Cultivating a Risk-taking Culture: Inside Li & Fung’s Innovation Journey

Article first published as Cultivating a Risk-taking Culture: Inside Li & Fung’s Innovation Journey on

When it comes to building a more innovative culture, lots of companies wring their hands. A few actually take bold steps to make it happen.

One such organization is Hong Kong-based Li & Fung, which manages the supply chains for hundreds of retailers and brands around the world. With market changes brought on by e-commerce disrupting its business model, the company’s vision is to “create the supply chain of the future.” To deliver on the culture piece, Li & Fung formed a five-person open innovation unit under the direction of Lale Kesebi, Chief Communications Officer & Head of Strategic Engagement. The team is focused on finding new ways of working, and discovering new ways to grow revenue.

What follows is a condensed version of my conversation with Kesebi, a native of Halifax, Nova Scotia, which took place at the Ignite 2017 crowdsourcing conference in San Francisco on May 4th, 2017.

Robert Tucker: Lale, what an inspiring and detailed presentation of Li & Fung’s culture journey. Where did you start this initiative?

Lale Kesebi: Our journey started three years ago with the creation of the Strategic Engagement unit. We were interested in thinking deeply about how to get to transformation in the company through the core initiatives that were focused on the employee as an individual and as a whole person across our 22,000-person organization. We began asking “WII-FM”, what’s in it for me? We knew that every project we were going to run needed to be able to translate itself to WII-FM, and that we needed to be able to connect with colleagues in our company globally, in 40 countries. That turned out to be a pretty profound question to ask. We needed to connect with the “why” of the change we wanted to bring about, and pair that with creative storytelling to make the change real.

Robert: What was your rollout strategy?

Lale: We asked ourselves how we could role model the change to a traditional culture that was looking to bust out and create transformation in its business model. Could we identify the motivators and create the environment that would truly inspire interesting work? And could we invite others into our work from inside and outside the company so that they could not only see the difference, but feel it.

Robert: What was the journey like?

Lale: We could never have predicted where this journey would go. We experimented a ton. Some of the things we tried didn’t work out, but many of them exceeded our expectations. We built a broadly skilled creative team that was designed to be collaborative. We focused on creating sightlines from company goals to team goals to individual goals that were both professional and personal. We ran mentoring circles to get to individual performance that uplifted the entire team. We drew heavily on crowdsourcing our ideas from far-flung companies and organizations. We began giving out random Rock Star awards to people on our team for great work on a project. We collaborated across Slack and connected personally through our wellness room. We did whatever we could do to bring feeling and emotion and connection and a sense of belonging to a team of extremely high-performing individuals.

Robert: You also made physical changes to your headquarters offices. How come?

Lale: To get people’s attention, we felt we needed to move away from a traditional office structure with cubicle farms surrounded by managers’ offices on the perimeter, and towards an open structure for everybody. I know this kind of thing is typical in Silicon Valley, but not for Hong Kong. We were really trying to create a high-performance team atmosphere that was naturally collaborative, and where we could co-create together. And we asked, how do we honor people’s ability to bring their full selves to work and unleash their full potential?

Robert: How did you scale the change to all of Li & Fung’s 250 offices?

Lale: One thing we did that worked amazingly was we dispatched a three-person team from headquarters that visit our offices around the world sharing our company values. We call them the Culture Crew. These folks are amazing. They volunteered to spend the next eight months of their lives — on top of their day jobs — traveling the world, meeting people in our field offices. They ended up going around the world seven times, ate a lot of really bad airline food, and got to about 100 offices, but it was a game-changer for us. They were out there listening and figuring out the stories of our people in those markets. They would engage people, asking them what were the values of the company as far as they were concerned, and they were, as we say, spreading the love.

Robert: They did a lot of social media on these visits, right?

Lale: They sure did. It was an amazing project to chronicle their journey and see the response to their tour. The Culture Crew would travel with their GoPro cameras and shoot and edit videos, and they’d push out vlogs and blogs through our internal channels. They became rock stars inside our company. Everyone was learning from everyone else what was going on because the stream was coming through to everybody. We used WeChat a lot as a social channel. Our little group was on it daily. Whoever was in market was giving the rundown of what happened during that day and what new innovators they were meeting in market. The buzz was extraordinary.

Robert: What was the payoff?

