A 6 Step Blueprint for Creating a Culture of Innovation

February 6, 2013

Here is today’s Wednesday Work Wisdom

The question I get most often from my Fortune 500 clients: “How do we create a culture of innovation?”

Although there is no simple answer, here’s a blueprint I’ve found useful to get things started and build momentum.

  1. Ask employees for ideas – Most organizations start here with the corporate suggestion box.  Let’s call it idea-driven innovation.  This step is useful for getting people engaged. It also helps capture low hanging fruit and incremental innovations.  However, after a period of time, the ideas become less practical and less valuable.  The “noise” (low quality ideas) increases.  And sadly, even the good ideas often have a difficult time finding a home (sponsor, owner, funding, resources), so they wither on the vine.
  2. Ask top execs for their most pressing challenges – We now move from idea-driven innovation to a more useful approach: challenge-driven innovation.  Find the people with money, power and resources in your organization, and ask them for the  most important challenges that they need solved.  Don’t call it innovation. Think of it as problem solving. This step gets the executives engaged as they start seeing direct value.
  3. Ask employees to solve these challenges – Once you’ve identified the top executive challenges, it is now time to get the employees working on finding solutions. This is done via internal crowdsourcing. Instead of asking everyone for their  suggestions, ask them for solutions. This keeps them engaged, reduces the noise, and provides a much higher ROI.
  4. Ask employees to identify challenges - This step is designed to get everyone to realize that the mantra, “Don’t bring me problems, bring me solutions,” is wrong. Teach employees that if you bring bigger and better problems, there are many ways to find better solutions. Ask employees to submit good challenges. This steps requires proper education/guidance to avoid being inundated by poorly defined challenges.
  5. Go externally for solutions to challenges – Use alliances, outsourcing, and external crowdsourcing/open innovation as a means for discovering solutions to exceptionally pressing solutions. Or use “tech scouting” in order to find off-the-shelf solutions to meet needs of less strategic challenges. Some organizations do this earlier in the process, starting here before asking employees for solutions.
  6. Go externally for identifying challenges – Most organizations struggle to identify the right challenges. They are too close to the business and therefore have reduced peripheral vision. Therefore, it is useful to partner with trend monitoring organizations, universities, think tanks, and experts to help identify the challenges that might be in the organizational blind spot.

This process is not sequential. Some steps are done in parallel at times. And sometimes they are done in a different order.

If your objective is to accelerate the way you innovate, this model is extremely useful. You will find that less time is spent on innovation with better results.

Wednesday Work Wisdom: Your Organization is a Cult

January 30, 2013

Contrary to conventional wisdom, opposites do not attract. In fact, it has been scientifically proven that opposites repel. The reality is, like attracts like.

As a result, your organization has a bunch of people who think the same way.

People have personalities, and so do organizations. Many would call this their culture. This is an appropriate word since it is related to the word “cult.” Everyone in your organization most likely fits the mold.

There are four primary organizational personalities:

  • Analytical: Organizations that value expertise and intelligence, like pharmaceutical companies, research labs (like NASA), and many financial institutions.
  • Results-Oriented: Organizations that value the bottom line, quarterly earnings results, and stock price like large, publicly traded organizations.
  • People-Centered: Organizations that value relationships and their impact on society, like non-profits and NGOs.
  • Creative: Organizations that value imagination and ingenuity, like advertising/branding agencies and some entrepreneurial start-ups.

The key word in each description above is “value.”

The personality of your organization is not determined by the work you do, the industry you are in, or the people you hire. It is determined by what is valued.

Ask yourself which of the attributes above – analysis, results, people, or creativity – is valued the most. Don’t just look at your performance management system.

What is truly valued, when push comes to shove, by your leadership? Who really gets promoted? What always gets recognized and rewarded?

Here’s the important point…

*** Your organization’s personality will give you a hint at what is not valued. ***

This is your organization’s innovation blind spot. Non-profits are notorious for not valuing traditional business lessons. Large corporations are known for not truly appreciating creative individuals who think differently.

In order to innovate more effectively, you need to first identify your innovation blind spot – what is not valued – and make a concerted effort to encourage these people, behaviors, and activities.

Although your organization will have a single personality, you need to be adept at all four sets of innovation skills.

P.S. Personality Poker is a great tool for identifying your innovation personality and specific innovation blind spots.

How To Create a Culture of Innovation

July 6, 2009

I define innovation as an “organization’s ability to adapt and evolve repeatedly and rapidly to stay one step ahead of the competition.” A culture of innovation, when done right, gives you a competitive edge because it makes you more nimble with an increased ability to sense and respond to change.

A culture of innovation has less to do specifically with new products, new processes, or new ideas. There are of course discrete innovations such as the iPhone or a battery that is powered by viruses (MIT has developed this). These are valuable and necessary in order to create a culture of innovation.

But a culture of innovation is more than new ideas. It needs to be repeatable, predictable, and sustainable.  This only happens when you treat innovation like you treat all other capabilities in your business.  This means having, amongst other things, a defined process.

An organization’s innovation process must achieve three things.  It must:

  • focus on the “right” challenges
  • find appropriate solutions to those challenges, and
  • implement the best solutions.

These translate into three “portfolios” an organization must create:

  • A portfolio of challenges
  • A portfolio of solutions
  • A portfolio of projects

Let’s take each one at a time.

A Portfolio of Challenges

All companies have challenges. They can be technical challenges on how to create a particular chemical compound. They can be marketing challenges on how to best describe your product to increase market share. They can be HR challenges around improving employee engagement.

An organization’s ability to change (i.e., innovate) hinges on its ability to identify and solve challenges. Challenges are sometimes referred to as problems, issues, or opportunities. But at the end of the day, they are all just various forms of challenges. I will use these terms interchangeably here.

Where do you find these challenges? You can find them anywhere – from customers, employees, shareholders, consultants, vendors, competitors, and the list goes on.

Let’s face it, companies have no shortage of challenges.

And guess what, some of the most important challenges to solve are hidden due to organizational blind spots and assumption-making.

The “meta-challenge” for all organizations is to find which challenges, if solved and implemented, will create the greatest value. Given that organizations have limited resources and money, prioritization is critical.

My favorite quote (used many times in this blog) comes from Albert Einstein – “If I had an hour to save the world, I would spend 59 minutes defining the problem and one minute finding solutions.” Most companies spend 60 minutes of their time finding solutions to problems that just don’t matter.

Therefore, the first step in creating a culture of innovation is to surface, identify, and codify challenges. And then you must become masterful at valuing, prioritizing, and framing these challenges.

Think of your innovation portfolio much like you would handle a financial investment portfolio.  You want some safe bets (incremental innovation) and some riskier investments (radical innovation).  You also want a variety of innovations ranging from technical challenges to marketing challenges, and service challanges to performance improvement challenges.

Once you have the right challenges to solve, the next step is to find solutions.

A Portfolio of Solutions

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