting some degree of accountability and I’d even perhaps even more boldly suggest that the investor in the programs are looking for accountability because a lot of these program, entrepreneurial programs, I’ll call them ‘broad church’, irrespective of what particular descriptors are used, government money is going in there which would buy…mine and anyone listening to this podcast in Australia, there’s an accountability along that, along that dimension as well, isn’t there?

SA: Yeah. I guarantee anyone that’s paying tax in Australia, putting a tiny little bit of it is ending up in one of these entrepreneurial programs. And like I say, typically the KPIs for a government grant in this environment is how many people started it, how many people finished it. That’s it. There is no drive there to say who’s got that really entrepreneurial, entrepreneurial solution that’s going to take them to the next level, that’s going to create jobs and in the world that you live in around tech and tech transfer, what is being created here that is novel. I don’t want to sound too negative about it because there are programs around that are that are driving to some outcomes. But typically, the twelve week, my issue is that at the twelve week end of program, that’s it. Someone might walk away with $15,000, $10,000, $5,000 to help them go to the next level. They might get a little bit of mentoring, but basically that’s the end of it. And so, government’s short-termism attitude these days, the elections, the political cycle, drives this kind of behavior, which means that the investment cycle to get really good businesses started is not matched with the political cycle. So, I would go to say there’s a fair percentage of this money that is not being spent well and on great business ideas.

CB: Before we get to sort of what the solution might look like to the innovation fatigue or the innovation program fatigue that we might be seeing and discussing, I’d just like to momentarily explore what happens to those people, men and women, earnest efforts over their twelve weeks, and one of them wins the X Prize. I’ll call it the X Prize, right? And they get their little stipend of 10K-15K, whatever the number happened to be. And they may have the good fortune to have someone continue to mentor them. So naturally, they are the dominant predator in that particular ecosystem, and as a consequence, all the other animals that are lower down on that particular ecosystem would die, I assume. Like what happens to the others. The winner of X factor is lauded.

SA: Yes.

CB: What happened to the others? Based on your observations of running a few of these things and being involved?

SA: I would say that this is just a rule of thumb, that about, if 10% of the ideas that come into a program are still sustaining in twelve months’ time, it’s an extremely successful outcome. The vast majority, continue to be what I’d call one person cottage industry. And again, there’s nothing wrong with that. No issue with people who want to set up a little business to do their own thing in their own backyard, but the vast majority never get beyond that-

CB: Cottage industry?

SA: Yeah, cottage industry. And the ones that are very successful, occasionally someone like an angel investor or someone with some tech skills say, ‘hey, I can take you to the next level for a small amount of money or a bit of a sliver of the slice of the pie’, but the vast majority just disappear. You never hear from them again.

CB: No, it’s interesting because I think you’re quite right, Stephen, that cottage industries and the delivery of services is a perfectly useful, legitimate set of outcomes.

SA: Completely.

CB: The question that strikes me, though, is as government, as an investor in these programs, who are typically driven by, if I quote, current political mantra are interested in j’obs, jobs and jobs’.

SA: Yes.

CB: So, if the needle is not moving on that, that comes back to that whole notion of accountability. Right. So, I was sort of curious about what happened to the others and thinking about that through the lens of accountability to those that contribute money, being governments at various levels. And I’d almost add into that, the in-kind contribute that are made by the mentoring system that typically sits around them. Yeah.

SA: I’ve never seen a KPI where job creation was actually lauded and then examined and then tested over, say, a three-to-five-year period. And I’ve also been involved with programs where the startups that were fortunate enough to be selected to be part of the stay and annual program were required to put in monthly reports on how they were progressing their sales, what was happening with them. That was always a commitment to a certain program that I was involved in for a number of years. And again, the program generally didn’t follow up on those monthly reports. And so, you never knew actually where your money had been spent. Now, it’s a high-risk environment being an angel investor, but it lacked that discipline where I sensed I had an idea of who was succeeding and who was not.

CB: And from an angel investors perspective, those sorts of metrics ultimately matter, in whether you continue to either invest in that cohort or choose to make other decisions based on data rather than gut field.

