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15 Components of Innovation Culture

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Our insight, at The DeSai Group, from working with global customers since 1983 is that leadership readiness is the most essential factor for success. Leaders may want innovation, but it is entirely possible that the midlevel managers are not ready, meaning they have no time and no resources and lack the mind-set, motivation, and skills. It is also possible that the current organizational structures are too bureaucratic to welcome innovation thinking

Let's look at the 15 factors in the categories of Alignment, Insights and Mobilization

that control innovation readiness and improve innovation propensity at your company.  


Five alignment factors are related to a business's ability to recognize, specify, clarify and commit to the purpose of innovation and help achieve predefined business value-your target destination.  There is no need to waste time and money on innovation unless it is critically linked to the business strategy.  

Alignment is about strategically sponsoring, engaging, monitoring, and supporting all innovation activities at every level of the business structure. If alignment is properly executed and adjusted as the organization matures, the result will be a climate and culture of innovation for long-term sustainable business growth. 

Alignment Success Factors Definition
Innovation Mandate At the top, innovation is seen as critical to the future of our organization.
Leader readiness Leaders are prepared to guide the organization's innovation efforts.
Employee engagement Individuals throughout the organization are motivated to contribute to innovation.
Innovation support Organization has effective systems and processes to support innovation.
Systematic approach There is a clear framework, common language, along with a systematic and well-understood approach to innovation.

What are the signs of an aligned organization for innovation? When alignment is present, you will see focus and collaboration at the right levels for the purpose of achieving organizational and individual goals for both the business leaders and for individuals. True alignment will show up in the form of employees' desire to engage at work and be effective contributors to the organization, continually looking for new ways to support the overall vision, mission, and purpose of the organization as a whole. 

Alignment means that each business unit, department, team, and individual sees and understands its role and how it contributes to the overall innovation mandate of the organization. It gives them confidence that their work is valuable. 


Insights reflect the importance of discovering new ideas-with art and science rather than as matter of luck. It begins with the recognition that information from many sources is essential to developing unique insights that will allow your business to achieve strategic targets. 

To develop deep insights about what is possible, you must involve people from all levels of the organization, including partners, suppliers, customers, and regulators. The larger the field of information and ideas, the more dramatic, sustainable, and unique will be your pool of insights. Here we capture a collection of ideas and knowledge, connected or not to each other, for potential exploitation. 

Once captured, the ideas must be organized and easily shared with others so they can be enhanced; the result becomes your idea bank. You need a disciplined process to keep the idea bank alive or, like anything else, the ideas will quickly die due to inertia. 

Insights Success Factors Definition
Diverse perspectives We incorporate a wide range of perspectives in the idea- generation process.
External orientation We actively engage with the external environment.
Climate/Culture Our organizational climate and culture support the generation of ideas/insights.
Idea flow We have strong flow of creative ideas.

Idea selection

We select the best ideas from those that are generated on a timely basis.

How does a company develop this competency for deep insights? In most organizations, to gain insight into projects, market positioning, and corporate performance, they develop and study performance charts, two-by-two matrices, and Balanced Scorecards, respectively. Looking at data in such a way, we are able to develop certain forms of business insights. 

Similarly, innovation insight depends on finding (sometimes through visualization and highly diverse group exercises) new knowledge that leads to practical ideas for consideration. When executed well, insights enable creation of innovation platforms (a plethora of ideas to pursue a large multiyear business opportunity) and fresh ideas. This helps managers quickly make investment decisions to accelerate new and novel discoveries. 

What is required for an idea pipeline to get fatter and mightier? The most important is to establish climate of trust and openness that support the creative process. You will also need tools for individuals and teams to find incremental and breakthrough ideas.


The focus here is strictly on innovation execution. Our data show that most organizations are weakest in this area. Mobilization reflects the reality that even with strong alignment and a good flow of insights, innovation is only valuable when it is translated into results-that is, executed. The organization with the best idea is not always the winner. Rather, the organization with the ability to execute the best idea is the winner. Especially in today's competitive and fast-paced environment where maturation from unique idea to commodity is very swift, execution in the early stages of innovation is critical for success.

