Innovation in business today Part IV

Innovation in business today Part IV

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

In prior articles in this series, I focused on the management culture that establishes and maintains innovation. My focus was on the interaction between the tactical visions of the CEO and senior management team and the strategic visions of the Chairman of the Board and members of the Board of Directors. However, successfully managing the mixing of these ‘analytic’ and ‘creative’ types is only the first step in the process - one that enables but does not accomplish the cultivation of an innovative culture.

The core of any innovative culture is what we called the ‘beehive’ in one of my companies. This was innovation central. Its denizens were the deep thinkers who spent most of their time thinking outside - and sometimes way outside - the box. I admit that I found wandering into the beehive. I was exhilarating at times - you never knew what they were thinking about. I also realized that many of my ‘operational’ types found the experience somewhat unsettling. After one such incursion, my COO stopped by my office. “Chief, I hope the hell you know what is going on down there. I feel like I just fell down the rabbit hole.” She had it right. This was wonderland and just as dangerous.

The experience was often akin to herding cats. The management of the inclusion within the broader culture of the company presented a challenge. I divided the challenge into two distinct areas. The first was focusing on managing the beehive - or herding the cats. The second was managing the delivery of innovative thinking into the mainstream - into the parts of the corporate culture that specialized in converting ideas into revenue. In this article, I will focus on the first and return to the second in the next article.

The first hill to climb was making sure that the tendencies of the ‘creative’ types were focused in areas that were of interest to the company. The danger was that, without such guidance, the wandering tendencies within the beehive would produce ‘innovative’ ideas that were less useful to the company. We solved this problem by organizing a regular series of briefings - show and tell session - during which the senior team reviewed the ‘wins and losses’ that had resulted from recent deliveries from the beehive. A team from the operational side of the company also came with a shopping list of new ideas that they could use. This part of the meeting focused on the experiences that were coming from client interaction as well as new initiatives from our competitors. During the last part of the meetings, the beehive got to show off their ‘newest and greatest’ ideas. Some were welcomed with a hearty ‘wow’ while others received a polite yawn.

Meetings within the beehive and the senior management team followed up these sessions. Initially we scheduled these monthly, but in short order, we ended up running them twice a month. There result was an improved relevance of the production of the beehive and a more rapid translation of innovative ideas into revenue.

The second hill to climb was the efficient management of the beehive itself. Innovation and innovative cultures are much more difficult to manage than production lines or service delivery. You never know when one of the ‘creative’ types is going to get a good idea. It is also difficult to predict how long it will take to develop that good idea into something that can be transferred to the operational side of the company. However, you do need to establish a set of metrics that can be enforced. Efficiency has to have meaning inside the beehive. The key to this challenge turned out to be selecting the right person to manage the ‘creative’ types. It had to be someone who shared in the joy of discovery, had no trouble thinking outside of the box, spoke their language and both accepted the need for and had the ability to enforce performance metrics.

The third hill involved the migration of ideas from the beehive to the operational side of the company. With the beehive operating, we turned quickly to managing the evolution of ideas to the point that they could be shared with the operational side of the company. Bringing them out before they were completely formed produced less than optimal experiences and a lot of frustration. Groups of ‘advocates’ from within the beehive were tasked to develop their idea to the point that it could be described to a team or operational types who involved was a series of meeting with the operational types pushing for more refinement and additional functionality. The operational team leader and the beehive manager often had to work overtime to keep things from exploding. Frustration was a constant result. However, after a few experiences, both sides educated each other and the process came to work relatively smoothly.

One issue that constantly came up - and that I will address later on - was the question of compensation. Although the inhabitants of the beehive were more idealistic than those on the operational side, they did have a practical side - both in terms of compensation and budgeting. Solving that problem presented some interesting opportunities for experimentation.

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.