Innovation 1.0, Served Here

Riveting article on Bloomberg / Businessweek about how leaders really don’t want employees to innovate. Rather: “Businesses need most of their workers to carry out their primary duties with enthusiasm and consistency,” writes Pat Lencioni

As to how organizations should lead and execute, the article opines in two seperate areas:

“What should leaders do? Be more open to new ideas from employees? Probably not. Better yet, they should stop overhyping innovation to the masses and come to the realization that only a limited number of people in any company really needs to be innovative

As heretical as that may seem to those who want to believe that “innovation is everyone’s business,” consider that even the most innovative and creative organizations need far more people to be dutiful, enthusiastic, and consistent in their work than innovative or creative.”

If you’ve read this blog before, you’ll know that I’m all for respecting the realities of how organizations operate today and finding a more decisive and surgical approach to leveraging the benefits of open collaborative and flatter organizational structures based on performance acceleration opportunities for client organizations. So I’m not opposed to Pats overarching message that managers need to ensure focus in innovation when it comes to meeting performance goals that have been promised to shareholders.

But here’s where this thinking goes off the rails and conforms hopelessly to the status quo (or Innovation 1.0):

Innovators vs. Innovation Cultures

There’s a difference. By organizations embracing and encouraging innovation, that really doesn’t equate to every factory worker walking off the line and putting on a lab coat. That would no doubt be asinine. Building Innovation cultures come in many flavors (see this by Hutch Carpenter on the many incarnations). It really means opening up the participatory funnel on not only suggesting but more importantly, refining the good ideas and getting the kinks out. In practical terms this means getting the big brains hidden in the corners of your enterprise to contribute unique data points (validation, rebuttals, refinement, oversight) to remove risk and enrichen outcomes. Far away from the lab or mahogany row where ideas have traditionally been hatched lies two complementary flavors of talent: practical front line customer centric views (customers, support, sales, partners, marketing) as well as deep deep component level knowledge (product developers, suppliers). Both these camps bring a heavy dose of insight that can shape execution outcomes.

Balancing The bird in hand vs. Two in a Bush

Other than that visionary CEO, when’s the last time you’ve heard leaders tout their innovation wins? They generally talk about operational and revenue wins because they manage people and products (development or sales). The problem with mahogany row innovation is that those same management realities of preferred top down innovation that Pat touts, bring along another, ugly, truth. Management systems of the last 4 decades have rewarded people managers more than subject matter experts. If you manage large numbers of people you get rewarded. If you continue to remain an individual contributor that wants to contribute deep deep subject matter expertise, theses very little room for you in the leadership ranks at most organizations. The fact is that beyond long range directional moves and high level innovation requirements to get there, operational leaders often can’t sweat the details of what might be, at the cost of managing where the dollars and cents come from today. They need the best minds across the organization to come together and execute on business innovation, whilst they keep Wall Street satiated during the next earnings call.

Ideation vs. Idea Execution

Innovation cultures support execution. The germination of innovation can often be really top down directional in many cases but with the best of the best when it comes to sourcing talent across the ecosystem (customers, employees, partners and suppliers). Citing one of our own examples, were working with one of the world best known traditional software companies facing what looks like a very dark cloud computing overcast on their core bread and butter business landscape. The realization to innovate comes decisively from the top yet together were leveraging those very core assets in place today (product know how, market positioning, incumbent customer segment needs) to innovate a shift in service delivery model, market engagement and value proposition to embrace the new opportunity.

In line with what our work covers (and the byline of this blog), I was naturally drawn to this Economist book review of “The Other Side of Innovation: Solving the Execution Challenge” by Vijay Govindarajan and Chris Trimble of the Tuck School of Business at Dartmouth College. The book offers a reasonable approach to executing innovation that would in fact be embraced by many many leaders. This snippet of examples gets to the crux of the issue:

Nucor Corporation, a steelmaker, gives its workers bonuses if they can produce steel more efficiently. Deere & Company, a maker of farm machinery, has produced a detailed playbook on how to design new tractors.

These are distinct execution outcomes of an innovation culture – different from some notional wild west format. And I believe in sharp contrast to recent concentrated innovation efforts that were high profile failures. And beyond the few forward thinking organizations who can let innovation run loose but still reel in the big fish (for the record, I don’t have a problem with this and we work with partners and customers that live this management theory), the flavor of innovation sold by many theorists offer this often impractical mode of innovation design:

Many would-be innovators deal with the trade-off between efficiency and innovation by rejecting traditional management entirely. They repeat mantras about “breaking all the rules” and “asking for forgiveness rather than permission”. They set up skunk works (small, autonomous units with a remit to innovate) and mock the boring corporate types who write their pay-cheques. But again this is counter-productive. Mocking the corporate establishment only encourages it to starve you of resources.

In the Power of Pull by John Hagel III, John Seely Brown and Lang Davidson, we see definite data how our efforts to date (which includes how we have innovated to-date) is keeping us on track to approaching a big zero when it comes to return on assets. So I would suggest that we rethink unnecessarily top loading our ideation and as important, feasibility and execution. We need all big brains on deck to collaborate in more agile ways (read: wrap around new concepts more fluidly) and this book gives data on why it needs to be done ASAP. And if its decisive innovation examples you are looking for when success would have been a pipe dream without a well orchestrated concert of surgical business decisions, supplemented by a coalition of the brightest, there’s plenty in The New Polymath by Vinnie Mirchandani on both do’s and don’ts referencing the Telco, Healthcare, CleanTech and other business sectors.

In my assessment, in practical terms, many oftoday’s leaders have little choice but to encourage some degree of an innovation culture that allows them to test, validate, dispute and confirm large scale directional changes with a broader set of talent that transcends hierarchy. Customer and market expectations and the effects of globalization are more dynamic than ever these days and the ability to see the best innovation come through whilst still delivering results today will in fact require all hands on deck. So, as leaders, before you unleash the Kidons of innovation, make sure your differentiating between decisive innovation execution and wild west idea festivals. That disciplined approach to seeing ideas through will in big part dictate the odds of long term viability.

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Rick Ladd
Rick Ladd

Thanks for this, Sameer. I am amazed at how many people seem to think innovation is either only about product (not services, connections, processes, etc.) or only customer-facing. Process innovation, both internally and with respect to customer-centric activities, can provide fertile ground for greater efficiency and, even more so, effectiveness. In my opinion, innovation can spring from being "dutiful, enthusiastic, and consistent." There's no disconnect in these concepts.

Sameer
Sameer

Agree, Rick. That piece was myopic to some degree. Innovation can happen, 'in the flow' of work - something that you need to encourage from a cultural stand point. Not often that experts or the experienced that have moved off the production line can see those cost saving / efficiency opportunities. Thanks for the comment.

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  1. [...] few months ago I opined on the difference between Innovation and Innovation Cultures here, on this blog. It was a riff inspired by a post by Pat Lencioni on Bloomberg/Businessweek that [...]

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