Mobilization Success Factors  Definition
Resources The organization allocates sufficient resources to innovation.
Governance There are effective governance structures and processes for innovation.
Portfolio Through a structured process, the company effectively manages a portfolio of innovations selected for implementation.
Change management Leaders create the adjustments required to ensure all innovations achieve full realization.
Execution The company has a clear process for successfully bringing projects through the pipeline to achieve positive results.

Mobilizing also means you must capture the maximum value of an innovation before it is duplicated, continually improving that product of service to stay ahead of the competition. Effective mobilization calls for sufficient resources; quick and effective decisions; clear thinking about the human impact of new approaches; and continuous learning about how to translate innovations into reality faster and successfully over time. 

In summary, mobilization is a set of processes, methods, tools, and structures that will allow employees and managers to operationalize ideas  for implementation and venturing in an informed way to achieve targeted business outcomes.  

Alignment + Insights + Mobilization = Success 

Alignment, insights, and mobilization are all happening at the same time. All three play critical roles in the success of innovation and therefore, the long-term sustainability of your organization. To be successful, you must manage each of them and the trade-offs between them. An idea that has great merit but would struggle to be mobilized in your organization may not be as valuable as an idea with less merit that can quickly be tested and mobilized. A fantastic idea that would be great for your consumer but does not align with your organizational purpose will struggle to receive funding and support over the long term. A great idea for the market but without strong leadership alignment will stay dormant. 

The Takeaway

As your organization builds the innovation muscle and the innovation engine continues to grow, you will need to adjust the integration points as a part of the overall business planning conversations and activities at the top. 

Your turn.  Please comment below.

  1. Do you feel that Alignment, Insights and Mobilizing should receive equal weight in the process?
  2. What have you done to commercialize your idea pipeline?
  3. Which of the 15 factors do you find most important?


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8 Environmental Factors Creating Organizational Friction

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Mechanical organizations are machinelike and effective when the environmental factors are predictable. But in today's world, it is impossible for such companies to manage the type of change occurring around them.  As an example, here are eight types of environmental factors creating friction at all levels:

1.  Technological factors. Fast new technologies causing rapid product obsolescence.

2.  Economic factors. Unpredictable prices, costs, currency rates, interest rates, taxes.

3.  Competitive factors. Aggressive, global, highly innovative, threats from niche players, competitors who are also customers and partners.

4.  Labor factors. Increased scarcity of skilled professionals, mobile workforce, increased employee benefits expenses, more reliance on contract labor.

5.  Resource factors. Scarcity, increasing specialization, unknown sources of supply, rapid obsolescence.

6.  Customer factors. More demanding, complex, market fragmentation, narrow market segments, increased acquisitions costs.

7.   Legal and regulatory factors. More aggressive, increased costs, unlimited product liability, growing compliance on free and fair trade.

8.   Global factors. Real-time communications, production, distribution, logistics, sophistication of supply chain partners, customers and competitors located anywhere in the world, outsourcing pressures, international strategic alliances.  

Mechanical Engine Versus Innovation Engine

These and many other issues are generating additional pressures for today's employees and managers in an already mechanistic and heartless environment within organizations. Due to these pressures, leaders have focused primarily on survival, with little focus on achieving sustained growth. 

Is there a way out? Yes. 

The primary way out is to evolve today's strategic operating model based on mechanistic, bureaucratic, and hierarchical practices (machinelike) toward an innovation-driven execution model. 

Machinelike companies focus on bottom-line performance as the primary measurement for most management decisions, at any cost. Focus is on the short-term. These firms are weak because they are inefficient at managing their future. 

Experience shows that the companies that build an innovation engine are more adaptable, flexible, fast, aggressive, innovative, and able to adjust to dynamic, threatening, and a complex external environment.  These firms do not take the external environment as a given.  Instead, they embrace it as a challenge and act as an agent of change, leading customers, creating new markets, and rewriting the rules of the industry they serve.  

Performance Wheel Versus Innovation Wheel

To better understand the two machines, I'd like to use the metaphor of a bicycle.  The bicycle represents an engine.  The fuel comes from a human being riding it, instead of gasoline/petrol we use in other machines. 