Lale: For a shoestring budget of less than fifty thousand U.S. dollars, the Culture Crew created an impact that’s still paying dividends. We launched an experiment where we didn’t really know what the output might be. But by taking a chance on creating something original, and by getting stories out of these Culture Crew drop-ins, we were plugged in to individual innovators everywhere in the organization. And the word got around. We would have our colleagues say “you’ve got to meet so and so because he’s cracked a solution to a problem that can help the company. And by the way the he’s also a racecar driver in his free time!” We’d hear incredible stories like this of some incredible people out there who were innovating alone. So the Culture Crew was connecting innovation without that even having been the point of the original experiment.

Robert: How did you come to use crowdsourcing software to accelerate your sharing?

Lale: We had been racking our brains trying to figure out how to pull these global innovators together once the tour ended. And we were struck by the fact that maybe we could use a scalable technology around ideating. So that’s what we did. A chance encounter in Singapore with Spigit, our software provider, helped to launch our first open innovation challenge on a platform we called The Kitchen.

Tucker: What was your first challenge?

Lale: We challenged everybody everywhere with the question: what innovative product can you create to delight a customer? We held idea jams, both online and offline. We got over 600 ideas in 4 weeks. One was a simple redesign of a body brush for back cleaning. We’ve since held open idea jams around our company’s moonshot purpose of Making Life Better for a billion people in the supply chain. Another idea around that was a system for building sensors that enable emergency response after natural disasters. That idea came from our team out of Turkey. They were looking at how they might be able to find people after earthquakes, which was an issue that had impacted them. And we got so many more ideas it was incredible.

Robert: Out of all this culture-enhancing activity, a community of innovators started to emerge. Tell us about that.

Lale: We started pulling this group together because they needed to actually have a conversation with each other beyond the time limits of the challenge. This group now regularly talks to each other through Slack. They’re just basically a global community of innovative and creative people. That led us to launch something called Guerilla Sessions, where we invite speakers from anywhere in the world to our local offices to share their innovations with LF innovators. Those stories encourage a broader culture of innovation.

Robert: I must ask: did you get pushback? How did you deal with risk averse resistance to change?

Lale: Well, first of all, I’m an optimist. I’ve always believed where you find friction points, your first job is to try to eliminate them with experiments and projects and to find people who can work with you to fuel the change you’re looking to make inside an organization. If the culture itself is the sticking point, then you need to change the behaviors that are manifestations of your company’s real values. As an innovator, you know you’re innovating and making strides when you get pushback. You’re taking people into the unknown. That’s scary for humans.

Robert: So how did you do that?

Lale: By engaging in what I call artful communication. You really have to communicate with human beings, not just through emails but actually eye-to-eye standing in front of them having conversations about the change you’re trying to make. My advice is keep going where there is friction. That’s the noble work to be done. Inspire the change, and lead with empathy.

Robert: Empathy is huge in the innovation field. What role does empathy play?

Lale: Empathy takes you a long way towards understanding. If you can truly embody the principles of design thinking and lead with empathy, you will find in many cases you’re not dealing with opposition so much as with fear. It could be fear of being displaced by a change that you can’t cope with yourself. Often, you’re dealing with a tremendous amount of ego which is a very traditional leadership characteristic of ‘I already have all of the answers”. Or “I need to look like I know what I’m doing. I can’t possibly ask for help’. Put simply it all amounts to politics. If you can figure out why somebody isn’t supporting your agenda, then that’s the first step to figuring out how to convert them [to your cause]. And in some cases if they’re holding a tremendous amount of influence on your organization, you need to lean in and get that support. If they are not supportive, then you just have to realize it’s about neutralizing them.

Robert: You’re never going to bring everybody on board.

Lale: Right, but if you have a whole group of passionate people talking about the positives of your agenda or the change and you only have one person who’s not supportive, that group of people is going to be the place where you’re going to find your support. And you’re going to need to keep doing that over and over. And there will eventually be a tipping point. In the end, the obstacle person can’t possibly vocalize their opposition any more because they won’t have any political capital – everyone else will be at the party. So you’ve got to get people into your party. And you’ve got to keep them in your party!

Robert: Lale, this is great! Final question, where do you go from here?

Lale: At the end of the day our audacious goal for our open innovation group is to eventually put ourselves out of business. If we can create a real culture of innovation enabled throughout the company so that it becomes our new DNA, the air that we breathe and the way that we work all the time, our work will then be done.