The Microsoft Mindset - How Innovation Fuels Success & Growth

Summary

Podcast Summary: The Microsoft Mindset - How Innovation Fuels Success & Growth

Podcast Information:

• Title: THE ED MYLETT SHOW
• Host/Author: Ed Mylett | Cumulus Podcast Network
• Episode: The Microsoft Mindset - How Innovation Fuels Success & Growth
• Release Date: February 25, 2025

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Introduction

In this episode of The Ed Mylett Show, host Ed Mylett delves deep into the world of innovation and growth by exploring the mindset that has propelled Microsoft to unparalleled heights. Joined by special guest Candy Valentino and Microsoft veterans Dean Carignan and Joanne Garbin, the conversation unpacks the strategies and philosophies that drive one of the most innovative companies in the world. The discussion is enriched with insights from their co-authored book, The Insider's Guide to Innovation at Microsoft.

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Guests Introduction [02:06]

• Candy Valentino: A seasoned business expert and recurring guest on the show, Candy brings her extensive background in business to help navigate the heavy topics discussed.
• Dean Carignan: A 20-year veteran at Microsoft, Dean played a pivotal role in driving the company to its first billion dollars in revenue.
• Joanne Garbin: Former Director of Innovation at Microsoft with a 25-year track record of launching groundbreaking products, Joanne co-authored The Insider's Guide to Innovation at Microsoft.

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Understanding Innovation vs. Invention [04:23]

Joanne Garbin begins by distinguishing between invention and innovation:

• Invention: Coming up with a new idea.
• Innovation: Taking that idea, building it, testing it, and successfully bringing it to market.

Notable Quote:

"Invention is coming up with a new idea, which is much less difficult than innovating, which is taking that idea, building it, testing it, experimenting with it, getting it out into the market, getting it adopted by customers by design."
— Joanne Garbin [04:23]

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Double Loop Learning [07:09]

Dean Carignan introduces the concept of double loop learning, a fundamental practice for sustained innovation:

• Single Loop Learning: Iterating on design and development based on existing assumptions.
• Double Loop Learning: Challenging and reassessing the underlying assumptions, leading to potentially redefining business models or value propositions.

Notable Quote:

"Innovation is loopy. One of the primary things this loop of double loop learning is... you don't just iterate and design and develop. You actually double loop back to your assumptions."
— Dean Carignan [07:31]

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Implementing Double Loop Learning [09:55]

Joanne elaborates on shifting from merely failing fast to learning fast:

• Learn Fast: Focus on extracting valuable lessons from every attempt, whether it succeeds or fails.
• Example: Microsoft's approach with their search engine, Bing, emphasizes learning from each iteration to enhance user experience.

Notable Quote:

"Instead of fail fast, it's learn fast. The objective... is to learn."
— Joanne Garbin [09:55]

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The Importance of Metrics [12:09]

Ed highlights the critical role of metrics in driving innovation:

• Kept Rate: A metric used by Microsoft to measure the success of AI integrations based on user retention.
• Emphasizes that many entrepreneurs lack essential metrics, hindering their growth.

Notable Quote:

"If you get good right now, the opportunity to increase revenue is... AI is going to do all of this for me."
— Ed Mylett [13:24]

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Navigating the AI Era [15:35]

Candy raises concerns about the impending impact of AI on jobs and personal growth:

• Job Displacement: AI is projected to consume hundreds of thousands of jobs by 2030.
• Balancing Excitement and Nerves: Strategies to safeguard oneself in an AI-driven landscape.

Notable Quote:

"Hundreds of thousands of jobs are going to be consumed by AI... how can we safeguard ourselves about that?"
— Candy Valentino [15:35]

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Think Weeks and Cognitive Shifts [23:48]

The guests discuss the concept of Think Weeks, a dedicated time for deep reflection and innovative thinking:

• Phases of Innovation: Divergence, Convergence, and Synthesis.
• Microsoft’s Practice: Encouraging employees to take a week off to think deeply about relevant topics, fostering a culture of innovation.

Notable Quote:

"If you're going to really have some kind of breakthrough idea or opportunity, you have to get out of that mindset... that's a lot about the space you give your mind to new ideas."
— Joanne Garbin [25:28]

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Self-Disruption for Personal Growth [41:22]

Dean shares his personal journey of self-disruption when joining Microsoft:

• Mission and Values Alignment: Used a decision matrix to align his personal mission with professional opportunities.
• Outcome: Successfully transitioned to a corporate role by ensuring it matched his core values, even amid challenges like the pandemic.

Notable Quote:

"I mapped out my values, and then I took my mission and my values and I used them to create something we describe in the book, which is a decision matrix."
— Dean Carignan [41:30]

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AI's Future Impact [54:23]

Joanne discusses the dual-phase impact of AI:

• Current Phase: Summarizing documents, generating content, and assisting in creative tasks.
• Future Phase: Development of AI agents that can handle complex, multi-step tasks.

Notable Quote:

"AI is going to be something we offload to the computers because it's formulaic... higher level engineering work, the creative solutions, they're going to need to be done by professionals."
— Dean Carignan [55:48]

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Final Insights and Key Takeaways [59:06]

As the conversation wraps up, the guests share their final thoughts:

• Everyone as an Entrepreneur: Joanne emphasizes that everyone can and should adopt an entrepreneurial mindset, leveraging available tools to innovate.

Notable Quote:

"Everyone can be an entrepreneur and should be an entrepreneur. Good ideas can come from anywhere."
— Joanne Garbin [59:08]

• Broader Perspective: Dean highlights the importance of designing with a wide perspective, ensuring that innovations consider broader community and environmental impacts.

Notable Quote:

"Flip your perspective and build your team."
— Dean Carignan [59:53]

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Conclusion

This episode provides a comprehensive look into Microsoft's innovative mindset, offering actionable strategies for entrepreneurs and businesses alike. From understanding the nuances of innovation to leveraging AI responsibly, Dean Carignan and Joanne Garbin share invaluable insights grounded in decades of experience. Ed Mylett effectively translates these high-level concepts into practical advice, encouraging listeners to adopt a growth-oriented environment and continually challenge their assumptions to achieve sustained success.

For those seeking to delve deeper, The Insider's Guide to Innovation at Microsoft by Dean Carignan and Joanne Garbin is an essential resource, packed with nearly 50 distinct practices to foster innovation in any organization.