SA: Yes. So, we stopped being involved in that particular angel program and we are now looking at alternatives in Melbourne because we still are passionate about the idea of helping people be successful, and to create great businesses for the Australian economy and for the people and all that good stuff. And we are testing the water here in Melbourne now to see if we can find something that’s a good fit for us, that we think is truly passionate about outcomes rather than outputs. And there’s a big distinction there between an outcome and an output.

CB: There is indeed.

SA: Yeah. And so, I think that’s part of this, that there needs to be a little less window dressing and a little bit more grunt.

CB: And so that, the less window dressing, more grunt, which is about the solution to some extent, or how we see a pathway through that. And Stephen, we’ve been chatting before coming to air, as most listeners would anticipate, about what that solution might look like, and I think it’s time to introduce the CVO.

SA: Well, you’ve wanted to do it, Cameron, so here’s your chance.

CB: I’ve been meaning to do the CVO and you’ve been the guy I’ve had in the slot for the CVO.  The CVO and for our listeners here, what on earth does this acronym mean, Stephen? And what could it possibly do for them?

SA: Well, everyone wants to be a chief, so that’s the first thing Cameron, so that’s the ‘C’ right there. And most these days, I noticed these days that people are not managers anymore, they’re officers. That’s the ‘O’. So, the only mystery left is the one in the middle,

CB: Isn’t it? Is the V for victory?

SA: Well, that would be the passion and the outcome. So, we’ve talked about this concept of veracity and veracity is just another way of saying, are we truly being accountable? Are we really testing the work we are doing to build an enterprise and being truly confident that actually what we’re building has got evidence behind it to tell us that it’s going to have a very good chance of being successful. And again, it’s a bit boring because if you go to any small to medium business that’s successful, they’re watching the numbers, they understand time and motion, they understand the ins and outs, they understand their supply chain, they know the behaviors of their customers because they’re always on the ‘thin edge of the wedge’. And so, the idea of veracity in this case is very much about a really determined and disciplined approach to testing the evidence of your business. And it comes down to really a fundamental. If your business is not proving to be successful based on the numbers and the work you’ve done, you’re better to stop it quickly and take your precious energy and your wonderful entrepreneurial spirit and move it to the next idea.

CB: Yeah. So that notion of veracity. It’s the pursuit of truth.

SA: It is.

CB: And that truth manifests itself in those numbers – can so, you know, can we be honest with ourselves?

SA: Yep, that’s right.

CB: And it’s, it’s really convenient not to be at times, isn’t it?

SA: Oh, that’s right. It’s a pretty easy to duck and weave and, and hence this concept, which is, it’s not tongue in cheek, but it is a bit of fun. But it’s actually to create a different level of enlightenment around this, is to call it a CVO. You combine that with great accountability and persistence in that accountability, you’ve then got your winning team. Which goes back to that concept. That an average to okay idea with a winning team has got so much more chance to be successful. So, here’s a practical example of how a CVO may work. And I’ve been guilty of this, so I’m part of the problem, but would like to be part of the solution as well. And that is a classic adage is, if you’ve got a business idea, the first thing you should do before you do anything else is go out and test it in marketplace. And the old advice, the old adage is, go and have 100 conversations.

CB: Yes.

SA: And people think that that’s a flippant suggestion. They kind of look at you and go ‘oh, my God. Does that mean I’ve actually got to go and talk to 100 strangers? I don’t know how to cope with that. He’s not really serious, is he? Surely, he’s not really meaning 100. He probably means two’. And so typically, what happens is that people don’t take that seriously. And I just use it as an illustration, that if we’re a little bit more hard-nosed, but in a nurturing way, and we say to six founders in a program, you’ve got two weeks to have 100 conversations, and you need to test and listen, and then come back and tell me what you found out from those hundred conversations. And there are other ways you can test the value of your proposition, but this is a great way to find out whether, in fact, there’s even a customer base that’s interested before you even start creating the good or the service or even taking the next step of putting any money into it. The only thing that 100 conversations cost is a bit of time.

CB: I want to unpack two aspects of the 100 conversation idea, and very aware of that construct, which is effectively market testing, market validation, and in turn, it’s about pursuing the truth in your idea, the market truth of your idea.

SA: That’s right.

