“We now accept the fact that learning is a lifelong process of keeping abreast of change. And the most pressing task is to teach people how to learn.” -Peter Drucker
Innovation is a word that is bantered about unwittingly by many. From its Latin root, it generally means to renew or change. Yet, many reduce innovation to invention—as in product-specific concepts come to fruition and production. If we faithfully apply the definition, innovation may be seen to pertain to any ideas to effect positive change that go from origination to transformation to implementation to systemization within an organization.
If your organization is to remain/become competitive in the current world economy and proliferation of information sharing, it is unlikely to do so without making a commitment to continuous improvement. Again, so as to not confuse this phrase with the Deming’s work in documenting kaizen approaches to manufacturing in Japan, let’s define what is meant. We are speaking here of a core value within an organization to not accept the status quo—to not become complacent.
In a Business Week survey conducted in conjunction with the Boston Consulting Group in 2008, it was noted that total shareholder return (TSR) was greater over a three, five, and ten year period among business model innovators versus their industry peers. Notice that it was those who innovated their business model rather than those who tried to hold onto their old one who prospered! TSR was greater among global innovators than the S&P 1200, greater among U.S. innovators than the S&P 500, greater among European innovators than the S&P Euro 350, and greater among Asian innovators than the S&P Asian composite.
One of the biggest hindrances to innovation is structure. Make it a new practice to collaborate across departmental lines, across multiple layers, and among newly arrived and long-tenured alike. Seek out different viewpoints, structure teams in creative ways, and generally think, “how can I get objective, insightful input?”
Once the management team is effectively collaborating, then strategies can be put into place to move from considering the right motives to change to cultural innovation. Successful organizations deconstruct themselves in order to grow and become more responsive. At IBM, Lou Gerstner inherited a company losing almost a billion dollars per month. He realized that “culture isn’t just one aspect of the game—it is the game.”
Gerstner had heard that one of IBM’s chief rivals had made the comment that, “IBM? We don’t even think about those guys anymore. They’re not dead, but they’re irrelevant.” When he shared this comment with his senior leadership group, there was instant motivation, but the skills and creativity were six years in coming. During that time, IBM became hugely profitable, and share price increased more than tenfold. What drove the turnaround was a change in internal communications. An internal memo by Gerstner to all employees instructed everyone on the new agenda:
Do it my way
Do it the customer’s way
Manage to morale
Manage to succeed
Decisions based on anecdotes and myths
Decisions based on facts and data
Conformity (politically correct)
Diversity of ideas and opinions
Attack the people
Attack the process
Value me (the silo)
Value us (the whole)
Analysis paralysis (everything must be proven 100%+)
Make decisions & move forward with urgency (80%/20%)
“There is nothing more difficult to take in hand, more perilous to conduct, more uncertain in its success, than to take the lead in introducing a new order of things; because the innovator will have for enemies all who have done well under the old conditions and only lukewarm defenders in those who may do well under the new.”
As Machiavelli points out, leading others to a new order is tough work. Here are some management suggestions on how to make it a part of your culture:
What is the thing they like most about their position? What would they change?
Have them explain why they are on this particular career path.
What do they think about the company and its management? What do they believe should be done differently?
Ask them who have been the greatest influences in their lives/careers. Listen empathetically and ask follow-up questions.
Ask what they like to do away from work. Don’t make them uncomfortable. Make it known you are interested in getting to know them as people.
Share what values are important to you and why. Provide some stories where appropriate—people relate to stories.
Find out about their personal and career goals; share your own.
Become vulnerable. Ask what you could do better to serve them and the department/company.
Add flexibility to planning & budgeting
Design interactions across organization