Tuesday, July 11, 2006

Deep and Wide

Innovation, like other business initiatives and functions, requires support and direction from senior management. To be sustainable, any business function needs a cross-organizational process. Innovation requires both deep and wide support.

Deep support means that innovation is sponsored and organized and encouraged from the top of the organization to the lowest levels. The CEO needs to be out in front, helping people understand the direction and rationale for innovation. This does NOT mean, however, that the CEO or his or her immediate subordinates should dictate "what" the innovations should be, only that they should provide the direction and encouragement for innovation, and ensure that people are appropriately encouraged, motivated and compensated for their efforts.

Innovation, as we've seen recently, can mean changing the corporate culture, introducing more risk taking and the potential for failure. If the CEO or other senior sponsors don't get involved, then there's little chance of a sustainable innovation culture taking root. Innovation needs support from the top down, and that support needs to be deep and sustaining.

Wide support means that the organization needs to understand and implement processes and procedures across the organization to enable innovation and innovative ideas. Rather than a "skunk works" in the corner, innovation should be treated as a sustainable business process and become part of everyone's focus. There should be broad understanding and involvement in innovation and idea management across the organization.

Right now, most firms have shallow and thin innovation. Senior managers are talking about the importance of innovation, but get quickly distracted by other important aspects of the business. The people in the trenches understand that innovation is not important if the CEO cannot retain his or her focus on it for any length of time. Innovation has thin support throughout the organization in most companies. Little pockets wrestle with innovation without broad support, and there are too few consistent processes and systems to support innovation.

Yet, I am told constantly that CEOs consider organic growth important, and innovation as a key factor for organic growth. There's an inconsistency somewhere. If innovation is important, it should be treated as such, with broad mandates and strategic involvement. Occassional support and disparate attempts at innovation will definitely lead to disappointment, and in our quarter-driven business environment, will quickly lead back to cost-cutting and outsourcing.
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posted by Jeffrey Phillips at 3:01 PM

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