Innovator Interview: Sandy Sanzero, Sandia National Laboratories by futurethink

Sandy Sanzero

Manager of Robotics, Intelligent Systems, & Cybernetics Sandia National Laboratories

the innovator’s interview May 2009

The Innovator’s Interview highlights unique innovations from a wide range of industries, and is an opportunity for futurethink and some of today’s leading innovations to share insights and ideas.

the innovator’s interview

Sandy Sanzero the background This Innovator Interview series highlights leading innovators at Fortune 500 companies. In contrast to past interviews, focusing on a single innovation, this series examines the state of innovation at global organizations. We spoke with both innovation leaders and practitioners, within varying business units and organizational structures, across a broad range of industries both for–profit and not–for–profit. The interviews offer a unique insider’s view into the world of innovation—what makes it work, what holds organizations back, and what critical advice new innovators need to know to be more successful with innovation overall.

the interview futurethink had the pleasure of speaking with Dr. Sandy Sanzero, Manager of Robotics, Intelligent Systems, and Cybernetics at Sandia National Laboratories, a division which was spun off as a separate department of the U.S. Department of Energy’s National Nuclear Security Administration. In 1945, the forerunner of Sandia Labs was known as the ‘Z’ division of Los Alamos Laboratory. Sandia Labs received an official congressional designation as a separate National laboratory in 1979. Sandia’s mission is to develop science–based technologies that support the United States’ national security. Dr. Sanzero offers insights on the need for dynamic drifting, how innovation must happen, and why StageGate is inhibiting breakthrough innovation.

Tell me a little bit about what makes Sandia Laboratories unique from the other organizations we’ve interviewed. Because we’re a National Lab, we can’t make a profit; we can’t compete with industry by law. So, our role is to be a trusted agent that does things for all the right reasons. There’s not a profit motive there. Plus, because of our role as a National Laboratory and our focus on far reaching research, we know where the world’s going to be a little better than the average bear in 5, 10, 15 years. We examine what the threats are going to be, what the potential is for new, cutting edge technologies to actually be in the hands of users, and more. So, how exactly do you go about the process of predicting the future or figuring out where technology and innovation might be 10 and 15 years out? We try to fit where universities and industry and others don’t fit. Our goal is to prevent technological surprise from occurring to this country. As an example, if you looked at World War II, we had tanks, our enemies had tanks; we had airplanes, they had airplanes, right? In fact, some of our enemies’ products were even better than ours. There was a lot of death on both sides. It was a relatively balanced playing field, from a technology standpoint. You don’t want balance. Deterrence is based upon having a tremendous imbalance, and not being surprised. One of the things we look at is studying the major things that might

the innovator’s interview

Sandy Sanzero drive national security – or insecurity – and almost take it from an industry standpoint. If you looked at Porter’s Five Forces on how you study the structure of an industry, whether it be the Navy shipbuilding industry, for example, or an issue, a problem of the day such as anti– piracy or the Artic climate change, and you take it at that macro level and look at what’s in place now and then go to the intermediate level and do the four corners analysis of motivators and potential actions that individuals, or states, or companies, what might be their drivers for change? We then look at the disconnects between those motivators and actions that are potential blind spots. We’re looking for blind spots. These blind spots, if detected properly, would be the source of potential national security problems – or could give insights on policy or technologies that might give us an advantage. You’re constantly studying these macro trends to know what the implications are for various levels of government and national security. That’s part of it. We look at what private industry does – what are they capable of doing, and what will they do – and what does this mean to us? We look at universities – what can they do? Are there partnerships that – between what we are very good at the National Labs and industry and universities – we can put together a dream team that can take us quickly to a different paradigm and solve problems together?

“A lot of people call innovation things that create improvements by 5 or 10 percent. But, if I employ new to the world, truly disruptive technologies, then I’m changing the paradigm so that I see ‘orders of magnitude’ improvement. That’s a whole different kind of innovation.”

