The cultural revolution
BY STEVE HENDERSHOT // PHOTOS BY RAFAEL DABUL
Organizations looking to be truly innovative must change their mindset from top to bottom.
The concept of innovation has near-universal appeal across the executive suite. After all, what company couldn't use a new winning product? Whose balance sheet or stock price couldn't stand to approach those of famed innovators Google, Apple or Facebook?
Two-thirds of innovation executives responding to an April study by IT consultancy Capgemini and the IESE Business School at the University of Navarra (Spain) said they have been tasked with creating a culture of innovation. In fact, 39 percent of executive recruiters responding to a July survey by ExecuNet ranked the culture or environment in which one operates as the most important factor to fostering innovation.
But there's a catch. While the concept of innovation may have universal appeal, actually fostering new ideas and turning them into real deliverables is considerably more difficult and controversial. By definition, innovation requires thinking that represents a threat to the existing order; the stronger the existing order, the harder it can be for would-be innovators to do their work.
Accordingly, successful organizations with well-defined corporate cultures can struggle mightily with the charge to innovate. The same Capgemini/IESE study found that just 42 percent of respondents have a formal innovation strategy at their organizations, and only 30 percent have an effective organizational structure for innovation.
That doesn't mean big companies can't be innovative. But in order to innovate, they must nurture the new ideas they hope to develop, and recognize and mitigate the forces within their organization that inhibit innovation. Six techniques can help any organization build a game-changing culture of innovation.
“You have to foster a culture of always challenging the status quo, of borderline rule-breaking.”
—Trevor Owens, PMP, Lean Startup Machine, New York, New York, USA
BRING TOGETHER CREATORS AND CUSTOMERS.
New ideas are born when people identify problems with existing solutions. If product engineers are buried in a basement research and development lab, they may not understand customers' needs, opportunities presented by those needs or shortcomings of current products. Asking the sales force to present client requests for new features simply doesn't get the job done.
“You have to empower your employees, and that starts with letting the product team talk to customers,” says Trevor Owens, founder of New York, New York, USA-based Lean Startup Machine, which applies innovation strategies to large corporations. His clients often battle internally over this idea, because legal and sales teams aren't thrilled with the idea of turning loose product engineers. “The hurdle is training employees how to actually listen to customers,” Mr. Owens says. “When people get out of the building for the first time, it's a huge win.”
MAKE SURE PROJECT TEAMS PURSUE THE RIGHT IDEAS.
One critical piece of fostering innovation is to get great ideas noticed and developed. However, it's a good idea to add a little direction to teams' development efforts, says Ali Forouzesh, PMP, an IT senior consultant at software developer Seasontd in Tehran, Iran. If someone creates something promising but off-point, it's far more likely to result in frustration than to benefit the organization.
“Are your ideas aligned with the organization's strategy? Do they help managers reduce their work or costs?” Mr. Forouzesh says. “The ideas must help our company and managers improve their capacity.”
He recalls a promising software project that stalled for a year because he was too focused on the nuts and bolts of implementation rather than on training key stakeholders in the software's use. Once he shifted his attention to the product's users, adoption accelerated.
MINIMIZE BUREAUCRACY AND OTHER CONSTRAINTS.
Massive multinational corporations rely on elaborate, consistent processes to function effectively; innovation by its very nature rebels against standard procedure. Unfortunately, not many organizations are effective at promoting both values at once. A mere 8 percent of European respondents to the 2012 KPMG Technology Innovation Survey released in July said their organization is good at “spotting and nurturing innovation from the bottom up.”
Success begins by allowing innovators to experiment without the burdens of conventional wisdom or standard operating procedure.
“Innovative companies, people and teams dream and better translate their ideas into actions when they're not facing many constraints,” says Alexandre Sörensen Ghisolfi, PhD, PMP, a Curitiba, Brazil-based product development manager for manufacturer Case New Holland's Latin American region. “Innovation works much better if you can create the environment that will not block people or ideas flowing around. Instead, build an environment that supports the ideas.”
This openness is particularly important for the most radical new ideas that likely conflict with an organization's current processes, he adds.
“We must desire to create this environment,” Dr. Ghisolfi says. “To do so, bureaucracy is something that we need to eliminate or avoid as much as possible.”
Encouraging outside-the-box thinking must include some sort of incentive for employees to do more than “just enough.” Deloitte's Achieving a Culture of Innovation survey, conducted with the Partnership for Public Service and published in July, found 91.5 percent of U.S. government employees look for ways to perform their jobs better. But just 59 percent are encouraged to come up with new approaches, and only 39 percent said creativity and innovation are rewarded in the workplace.
“You have to foster a culture of always challenging the status quo, of borderline rule-breaking,” Mr. Owens says. “You want your employees to take risks, and you want them to know they'll be rewarded for taking those risks. That way, if they see a problem, they will know that they have the ability to solve it, and that it's worth their time to address it.”
NASA (National Aeronautics and Space Administration), for example, honors innovative internal discoveries each year—and topped the Deloitte survey as the most innovative agency.
Openness to change must be positioned as a company-wide value, on par with the commitment to standards and consistency.
—Alexandre Sörensen Ghisolfi
TAKE INNOVATIVE THINKING ALL THE WAY TO THE TOP.
A sustainable innovative culture requires not only a steady flow of good ideas, but also an executive suite that adapts to change and implements innovations.
Openness to change must be positioned as a company-wide value, on par with the commitment to standards and consistency, Dr. Ghisolfi says. In addition, innovative ideas need strong sponsorship from upper management. Executives need to champion new ideas, and ensure relevant processes and strategies can adapt to accommodate a promising new project.
“Innovation can create a feeling that the future is not clear or secure. The existing process is the secure way,” Dr. Ghisolfi says. “Innovation can be good and very much required, but we also need to keep in mind that during the execution of the project, it is all about change management.”
GIVE YOURSELF THE FREEDOM TO FAIL.
Some wild ideas are destined for even wilder success; others are ticketed for the ash heap. Sometimes the genius of an idea is immediately apparent. Other times, it takes time and refinement before its project merits—or lack thereof—are clear.
Nurturing innovation means letting creators pursue their ideas, even if the early returns aren't promising. “We must have the chance to make mistakes,” Dr. Ghisolfi says. “Then, from the mistakes, next time we will make it happen as a success.” PM
PM NETWORK OCTOBER 2012 WWW.PMI.ORG
OCTOBER 2012 PM NETWORK