The athlete riding is similar to the leadership team members who models the values, beliefs, skills, and behavior of the organization. The bike frame represents the organizational form-firm strategy, structure, processes, and culture. 

The performance wheel is the back wheel, which represents practices for achieving organizational effectiveness, efficiencies, and stakeholder management and includes customers, suppliers, shareholders, and partners. This wheel is the source of power and acceleration for individuals, teams, and the organization. 

The innovation wheel, the front wheel, represents direction and clarity about the future. It is the organization's capacity for two very important competencies: corporate entrepreneuring ( intrapreneurship) and strategic renewal. The front wheel is the first to sense new opportunities to maneuver based on the eight (internal and external) environmental factors listed previously. The innovation wheel provides the first experience of the environmental factors, the road ahead, and the ability to conduct quick experiments in the turbulent race. 

Misplaced Organizational Focus

Unfortunately, today's organizations primarily focus on the back wheel to achieve bottom-line optimization, which is why it is called the performance wheel. The values of this wheel calls for power and acceleration, but if the motives of the organizational athletes (leaders at the top) are flawed, results can lead to disaster-we have seen plenty of examples. The company may move in wrong directions, lose focus on what is ahead, not make fast enough decisions to alter the path, not be sensitive to environmental conditions, and watch others pass by. 

Without the front wheel of innovation, the organization has little to no strategic lens for what is possible ahead and what directional decisions to make because the front wheel is missing or ill functioning, most teams at the top make the same decisions as their competitors. The goal of this wheel is to turn the highly mechanistic athlete into an innovative competitor who can easily gather new knowledge, experiment fast, and adapt quickly to outmaneuver other competitors in the race. 

Most organizations are pretty good at operating the back wheel; they just need to improve management practices and associated discipline. For managers, as practitioners, the back wheel is a safe zone because the artifacts used are metrics, scorecards, and quantitative analysis-hard stuff. For the front wheel, though, the primary values are qualitative, abstractions, and the intuition to make midcourse corrections. Due to emphasis on performance, managers lack experience operating the front wheel-the innovation wheel. 

The Takeaway

The best performing companies evolve from machinelike short-term focus organizations to an innovation execution long-term focus. 

It's Your Turn.  Please comment below.

1. Is your organization focused on the performance wheel or the innovation wheel?

2.  What steps has your organization taken to be more innovative and less mechanistic?

3. Which of the outlined Environmental Factors do you feel are most important?

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Recognize Intrapreneurs Before They Leave

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Govindarajan-Jatindesai Any CEO can tell you that finding ideas is not the always the problem. The real issue is selecting and spreading the best ideas, testing quickly, and executing flawlessly. An "innovation engine" is an organization's capability to think and invest in long-term opportunities along with the competence to drive continuous innovations for top-line growth each year.

To build your innovation engine, your firm must excel at operationalizing ideas from your energized people who are willing to do everything they can to fight off internal resistance without creating chaos. This is your bench of corporate innovators: your intrapreneurs.

You already have natural intrapreneurs in your company. Some you know about, but most are hiding. These individuals are not always your top talent or the obvious rebels or mavericks. But they are unique and certainly the opposite of "organization men." When you find them and support them correctly, and magic will occur.

Intrapreneurs can transform an organization more quickly and effectively than others because they are self‐motivated free thinkers, masters at navigating around bureaucratic and political inertia.

In a firm with 5,000 employees, we've found, there are at least 250 natural innovators; of these at least 25 are great intrapreneurs who can build the next business for your firm.

Read the entire article at Harvard Business Review >>>

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Moving Forward in a Changing World

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Today's modern leaders need to be prepared to guide their organization's innovation efforts. In this global economy, how to begin and how to structure are big questions. How exactly does one assess innovation readiness and what qualities, values and competencies will drive future success?