We are always exploring potential major paradigm changers that we’re not reacting to right now, but are out in front of the power curve; for example, the inter relationship of water and energy, how instabilities and future wars can be caused by that. You might be able to wage peace rather than war by taking care of water and energy problems for people and nations. Food, population – we look at all those things. To us, the question isn’t “can you build a gun?”, but “what are you going to do with it when you do build it?” That’s what we’re interested in: What’s Next. We have technology enablers provided by ‘centers of excellence’ in different areas, such as microsystems, nanotechnologies, modeling and simulation, etc. How do you define ‘innovation’ at Sandia? A lot of people call innovation things that create improvements by 5 or 10 percent. But, if I employ new to the world, truly disruptive technologies, then I’m changing the paradigm so that I see ‘orders of magnitude’ improvement. That’s a whole different kind of innovation. And I suggest to you that what we have found is that the way you manage those programs, if you are to be successful, is terribly different than the way you manage the evolutionary programs. Most people that do the evolutionary kind of programs, and have them as a major part of their portfolio; will dip their toe occasionally into the revolutionary, trying to manage it the same way as incremental ideas, but they get burned and do not make money or aren’t successful. And then they deem the revolutionary projects ‘too risky’. They don’t realize that the risk was not in the nature of the program but in the way they chose to approach it. Most people today approach programs of new business development

the innovator’s interview

Sandy Sanzero or new product development through a Stage Gate process. So, the marketers own this. You clearly have to be able to know what the potential ROI is going to be, who’s going to be the customer. The more you acquire that kind of Stage Gate process, the more you will rule out and be unsuccessful with truly innovative disruptive technology programs because everything needs to fit in a box or into a marketing plan schema. The very nature of revolutionary ideas is that they are paradigm changers, which means you don’t know the market. Imagine back when trying to define 20 years ago what the market would have been for the internet. If something is truly new to the world, the marketers will say this is too risky, or can I dole out money in slight little increments and put you to a schedule. To me, true innovation is the disruptive, not the evolutionary kind. For us, if we’re truly going to change the paradigm and prevent technological surprise, one of the metrics that you’re going to use is that the innovation is not easily emulated or copied. The counter to it is just too quick and too easy, right?

“If you’re a National Laboratory, you have the luxury of doing a high percentage of highly innovative projects because you’ve got a mission space that says if it’s evolutionary and industry can do it, you’re not allowed to do it.”

And how do you make this revolutionary innovation happen? To be successful with this bold type of innovation, you absolutely need to have a champion. And that person has to put together a team. We have found that the real interesting problems that we tackle are systems level problems that are interdisciplinary. So, you need to have a diverse team by the way of not just having all mechanical engineers or all electrical engineers or all material sciences. And that’s one of the real reasons the National Laboratory has biologists and psychologists and cultural anthropologists, etc. Because the real tough problems in life, the ones that are really going to be disruptive, they require that kind of interplay. It’s those edges of the different technologies. And so, you need to allow a team to do a bit of dynamic drifting. You’ve got to give them some space to not say here’s the schedule, here’s the cost. In a month, come up with it. You’ve got to allow a little bit of freedom. Of course, at some point, there has to be a convergence. And sometimes, the convergence is because you’ve picked the right partners and they bring something to the table that you don’t have? Sometimes it’s just timing. When things get invented, there are different pieces of the puzzle that when they’re all in place, you now are at that convergence point and that’s why you need the champion to recognize and push very, very hard for a prototype, and to create them very fast. I mean orders of magnitude faster, because what you want to do is build a prototype. Don’t worry about it being 100 percent. You want to get it into the hands of users as quickly as possible so you can see where people could use it and how they’ll use it. How do you manage, timelines then? Do you build in extra time or do you not really set deadlines for projects as they’re in play? If you’re a National Laboratory, you have the luxury of doing a high percentage of highly innovative projects because you’ve got a mission space that says if it’s evolutionary and industry can do it, you’re not allowed

the innovator’s interview

Sandy Sanzero to do it. However, all customers have milestones and deadlines. We attempt to manage timelines by accurately evaluating technology readiness levels (TRLs) and making realistic schedules based on those TRLs. If your boss wants a progress report on innovation tomorrow, how to you measure your efforts? What metrics do you use? So, for us, it’s real simple. What’s the impact on national security that is a paradigm–changer. That’s number one. Number two, is there a systems–level vector of differentiation? In other words, it’s not just an interesting little widget. What’s the big hierarchical problem you’re trying to solve and do we have a systems level vector of differentiation in here, magic foo–foo dust, something nobody else has. And the third thing is are there individual technology differentiators that can’t be easily emulated that are imbedded in there. We’ve done a lot on modeling and simulation in the National Lab here. We had to build nuclear weapons and assure the President of the United States by letter every year and by fundamental information data that by six nines, 99.9999%, those things would never go off when they’re not supposed to and always go off when they are supposed to. Now, because of the Salt Treaties, we could actually never set one off. How do we know we can guarantee this? Through our modeling and simulation.

