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Re-thinking Innovation – 10 Golden RulesSubscribe to de-cooded
“No problem can be solved with the same kind of thinking that created it” ~ Albert Einstein
If you work in a company that is trumpeting the need for more innovation, creativity and agility, you are not alone.
For many organisations, it feels like a ‘perfect storm’. The combination of over-indebted governments in developed economies, lower growth in emerging markets, the end of the commodity super-cycle and the rapid decline in prices, as well as structural workforce reductions in established industries such as oil & gas and financial services are all putting huge strain on an organisation’s ability to function effectively and grow.
In addition, technology is rapidly changing many traditionally stable markets. Car manufacturers now see their biggest competitive threat to be Silicon Valley technology such as driverless cars and internet connectivity, and new business models such as Uber and car sharing that threaten to change the way their consumers behave and value car ownership itself.
Most companies are also feeling the pressure of a profound capability gap brought about by years of cost-cutting, re-organisations and leadership changes. For a number of years, organisations and the individuals in them are being asked to “do more with less” and this trend seems to be accelerating.
Innovate or die
Unsurprisingly, many organisations realise that, in order to remain competitive and find new sources of growth, the speed of change and innovation must increase. Various ‘Agility’, ‘Innovation’ and ‘Change Capability’ programmes have sprung up, all trying to answer the same question: “How can we be more ready to change, experiment and innovate and increase our ability to respond to external pressures and opportunities?”
In trying to answer this question, we see broadly similar responses from organisations, usually involving a combination of the following:
- Declarations from the leadership that the organisation’s future depends on changing and emulating smaller, more nimble organisations in order to be more innovative;
- Impressive launch events accompanied by flashy videos and interviews of dynamic-looking young, good-looking people saying how innovative and successful they are;
- The establishment of a ‘Centre of Excellence’ and the hiring of expensive people from more innovative industries, to ‘teach’ the organisation to be more creative;
- The creation of Committees to oversee and guide innovation. These are meant to demonstrate leadership’s support;
- A new methodology (with a catchy name) is announced and introduced as the answer to how to innovate. Following the training of large swathes of the organisation before long all presentations include some reference to this methodology, usually within the first couple of minutes. For a good example of this, see GE’s ‘FastWorks’ programme.
- At great expense, groups of senior executives are sent off on international fact-finding tours, interviewing companies and experts who are seen to innovate effectively. They return triumphant and present their findings and heavily-filtered recommendations to the Board (most of which are quietly shelved);
- In some cases, whole new business units are established to challenge the existing business model. This separation recognises the tendency of an organisation to view innovations as ‘dangerous’ and consequently killing new ideas. There are many precedents for this – one of the best examples being Eastman Kodak, which was the first to develop a digital camera in 1975, subsequently dropping the product for fear of it threatening their photographic film business (Kodak filed for bankruptcy in 2012).
As well-meaning as these initiatives are, many flounder and fall short of expectations, being noisily replaced by the next big corporate initiative a few years later. What all of these activities are missing is that innovation cannot be introduced from the outside, whilst ignoring how the organisation functions on the inside. All organisations, however large, are a complex web of information flows, processes, relationships and habits of behaviour – most of which have served the organisation, and the individuals within it, very well in the past – and these need to be shifted in order to create new ways of working.
Any successful attempt to introduce greater innovation and readiness to change must first address this habitual thinking and ways-of-working in order to avoid these ‘new ideas’ being filtered through ‘old thinking’.
A good analogy is to think about a field that must first be ploughed before a crop can be planted. In the same way an organisation’s culture must first be aligned and prepared before innovation can be introduced.
Creating New Thinking
I’ve written before about how organisations tend towards routine and how this routine can stifle fresh thinking, new perspectives and experimentation in organisations. Also, as a species with a strong drive towards collaboration and working in tribes, we have a strong tendency to conform and not question accepted norms. For an amusing example of how this plays out see this video.
New thinking is needed in order for new ideas to take root.
10 Golden Rules
Every organisation has its own dynamics and legacy culture so ‘one size does not fit all’, but organisations may find the following suggestions helpful.
- Build for the long-term. Stay away from elaborate launches and grandiose statements of vision and strategy. Be practical, involve everyone and allow an understanding of what’s involved to emerge over time, rather than trying to answer every question at the start. We have a theory that seems to hold true that an inverse relationship exists between the scale of a launch event and its long-term sustainability.