Competing on price alone in the long and even short run, is a losing strategy. Today, there are no safe-haven sectors, every industry is being re-shaped, and new competitive advantages average three months. Macro trends of globalization and automation continually shorten life span for products and services. Nimbleness is lacking, strategic and annual processes are not working, and multigenerational talent gaps are widening. (chapter 2, Assess Innovation Readiness, Innovation Engine)

Moving Forward in a Changing World

The disruptive result is the shift of power from the board room to the marketplace. Many authors and experts have pointed out this trend, yet traditional business models in the main, have not yet adjusted. Spend Shift describes a post-recession values-driven economy, concluding that consumer expectations and behaviors will drive business decisions.

John Gerzema and Michael D'Antonio's latest book, The Athena Doctrine: How Women (and the Men Who Think Like Them) Will Rule the Future, may give us some important insight into the skills, values and competencies of an ideal world leader, as identified through a two year study involving 64,000 people in 13 countries that comprise two-thirds of global GDP. It comes down it seems, to an array of desirable skills related to an emerging form of leadership arising in the business world - skills, traits, values and competencies thought of by the majority surveyed, as feminine traits.

While 81% said both masculine and feminine traits are needed to thrive in this world, the survey strongly revealed that both women and men are frustrated with the traditional masculine conduct and business structures they believe to be responsible for the financial global crisis. Globally, the feeling is one of cynicism overall, distrust particularly in financial institutions, and an overwhelming opinion (86%) that organizations have accumulated too much power.  The world is more social, global, and interdependent. While traditional practices in business, education, and government are increasingly ineffective in today's emerging global community and markets, we are seeing successful, new approaches to business as "millennials" enter the workforce with values that are challenging and changing the status quo.

In the August 7, 2013, article/video entitled Athena in Pinstripes, John Gerzema makes two glaring points:

  • There are still a very small percentage of women in the board room, yet women influence 80% of purchases
  • A public company today focuses on shareholder value. The company of tomorrow will focus on employee value and community value, recognizing who actually creates value within an organization.

As John Gerzema reminds us, Peter Drucker once said, "The Only Purpose of Business is to Have a Customer."

Getting back to assessing and planning, in Innovation Engine: Driving Execution for Breakthrough Results, Jatin Desai, in Chapter 2, "Assess Innovation Readiness," states that, "Innovation, if done right, should be an input  to strategic planning, not an outcome." Building a supportive climate and culture of innovation requires an evaluation of not only a firm's offerings, but also the intent, knowledge, quality and ethics of a company and the skill set and values of its leaders. The overall theme really needs to be one of engagement.

Innovation Engine addresses how to assess innovation readiness, the factors that must be examined, the questions that need to be answered, how to develop the competency for deep insights, the roles of external environment and internal employee engagement, and the overall alignment of success factors.

Unfortunately, "In most companies, future-related decisions are based primarily on use of historical data. Hardly anyone brings explicit data about the emerging needs of current customers or defines new opportunities for evaluation … in most cases, the process lacks the collective wisdom and knowledge of the entire organization at large. … it is assumed that the top team, albeit most distant from the front line, has the required knowledge about the ever-changing products, technologies, and issues. This is an orthodoxy that is rarely, if ever, challenged." ( Innovation Engine, Chapter 2, p. 39).

Past methods do not guarantee future success. The role of transformative leadership is crucial, as it sets the tone, dialogue and pace of an organization's strategy and execution. If dominant logic is stifling, a learning culture does not exist, or a firm's access and commitment to technologies and resources are lacking, ultimately innovation will not likely succeed. Regardless of how brilliant an idea may be, or how aggressive leadership and management, if the organization is out of step with the markets, trends, desires and values of its potential customers, there is no business.

The success of future leaders is not "men versus women" despite Athena's survey results of 66% of those agreeing the world would benefit if men thought more like women. Feminine qualities like collaboration, Intuition, patience, flexibility and loyalty were ranked high as key leadership qualities. So were masculine qualities such as decisiveness and resilience, along with neutral qualities including intelligence, candor and vision. It seems the message to CEO's from Athena and Innovation Engine is, from the beginning of the innovation process:

  1. be a better listener, be inclusive embracing diverse mindsets and points of view
  2. strive to continuously engage your customers, employees and communities

Innovation Engine puts forth a solid methodology for assessing, aligning, mobilizing and leading innovation which is comprehensive and inclusive from the start, emphasizing the importance of developing an innovation framework, organizational structure and momentum that begins, plays and continues with people, including and accommodating all stakeholders. This is the new direction of the world, and thus, everything in it.