“We’ve done a lot on modeling and simulation in the National Lab here. We had to build nuclear weapons and assure the President of the United States by letter every year and by fundamental information data that by six nines, 99.9999%, those things would never go off when they’re not supposed to and always go off when they are supposed to.”

Now let’s take this further. Say that you’re building a product – you’re building a car. You have to assure that it will always work to six nines, but you can never turn the key on. How do you do that? Our solution would be to create an awesome modeling and simulation capability to ensure success. To give you an example, a company comes to us and says we’ve got a fighter jet. We always used to test this by going to China Lake and shooting 20 millimeter high explosive incendiary HEI rounds into the wing box and we just shoot hundreds of them – to test that our planes are safe. And we say, yeah, but that doesn’t tell you enough. You need to shoot millions. We can do that in modeling and in simulation that most organizations . We will model that wing box and we have hydro dynamic RAM effect because it’s a wet wing. The bullet goes in this big and it goes out like a grapefruit, right? And we can simulate further, too. There’s fire when you get in there. There’s structural dynamic effects. So testing can be derived from modeling and simulation for the worst case scenario. I’m going to give you an example of how we helped one company, Goodyear. Goodyear was the last US tire company that was in existence. You say, well, what do you guys care? Well, from a national security standpoint, tires are a war material. You don’t want to count on a foreign government for them necessarily. And basically, the French, Michelin and the Japanese, Bridgestone, were putting Goodyear out of business. And the government asked us: would you please go look at their factory and see how they can improve their business; they just assumed that it was a manufacturing problem. Well, when we looked at it, we said what their problem is really a design problem. Because of their inability to rapidly prototype well, they were doing one or two

the innovator’s interview

Sandy Sanzero new designs every one or two years. And then, there would be a lot of iterations before the original equipment manufacturer, or car company, would even approve it. We showed them the knowledge of how to do this modeling simulation for tires and transferred the technology and the process knowledge to them. Now, what was good for us is we got all that rich experience that they have in polymer science and we got rich, rich data we can use for the future. And for Goodyear, rather than one to two per year or two, they now do eight to ten designs per day. That’s a paradigm change. And that was basically an introduction of software. Software and hardware because you also need the hardware to be able to support the simulations. Goodyear is getting the R&D 500 Awards for their run flat tire and all the kind of innovations that are occurring now as part of how they can do things in a different way. Even better, about a year ago, the French and the Japanese realized this change and actually created a consortium to try to emulate a little bit of what Goodyear was able to do. Sandia has a role to make US industries more competitive, to prevent technological surprises. But, they’ve got to go do it on their own. We just get them started. Do you find that companies traditionally approach you, are you going out and seeking partners in industry that you can basically support? Do you seek out opportunities for improvement? It’s both. If we see a problem set and we know that we have some gaps where a company would be a beautiful part of our dream team, we’re going to approach them. But, we’ve got to be sure that we do that such that there’s a fairness to the opportunity. We can’t introduce an unfair opportunity into an industry. We have to be sure we approach everybody in an industry do this in an open fashion. If industry approaches us, there has to be a national security issue or problem for us to be involved. But, national security issues are far reaching if you really think about this. Is food a national security issue? Absolutely. Is cyber security? Absolutely. Are transportation and water? Yes. It seems as if the health of the overall economy in general is a security issue. Absolutely, it is, and that’s why we also have economists on our teams. What do you think is the number one indicator of a healthy innovation program? There are several indicators. Dynamic drifting must be allowed and in evidence. Strong multidisciplinary teams that constantly interface with each other. Open competition of ideas. And finally – leadership. A team without a leader is useless. The military knows it. Everybody knows it. There needs to be a champion. As far as research and opportunity identification all the way to prototyping and launch and then post–launch analysis, where would you say it is that Sandia excels? Oh, we are great at some and we’re terrible at others. Innovation

