Thursday, August 26, 2010

The Innovation gap between Executives and their teams

It strikes me regularly that senior executives of many firms underestimate the insights and abilities of their companies.  I guess that many of us grow up with a backward-looking preference.  We prefer to remember how things were "when we were there" and expect those attributes and features to remain the same.  For most of us, the people we worked with and the companies we worked for are still locked in the past, unbending and unchanging.  I'm stealing a bit from Seth Godin's recent post about "senior management".  His point, and mine, aren't that senior managers are myopic or uninspired, although that's certainly possible.  It's more that they have a vision but often aren't confident that the organization can achieve the vision without painful change.  These executives remember the organization as it was, rather than as it is.

Most large organizations are built to optimize a set of predictable processes which support and maintain a given set of products or services.  Over time our management styles have migrated to the point where we've optimized these processes and the products they enable to the detriment of new thinking, new products and new services.  At least that's what the senior executives think.  What they miss is that while we've gotten really good at managing the status quo, most people aren't energized by that work, and actually have plenty of free brain cycles left to commit to interesting new work.  Most senior executives not only remember the organization as it was, but underestimate the engagement, capability and insight of the people who are in those roles now, or just don't make enough demands of those teams.  To those executives, the organization seems "brittle" - too unwilling or unable to change to meet the dynamics of the marketplace.  That's too bad, because I suspect they are wrong about their organizations.

One reason to avoid innovation is this concept of "brittleness".  A firm too enamored with its processes and products and too aligned to supporting and enabling those processes doesn't appreciate people or programs that intentionally question the status quo.  Certainly, innovation is fine if it addresses products or services that are in no way competitive or confrontational to the status quo, but not if the new product or service questions the underlying beliefs or may cannibalize the existing products or services.  This assumed "brittleness" means that many firms want to understand how to innovate new products and services that disrupt someone else, but rarely want to innovate new products and services that disrupt the internal paradigm. 

This thinking, however, assumes that most firms are very brittle - unwilling and unable to change, unwilling to accept new ideas, unable to address new opportunities or new markets.  There was another recent survey that suggested that firms that had innovation success were firms that had as little involvement from senior management as possible.  While I'm not sure that senior management involvement is a death knell for innovation, I suspect that people within organizations are much more adaptable and nimble than executives give them credit for.  Executives in most firms rarely interact with anyone more than one or two levels below them, so they don't "know" the people in the organization and their ideas.  They remember the organization as it was when they were there, and assume it's still the same, or they accept what their direct reports tell them about the organization, rather than demanding change or simply going to find out.

I wish I had a dollar for every time I've heard someone say that if "Mr. CEO" was here we'd be able to innovate, because that's what he, or she, wants.  Yes, many of them want innovation, but too many of them are afraid that the organization is simply too inflexible or too brittle to adapt to market conditions and opportunities.  Which is a shame, really, since many of the people three and four levels down from the CEO have great ideas and are willing to try to innovate, and in fact have spotted good opportunities, and are simply waiting for the executives to give them the green light - to sponsor innovation programs and activities.

The gap between the executives who want innovation but don't believe the organization is capable of doing it, and the managers who have great ideas and want to innovate but don't believe there is executive support, is probably one of the things that give innovation consultants like me gray hair.  What I fail to understand is why there are such breakdowns in communications between what executives want - regardless of whether or not they believe their teams can accomplish it, and what their teams want to do, regardless of whether or not the executives will sponsor it.  My answer is that any CEO or senior executive who wants more innovation should get out of the corner office and go meet with people three, four and five levels down from them, face to face, person to person, to see just how much capability and insight is waiting to be unleashed.  Yes, the processes and products that drive today's revenue have to be run effectively, but believe me these organizations are much more nimble, and much more adaptable, than many executives believe.  And the people in those roles have plenty of insights and ideas if we'll simply unleash them.

This gap between the wants and needs of the executive team, and the capabilities and energy of the "rank and file" means that many executives aren't doing a good job of maximizing the value of the firm.  In fact, while they've optimized the easy stuff, they've left all the really valuable stuff on the table.  This gap is one that can be quickly and easily closed.  All the executives need to see is the capability, the nimbleness and the insights that their teams have, and be willing to recognize that the organization is capable of change, and in fact is often ready to change.  Eventually the question will be more about the nimbleness of the executives, because once the innovators are freed up and sponsored, it might be difficult to get the firm to slow down.
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posted by Jeffrey Phillips at 6:00 AM

8 Comments:

Anonymous Frank Connolly said...

I agree with the sentiments here. I have recently completed a two year collection and analysis of narrative from across an entire public sector here in Australia. The focus of the survey was continuous improvement and innovation in the sector.

Two of the overwhelming messages to come out of the narrative threads were:
1) People at the Executive Officer level were just not sufficiently personally developed enough to appreciate the new thinking and methods required to cope with what is happening around them. My guess is there are many reasons for this but chief amongst them arw a) Their "busyness" they tend to be so busy they do not attend learning sessions that are routinely available to staff. b) Many have the false belief that "I got to where I am now by doing things my way, so why should I change?" and c) the sector tends to promote the square pegs and shun the round ones.

2) There is also intense frustration within the ranks beneath them because many of the middle managers have been personally developed, have continuously learned and they are unable to get approval from above to try out the new thinking and methods they have skilled themselves up in.
One can only hope that these skilled mid level managers will ultimately replace the executives in the sector now and finally get to put into practice those things they have learned on behalf of the people they're there to serve.

12:03 AM  
Anonymous R Hughes said...

Thanks--you just inspired me to submit an innovative concept to my management.

7:53 AM  
Anonymous Ayo Sanni said...

Bridging this disconnect is the the main reason why I recommend an 'open door' policy in organizations as is practiced in projectized organizations where change is instituted by projects and project management. This means that anyone has access to everyone thus increasing the speed organization's reflexes to external and internal stimuli.

Tom Peters is also a big advocate of this; getting to meet your team to get their thoughts, feedback, critique, suggestions etc. He termed it MBWA(Management By Wandering Around) and in the process of doing this, you will be bound to meet some 'renegades'. People who are secretly carrying out change within their departments/units and looking for a someone to champion them from senior management so as to make their impact permeate the organization as a whole.

2:18 AM  
Anonymous Ayo Sanni said...

Bridging this disconnect is the the main reason why I recommend an 'open door' policy in organizations as is practiced in projectized organizations where change is instituted by projects and project management. This means that anyone has access to everyone thus increasing the speed organization's reflexes to external and internal stimuli.

Tom Peters is also a big advocate of this; getting to meet your team to get their thoughts, feedback, critique, suggestions etc. He termed it MBWA(Management By Wandering Around) and in the process of doing this, you will be bound to meet some 'renegades'. People who are secretly carrying out change within their departments/units and looking for a someone to champion them from senior management so as to make their impact permeate the organization as a whole.

2:20 AM  
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