CB: But the more confounding aspect I just want to quickly touch on is because a lot of the people that we deal with and I think a good number that you deal with in your operation, Stephen, have this lurking thing called intellectual property.

SA: Yes.

CB: From a market testing validation perspective, how do you land that? Because you don’t want to have to sign 100 nondisclosures, do you?

SA: Yeah, well, that’s the environment. That’s why it’s called ‘agile’. You’ve got to have self-belief, and you got to have the courage to stay in front of your competition. So, I’ll give you an example. In a program that I was part of last year, one of the founders had a fantastic idea. I don’t want to reveal it because it’s not for me to reveal it, but believe me, everyone in the room said, ‘this guy’s onto this’. This has actually got some real potential. It could scale globally, so you’ve just got to take my word for that. But that’s where it looked. This guy had been mucking around with this idea and fine tuning and fiddling with it for eight years. So, for eight years he’d been, I don’t know, improving it. I’m not sure what he was doing, really, to be, with great respect, hell of a nice guy. And we spent twelve weeks encouraging him to get out of the house and get this thing moving and he had exactly that. ‘Oh, what, someone else will copy it?’ Well, mate, for eight years no one’s copied it, so you may as well give it a crack. Yeah. And if you believe in it, you’ll move faster than anyone else.

CB: And how did he go?

SA: Yeah, he eventually moved, but then, of course, the twelve week was over and we lost contact with the guy.

CB: So, we’ll never know.

SA: Well, I could probably go find his phone number, but the program didn’t provide that environment and he needed some really intense CVO intensity. That’s what he needed. Cameron, he needed someone to really hold him to account. He needed to learn that for himself. He was lacking in confidence because he didn’t really work in the entrepreneurial network, but part of that was the job of the mentor, to build his confidence up and then give him a little push and a nudge every now and then.

CB: So, this concept of veracity and accountability, they sort of sit ‘hand in glove’ in a way, because in the pursuit of evidence, in the pursuit of testing hypotheses and really being true to yourself, there’s an internal voraciousness that you need to seek out the truth in yourself to survive this process. There is a survival element, I think, to doing this as much as all the other great stuff. How do we start to inject that into the conversation, so conceptually, unsurprisingly, I’m completely with you. How do we actually start to do this in the innovation system or the innovation ecosystem? How do we start to do this with the companies that we are involved with, either through our businesses or the ones we own?

SA: Yeah, so I don’t think there’s any one easy answer to that. I think it’s a combination of things. First of all, I think program design needs to change to be more demanding of outcomes rather than outputs, and that whether you want to call that KPIs or milestones. But if in a perfect world, that if at week two X hadn’t occurred then that person can no longer stay on the program, or Y hasn’t occurred so the funding doesn’t continue. It will drive a different level of accountability to making sure that those things get done. And again, we’re not talking about particularly complicated things because in most cases in the entrepreneurial world we teach people simple business models using things like business canvas model. It’s not very complicated. You can see on a page what it is you need to do and where your problems are, what’s your next priority so you can quickly create a KPI outcome- driven culture within your program to get these things done. And then like I say, it’s not always about this ‘carrot and stick’. Life happens and you’ve got to encourage people from time to time, and every now and then someone slips, and you pick them up and dust them off and get them going again. But we are actually teaching them a life skill. It’s not just about the business idea, it’s the life skill. Because if this business idea fails, you want them to take something away so they can apply that experience and learning to the next idea, that might be just that bit better because of it. So that’s one of the principal things that secondly is I think mentors probably need to be built up and developed in a slightly different way, so they understand how to drive accountability. That is a bit of a mix between push and nurture and that is the second piece of this for me. And the last thing for me is that these entrepreneurial programs need to be longer to allow these things to develop. Then if you take the concept CVO and take it a little bit out of what I call that startup world and apply it into business. Um, there’s this thing these days, you know, human-centred design where you build big, big pools of ideas and then you test those ideas and then you ultimately come down to a great idea that then needs to be delivered by an organisation. A CVO becomes a really important concept, function, role, to drive innovative and new ideas within a business that typically will be in a particular non-changed paradigm. And you need these CVO types that are prepared as, come on, we’ve got to get this across the line. I’ve done some consulting work with organisations that I doubt, despite the quality of the idea, ever going to take it forward because everyone just goes back to their day job.

