Five Indispensable Lessons from SXSW

Last week I rolled into Austin for my inaugural South by Southwest (SXSW) experience, and after a few days in the city that is dedicated to keeping its weirdness, I can confidently say SXSW did its part to fulfill the mission.

I expected to hear stories of grand achievements and inspirational actions, but what I found instead was pretty weird: a theme of failure. Some of those failures were enlightening, with speakers sharing what they learned in the process of attempting something difficult or creating something new - that the humbling experience of failure was essential to their ultimate success.

But then I saw the other kind of failure, the head-shaking, uncomfortable kind, as speakers or marketers tried their best to make a splash at the event, only to really do their worst.

Both types of failure supply increasingly vital lessons for healthcare. On the positive side, it’s inspiring to hear from those who have stepped beyond the well-paved path. Within our industry, innovation is happening, but only in pockets. One example: Novartis is developing 10 ambitious pilot projects that combine healthcare and technology. In fact, just last week Novartis CEO Joe Jimenez explained that the company’s approach to innovation required a transformative vision in response to macro factors reshaping the entire industry: “Our view has to be based on how healthcare is going to change. If you look at what led to the transformation that [Novartis] just went through, it was a view of what's going to happen in 10 years externally.”

Undoubtedly, among these 10 Novartis experiments, there will be failures. And a mountain of learnings. The pilot concept is not novel to Novartis; my agency has partnered with many pharma companies’ Centers of Excellence (and the like) over the years on many such innovation initiatives. But then something almost always… happens. Those CoEs aren’t well-funded (or well-empowered) enough to succeed, or they end up being dismantled completely, along with all the historical knowledge and advancements made through success…and failure. That’s failure of a more lasting, damaging kind.

Ultimately, there is much to be learned by healthcare marketers from the risk-taking nature of Novartis - a point made repeatedly by the entrepreneurs featured at SXSW. So join me on a journey in counting down the top 5 lessons in invaluable failure from SXSW 2015…

5. Simulating Failure: Paul D'Alessandro ofPWC
Paul D'Alessandro, PWC’s Healthcare Data Science & Consumerism Leader, sees the key to progress lying in a combination of technology and data to simulate real-world successes and failures. Mr. D’Alessandro’s personal experience as a Navy pilot flying planes off aircraft carriers taught him the value of learning from technology-enabled faux-failure. He crashed 127 planes in a simulator before he ever flew a real one.

Applying this sensible approach to risk to the private sector, he presented compelling data from other industries that have improved failure rates by leveraging technology and data, comparing advancements from 1960 to today. Weather forecasts were 30% accurate in the ‘60s vs. 80% today. Car longevity: 4 years vs. 11 years. Aviation failures used to occur 60 times a year, and now it’s 5 - a 12x improvement. But what about healthcare? Life expectancy in the 60s was 70 years, now 79 - just a 12% change. On the learning-from-failure front, we’re the laggards.

Mr. D’Alessandro yearns for healthcare to invent its own version of the “check engine light” - for patients to have access to the complex and powerful data about themselves in a simple, visual way to drive preventive, rather than reactionary, care. His team is working on the “most advanced human model in history” to lead this change. All I could think is, why is a consulting company doing this and not a healthcare company?!

4. Excuse Me: Eric Schmidt & Walter Isaacson
A trifecta of powerful pedigrees stepped onto the SXSW keynote stage - Google Chairman Eric Schmidt, Aspen Institute head Walter Isaacson (former CEO of CNN, Managing Editor of Time, and Steve Jobs biographer), and United States Chief Technology Officer Megan Smith. A wide-ranging discussion eventually honed in on another type of failure - the woeful under-representation of women and minorities in the tech industry. But a more immediate failure was pointed out by one brave audience member who commented to the panel that there is “unconscious bias” in our workplace interactions and one facet of that bias is men interrupting women, essentially working to silence them. She then pointed out that Schmidt & Isaacson had just demonstrated this very trait by interrupting Megan Smith several times. She suggested this might be a factor in more diverse groups not flocking to the tech space. The crowd responded with applause and a cacophony of “burn” utterances: “Ooooh.” It was later revealed the commenter was Judith Williams, the head of Google’s own unconscious bias program. A tough day at the office for Mr. Schmidt.