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References:

• The Insider's Guide to Innovation at Microsoft by Dean Carignan and Joanne Garbin

Transcript

[Ed Mylett]

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[Candy Valentino]

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[Ed Mylett]

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[Dean Carignan]

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[Dean Carignan]

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[Candy Valentino]

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[Ed Mylett]

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[Joanne Garbin]

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[Ed Mylett]

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[Joanne Garbin]

This is the Ed Miler show.

[Ed Mylett]

All right, welcome back to the show everybody. So this week is really special for me for a Couple reasons. Number one, the lady to my left, Candy Valentino, is joining me here today. One of my dear friends. Thank you for being here by the way. And you guys have seen Candy on the show a couple different times and have just loved her appearances. And we have a topic today that's very, very heavy business stuff. And I wanted Candy to help me kind of carry the weight of this podcast because of her background in business. So you get a treat of getting a chance to actually listen and watch four of us today. So anyway, we've got an unbelievable show for you today. Just think Microsoft and all of the inside secrets of how to build and innovate in your company. And Candy, I'll let you kind of take over from here, but thank you for being here. It's great to have you. And I'll let you kind of introduce our guests.

[Candy Valentino]

Thanks so much for having me. It's always an honor to be one trusted with your audience. But this is so much fun. So than so much. And we get to have a great conversation today because we have two people who I'm fascinated by their background. We have first up we have Dean carignan, who's a 20 year veteran at Microsoft and really played a pivotal role in driving the company to its first billion dollars in revenue. And then his friend, colleague, co author Joanne Garbin, who was formerly the director of innovation at Microsoft, also has a 25 year track record of launching innovative products. So together they co authored the latest book, the Insider's Guide to Innovation at Microsoft, which really just gives, I think everyone. And I'll look at that behind the scenes of what does it really take to build a phenomenal company? Because we hear these things in theory, but they are really hard to implement. So first off, welcome to the show. Thanks for being here. And I just want to ask the first question out of the gate, I'm super curious. You mind if I take the no go?

[Ed Mylett]

I want you to.

[Candy Valentino]

So I know obviously our background in business, it is really easy to talk about these things, right? Like let's innovate something new. But it is really hard. It's actually a lot easier to market something that already exists than it is to innovate something new. So what is it through your eyes when this has been your entire career of innovating from Xbox to Microsoft Office to all the crazy things you've been involved with, how do you look at innovation and most importantly, how do you get your team behind it?

[Joanne Garbin]

Yeah, I'm so glad you started with that question. One of the core Themes of the book is that there's a real difference between invention and innovation. Invention is coming up with a new idea which is much less difficult than innovating, which is taking that idea, building it, testing it, experimenting with it, getting it out into the market, getting it adopted by customers, by design. We wrote about innovation because it is so hard. We also noticed, Joanna and I, we are innovation nerds. We read every book that comes out on the topic. One of the things we noticed was that there was a void in the literature. A lot of people would describe the what, where, when, why of innovation, but not the how. And as we had this really rich canvas in Microsoft, 50 year old company, multiple products, multiple breakthroughs, we were able to study and get down to very specific practices which we document in the book. And in the end, I think we did a count towards the end, there's almost 50 distinct practice in the book that people can use in their day to day work. Immediately after reading the book and you'll.

[Dean Carignan]

See the differences between me and Dean. We leaned in hard on the fact that he's an entrepreneur and I'm an entrepreneur and us entrepreneurs get down to the what do I actually have to do? Right? And it's all about something you talk a lot about, Ed building habits. Whether they're tiny habits, every day or weekly habits, monthly habits, annual habits. Microsoft, when you really get under the hood of it, has a lot of people with good innovation habits. And that's what we tried to pull out in the book. Like you have to have a big vision, but you also have to have stepping stones to get there. You have to have a message that speaks to the value of every stakeholder. So when we talk about those 50 tools, it's really, what are the 50 habits and practices you need to adopt as a team, as an end, as individuals?

[Ed Mylett]

Well, it's really good to read a book that has that, frankly, you know a lot of books, right. I want you guys on number one to look under the hood at Microsoft. You both have been there 20, 25 years. That's pretty unique. One of the most innovative companies of all time. But the other thing is it's not just philosophies. There's actually techniques and strategies in the book. And I love stuff like you said, especially as an entrepreneur. And that's what I want to ask you about. I kind of, we get an hour. I always want to go get the audience everything we can. And the great thing about your book is I can ask you 30 questions on this podcast. They still would have to get the book because there's so much more in it. But I learned so much reading it because I was self taught as an entrepreneur. So either one of you can grab this one. But I'm going to go right to like tactics that are in the book.

[Dean Carignan]

Awesome.

[Ed Mylett]

Tell them a little bit about what double loop learning is so every entrepreneur, entrepreneur, listen to this right now can start kind of going. That is something I don't know. I just learned within the first 10.

[Dean Carignan]

Minutes of the podcast and it's so powerful and it's the secret of success of so many businesses and entrepreneurs. And entrepreneurs. So Dean, you mind if I start?

[Joanne Garbin]

Go for it.

[Dean Carignan]

Okay, great. So we say innovation is loopy. And one of the primary things this loop of double loop learning is in single loop learning you have a set of assumptions. You design a solution, you put it out into the market and then you iterate between design and develop. In double loop learning, you don't just iterate and design and develop. Right? Like you put it out and fail fast and bring it back and correct and put it out again. You actually double loop back to your assumptions and you're like, okay, I'm not just going to iterate on the design I have. I'm going to go back and challenge the very premise of what we built. Because sometimes what you learn in doing that is we were just off the mark, we were solving the wrong problem and we can't iterate our way there. We need to just completely rethink our business model or our value proposition or even our user interaction. Dean, you have a great example of this in the Xbox history.

[Joanne Garbin]

Yeah, absolutely. I was just going to build on the description is double loop learning is such an important habit because we tend to, at the start of a project, we do think deeply about what's going on in the world. Why is this a good idea? Why might it work? But then we tend to shift into an execution mode and we're just executing and sometimes it's not going the way we thought and so we try to execute harder. Double loop learning is a habit of pausing, going back to those assumptions. My team likes to write them down and actually saying, well, maybe the world is a little bit different, maybe our assumptions were wrong and so we need to change the way we come at this.

