Keynote: How to Drive Exponential Growth in Your Organization
April 27, 2022 Author: Gary Ralston
In the past two decades a new species of organization - Apple, Google, Uber, Amazon, Airbnb, Instagram, Github - is achieving a mind-blowing 40x return on shareholder investment compared to their 20th-century peers. Business Innovation Coach and OpenExO Ambassador, Gary Ralston, presents a keynote to 400 Credit Union CEOs and officers at Filene Research GAC Chair's Breakfast in Washington D.C.
Introduction by Salim Ismail, author of the book, Exponential Organizations.
Chair Breakfast at GAC 2022 from Filene Research on Vimeo.
What the talk covers
Gary’s keynote starts at 12:01 in the recording and runs about 25 minutes. It asks three questions: why do some organizations consistently outperform their peers by 10 times or more, why do formerly great companies fail, and what does that mean for credit union leaders?
The future is faster than you think
Our brains are built for linear change. Take 30 ordinary steps and you cross a room. Take 30 doubling steps and you travel about 27 times around the planet, with 97% of the distance covered in the last five steps. Experts fall into the same trap: consensus forecasts for new solar capacity kept falling short of what actually happened.
Once a technology becomes information-enabled, its price-performance doubles on a predictable interval. Solar doubles roughly every 4.5 years, computing every 18 months and drones every 9 months. The talk asks credit unions to apply this to their own business. When lidar, cameras, computing, AI, batteries and smartphones combine into self-driving, shared cars, what happens to personal auto loans?
The corporate immune system
Organizations are trying hard to innovate, yet most corporate innovation fails. The problem is rarely a shortage of good ideas. It is digestion. Organizations built for stability and efficiency develop an immune system that attacks anything new: status-quo thinking, naysayers treated as heroes, no experimentation and no co-design with members. Changing that starts with the leaders in the room, their C-suites and their boards. In Peter Drucker’s words, the bottleneck is at the top of the bottle.
Exponential organizations and the ExQ
Exponential organizations share a massive transformative purpose and use several of ten ExO attributes to attract abundance and manage it. In 2014, OpenExO scored the Fortune 100 with a 25-question survey called the Exponential Quotient (ExQ). Seven years later, the top 10 by ExQ had outperformed the bottom 10 with 40 times higher total shareholder returns, 3 times better revenue growth, 6.4 times more profitability and 10.9 times higher asset utilization.
Key learnings for credit unions
- Lead innovation from the most senior levels.
- Invest in dual transformation: protect and extend the core business while practicing disruptive innovation at the edge. Fund edge innovation with savings from the core.
- Create slack capacity for continuous innovation. 3M gives everyone 15% of their time.
- Continuous innovation is a talent magnet.
- Being exponential once is no guarantee. IBM, GE, Cisco and Oracle fell back. It is never too late to start: Costco climbed from the bottom 10.
- Credit unions already know how to be purpose-driven, which gives them a head start.
Want help applying these ideas in your organization? Book a 30-minute call with Gary.