- Do rather than tell. Actions speak louder than words. Demonstrate what the change looks like with actions rather than communications, starting with the leadership. Managers can quickly distinguish whether they are listening to something that is ‘flavour of the month’ (and therefore can be safely ignored) or something that the leadership is genuinely committed to.
- Silos. Break down the silos. People easily become attached to labels and can strongly identify with their function, team, department or geographic team, hindering the sort of openness and collaboration needed for innovation to thrive. By changing the organisational design, new light can be let into the organisation with people mixing with different people in new ways.
- Routines. Go out and deliberately disrupt routines. Established routines keep established thinking in place. Not only can insight lead to change, but change often leads to insight. Leaders should deliberately alter their routines to create a familiarity with change and an openness to trying new ways of working. Culturing an environment of ‘deliberate serendipity’ will always pay dividends.
- Curiosity. Openness and Curiosity are at the heart of discovery and change and should be modelled and encouraged by all, especially leaders. A lack of openness is easy to spot in others but apparently difficult to shift in oneself as it requires a readiness to question what we think we know. Carol Dweck frames the problem well by distinguishing between a ‘Growth’ and a ‘Fixed’ Mindset. To start, leaders themselves need to be highly curious. A good way to test this is to measure the ‘Question Count’ in meetings. In our experience questions are an endangered species in many organisations where air time is occupied with people stating only what they already know.
- Focus on Values. We’ve become overly focused on achievements and qualifications and have lost of sight of the role values and character play in success. David Brooks gave an excellent TED Talkon the difference between what he calls ‘Resume’ values (qualifications, education, work achievements, etc.) and ‘Eulogy’ values (our values and what people most remember us for). Those impressed with qualifications are too ready to accept expertise unquestioningly and to avoid questioning what they themselves know; stalling exploration.
- Loosen the bricks. Organisations, processes and budgets tend to be run very tightly, especially in cost-focused organisations. This is understandable, but when leaders rush from meeting-to-meeting with little time to reflect and where managing limited budgets is a question of where to compromise, it’s easy to see why experimenting and accepting that some failures will occur is squeezed out. In order to stimulate innovation the institutional practices need to provide space and resources for it to grow. Budgets need to be set aside; space created in calendars; and productivity targets need to recognise that 100% utilisation is not conducive to creativity.
- Mistakes. “Mistakes are the portals to discovery” (James Joyce) and are too often feared by career-focused managers. We all learn far more from our mistakes than our successes and a mistake demonstrates you have taken a risk on something where you didn’t know how it would turn out. Mistakes should not be sought in their own right, rather a willingness to experiment. Experimenting is the surest way to discover new and better ways of doing things, but carries with it the risk of getting it wrong. As Thomas Watson Jnr(of IBM) said: “If you want to increase you success rate, double your failure rate”.
- Shared Accountability. Too often creativity is seen as an isolated event, focused on an individual act. However, if innovation is to be institutionalised it must involve everyone and be seen as everyone’s responsibility. Introducing easily accessible tools and processes, de-mystifying innovation, creating shared goals and celebrating collective success are all crucial tp success.
- Value ‘Striving’. One of the biggest challenges organisations face is overcoming their institutional focus on evidence, results and outcomes. When it comes to creating a capability in innovation, you never actually achieve the goal and it should be recognised that the value can be found in the striving (towards the goal).
In his book ‘Intelligence in the Flesh’ Guy Claxton, tells the story of how candidates for new roles in Google are filtered out if they claim to have a track record of success in their field and they consciously look for ‘Strivers’; people who can think from scratch and “flounder intelligently” in the face of new challenges. They have realised that it is the capacity to tolerate ambiguous situations, seek input from a wide range of sources and appreciate that making mistakes plays a central role in the process of creativity and innovation.
Many organisations don’t think this way, instead hiring on a past record of success, valuing qualifications over values, and in so doing, inadvertently hiring ‘heroes’ who reinforce existing silos and compete for individual success.
As we enter the season for leadership conferences and global launches, organisations should give careful consideration to the 10 Golden Rules, so they do not end up in another conference next January, wondering “Whatever happened to us being an agile organisation?”
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Coode Associates supports and advises companies on leadership and organisational effectiveness and alignment, identifying Purpose and Values and on culture-shaping more generally. If you’d like to speak with us, we’d love to hear from you: email@example.com.Back to Insights