[Candy Valentino]

So good. I actually talk a lot about the pause, which you and I have talked about how entrepreneurs and companies just want to build and build and build and sometimes they are building on a foundation that wasn't actually built to sustain what it is that they're now doing so you have to pause and bring it back. Can you talk about specifically? Right, because someone's listening is going, well, that's really great. But I'm reading all these things on social media that say just start and fail fast. Can you tell us how to implement that? Like, are there certain thoughts that go through your mind or questions that you're like identifying, did this work? Do I need to pull this back? Do I need to throw this out or do I need to force it? How can you discern which way to go?

[Joanne Garbin]

The term we like is instead of fail fast, it's learn fast. And the objective of trying something that's high risk and that's unknown is not to fail, of course, but to learn. Sometimes you do need to fail in order to learn, but it's the learning that's valuable and lets you go back, reconsider assumptions and move on. One of the examples we use in the book is Bing, our search engine. They don't talk about product launches, they talk about flights. We're going to put some new capabilities into the product. We're going to fly it for a couple of weeks and then we're going to look at two things. Did it deliver good user and business results, but also what did we learn? And being very specific and intentional about a learning review kind of ensures that you're going to bring that information back, change and adjust for the future. So it's really creating both space and the sort of formal structure for learning to take place in.

[Dean Carignan]

Yeah. And it's about building feedback loops. So again, innovation is loopy. If you put your product out there and you have no way to measure, if people are clicking on something, using something, liking something, then you're just throwing things into the abyss and hoping for the best. So put your product into the market with built in feedback loops and that can be listening channels or it can be technologies that are built in. But then that's only one half of the feedback. The other half of the feedback is that challenging your assumptions part? You gotta monitor the world. Is new tech coming out? Are there scientific breakthroughs? Has some world event like a pandemic disrupted everything? And you get those feedback loops and that gives you your context change. So now you're living in between these two worlds of what you're doing today and what you need to be doing tomorrow. And if you're good at it, you can process that into let's stay ahead of the curve. And now we're continuously adapting our products and our businesses to stay ahead of that curve.

[Ed Mylett]

I'm going to talk about metrics in a minute, which is kind of going down the line that you're talking about because you talk about metrics in the book. I want everyone to step back for a second. You know, most of you have been raised, if you're listening to my show, in sort of the social media business era, which is the same eight or ten strategies and ideas philosophically and we almost kind of look down upon, I don't know what you'd call like traditional Harvard MBA like type education. And the truth of the matter is the merger of the two worlds is what you're going to need. You're not going to need a Harvard mba, but you're going to need to know how do these large companies innovate? And a lot of the entrepreneurs that I talk to, it blows my mind. They don't even know their own metrics. I'm talking about a small mortgage broker who's got three agents with them. They don't know their contact to appointment ratios, they don't know their appointment to close ratios, they don't know their revenue number per clothes. They don't even have metrics. They're not real entrepreneurs because they were raised on social media. And there's all this room for growth. If you just started to be a more legitimate entrepreneur, quite frankly, and you actually track your metrics. And it was fascinating to me that in the book, it's one of the first, when you get to the tactics and strategies, it's metric based, you actually talk about kept rate.

[Joanne Garbin]

Yeah.

[Ed Mylett]

So let's just talk about the importance of metrics and maybe let's just flavor it up with what kept rate means.

[Dean Carignan]

Go.

[Ed Mylett]

Just give them an idea of what a company the size of Microsoft does to innovate that they could be doing in their small business.

[Dean Carignan]

Yeah. And cap rate was one of our favorite things we uncovered in our research. So I'll start it. Dean, the Office group, which the Office product at the point that they did this was a $30 billion product. And we make the point of they didn't need to disrupt themselves or, you know, they were flying high. And we're all addicted to the Word word, Excel and PowerPoint. Right. But they looked at the coming changes of AI and they looked at user patterns of their products and they saw the fact that they had all of this functionality that wasn't being used and they said, we're not going to make anything new, no new features. We're going to start uncovering the features we have in our products. Using these new AI tools. And the measure of success isn't going to be if we delivered it on time or on budget or even if our revenue grows. The measure of success is if we serve something up with AI and the user keeps it. We succeeded. If the user then has to further manipulate it, we're not done yet. We got to do better. So it's all about user captrate, almost.

[Candy Valentino]

Like retention rate in certain other industries. And you mentioned AI and I don't know if you want to talk more about metrics.

[Ed Mylett]

Oh, I want to go AI because.

[Candy Valentino]

Yeah, I mean, the one stat that I read that you, you had put on is said by 2030, hundreds of thousands of jobs are going to be consumed by AI. And I think that's something that we all know is coming. But it's almost like how do we navigate that? Like, how does the average person hear that information, whether they're a small business or they're an entrepreneur and they're working for another company? How can we safeguard ourselves about that? Because it's exciting, but it also could also be nerve wracking. Right. Both can exist.

[Dean Carignan]

Go for it, Dean. This is why we wrote the book.

[Joanne Garbin]

Exactly. Could we go back to metrics for one moment though? Because there's a couple other.

[Ed Mylett]

Using the word loop. Put them together.

[Joanne Garbin]

Yeah, yeah. Because metrics become super important in the world of AI. There was two things that I wanted to build on Joanne's comment. One is that, and also Ed, on your comment about startups versus corporations. The thing that really motivated us to write the book was when Joanne joined Microsoft about five years ago. She was new to Microsoft. I was about 15, 16 years in at that point. And we just started swapping war stories about innovation. Joanne having done it outside and startups and mid caps and me having done it from within. What we realized was that the patterns were universal. We were seeing the same practices and patterns play out in companies that were small, medium or large. And that was one of the aha moments that okay, we're going to write this book not just for Microsoft, not just for big tech, not just for corporate America, but for everyone, whether you're in large, small or medium companies. The interesting point about metrics is metrics is one of these things that no matter what size company you're in, it's super important to get that right. And it's also important to innovate in metrics if you're going to innovate in other areas because you can't manage what you can't measure. And metrics give you that ability to do it. And in innovation, you're in a super ambiguous environment. And so having something that you go back to regularly and data that you monitor and review is arguably more important for smaller companies than maybe even a big corporation. So I'm 100% with your point there, Ed.