CB: Stephen, that’s terrific. There’s a lot of pieces I want to dig into quickly. The last idea that you tabled there was around the role of the CVO as you move into a steadier state operational setting. And two things struck me as you were saying that, one is well, I could see the CVO actually turning into two roles. One called the Chief Financial Officer and the other called the Chief Operating Officer. But at the same time, you don’t want to disband that veracity aspect because the coup and the CFO will get so entangled in the operations that they won’t have that ability to step outside of it. And the CVO is there to offer that external reflection point to keep that truth telling and to keep that external perspective alive within the operations, no matter how mature the business. So, there was a moment while you were explaining going, ‘oh yeah, and that’ll just split out’. And then, hang on, you don’t want that. You actually want the CVO almost to be the second or third hire to keep the truth in the business.

SA: Every business, in the end, is managing risk.

CB: Yes.

SA: That’s what we do. We don’t contextualizse it like that. But keeping our supply chain consistent, reliable, keeping our customers happy and content, evolving our products and our services to meet an ever-evolving demand, is all about managing risk. And I’m not saying that you need to suddenly turn your CVO into a CRO – is a pretty common term. But I think it’s an interesting way to think about how you manage your business. And my experience is that a very good CFO and a very good COO in their own interesting ways are very good risk managers, but they are typically not very good at risk taking.

CB: Yes, we have touched on that recently in some work we’ve done where we actually separated out the risk management versus the risk taking.

SA: That’s right.

CB: And that notion of trying to drive a business to zero risk, which is an impossibility, if it’s successful, I think it’s an impossibility.

SA: There’s nothing new in this concept. It gets talked about a lot. You’ll have plenty of change. Consultants will come in and do a program and tell you change is hard. But in fact, the reality is it’s true. It’s very seductive to go back to what you know. Absolutely. Even if it’s crappy. Even if it’s not even itself particularly safe or it’s not particularly well managed from a risk perspective, but at least you know it. And so therefore, it’s like the water closes up behind you. It’s a comfortable place to be. A CVO has got to have that pillar of strength and imagination and creativity and challenge to be able to say ‘no’, we’ve got to move forward. But in this entrepreneurial world where, in your case and what we’re talking about here is tech transfer, they need to have that really strong mindset that they understand the business of entrepreneurship. They also understand of those mindset things that hold people back. They also have that ability to say, we’re going to crunch some numbers and some facts, we’re going to get to the truth here before we go any further. There’s actually not many people around that have got those kind of habits, those skills and those experiences. And so, I suppose I’ve got that a little bit. As you described before, I was a musician, I owned a restaurant, learned to fly an airplane, was an air traffic controller, now doing consulting. So, I’ve kind of come from a farming background. So, like a lot of people, had lots of rich life experiences and so that helps me a lot to think about how I articulate a veracity in this case. And on a number of the programs that I’m on, I’m often the one that they turn to when someone actually needs to be given a bit of a ‘gee up’.

CB: Yeah, just what struck me as you were talking there, Stephen, is that you spoke about the natural comfort that people seek. The CVO potentially is sitting with the discomfort, creating the discomfort constructively and managing that discomfort through the organisation, through the startup, through whatever it is, to channel that constructively rather than destructively.

SA: A CVO must understand the fundamentals of business. They must understand what makes a profit. They must also understand that you can have the best idea in the world, but if it’s not at marketplace turning over cash, then it’s not worth a hill of beans. And they’ve got to bring that kind of hard edge to it, probably earlier. And part of this, I suppose, is that we’re exploring a little bit is, of the 100 ideas that might go through startup filter, and we know from experience, possibly ten might be successful, how quickly can we knock out the other 90 so we can really focus on the ten?

CB: Yeah, and that’s actually something Paul Bryan touched on a few podcasts back how you manage that portfolio, that portfolio management issue’s alive and well. I do want to just circle back to something you spoke about a few minutes back, about the ‘carrot and stick’ and what the word I scribbled down on my notepad here was conditionality.

SA: Is that a word?