the innovator’s interview

Sandy Sanzero research – great. Idea generation – great. I mean, if you hire as many Ph.D.s as we do from the best universities in the country, they ought to be some of the best idea generators and thinkers, right? I mean, we’ve got about 8,000 people that work here of which we’ve got about 4,000 Ph.D.s in engineering science, etc. That’s enough to staff about 150 universities. Concept development is good, but market analysis, absolutely not – terrible at that, business development – terrible at that, technical development – great, market development – terrible. We don’t hire marketers. That’s not what we’re about. Launch – if it’s a onesy or a twosy, or small quantity. If it’s a specific threat, a specific problem, then our launch is excellent because we have a level of expertise that nobody else has. But, if you’re thinking about like a new product launch, terrible at that. And that’s why we need those partnerships. We need to get somebody who’s good at that in industry so that we can transfer the technology to them and let them help us in turn.

“When they say R&D – is it R, or is it really D? If you really did portfolio management and looked at their portfolio and said I want to know what is big R – truly concept development, new to the world– what they’re doing is D. That’s not innovation.”

And in terms of just resource planning, do you think that’s a function of the fact that you’re not a profit driven entity, so it just doesn’t come into play as often? Well, yes, but the other thing is if you look at large companies like let’s say Lockheed Martin or Boeing or any of those companies, I mean, they’re spending about 15 percent on R&D. But don’t get fooled. When they say R&D – is it R, or is it really D? If you really did portfolio management and looked at their portfolio and said I want to know what is big R – truly concept development, new to the world– what they’re doing is D. That’s not innovation. Exactly, which is one of the biggest challenges that companies have– public companies especially – to overcome. It’s about overcoming an aversion to risk. Any risk. So basically, why do they do Stage Gate? Stage Gate is a risk averse process for risk averse people. And as long as they hang onto that risk aversion, they should not do innovation. If they say I’ve got to do it by Stage Gate, they are so risk dominated, they are not in the innovation game. It’s too rich for their blood. They want the margins they get from it, but they’re not willing to pay the penalty. So, how does one build a culture that’s comfortable with risk and that’s taking the right kinds of risk? Well, that’s a very good question. You need leadership that allows you to take risks so you can anticipate change and survive. You start asking yourself of the Fortune 500 companies over the last 50 years, how many of them are still in existence? About two. And you ask, why? Well, part of the equation is that the structure of the industry changes. We’ve watched the structure of the automobile industry change before our eyes. We’ve watched them have blind spots. Certain innovative things that they should have been doing, they didn’t do. They didn’t have innovation from the standpoint of what Toyota did, for example, in the hybrid market or in the reliability market. US car makers didn’t produce many innovations in these key areas. That represents an aversion to risk.

the innovator’s interview

Sandy Sanzero What would you say is the best way to maintain energy at a cultural level on innovation, getting people inspired, engaged and participating in the innovation process? So, my best thing is champions always have passion. Passion doesn’t come around profits as much as it comes around mission space. Don’t give these people so much profit motive as give them a mission space motive. What skills or what qualities do you think make an individual good at innovation? Broad inter–technical competencies, a strong team player, and by that I mean someone who can work with someone outside their own social style. Because they’re going to be on a team with all kinds of different people. They all have to complement each other – people who are analytical that are really the foundation of data; people who are the expressive–types who are very creative and very people oriented rather than product oriented; people who are drivers that are extremely options oriented and going for a product and show me the options and I have the authority to make a decision, I will pull the trigger; whereas the analytical guys will always say they never have enough data to make a decision; and also the amiable types that really pull the team together and solicit everyone’s input. You need to have all those kinds of people on a team and every one of them has to be somewhat flexible so that if I’m an expressive, I don’t insist that you interact with me in an expressive manner.

What can you learn from the team at Sandia to better innovate? • Better anticipate the future and identify opportunities for growth: What methods are you using to keep on top of long-term trends and the driving forces shaping today’s business landscape? Are there processes or resources in place to identify and focus on new growth areas for the business? Is there a shared vision for where the organization will be in 3 years? 5 years? 10 years? • Enabling ‘Dynamic Drifting’: How are you giving teams the time – and permission – to explore innovative opportunities? How are you letting them get away from typical process and out of their comfort zone to learn something new? • Defining your level of acceptable risk: Have you defined and communicated what an acceptable level of risk is in your organization? Do employees know what it’s OK to take a risk – and when it’s not?

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