[Dean Carignan]

Yeah, And I'll just read. I'll just keep going with that thought if it's okay. In this world of AI, all of the metrics of success are going to change. The value. How we measure the value of work is changing. I'm really excited about it, by the way, because I have been frustrated. Dean knows how to code. Dean knows data like deep data and analytics. That's not me. I'm a business person first and foremost, other than a mechanical engineer, but I'm not a mechanical engineer. So this world that we've been living in of software is some people can build things and the rest of us can use the things that are built. That's going away now with generative AI, we can all build things. Yes, it is going to displace jobs that are formulaic because it's formulaic. Right. So it's built for the purpose of doing formulaic things, but it can't displace creativity and collaboration and insight and all of these human higher level capabilities that actually we talk about this in the book. It's our favorite takeaway. It actually is the thing that brings us joy. And so many people are disengaged at work and unhappy at work and burnout at work. And a lot of it is that formulaic treadmill stuff. Great, take it. AI, you can have it. Creativity and collaboration. And that's why we wrote this book. It's really a handbook on how to work with everybody, how to collaborate from blank sheet of paper to something of proof to scale in this new world where human capabilities are the most important thing and will be valued and measured.

[Ed Mylett]

Yeah, you know, it's so good. It was a great conversation. I wish I did more shows like this. You know, I grab things from books, let's say, for the lower iq, people that read them like myself and. But they're big concepts, so. Hey guys, I want to jump in here for a second and talk about change and growth. And you know, by the way, it's no secret how people get ahead in life or how they grow. And also taking a look at the future, if you want to change your future, you got to change the things you're doing. If you continue to do the same things, you're probably going to produce the same results. But if you get into a new environment where you're learning new things and you're around other people that are growth oriented, you're much more likely to do that yourself. And that's why I love Growth Day. Write this down for a second. Growthday.com forward/ed my friend Brendan Burchard has created the most incredible personal development and business app that I've ever seen in my life. 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There's something in the book I took that I want you to talk about and it's, it's because we've been a little bit granular, I want to get a little bit bigger and I want any person listening to this be able to adopt a strategy. We're going to talk about right now. It's Think Week. And you know, there's so much legacy thinking in business. And I think people think, well, legacy thinking, that's sort of like an old insurance company. Actually most of you to some extent, I say this as a friend, you suffer from legacy thinking, meaning this is just the way we've always done it, so we're always going to do it that way or this is the way the markets always responded. So it's always going to respond that way. So the amount of things that I call legacy thinking that intrude and then in a business and then impede upon its growth and it's invisible and you don't know why you're not moving. It's this stuff that's like repetitive historical thinking that in an AI era and in a high tech era like we're in now is like death to explosive growth. Right. And so this idea of like Think Weeks is so healthy for an entrepreneur who's a husband and wife and they've got a bakery all the way up to, you know, one of the five largest companies in the world and you're Microsoft. Right. So tell us what Think Week is and how it might apply to anybody listening to it.

[Joanne Garbin]

Yeah. And maybe I'll ground it in something that Joanne taught me, actually, which is this idea that if you're going to innovate, you're going to Go through three phases at least cognitively, divergence, convergence, and synthesis. And the idea is that if you're going to really have some kind of breakthrough idea or opportunity, you have to get out of that mindset that, that legacy mindset that you're describing it. You have to shed that and you have to start reading, thinking, talking to people you might not normally talk to, reflecting, and give your mind the sense to be, the opportunity to be exposed to new ideas. That's divergence. And convergence is where you start to make sense of it, organize it, maybe put a little bit of structure. And then synthesis is where you go and you do something with it. The challenge is, in modern society, divergence feels unnatural because we don't know where it's going to take us. You almost feel guilty doing it. Whereas if you're sticking with the legacy mindset, you know what you're doing, you're active, you see a lot of hours in the day that you're doing stuff and you feel like, I'm doing what I need to do, I'm working hard. But you might not be working smart. And so that's why that divergence. There's kind of two traditions at Microsoft. Think Week was a period where everyone was encouraged to stop doing their day jobs for a week and think deeply about a topic relevant to the company, but not something we were doing currently. And then the other sort of activity is hack week, which is where I think it's about 40,000 people across the company.

[Dean Carignan]

75.

[Joanne Garbin]

75,000, thank you, 75,000. So a third of the company take a week off, pick a project, not just to think about it, but to actually get people together, prototype some ideas, write some code, and actually have a kind of an end to end effort on completely new ideas, many of which then make their way into our products and services.

[Candy Valentino]

That's so cool. And I think if the person listening is like, I don't even have two minutes to think in my day. I don't even know what he just said because I'm probably the least educated person in this conversation at the moment. I want to bring it down for everyone listening so that you actually can like put a little push pin into what you just said. Dean. I think if entrepreneurs and people in general, this could apply to parents, this could apply to someone that's trying to just be a high performer inside of somebody else's business. We are inundated with so much noise all the time. Social media, anything. We're consuming this podcast. Oftentimes we don't just take A minute and think and see like what do we want to create, what do we want to do, what do we want to build? And I think what's really fascinating about learning from billion dollar companies that have been successful is how can we take something that they're and apply it into our everyday life. I call this thinking time. I literally take just an hour or two a week and I put it in my calendar that I'm just going to think and not have my phone have it on silent, upside down on airplane mode and just be like do I want to do this? Do I not want to do this? And just maybe this is an over simplistic way of how you just explained it. But I think for the average person listening, I want to give them something that they can implement with.

[Ed Mylett]

Can I ask you something? And I'll ask the three of you. I'm just curious. For me, and I have done something like this not regularly enough, but when I'm really growing and doing well, I take think time away. For me, I have to change my environment. I have to like literally get away. Like I, I can't do it at my house. That doesn't mean that I don't have thinking time in my home. But I found like I'm scheduling a week. I've never done a week. I'd be lying a weekend away where I'm going to go get out of my environment. Because I think there's triggers and anchors even to environments like just the room you're in. You've always thought that way in this room. You're in the same room, the same distractions, the same people. So for you, do you get away and do it? And then at Microsoft are these think weeks off site, do they go somewhere?

[Candy Valentino]

So for Me I,000% agree with what you were saying. Like certain environments are going to trigger a certain state. So back in the day when I didn't have the ability financially to go on a weekend, I would go to a coffee shop.

[Joanne Garbin]

Sure.

[Candy Valentino]

And to me it would just be like I'm going to the coffee shop, I'm thinking I'm getting my drink. And it would just be like when I walked into that space I knew that this was what I was doing. And once my two hours was up, I would leave. You could do this in your car. Like I know a lot of busy parents. You can go into your car for an hour or two and just drive around or go to a parking lot. I mean I used to do all these hacks. Now I definitely. When did you ever notice when you're in an airplane, you're super productive. Yes, because it's like a different environment that you work in. So for me, the person listening, you can do this in just a little coffee shop. You can go away. But what does Microsoft do? Or do you guys go on, like a fancy retreat?

