Innovation in business today Part III

By Dr. Earl R. Smith II
DrSmith@Dr-Smith.com
www.Dr-Smith.com

In the prior articles in this series, I focused on the general problems and some of the specific issues which come to fore when a company sets about to develop a culture which supports and encourages innovation. In this article, I would like to focus on some of the characteristics of leadership that best support such an effort.

In the first two installments, I made it clear that a close partnership between the CEO and the Chairman of the Board is one of the best ways to develop a corporate culture that stimulates innovation. A careful mixing of the CEO’s essentially tactical focus with the Chairman’s strategic view can be the first and most important step in developing such a culture. While there are characteristics that these leaders may not share, many of the components of their leadership style are the same. I will address these differences in a subsequent article. However, for now, I would like to focus on the common leadership characteristics that I have found important.

Vision Beyond Self: There are lots of ways to describe this leadership characteristic - ‘seeing it from the other’s perspective’ - ‘walking a mile in their shoes’ - but it comes down to being able to understand, appreciate and honor where the person on the other side of the table is coming from. Good leaders have the ability to appreciate empathetically the position and condition of their subordinates. This is true whether the perspective of the leader is tactical (CEO) or strategic (Chairman).

Providing the Visions: One of the most common mistakes that leaders make is to assume that vision relates to strategic perspectives and not tactical ones. Nothing could be further from the truth. The combination of the two perspectives begins with the promulgation of clear and inspiring visions from both. One of the most common imbalances that I encounter in my work with companies trying to develop a culture of innovation is that imbalance between these visions. Most often, the strategic vision is well defined - or at least as well defined as it might be without the discipline imposed by a well-formulated tactical vision. The CEO and Chairman must both develop visions from their own perspectives and then blend them effectively.

Communicating the Visions: Innovation works - and by that I mean the process which begins with an innovative insight and progresses efficiently to the point that it is translated into revenue - when the two visions are deployed and blended appropriately within that process. At the beginning, the mix will be more towards the strategic vision. However, it is important the tactical discipline make itself felt even at the earliest stages. As the process proceeds, the balance needs to shift gradually towards the tactical. This means that the communication of the visions needs to be re-aligned as the process moves from the idea to realization. This evolution of vision-mix is one of the most difficult and subtle challenges that the CEO and Chairman face.

Facilitation Not Forcing: Vision is not innovation. The CEO and Chairman are not going to be doing the work of innovation - they are going to be facilitating it. In my experience, CEOs and Chairmen who insist on taking the lead in the process of innovation - rather than facilitating it - are either misaligned or do not understand the process. Good facilitators are seldom great innovators. People who make the mistake of assuming they are identical become intrusive and disruptive. Sustainable innovation requires effective facilitators. Innovation occurs because facilitators fill the appropriate role.

Seeing, Hearing and Sensing: The CEO and Chairman are partners in the effort to stimulate innovation and to establish a culture that supports and sustains it. Both will bring skills and sensitivities to that process. Together they must see, hear and sense the needs of the process as it evolves and work together to provide for those needs. The must be attuned to what is going on within the organization. They must also work together to sense how the organization and people working within it are responding to the efforts to stimulate innovation. Finally, they must listen to both the organization and their people. What important is the balance. If the CEO hears only what his tactical perspective leads him to hear while the Chairman does the same - hearing the strategic - then the tendency will be for the two camps to divide. If that happens effective innovation will likely not occur.

Developing the People that Make the Culture a Reality: In the beginning, the vision of a culture may be shared by only two people - the CEO and Chairman. If a sustainable culture is going to be built, the understanding of how the tactical and strategic visions combine to produce effective innovation needs to grow and be shared by large parts of the organization. The subtle part of this challenge is that the understanding is not constant throughout the organization but is a varying blend of the two components depending where in the organization a particular individual is. The CEO and Chairman must work together to influence the thinking of key players. They must actively mentor individuals so that they will understand better the overall vision of the culture and their appropriate role in it.

The Seamless Whole and the Sum of its Parts: A culture of innovation requires that the whole be greater than the sum of its parts. Supporting teamwork among people with significantly different skill-sets and visions provides a unique set of challenges. More on that in Part 4.

Innovation in business today Part II

Continued from yesterday:

By Dr. Earl R. Smith II
DrSmith@Dr-Smith.com
www.Dr-Smith.com

In the first part of this series, I outlined the importance of cultivating a culture of innovation and some of the major challenges that must be met. In this installment, I would like to focus on some of the practical issues that arise. The conflict that causes the most difficulty is between essentially two different perspectives - the ‘creative types’ and the ‘analytical types’. The effectiveness of any program designed to stimulate innovation turns on the ability of the senior management team and the board of directors to develop a culture within which these two very important perspectives can work productively together.

One of the most evident differences in these two perspectives is their attitude towards risk and uncertainty. The analytical types are generally risk-adverse and uncomfortable with high levels of uncertainty. Their inherent conservatism is an essential part of any corporate foundation. Without it, it is virtually impossible to build a large and sustainable organization. The creative types live in an environment of risk and uncertainty - in fact; they tend to thrive on it.

Teams of creative types tend to do their initial work best among peers - that is, among people who have the same relationship to risk and uncertainty. In this early stage, the analytical types just get in the way. However, at some point their efforts need the infusion of the analytical approach if for no other reason than to ‘ground’ their efforts in the reality of the company’s need to turn innovative ideas into revenue. Thus an important part of any innovative culture is the common realization that neither type has it all figured out - has all the answers. Creative types without the discipline and focus of the analytical types are merely running a ‘science project’. Analytical types without the non-linear thinking of the creative types are embarked on a journey that will end in obsolescence.

The combined skills of the senior management team and an effective chairman and board of directors is required to manage an effective mixing of what is normally oil and water. It is only under the egis of such a combination that such diverse talent can productively coexist and still feel comfortable enough to let their particular talents blossom. The strategic focus of the board and the tactical focus of the senior team meet in this partnership. The principal characteristic of this partnership - when it works well - is creative and innovative - it becomes a model for the combining of disparate perspectives in the company as a whole.

I have worked with companies to develop just such a partnership and some of my greatest successes have come from helping them get the mix just right. When the strategic vision of the board combines effectively with the tactical focus of management, great things begin to happen. The central players in this combination are the right CEO and the right Chairman. They are the ones who define the dynamics - open the possibilities. Creativity comes easier in the team environment where disparate types can operate effectively. So much more can be accomplished when persons from different disciplines and backgrounds exchange various ideas in the brainstorming process. The example that an effective partnership between management and the board provides becomes a template for the relationships between the analytical and creative types within the entire company.

A critical part of this relationship is a negotiated understanding of the process that turns innovative ideas into revenue. In the early stages, the creative types need to hold sway. Strategic thinking dominates. Management and the board need to manage the gradual transfer of this domination to the analytical types. As this happens, the composition of the team will change. The fundamental objective, after all, is to turn innovative ideas into new sources of revenues. The close working partnership between the Chairman and CEO is generally the critical factor. They are the two that must manage the process.

Cultivating innovation is not an intellectual exercise but a practical process that is based on a clear understanding of its nature. Companies that effectively and regularly innovate have mastered the challenges that come from bringing diverse talents into close proximity and facilitating their collaborative efforts in a way which takes maximum advantage of the strengths of all.