The future is upon us. Meet it with an open mind.

" Bon chance mes amis."

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U.S. Innovation Leaders need IQ, EQ & CQ (Part Two of "Judas Goats")

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With the U.S. appearing to suck at globalization and largely indifferent but dependent on the domestic market, we need leadership willing to step up and innovate with a capital "I" if we intend to remain in the top 3. It can be done. We are still viewed as the country of freedom and ingenuity around the world, but more and more we are being viewed as resting on our past accomplishments and steering rudderless, albeit arrogantly, through cultural impacts we don't quite understand and don't appear to appreciate.

We Are All Connected - Domestically and Globally

If we figure the world will just accept us the way we are because we are America, we need to examine that attitude and quickly. How much time do you think the Chinese spend learning about America? Cultural impact in the U.S. from voting to job creation and economic recovery, affects us all within and without our borders, and domestic and international markets. We need capital "I" Leaders in the U.S. to embrace not only IQ and EQ, but also CQ (cultural quotient). Consider India; America by no means has an exclusive on innovation.

While JC Penney apparently embraced the risk side of innovation hiring Ron Johnson, at least they tried.  Demographic differences between the loyal Apple consumers vs. loyal Penney consumers relied on an Apple innovation methodology that couldn't make the leap. Yet, JC Penney may still pull a "Coke" - to - "Coca Cola Classic" and now build on the needs and desires of their demographic strengths to bring back a new and improved "classic" approach. Finding the "classic" in emerging markets as well could be a significant and even sustainable coup. But to target effectively they need to know the markets and the cultures, and be set up to strike when the timing is right.

Leaders must move faster regardless of sector. Crowd sourcing like Twitter, makes the whims of the consumer more volatile than ever before, whether it's basics of life like food, or the latest smart phone. Share one weight loss recipe featuring a specific ingredient or nutraceutical; demand changes instantly and involves multiple markets and cultures.

As a leader, if you are acting as the "judas goat" still herding your company to a rigid, specific destination bogged down in status quo, it will be as sheep to slaughter.

What factors are the most critical for emerging achievers and leaders of today when they predict a future for themselves?

"Self-awareness, high intelligence, high emotional quotient, extremely high integrity, multiple discipline knowledge, voracious appetite for new knowledge."  ~ Jatin Desai

Leaders need to loosen up and embrace the reality that "90% of what we call 'management' consists of making it difficult for people to get things done." ~ Peter Drucker 

Need help developing a clear innovation strategy, penetrating emerging markets, leadership development? Visit The DeSai Group. Follow Jatin Desai on LinkedIn and Twitter for juicy innovation ideas and tidbits.

Jatin Desai CEO, and author of Innovation Engine (May 2013 release by Wiley International), addresses C-Suite groups, delivers keynotes, leads workshops and joins with corporations and organizations to design and implement innovation programs and optimize existing programs, in the USA and internationally. Innovation Engine is now available in digital and hardcover versions at your favorite retail online or brick and mortar outlet.

  describe the image

                                 Innovation Engine

"Innovation Engine will help you build a climate and culture of innovation. A must-read for every serious executive desiring innovation as a daily habit in his or her organization and to drive innovation execution."

-Vijay Govindarajan, coauthor of the New York Times and
Wall Street Journal bestseller Reverse Innovation

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Innovation USA - Leaders or "Judas Goats?" U.S. Leadership Please Step Forward

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Innovation USA - Leaders or "Judas Goats?" U.S. Leadership Please Step Forward

Here in the USA the one question begging to be asked and answered is, "Are we simply sitting too comfortably where we are?" The up and coming countries and markets are busy manufacturing most of what we consume. While they are motivated, innovating and expanding, we are well - sitting.

Not only are many organizations still stuck in their chairs instead of examining the effectiveness and long term feasibility of status quo, but even worse, it appears that while a lot of lip service has been given to the term "innovation" action has been blatantly MIA.