[Joanne Garbin]

I'll give this one just, then I'll let you in. Bad. But think week would be. People would do it all sorts of ways. But the papers, when Bill Gates was the CEO, they would get sort of reviewed, and the most interesting ones would go to Bill. And then famously, he would go to a remote location, cabin, hotel, something like that, and he would spend a week reading through the papers and commenting, and the authors would get his comments back. And so if you think of the CEO of one of the biggest companies in the world disappeared, disappearing for a week just to read and reflect. That's an example of kind of the. The value of the space that. That at least he saw.

[Dean Carignan]

And today at Microsoft, we have the Garage, which is the host of the Hackathon, and we have 15 of them worldwide. And these are their own unique spaces, their maker spaces and collaborative spaces that are away from anybody's office. So you come into the Garage and you can go there for an hour. You can go there for the whole Hackathon week. It's just that whole, like you're saying that physical. I got to change the context. I got to change the environment. I got to walk away from the distractions or the business. Me, personally, I've taken. I've been really lucky. I've taken some real long sabbaticals throughout my career. I've joked that I've retired three times already, taken a year off or half a year off. And I spent a lot of time at coffee shops just watching clouds, just like sitting there, letting my brain decompress and wander. And Dean knows I went through a whole big health situation over the last couple years. And even that it was in my work life, helpful because for a year and a half, I couldn't think about anything but my health. So all the little background stuff was happening. And when I came out, we started writing this book. And it's a fundamentally different book because of that year and a half of me not being in the rush of the work. So however you can treat.

[Ed Mylett]

Okay, thank God, you're okay. And I have to tell you, I can contrast that with someone who has not done enough of it. It. And it's affected my health and I think it's affected my innovation. I think I'M fatigued. I think you have more brain fog and fatigue in some of your cases than you realize. And I know a lot of you are saying, saying, hey, that's great. Sounds good. You know, I'm trying to pay my bills this month. And that's why Candy's point of getting in the car or just going to the coffee shop matters. But I can tell you that I believe you're right. And I have to tell everybody that's just listening. Do you have a culture of innovation? So it's one of the. The big topics of the book. And even if you're a small business, my number one revenue generating this idea this last year came from my assistant. Not all the people around me. And it was the day with me that I did in my home. That was just something I started to say. Guys, I have this tendency to think and so do a lot of you. I'm the smartest person in our company. I know the most. I've been the most involved. I've been there since the beginning. And you can't see outside yourself. My best idea came from my assistant this, this year. So, you know, there's a lot of things, by the way, that compete with innovation. And in the book, you actually have something you talk about called innovation's primary competitor.

[Dean Carignan]

Yeah.

[Ed Mylett]

Like what is. What is. What is competing with innovation? This is a question all of you should be asking. I think it'll be one of the best answers on what is already an unbelievable interview. So I'll let either one of you grab that one.

[Dean Carignan]

So I'll start, Dean. And you build it's cognitive inertia, which is a, a fancy science way of saying, I know what I know and I do what I do and it works. So I'm going to keep doing it. And that is something. It's actually a survival instinct for us. Like, I figured out that if I go that way, there's lions. If I go that way, there's food. Right. Like, it's something we have to actively work against. This habit of staying with what we know. And it points back to what Dean was saying about making time to diverge and learn new things. It doesn't really even matter what. Listen to some new music, go to a museum and look at different things. Even just pay attention to your block when you're walking down it and see what's changed. Like, get in that habit of absorbing new because you're going to open up new things in your mind and it's going to unstick that natural tendency of us to do what we do and know what we know and ride on that. And to your point about your assistant, talking to other people is one of the best ways to unstick yourself. Because everybody's walking around in their own movie, right? Like their world is their reality. And we all see things differently, we all think things differently, Things matter differently. So the more you reach out and talk to the people around you and the people around them and the people around them, the more you start picking up these signals of what's important and what's happening in the world and what are your blinders preventing you from seeing.

[Candy Valentino]

And what I kept hearing right before you had started talking about that is it's almost like the antithesis of creativity. And innovation is chaos. And when we're stuck in chaos, it's like we can't think straight, we can't come up with great ideas, we can't innovate anything new because we're kind of stuck in this survival mechanism. And I think about the entrepreneurs that we work with, I think about the people listening and especially with what's going on right now in the world, and they think, like, what do I do next? Like, what? What? How can I even innovate anything? Because I'm so stressed and worried about what's going on now. Is there anything practical that maybe when there's someone in your team. Because it's tough to build a culture like this, right? Is there anybody that maybe was in your culture that really just couldn't almost get out of their own way to see this is the opposite of a fixed mindset? And is there any tools that you can maybe help that listener with?

[Joanne Garbin]

Yeah, one. One. I was going to say one thing that the teams that we studied that had really built the most innovative culture had created sort of trust and a sense of psychological safety within the group and an understanding that it's okay to try new. That in fact, it's not only okay, it's part of our charter is to test and explore and try new things. They were also very good at asking before someone would try something new, what's your hypothesis? And Julia Lewison, who runs our developer division that builds all our developer tools, she would always say, anyone can bring me an idea, because good ideas can come from anywhere. And I'm going to say, what's your hypothesis? And more specifically, what's your customer hypothesis? Why do you think this new idea would deliver value for a customer more so than the way we're doing it? If you can answer that question, you get time and maybe resource to go and actually build an experiment to test your hypothesis. What we like about that language as well is when you come back with your results, it's not a I succeeded or I failed, it's I learned my hypothesis was valid or it wasn't valid. So again, it takes the risk out of trying something new and doing something different, but it keeps the discipline there. You're not just going off and trying something because it sounds cool or fun or interesting. You're going out to prove or disprove a hypothesis that then you can build upon.

