Russ: Hi I’m Russ Capper and this is The BusinessMakers Show. Coming to you today from Bechtel Corporation and I’m very pleased to have as my guest David Wilson the Chief Innovative Officer here. David welcome to the show.
David: Great, really appreciate it. Thanks for having me.
Russ: You bet. I think a lot of audience knows about Bechtel but they’re probably not up to date so share with us an overview; Bechtel 2018, what’s it all about?
David: So as a private company we’re not as branded as other organizations. We’ve been private for 5 generations, 120 years. We typically do about $30 billion in revenue a year with right around 50,000 employees across the globe. So from a scale perspective it’s quite extensive; international projects, defense projects, rail projects, linear projects, brownfield, greenfield. So we specialize in the complex, major program projects, but just don’t get a lot of press like some of the other organizations. You hear more about Apple and Tesla; Bechtel is large, we’re just not out there as much because of that private complex project focus.
Russ: Okay. And the company is headquartered in California?
David: Actually we’re headquartered in Reston, Virginia. We’ve recently moved our headquarters from San Francisco. There’s still a small family office there, but now headquartered in Reston. We have business unit offices here in Houston; so our oil and gas division is here in Houston, small infrastructure footprint here as well. Infrastructure business is headquartered out of Reston as is our NS&E government work is headquartered out of Reston. And actually Infrastructure has their headquarters in London but a main office in Reston just as a qualification. And then our mining and metals is down in South America.
Russ: So your title actually caught our attention a lot, Chief Innovation Officer, I didn’t know there was one at Bechtel; tell me about that.
David: So there really wasn’t; 2 years ago there was not. It’s a new role, it’s new to the company established as a part of an effort to really drive construction productivity. If you’ve seen it or if you haven’t seen it, construction productivity has languished all of their labor productivity. I think it’s only better than the farming and hunting productivity, so if it gives you the spectrum it’s not great, right?
David: So massive problem. We don’t adopt R&D like other industries, we don’t adopt the technology, we don’t invest in R&D like others so the company said we need to do something about that. We need to go and apply some concerted effort to innovating. We have a history of innovation on project but we need to put some calories behind it. So they set up a future fund – a $60 million future fund – and the role of Chief Innovation Officer to go drive that R&D, go drive that exploration into technology to unleash it within the organization.
Russ: Are there Chief Innovation Officers in these other locations that Bechtel has or is it just here?
David: So it’s just – there’s one corporate Chief Innovation officer, myself; I report up through our Manager of Functions. The business units have Innovation Leads and Innovation Managers that we work with, so part of it is a centralized funding model but a distributed network of innovators that we’re trying to encourage. We tried not to centralize innovation to a small team but really structure it to get more participation engagement from the organization.
Russ: Tell us an innovation project that you’re working on or have worked on that you found to be most interesting.
David: I think one of the ones that I like to go back to that is – it’s really simple, obvious, but it’s a gateway to other innovation is the one that’s behind us. The data vault is a simple concept, let’s put a computer in a job box that’s close to workface so you don’t have to go back and forth from a workface where you’re working on a pipe rack back to a trailer to get your information and to have a meeting. You could have it steps away as opposed to thousands of steps away and that’s been a simple one where we just changed the model and said well why not? There’s no reason not to. Let’s go build it, let’s go prototype it, let’s go deploy it and see what happens and now we have hundreds of these across the organization. And the team that came up with the concept actually went back to it and totally cannibalized it and came up with a wholly new design that we now have across the organization as well.
Russ: Oh wow, so did that come out of here or did it come out of the field and make its way here?
David: So we’ve set up a very simple process where anybody in the organization can submit an idea and get funded to go explore if it meets really just two criteria, it’s disruptive – so new learning. Is there new learning? Does it meet more than one business need? And if it does then we’ll typically say looks promising, let’s go do a low tech, low cost prototype. If that works we’ll scale it, higher cost prototype and then deploy it in the field as a pilot. So the data vault came in as an idea from our construction unit in oil and gas, we funded it and now it’s out across the organization. My team’s objective is really to help enable the innovators across the organization to bring their ideas to life.
Russ: Speaking of your team, we took a little tour through the back here and I felt like I was in a technology beehive back there; I felt like I was in Station Houston. There’s probably not too many offices like that, or groups like that in Bechtel are there?
David: No, it’s a bit of a hot button right? I think more and more people are trying to gravitate towards a collaborative, highly adaptive environment to innovate and be creative, but they’re not a lot. We’ve got a couple of pockets that are springing up in the organization and we’re trying ot encourage more of it. The collusions of ideas and discussion are really pretty powerful and that’s where I find that space can either enable that or it can discourage that and we’ve tried to use the space to enable or encourage those collusions.
Russ: How big is your team?
David: We’ve got 10 people on my core team but that’s really to do three things; to help manage and administer idea flow in the organization, to work on a few ideas that we’re not seeing bubble up organically enough; so we’d think promising technology, not enough focus, let’s put somebody on it. And then to help liaison and connect solutions and innovations to our projects and proposal teams. That’s really my small team. But then you look at the second tier or the distributed innovators and we’ve got 600 people that are active in some capacity and we’ve got 6,000 that have participated or engaged in the process. So it really starts to grow exponentially because we’ve encouraged the participation and engagement of the organization.
