Tuesday, July 03, 2012

Innovation is a belief system

In today's post, I decided to tackle what is, to me, perhaps the most confusing characteristic of most organizations today - the failure to believe in innovation.  Most firms believe strongly in their culture, they say they believe in their people and their abilities.  Yet the biggest gap for innovation success is in what executives believe about the organization, and what the organization believes about its executives.

Executives want innovation to happen, in order to drive new revenues or create differentiated products, but are concerned about the distraction that innovation may produce.  That distraction may lead the team to take their eyes off the ball and miss quarterly projections.  Missing quarterly projections simply isn't done, and cannot be repeated, so far too much emphasis is on the short term numbers.  While executives want the benefits of innovation, they are concerned about the risks of emphasizing innovation.  Worse, many executives don't have faith that their teams are capable of innovation.

On the other hand, far too many people in the organization look at their executives and are certain they know what will happen if they suggest an interesting or compelling new idea.  Most managers and staff are convinced that if they present a new innovation, the executive team will shoot it down, and place a black mark on the permanent record of anyone who suggested a radical new idea.  Managers and staff don't believe that their executives are open to innovative ideas, even as executives ask for innovation.

This is a belief system failure, which leads to executives  thinking that their teams or staff aren't innovative, because they never suggest interesting, valuable ideas, and the staff thinking that executives don't believe they are capable or worse, will shoot down new ideas.  While both teams recognize the need to innovate, neither has a belief system which establishes communication, trust and commitment to allow to happen what both want to happen.  This is almost a prisoner's dilemma situation, where both win only if they can keep silent.

Why does the belief system break down?  Let's examine the executives first.  Executives often don't understand how innovation works.  Many executives achieved their positions by cost cutting or by financial management, not through innovation, so for many of them innovation is an unfamiliar, uncertain activity.  They know they need it but aren't sure how it works or how their teams can be effective.  They have repeatedly asked for innovation but have seen little from their teams.  They don't recognize that innovation is more than an activity - it is a capability or system that needs resources, funding and persistence.  Their unfunded requests seem cynical in the eyes of the managers and staff, who know that compensation is tied to delivering the quarter.  Eventually executives come to believe that innovation is a dangerous, risky exercise that requires great insight and experience, which isn't present in the organization.  Executives don't believe their organizations can be innovative.

In the reverse, a lot of managers and staff have good ideas, but are afraid to present them because the executive team hasn't been very open to listening to new or different ideas in the past.  Increasingly, I am told by our clients how difficult it is to obtain a meeting with executives and how unlikely new ideas are to receive a warm reception.  In many cases the managers have built an artificial wall, and I've found that with the right presentation and packaging executives are interested, but managers and staff don't believe that their executives will be open to new ideas.

This lack of a belief system is built on four challenges or assumptions:

  1. Innovation is something that requires a significant amount of insight and skill, which doesn't exist in our company.  The insights are often there, waiting for permission to be unleashed
  2. Our needs and strategies are well communicated, so innovators will step forward.  Executives often believe that their strategic goals and the needs for innovation are obvious, but that's rarely the case.  Company strategy is poorly or inadequately communicated and often analyzed and received differently than was intended.  Combine a poorly communicated strategy with the overwhelming pressure to achieve high objectives in short time frames and you can see why most organizations revert to business as usual
  3. When managers or staff suggested ideas to executives in the past they were rejected or ignored.  In fact in most organizations this is still the case - there are few mechanisms to allow good ideas to surface at the level where they can be considered and most importantly funded.
  4. Inaction and rejection breed a culture that accepts the difficulty of innovation and the inadequacy of the staff.  A vicious cycle erupts and becomes codified - executives don't think their teams are innovative and managers and staff think their ideas will be rejected.  Neither believe that the other is open or capable of innovation.
If you want more innovation, work for better and more consistent communication of that fact.  Establish communication lines and mechanisms for anyone to present good ideas.  Carefully define the strategic goals and frame innovation activities in line with these goals.  Set aside time to listen to your team and their ideas.  Demonstrate engagement with your team, and build a belief system that demonstrates you (as an executive) believe the team can develop good ideas.  Provide sponsorship to those who seek to innovate and offer encouragement, rewards and recognition to those that do.  You'll be surprised how much innovation is possible in an organization that has a strong belief in its capability to innovate, and how little innovation is possible when no one believes that innovation is possible.
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posted by Jeffrey Phillips at 5:58 AM


Blogger Kevin C. Desouza said...

For the most part I agree. However, what I have found in most organizations is that while belief in innovation is present, it is not sufficient. What is needed is a process whereby employees can actually move their ideas from conception to commercialization. You may find my recent book of interest and I would love to hear your comments on it - http://www.amazon.com/Intrapreneurship-Managing-Organization-Rotman-UTP-Publishing/dp/1442641436/ Belief will only take you so far.

12:29 AM  

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