[Dean Carignan]

I just want to add something because underneath of all of this is a team. No one at Microsoft is innovating alone. No one. Not even our PhD, 30 years in research. Brilliant. Not even Bill Gates innovates alone. Or Satya Nadella. And as entrepreneurs, and I've spent most of my career in that space, whether I was the first person or the tenth person or whatever. You have to create teams, your business team, of course, you need to collaborate with one another and share that cognitive load, share those problems and find solutions together. It's not all on any one person to figure out what needs to happen. But even if you're a solopreneur, I had a group of friends, we jokingly called ourselves ea. We were entrepreneurs Anonymous. And once a month we would get together and we would go around the table and be like, hi, my name is Joanne. I've been off the paycheck for six months and here's what I'm building. And we would help each other. And there was nothing to be gained other than support and creativity and a network of people swimming in the middle of the ocean together. Right? So you build those islands, you build those support structures with, with anyone. Your aunt, your kid, your mailman. Like, you just gotta find the people that give you energy and give you perspective. Perspective is key because you don't want to just have somebody that's telling you the same thing you're thinking. You want people that see the elephant from all the sides. Right?

[Candy Valentino]

Yeah.

[Ed Mylett]

It's very good. You know, when I was younger, I like that, by the way, a lot. When I was younger, I was encouraged by Tony Robbins. Actually, this is when we had first met. He said, because I was a solopreneur, he said, you need a personal board of directors.

[Dean Carignan]

Yes.

[Ed Mylett]

And. And you're a hustler and you're talented and you'll innovate and you'll be coachable to the ideas. Reach out to people further down the road than you and ask them if you know, once a quarter they'd meet with you as a group, four, five, six, seven people. And I did. And so for 25, 30 years, I've had a personal board of directors. Obviously the board has changed as my influence and reach and scope has changed. But to this day, I still have. And it's sort of an official group to the point now where I do take them away once a year. They get a great trip out of it for me. But they also know, you know, there's a half day if we're going to be skiing or golfing, that we're at the whiteboard and we're talking about me and my life and my businesses. And so I'd encourage all of you to do it. And by the way, one other thing, everyone listening. If you're not innovating, your competition is. So if you think this doesn't matter, I don't care what business you're in. I don't even care if you're not even an entrepreneur, if you're not innovating yourself, which is what we're going to talk about in this next. If you're not doing that, your competition is. That's the world we're in. Innovation, expansion, growth. Change is constant. And you got to change. You gotta have to grow. Which leads me to my next question. This message is from sponsor Intuit TurboTax Taxes was dealing with piles of paperwork and frustrating forms and then waiting and wondering and worrying if you were going to get any money back. Now Taxes is easily uploading your forms to a TurboTax expert who's matched to your unique tax situation. An expert who's backed by the latest technology which cross checks millions of Data points for 100% accuracy. While they work on your taxes, you get real time updates on their progress and you'll get the most money back guaranteed. All while you go about your day. No stressing, no worrying, no waiting. Now this is taxes intuit TurboTax. Get an expert now on TurboTax.com only available with TurboTax Live. Full service real time updates only in iOS mobile app. See guarantee details at TurboTax.com forward slash guarantees. This episode is brought to you by Progressive Insurance. Fiscally responsible financial geniuses, monetary magicians. These are things people say about drivers who switch their car insurance to Progressive and save hundreds. Because Progressive offers discounts for paying in full, owning a home and more. Plus, you can count on their great customer service to help you when you need it. So your dollar goes a long way. Visit progressive.com to see if you could save on car insurance, Progressive Casualty Insurance Company and affiliates. Potential savings will vary. Not available in all most states or situations. And I, I'm going to steal the word. In the book you talk about Microsoft's practice of self disruption. I actually applied that to me like personally disrupting me because that extends even beyond just even business for me. Disrupting my thinking, disrupting my relationship with God, disrupting my body disrupt. So I'm taking this self disruption kind of to a different level. But the application of the book is really specific. So why don't you guys sort of jump on that?

[Dean Carignan]

Yeah, yeah, Dean, why don't you take the business and I'm with you, Ed. I did the self disruption to myself, so I'll share a little bit.

[Ed Mylett]

Yeah.

[Joanne Garbin]

You know what's interesting is I, and I read about it in one of the chapters that there was a period in Microsoft's history where we didn't self disrupt, where we sort of had a certain complacency and we thought that we were at the top and we would always be at the top. And the thing that really blew up that perception was when Google became incredibly successful in search and had these kind of feedback loops in their business that made it impossible to catch them. And one of the things I love about Microsoft is its willingness to say we screwed up and we better learn from that. And you saw the whole company react to be like, we can't be complacent, we can't take our position for granted. And to really look for the entities that would disrupt us to a point where there are individuals at Microsoft whose job is to disrupt the company is to actually think about what's that thing that's being built in a garage in Silicon Valley that in a year's time might actually come and make us irrelevant in one of our businesses. It's just been good to watch the company react to that. That and I think it's even more critical in the period of AI because we're into this phase of rapid change where even a very small, even an individual can stand up an AI service that delivers value and that actually takes off. So I think we, thankfully we've had this habit of self destruction for a while at the company level, but we're going to have to lean into it even more. But we'll let Joanne talk about this as well.

[Dean Carignan]

And well, the connection to Microsoft is Microsoft was the kind of instigator of my own self disruption. I was leading a company up in Boston. I was the chief innovation officer of a 50 person company. And Microsoft came and said, we need you to come do what you do for us. And it was like, I'm not a corporate. I've only been in corporate once. And it was because they bought us. I don't want. I like, I'm not a big company person. And they just kept the conversation going. It took me. It took, like, four years for them to convince me. But in the course of that time, what I did was I applied the same things we would do in innovation to myself. I was like, all right, what's my mission? Like, what am I here to do on this planet? And what I'm passionate about is sustainability and ecosystem degradation. And I'm like, okay, that's my mission. What are my values? My values are having impact, learning, having good support structures, having accountability for the things I do. So I mapped out my values, and then I took my mission and my values and I used them to create something we describe in the book, which is a decision matrix. And I was like, all right, I'm going to translate this into three or four principles, guiding principles that will help me decide, decide what to do next. And when I did that, and I put Microsoft on the board with seven other options. Stay with the company I'm with, build a new company, quit, go live on a beach and paint tortoise shells like, I had everything up there. Microsoft knocked it out of the park. So it was like, okay, this hits my mission. This hits my values. It scores the best on my decision matrix. It wasn't an easy decision. I had to pack up my life of 20 years in Philadelphia with my neighbors and my family all around me, move across the country, join a giant corporation as a disruptor who. Disruptors are always inherently facing that cognitive inertia. So it's not an easy gig. And then three months later, the pandemic hit. So it was like it was one challenge after another. But what that process allowed us to do or allowed me to do was say no. I feel good about the decision because I made it in a good way. It's based in my mission and my values.