CB: It is a word, actually, and it’s a word that was introduced by one of my favorite economists, if such a phrase exists, Mariana Mazzucato, who speaks about conditionality when it comes to investment from public funds. So, the idea of, well, the public funds can go in, but there’s got to be some conditions around that, it’s just not a blank check. And that’s sort of reflecting on the consequences of the GFC or lack of consequences from the GFC and what happens to public money and how it gets mobilised sometimes in the wrong directions.

SA: Yes.

CB: So that idea of conditionality when it comes to a program. And that ‘carrot and stick’ struck me as really interesting because, in order to conduct a program where there are conditions enforced that if you don’t do X-Y-Z, you’ll be booted out, you’ll lose your funding, there’ll be a consequence, right? That screams at me ‘oh, hello., the CVO has now got an active role’ because they are actually that person who is holding the program and the participants in that program to various degrees of accountability and various degrees of truth seeking to make sure that things are in order. Not necessarily to judge whether it’s a good or bad idea at this stage.

SA: Yes,

CB: But just to ensure that the things that participants said they would do and committed to doing are in fact done.

SA: So consequence is a classic part of that whole risk process that we’ve sort of touched on during this conversation and what are the consequences of outcomes being not delivered rather than out puts? Money is wasted. A time and efforts put into a business idea that will never be successful. Often the founder then becomes disillusioned rather than enthused. There’s a whole lot of consequences. We could list multiples of them through the concept of not being – testing the veracity of an idea nice and early. As I said, I’ve never met an entrepreneur who hasn’t got multiple business ideas just banging away all the time. I’ve watched people on the first day of a program come up to me and say, ‘I think I might do this, I think I might do that, I think I might do this’. They’re just pinging off that enthusiasm, which is what is so wonderful about these things. But most of them are rubbish ideas, but their head’s full of it and it is about getting the rubbish out of the way. So that you talked about it earlier, about in terms of consequences, so that the consequence of that is, you’re taking good ideas through quickly and early.

CB: Yeah, absolutely. And within that, of course, the consequence, if I can call it that, is that the word ‘no ‘is going to come out.

SA: Yes. It’s an important part of this whole process in my mind, is we spend a lot of time saying ‘maybe’ and ‘yes’, whereas in fact, we should be courageous and say ‘no’.

CB: Stephen, it’s been really terrific exploring this new idea that we came up with, CVO. But also, I think that it’s a timely idea with that context of the notion of innovation sort of losing a bit of contemporary value, like how do we sort of break out of the sameness of it at the moment and try and get value reinstalled into innovation and into the programs, the entrepreneurial programs that are springing up everywhere? Everywhere.

SA: Very much.

CB: What are your sort of closing thoughts on how all this might advance from here?

SA: Good question. I think I’d say firstly, is the startup entrepreneurial world is an amazing place for people and I would want it to always be the most thriving energetic ecosystem that we can possibly create. But we all know from our own experience that that creativity, that energy, requires success. You can only go to so many meetups before they all feel a bit drab and about the same. But if you start hitting some success and you’re delivering some fantastic entrepreneurial outcomes, whether it’s tech transfer, whether it’s some other business idea, then immediately you are setting a much higher bar. And that immediately attracts stronger mentors, stronger applications for people who want to be part of that process. And I think the CVO and the concept of this veracity where you are testing that hard and getting as you said, get to the truth quickly, using some really solid pragmatic activities to test that so that these founders. Whilst you might say ‘no’ to this one, you’ll say ‘yes’ to the next one, because they go away a bit stronger, a bit more experience about what success looks like. And as a result, right across Australia, these entrepreneurial programs could be just that much more, have just that little bit more ping.

CB: Yeah, they’re terrific. Final thoughts, Stephen. Stephen, thanks very much for joining us on the podcast today. It’s been great chatting to you, and actually more formally exploring some of the conversations we’ve been having over the last few months.

SA: Yeah, good on you. It’s been great to talk to you today, Cameron, thanks a lot for having me along.

CB: That was Stephen Angus, who joined us today on the Tech Transfer Talk podcast. Stephen drawing on his extraordinary experiences, from music to restaurants, from landing aircraft from a tower to landing them himself, to managing landing those aircraft. And now, as an entrepreneur involved in Gippsland and Melbourne and in Canberra, it’s been terrific talking to him today and we look forward to you joining us next time on Tech Transfer Talk.

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