Russ: The numbers you shared, 6,000 and stuff, does that mean you’re just inundated with ideas though?
David: In 2 years – we started 2 years ago – we’ve gotten 2,500 ideas in and we’ve had to figure out ways to effectively respond and participate so we’ve been using crowd-sourcing tools to do that. We’ve leveraged the Spigit platform to tap into the social dynamic of innovation. You submit an idea, I get to comment on it, get to vote on it, it kind of socially forms and then it graduates into a pilot or a prototype. And we’ve taken the 2,500 and graduate about 400 of those into pitches, much like a Shark Tank meets The Voice kind of model; a little antagonization plus a little support, so it’s kind of a mix between the two. And then we’ve graduated – from the 400 pitches we’ve graduated about 200 prototypes and about 100 pilots and now we have matured about 50 ideas that are now spread into deployment.
Russ: Wow. So there’s neat toys around here too, there’s drones back here, a lot of devices that I have no idea what they do. Do you guys sometimes just have a wild idea and start working on it without input from the field?
David: There’s a few. There’s a balance, we call them -you get the moonshots, you get the roof shots, you get what we call floor shots, which the floor shots are not the best ideas, the roof shots, skyscraper shots, moonshots – kind of look at the spectrum. One great example, and I really like this one because it came in as a submission and actually the submitter is now in entrepreneurial residence for us here – artificial cloud. One of the challenges on jobsites is you’re out in the heat, you’re out in the sun which affects productivity. It affects your ability to work but also the process productivity and so his idea was artificial cloud.
Which you say artificial cloud and that’s ridiculous, that doesn’t make any sense. But we kind of leaned into it and said let’s go figure out what you mean by artificial cloud. So we funded it and he actually built a prototype and he’s in the process of finding a project to pilot this artificial cloud on. So here’s a crazy idea, we didn’t go out into the field and say what do you think. Initially we laughed at it right, artificial cloud that’s absurd, but we bet on it and leaned into it and he’s done a lot of amazing work to develop this concept now to where we can pilot it to really see what impact it has on execution
Russ: Now do you mean like a cloud cloud? Like a cumulous or whatever they’re called?
David: So I thought initially what, are you going to see the atmosphere and it’s going to create this cloud? No, it’s really the suspension of a solution that provides shade at the ground level. So he’s looking at how do you create shade by deploying a solution that gets between the ground and the sun? And so he’s just looking at different ways to do that, he’s got a prototype and a pilot he’s working on deploying. No kind of meteorology scientific experiments.
Russ: But is it suspended on something?
David: It hovers, it hovers. We’re working through the IP aspect of this but it hovers and blocks out the sun, so we’re trying to work through that. We’re not a technology company but here’s a great idea that somebody came up with that we’re trying to explore and then figure out how do we scale it? Do we partner with a third party to go scale? Do we – to something that we get into the habit of producing or manufacturing? We still want to be a project management, construction management company, building company, construction company; we’re probably not going to be a produce artificial cloud company. So we’re working through as we innovate what do we do with some of the solutions to scale effectively?
Russ: As you know you got on our radar through Station Houston through JR Reale; he said this would be real interesting and I think he’s right. How did that happen? Do you have a relationship with them now?
David: We do and it kind of came out because one of the things when we got started is we at least knew enough to know we didn’t know enough and so we reached out to the local community here in Houston as well as at other offices and looked for environments that were really where is innovation happening? How do we plug in to the academic community and into the startup community? And one of the things in just doing some research we came cross Station Houston, came across JR, went and sat down with him and we had a fantastic 2 hour discussion out of the gate.
And ever since then the relationship has grown from a sounding board for us as we talk about our strategy, but also the exposure to different businesses, different thinkers, different startups has been phenomenal and one of the things that JR opened our eyes to is this ecosystem and just the massive amount of potential here in Houston for this ecosystem because of all the factors and recipe components that exist. I truly believe and I think JR’s kind of educated us that Houston is at a tipping point. There’s a tremendous growth opportunity here to compete with other innovation hubs, whether it’s in the Pittsburgs or the Michigans or Chattanoogas or Silicon Valleys, I think Houston has the recipe and when you start to connect Houston with Dallas and Austin Texas has got a lot of opportunity. And so that engagement with JR has educated us but also been a great personal and professional relationship to date.
Russ: Fantastic to hear. So before I let you go David I kind of get this feeling that you might like your job, is that right?
David: Easily the best job I have ever had and I will tell people that on days it’s the best and worst job I’ve ever had. You get to dabble in disrupting an organization that has a 120 year history, which is phenomenal, but you also run into the resistance to that, which can be discouraging; so just kind of balancing that hope and optimism in the future that we’re trying to drive to with the day to day challenge of changing the direction and culture of an organization. In the day you can get very frustrated but any time we step back, I step back and look at how far we’ve come it really is reassuring and inspirational. So yeah, easily the best job, some days the most frustrating but I think it’s a good thing.
Russ: Well I really appreciate you sharing the story with us, really cool.
David: Yeah, thank you; appreciate the time. Thank you.
Russ: You bet, you bet. And that wraps up my discussion with David Wilson, Chief Innovative Officer at Bechtel and this is The BusinessMakers Show.
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