Touting innovation officers, teams, strategy and even innovation "days," doesn't mean companies are actually engaging in innovation. Setting aside the publication of numerous books on innovation and the mention of the "I" word over 33,000 times in annual reports filed with the SEC, it appears likely that using the "I" word is mainly a ploy to convince investors that "change" is taking place, even though by self-admittance most executives concede their companies still haven't developed clear innovation strategies.

What does it take to initiate real change? What kind of intervention is necessary? Look at the complaining and excuses presented by US companies when challenged, such as:

  • Our business is more complicated…
  • We need less regulation…
  • That's not how we do things…
  • We can't afford to re-tool, invest in new tech…
  • Our customers are happy the way things are… 

We need to ask: "Really? No need to innovate?"

What about new markets, evolving customer needs and wants, trade deficit with China, run-away growth in world markets, stagnant growth in U.S. markets, and limited U.S. penetration of world markets? What about VISION for the future?

There is plenty of evidence portraying a very different picture and begging for leaders to step up to the task of implementing real innovation in U.S. companies, instead of just lip service.

Domestically, it's been said that while around 30% of companies think they have introduced a major innovation within the past 6-12 months, only 5% of consumers agree. Presently, for instance, the perception is Google is beating the pants off Apple with innovations and methodology - brilliant new stuff, like "Glass." Consumers want to be seen, heard, listened to, responded to and enticed with "new" - note the T-Mobile inspired discussion on contracts - finally.

While we sit in our big chairs at home focusing mainly on domestic markets in largely an unresponsive way, we are losing big in global markets. Director of Tuft University's Institute  for Business in the Global Context, Baskar Chakravorti, recently released a paper detailing statistics and an argument as to why U.S. companies lag far behind in penetrating emerging markets. 

Although American brands are ubiquitous abroad, U.S. companies actually realize only around 7% - 10% of their overall revenues from emerging markets. In 2010 those markets represented 36% of global GDP - why is U.S. share so small while our "global peer average [is] 17%" according to HSBC estimated revenues.

Perception is Everything . Real leadership is multi-faceted, and above all based on communication, concern and relationship with real people - domestically and globally, and within and without an organization.

The great "growth" chasm between West and East cannot be filled by just moving our manufacturing east, negatively impacting even more jobs in America. That only makes Americans in this already high unemployment climate, well, angry. Emerging economies are still the ever-growing elephant in the room. Could it be that many U.S. corporations don't really care about the needs of Americans as workers or consumers in spite of bail-outs?

The combination of continued job decline stateside, along with demand for low priced goods by consumers hit with shrinking wages, plus U.S. companies' addiction to cost cutting to raise the bottom line, may ultimately be our undoing. Additionally, complications like China's government control of their currency, seemingly gives the U.S. a lose/lose situation, while the 3rd largest economy in the world, China - has the largest population and largest potential market, in the world. The Chinese people won't indefinitely accept a lower standard of living. When do we get to sell to them?

What do U.S. Leaders need for success in domestic and world markets?

We are still viewed as the country of freedom and ingenuity around the world, but more and more we are being viewed as … 

See Part Two of "Judas Goats": U.S. Innovation Leaders Need IQ, EQ and CQ

Need help developing a clear innovation strategy, penetrating emerging markets, leadership development? Visit The DeSai Group. Follow Jatin Desai on LinkedIn and Twitter for juicy innovation ideas and tidbits.

Jatin Desai CEO, and author of Innovation Engine (May 2013 release by Wiley International), addresses C-Suite groups, delivers keynotes, leads workshops and joins with corporations and organizations to design and implement innovation programs and optimize existing programs, in the USA and internationally. Innovation Engine is now available in digital and hardcover versions at your favorite retail online or brick and mortar outlet.

  describe the image

                                 Innovation Engine

  "Innovation Engine will help you build a climate and culture of innovation. A must-read for every serious executive desiring innovation as a daily habit in his or her organization and to drive innovation execution."

-Vijay Govindarajan, coauthor of the New York Times and
Wall Street Journal bestseller Reverse Innovation

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