Key takeaways:
- In the business world, we frequently talk about how businesses should only ever buy and sell essential products (“painkillers”) versus productive extras (“vitamins”).
- This advice is in opposition to what the most admired companies in the world – like Netflix or JP Morgan – do on a regular basis.
- The most innovative companies proactively invest in “vitamins” that build external sustainability and internal capabilities for the long term.
- Only spending money when it’s absolutely necessary is a recipe for being left behind when large societal shifts like remote and mobile banking come around.
- Waiting around for a pain to kill is playing not to lose. Building sustainable innovation with “vitamins” is playing to win.
Needing painkillers is a symptom of poor innovation. We tell startups and big companies alike to never waste money and only spend on “painkiller” expenses when absolutely necessary. But this mindset keeps businesses dependent on painkillers and ruins all chances of sustainable innovation.
In my 20+ years as a banking executive, I saw this firsthand multiple times: banks who refused to invest in innovation ended up in a pinch when anything major happened, desperate for “painkiller” solutions that charged exorbitant prices and barely delivered any value. The banks that took their “vitamins” – that is, planned for the future and made strategic investments – were more cost efficient, more innovative, and ultimately more successful.
The perverse incentive of painkillers
Painkillers mask the pain or make you stop feeling it, but they do not solve root causes of problems and they do not help businesses become more innovative.
Painkillers are short term: The pain is never gone for long and there’s always some urgency to it, meaning you can’t think beyond the short term cause you’re desperate.
Painkillers are a patch job: You feel better, but all you’ve done is numb the pain. You haven’t actually solved the problems that caused the pain in the first place.
Painkillers are a dark curtain: Pain is a sign something is wrong. Painkillers cover the deeper issues. It’s an illusion of productivity at best.
Painkillers are time-consuming: Setting up new software and running change management playbooks takes up a lot of time. So when it’s only to achieve short-term outcomes, you have to run the set up and change management playbook more frequently.
Painkillers are expensive: When you’re in a bind, you’ll pay whatever you have to. This takes resources away from possible innovation investments down the line.
Painkillers encourage dependence: Once a painkiller wears off, you need another painkiller to keep going – they don’t build any sustainability in your business.
When you buy painkillers, you’re also stuck buying whatever is available versus the thing you really need.
This happened a lot with banks, for example, in the sudden switch to remote and mobile banking during the COVID pandemic. Banks rushed – at great expense with pricey consultants – to quickly hack together a way to serve customers remotely instead of in a branch. These consultants quickly became the painkiller of the pandemic, but that left a lot of banks looking at their software a year later wondering if they made the right choice.
A vitamin today means innovation tomorrow
Vitamins are the opposite of painkillers. They are the building blocks of a strong foundation that leads to innovation, creativity, and sustainability.
Vitamins include things such as:
- Customer experience: Building with a customer-centric mindset.
- Digital experience: Creating unique digital experiences that are authentic to your brand.
- Diversity, equity, and inclusion (DEI): Building a workplace where all people can deliver their best work.
- Living your values: Focusing long term, even when it means forgoing short-term wins.
- Proactive analytics investments: Understanding data as it comes in, not after you have an uncategorized mass.
Vitamins are building blocks, both physiologically and metaphorically. An investment in a vitamin now means more strength, sustainability, and organizational health in the future. And when you have that healthy foundation, you can reach for stretch assignments, new innovation experiments, or take a calculated bet knowing you’ll be able to survive if it fails.
For example: Over the last half-decade, one of the largest banks in North America started quietly investing in predictive customer interaction, engagement and service infrastructure within their mobile app. As a result of this strong foundation, they were able to accelerate a lot of functionality during the COVID pandemic.
Within a few weeks of the pandemic starting, over 90% of their branch banking functions could be done through their app. This gave them a massive leg up on competitor banks that were still scrambling because they believed remote collaboration was not a high priority. No one predicted an event like the pandemic would shut down branches overnight, but that’s what happened. So instead of a slow, phased approach, those banks simply ended up scrambling for painkillers. The bank that took its vitamins soared to record Net-promoter Scores (NPS).
These kinds of investments don’t make front page news most of the time, but they build generational companies that can withstand pandemics, wars, and recessions. They also build the world’s most admired companies, such as Salesforce, Patagonia, Netflix, and JP Morgan. Each of these companies has a unique mix of “vitamins” for their business, just as each individual human has different vitamin needs.
Painkillers are lazy. Taking vitamins is playing to win
When you focus on painkillers, you’re playing to not lose. You’re holding off on the important things because you have too many “urgent” things on your plate. While this may seem like productivity, in reality it’s laziness: you’re waiting for the world to tell you something is urgent instead of making your own plans and building your own world.
When you find the right mix of vitamins for your business, you’re playing to win. You’re investing in building blocks that will give you strength for years to come, not just quarters. It might feel like nothing is happening when you make the first investment, but the compounding positive effects will soon pay dividends in ways you never imagined. Which, after all, is the whole point of innovation: to build a world previous generations could never have imagined.