[Ed Mylett]

Can I ask you really, can you go a little deeper on that decision matrix, how that works? I think that's really valuable.

[Dean Carignan]

Yeah, it's super useful. And more people involved, the more valuable it is. A good one to look up is the DARPA hard test in innovation, because they are one of the most prolific innovation groups in the world, and they use it. It's basically creating four or five at most metrics. So it's a combination of metrics and you give yourself an objective and you say we like. One of the ones from my program at Microsoft was create value for Microsoft, the environment and the communities and the. And was super specific because it wasn't. Or it was whatever we solve has to create value for Microsoft, the environment and communities. And then we had a range. It doesn't do it. It does it a bit. It knocks it out of the park. And every idea we came up with that was one of the four or five things we would judge it on. And we're like, no, it only creates value for Microsoft. Can we twist it or rethink it or change it in a way that stretches it to create value for all three? Can we combine it with something else that creates value for all three? And it just gave us a tool to not only it wasn't binary, like yes, yes, no, it was where are we in this thought process? Can we move it to knock it out of the park? And it's really, really helpful when you have lots of ideas coming into the, you know, into the group, into the table on the whiteboard to help filter through them.

[Candy Valentino]

It's almost like could you apply that same stretch, right? Like you're trying to say, okay, is this good for Microsoft, but is it also good for these other things? I think sometimes us as humans don't do that in our own lives. Yeah, it's like, this is a good business decision, but it's going to wreck your family. This is a great family decision, but now I can't pay attention to my business. So it's almost like if we could adopt that same decision thought process and say, okay, can this be good for all of these things in my life? Can I still be there for my family? Can I still go in on my business? Can I still focus on my faith? And I think what Ed had said and you guys did as well is really, it's just keeps hitting me is for the average person that's just watching or listening, it's like, how can you self disrupt your own life a little bit? Like for me, that's what I was, I was thinking, what do I need to self disrupt or destruct and burn down and walk away from so that I can do something else with greater excellence. To me that's what I'm hearing is like the through line messaging of being willing to say, what do we need to innovate differently, think about differently so that we can do this better as a team. And I just, I, I love this conversation. I'm sorry, I'm just so jazzed up. There wasn't a question there. I'm just super.

[Dean Carignan]

And Dean, it's. It's like your assumption. Map it. You gotta write it down, right? Like it's. You gotta take it out of the intuitive and make it concrete.

[Ed Mylett]

Yes, well, you're reading my mind. So Dean, jump on that. By the way, everybody, Dean is not Bill Gates son. Even though he looks like he could be if you're on YouTube. But go ahead, Dean. I think you should talk about that assumption stuff because that was in my list here as well.

[Joanne Garbin]

Yeah, it's so important is. And again, we get so busy we tend not to do it. But it's important to think about what you define as a fulfilling life, what you stand for as an individual. And not just in the office, but your family, hobbies, faith, community. And when you do that and kind of write it down, you can look at it and you can look back on a given week and say, oh boy, I really over indexed on work. Gotta do something now, this weekend with the family or the community. And you can kind of start to balance it. The tendency, if you don't have that in front of you is to go whatever's urgent and whatever is needed, more often than not, that will be work. Yeah, that will be your work. And that will expand. And so related to this, and this is what's exciting about AI. And you'll hear this expression, AI is about to give everyone superpowers. And I don't necessarily like the expression, it's almost right, But AI is about to make superpowers available to everyone. Whether or not you adopt them will be a matter of sort of choice and decision. But it gives you this opportunity, as Joanne was saying at the start, to look at my work and to say, you know what, there are some things I really don't like doing that don't add a lot of value. It's drudgery. And there's an AI tool that's going to do that for me now. I'm going to have more time to actually do the things that I care about that inspire me, or more time with my family or my community or other things. And so really encourage everyone. There is a lot of hype about AI now. And so you have to filter and you have to kind of find a couple people to follow that you think are reasoned in terms of how they describe what's happening and what's available. But follow the news on AI. Make a little time to experiment with it, but be targeted in your experiments. Focus on Things that you'd like to stop doing and just start to ease it in there.

[Ed Mylett]

Let me give you an example of that, everybody. And then by the way, I'll ask them one more question. I'm going to let you have the final one. But I have to say one thing about that. I hate follow up when it comes, like sales, setting appointments, like just. I think you have two. You and I are talking about this off camera before we start. Like, I just don't have this follow up detailed brain. I like big things. Like I'm left handed, right brain. I don't even know if any of that's true.

[Dean Carignan]

Right.

[Ed Mylett]

But I don't like following up. Well, guess what? What? AI follows up 100% of the time on a call, on time, every time, perfectly. And so things like that in sales and marketing and you guys, you're, if you get good right now, the opportunity to increase revenue is I don't think in the his. I don't, I know in the history of mankind it will cover your weaknesses for you. I don't like to follow up. I don't like details. I don't like the small questions. AI is going to do all of this for me, right? It actually is doing it for me. I think the average person, though, you guys listening has no idea what we're talking about still. Like, I heard it. It's like an enhanced Google. It's going to be a better Google. I don't really know what it means to me. I'll figure it out when we get there. I'm really busy. I got to figure out what Trump did today. I got to find out what's going on with my kids. I got a sales call I got to do. I got to get to the gym. I got to have some water. You know what I mean? Like just life's busy and you said find Dean. You said find two people or find some people that. Well, I have the two of you here today. So. A few weeks ago, I wore this cashmere sweater on the show. A lot of you said you loved it. And I got to be honest with you, when I used to try to elevate my style, you know, the brand stuff I'd buy would break the bank with me. I hated spending money on stuff like that. But with quints, I get high end, versatile pieces at prices that you and I can actually afford. Now you can upgrade your lifestyle without spending all your money to do it and paying huge price tags. Quince has all the must haves, like Mongolian cashmere crew neck sweaters from 50 bucks. Iconic 100 leather jackets and versatile flow knit activewear. The best part of all, all Quince Items are priced 50 to 80% less than similar brands. Indulge in affordable luxury. Go to quints.com ed for free shipping on your order and 365 day returns. That's Q-U I N C E.com ed to get free shipping and 365 day returns. Quince.com ed so it'd be crazy for me not to like open floor say look the two mega successful people at flipping Microsoft. Dean, you've been there through Xbox all the way through all the innovations. If someone said bro, we're at a coffee shop, don't give me the sanitized answer of what Microsoft would want you to say. You know the put together one. What the heck is this going to mean the next five years? And let's see if Joanne agrees with you or has a different version of it. Someone says AI is going to mean and by the way, if it's dark Dean, tell us it's dark. Tell us the things we should be worried about. If we should be.