3. Catastrophic Comments: Malcolm Gladwell & Bill Gurley
Everyone’s favorite head of hair, Malcolm Gladwell (see picture) interviewed Bill Gurley, a partner in the Silicon Valley venture capitalist firm Benchmark, a backer to companies like Snapchat, Twitter, and Uber. Mr. Gladwell opened their talk with the topic of healthcare. I perked up. Mr. Gurley stated he’d met with 100 health startups and invested in precisely zero because the entrepreneurs “have assumptions about market forces that are false.” Although he did not go on to articulate what those assumptions were, it seemed obvious to me where there is a gaping disconnect: Entrepreneurs know innovation and risk-taking, but we’ve seen time and again that they really don’t know much about the regulated US healthcare industry. On the other hand, pharma and medical device companies lack entrepreneurial skills (and instincts), but they have deep knowledge of the byzantine healthcare industry, enormous financial strength, and smart people looking to make a real difference. So, to me, merging these two skill sets into new organizational forms with a fresh business model provides incredibly rich opportunities.

As if to make my point about the Silicon Valley blind spot, it quickly became clear that Mr. Gurley’s knowledge of healthcare wasn’t much better than the entrepreneurs he chided. Drawing on his surface-level understanding (referenced mainly from David Goldhill’s book Catastrophic Care) he deemed ACA incentives for EHR implementation “asinine.” I doubt Mr. Gurley has a keen awareness of the struggles of today’s healthcare professionals, the upheaval to their work life, or their business model. This was a failure of a lack of real insight.

2. Black Cloud: Marlboro
As I was walking to a session, I turned a corner to find a promotional tent on the street and stopped dead in my tracks - the “Marlboro Black Tent” loomed before me. Yes, BLACK. From a cigarette maker. At the time I assumed the marketers behind this gem were thinking along the lines of the American Express Black Card - exclusivity - but a little searching reveals there is a Marlboro Black Menthol product. Genius product name! Genius installation at SXSW! The job of marketing a cigarette has to be one of the worst in the world. And they’re failing at it. Some free marketing advice: 1) Don’t market cigarettes; 2) if you are forced to, don’t evoke death in your branding.

1. Moonshot Maestro: Dr.Astro Teller
With the job title “Captain of Moonshots” within Google[x], the giant’s “factory for building magical, audacious ideas,” Dr. Teller’s job is to make the impossible possible, which he states can only happen by “embracing failure.” The 5-year-old not-so-secret organization within Google is working on a number of exciting ideas: using a global network of high-altitude balloons to connect people in rural and remote areas with limited Internet access (“Project Loon”); building self-driving cars; Project Genie, which aims to transform the construction industry; and Project Wing, which involves using “self-flying vehicles” (aka drones) to deliver packages. It must be noted, this is the same caldron from which the now infamous Google Glass emerged.

Mr. Teller addressed the embarrassment of Google Glass head on, noting they let too much go public - that it wasn’t yet a product, simply a trial (so they now say). They had to learn from that failure.

He also talked about how Project Wing drone delivery was something several team members knew was going awry about eight months in; 80% of the team knew by eighteen months but they still kept going, not wanting to accept all the work they had put in was flawed. Although concept failure shouldn’t be accepted, they did need to accept that they needed to completely rethink their approach despite their year and a half investment. Teller said you need to get the “full value” from your bumps and scrapes to ensure the next idea is even better.

So even some of the smartest, most revered people out there are failing constantly. And that’s a good thing. Because if they didn’t, progress would stagnate.

As ‘weird' as this sounds, that’s the SXSW lesson that most applies to pharma.

Janelle Starr is SVP, General Manager, Heartbeat West. She can be contacted at janelle.starr@heartbeatideas.com