[Joanne Garbin]

I think it's going to move in two very distinct phases. Right now the thing that AI is really good at at is summarizing documents. That's how I get my tech news now is I just have, I put in a couple of questions, I get a summary of everything that popped in the media in the last 24 hours. If I read research papers, I have AI summarize it. Really good at that. It's also good at generating content text. I'll use it to get unblocked. As a writer, I like to write the final content myself and the ability to generate pictures and images and even short videos. I'm not really in that creative or graphic design space. But for anyone who needs to put together brochure, website, thing like that, it's really going to be powerful in the longer range. And I'll throw out one technical term that people can monitor and it's agents and agents is exactly what you were talking about. Ed is where you delegate more of the work to a piece of AI and it may go through multiple steps. Write an email, send to the customer, monitor their follow up, tell me when they've responded, book a meeting. That is a more nascent technology. It needs a little bit of work and refinement but that'll be where I think we can really start to offload a lot of our day to day and then redirect onto other things.

[Dean Carignan]

Yeah really good in the, in the, in the small business world, you know, balance in the books, checking the inventory, all of that paperwork we all hate because it means we're not baking or greeting customers or selling or creating whatever you're creating. All of that in the agency, AI is going to be something we offload to the computers because it's formulaic now our role will still be check your books. Right. But you don't have to do all the pushing of numbers around in the engineering world. A lot of the first pass engineering calculations and stuff that you have to hire out, you don't need to do that. The answer's either right or wrong. But the higher level engineering work, the creative solutions, they're going to need to be done by professionals that have experience. This is another great thing for us Gen Xers. We're all turning 50 and historically that's been a detriment in the workforce, right? Like, oh, the youngins are coming. We love the youngins. They've got the values driven, mission driven attitude, purpose and all of that. But us Xers and 50 somethings, we've got that experience that we can look at these outputs and we can say, nope, that's wrong. Like that'll never fly. Like those things can't be displaced by AI. The trades, you know, they're not going to get displaced by AI. Anything that has to happen in the physical world. We've been waiting for the robot revolution forever. We're not there.

[Ed Mylett]

Interesting. Okay, that's interesting. Interesting. Okay, yeah, yeah, yeah, I'm happy to hear that. I'm happy to hear that about the robots and 3D printing houses. You still think even though we're hearing about those things, we're a little ways away still.

[Dean Carignan]

Yeah, them and fusion are still quite a while away.

[Joanne Garbin]

Okay, good deals. The other thing to remember about AI is we determine, we as a society determine how and where and when it will be deployed. And we like to use the term human AI complementarity. If we're thoughtful about this, we'll get to a future where we're using AI to complement us and do humble assistant. Yep.

[Ed Mylett]

My only fear about that, Dean, and I don't mean to be the least Pollyanna one, is that sort of assumes it's kind of like the environment. Right. That sort of assumes a global buy into that. And you know, I hope you're right about that part. I didn't mean to interrupt you, but you know, it does assume, you know, we're not just one country, we're one world now. And that Assumes bad actors will buy into that as well. That's a little bit of the unknown for me.

[Joanne Garbin]

Me, that's good.

[Ed Mylett]

And yeah, I think you probably agree with that. Anyway, Candy, I promise you the last question. So just.

[Candy Valentino]

I'm gonna. Super. For everyone watching, listening, obviously we talked about the book. There's been so much fascinating, but there's so much more in the book. So if there's one thing that we didn't hit on today, because I feel like there's so many questions I could ask to be the last one. But if there is something we didn't hit on, and you really want to make sure that the people that tuned in today get. If they hear. When you read the book, make sure you get this. What would be that one thing for each. Each of you?

[Ed Mylett]

Great question.

[Dean Carignan]

You first, Dean.

[Joanne Garbin]

Okay. Yeah, I think it is that everyone can be an entrepreneur and should be an entrepreneur. There's kind of this. This perception often that it's a certain group of people or it's creative types or it's a research division. What we found in the research, good ideas came from everywhere. They needed everyone to bring them out into the world and make them successful. And the tools are there, and they're known and they're available. The tools to be an entrepreneur. We consolidated them in the book. But that for me was the biggest message. Everyone should be and can be an entrepreneur.

[Candy Valentino]

Yeah, I love that you said that. That's fantastic. Joanne.

[Dean Carignan]

Yeah, he's an entrepreneur just inside the walls.

[Candy Valentino]

I know. That's why I love that answer so much. It's great.

[Dean Carignan]

And I would say I really like the full framing of. Of top down, bottom up and outside in. It's. It's, you know, some people gravitate toward grassroots efforts, and some people rise to the top and set the stage and hire lots of people like you all and create these empires. We need both, and we need them to find each other. So finding your top down that matches your bottom up and vice versa and empowering each other. But then there's this other framework of outside in. Too often we start where we're at and we try to build out from there. It's super helpful to go as wide out as you can. Like I was designing the data center of the future. Data centers are designed from the chip all the way out to the walls of the data center. And then you run out of time and money and energy, and you don't do anything past the walls. What if we start at the country and then go to the town and then go to the land and the people and the community around that data center and then design the walls and everything within it. Outside in. We designed something completely different than what we have today. So it's in art, they'll tell you take a painting and turn it upside down and you'll see totally different things in it. So it's just that flip your perspective and build your team.

[Ed Mylett]

It's so good. One of the best parts of the book is about going wide first. It's so good. This was a great conversation. Seriously. Dana, Joanne, thank you, guys. The book is the it was awesome. The Insider's Guide to Innovation at Microsoft. Thank you so much for being here today.

[Dean Carignan]

Thank you both.

[Joanne Garbin]

Pleasure. Thank you.

[Dean Carignan]

Great to meet you.

[Ed Mylett]

And Andy, thanks. This would have been good with me. It was incredible with you.

[Candy Valentino]

So great. I have so many things to think about. Thank you guys for your time today and thanks for having me. Me.

[Ed Mylett]

I loved having you. Everybody wanted her. And she's here. Candy's with me. All right, everybody. God bless you. Max Out Share this Episode.

[Joanne Garbin]

This is the Ed Milan Show.