Author Archives: Diana Porumboiu

About Diana Porumboiu

Diana heads marketing at Viima, the most widely used and highest rated innovation management software in the world, and has a passion for innovation, and for genuine, valuable content that creates long-lasting impact. Her combination of creativity, strategic thinking and curiosity has helped organisations grow their online presence through strategic campaigns, community management and engaging content.

Agile Innovation Management (Part Two)

Leave a reply

How Agility Enables Innovation

Agile Innovation Management (Part Two)

GUEST POST from Diana Porumboiu

In the previous article on agile innovation we covered the main concepts around agile, business agility and its role as a driver for innovation. Now, let’s see how to actually leverage agility to innovate and how other companies have succeeded in this area.

Agility is an enabler for innovation. The pace of innovation, while not easy to achieve, has become the ultimate competitive advantage as we all need to adapt quickly to evolving environments, the digital age and increasing pressing needs.  

The reality is that agile thinking is changing the world whether we decide to adopt it or not.  

Those who succeed at this are ahead of the game. McKinsey research suggests that agility is a critical factor for organizational success. 

The Organizational Health Index (OHI) assesses various aspects of organizational health, including agility, and examines how these factors correlate with business success. An increased organizational health is linked with more resilient, adaptive, and high-performing organizations that can better navigate complexity, drive innovation, and achieve strategic goals. 

What’s more, agile organizations are best at balancing both speed and stability, and these are also the companies that rank highest in the organizational health index.  

McKinsey Stability
McKinsey Ability
Source: McKinsey&Company

The research goes even deeper and identifies a series of management practices that differentiate the most from the least agile companies.  

As you can see, there’s more to business agility than meets the eye and a few sprints just won’t cut it.  

However, if we look at the agile principles, there are several ways in which they can enable innovation:

  • They bring an empirical process control approach, which emphasizes transparency, evaluation, and adaptation.  
  • They enable experimentation and learning as teams are encouraged to test hypotheses, validate assumptions, and learn from both successes and failures. This experimental mindset is essential for innovation.
  • They are about adaptive planning processes that allow teams to adjust their priorities, strategies, and product roadmaps based on emerging opportunities and threats.
  • They emphasize customer-centricity. By focusing on delivering value to customers through continuous delivery and customer feedback loops, you make sure your innovations meet real market demands and solve genuine problems.
  • They encourage cross-functional collaboration and self-organizing teams, bringing together diverse perspectives and expertise.  

To get a better idea of how this looks in practice, we’ll take the example of ING Bank.

ING Bank

ING is a global financial institution originally from the Netherlands and a good example to illustrate how agile can be introduced organization-wide, the right way.

ING wanted to become agile for the right reasons. The shift to agility wasn’t about working faster or growing more—it was about being flexible and adaptable. Even though things were going well financially in 2015, ING noticed that customer behavior was changing due to trends in other industries, not just in banking. So, they knew they had to change too.

ING Bank embraced several key principles of agility, drawing inspiration from the practices of tech companies to align with their objectives and operations: 

  • Cross-Functional Teams: ING structured its IT and commercial departments into agile squads, mirroring the approach seen at Tesla. This integration fosters cross-functionality and collaboration, with teams physically situated together within the same premises.
Agile at ING Bank - McKinsey
source: McKinsey & Company
  • Rapid Decision-Making and Experimentation: Without bottlenecks created by middle management, ING facilitates swift decision-making and continuous experimentation. This agile approach enables the organization to constantly refine and test customer offerings without bureaucratic delays.
  • Enhanced Collaboration and Transparency: Recognizing the importance of collaboration, ING implemented structural changes to break down silos. Clear delineation of roles, responsibilities, and governance structures fosters improved cooperation across teams and departments.
  • Accelerated Delivery: Instead of their usual annual product launches, ING adopted a more agile release cycle, rolling out software updates every two weeks. This agile delivery model allows the organization to respond promptly to market demands and customer feedback, ensuring rapid innovation and adaptation.  

The first step in achieving this agile transformation was to develop a clear strategy and vision. They started small and rolled out the new structures and way of working across the entire headquarters in eight to nine months.  

Last, but not least, they invested significant energy and leadership time in fostering a culture of ownership, empowerment, and customer-centricity, which are foundational elements of an agile culture.

As Bart Schlatmann from ING points out, agility is a means to an end, not the end goal itself; it is the pathway to achieving innovation.

Drawing from these examples and research from other organizations, we can summarize the five tenets of agile organizations:

  1. Purpose-Driven Mindset: Shift from a focus on capturing value to co-creating value with stakeholders, embodying a shared vision across the organization.
  2. Empowered Network of Teams: Transition from top-down direction to self-organizing teams with clear responsibility and authority, fostering engagement, innovative thinking, and collaboration.
  3. Rapid Learning Cycles: Embrace uncertainty and continuous improvement through iterative decision-making and experimentation, prioritizing quick adaptation over rigid planning.
  4. Innovation Culture: Cultivate ownership, empowerment, and customer-centricity, enabling employees to drive organizational success.
  5. Integrated Technology Enablement: View technology as integral to unlocking value and enabling responsiveness to business and stakeholder needs, leveraging advanced tools for seamless integration and rapid innovation.

Actionable Steps to Drive Innovation through  Business Agility

We can’t wrap things up without going through some of the key steps that should not be missed in an agile transformation journey.  

Constancy of purpose  

You might have heard of Edwards Deming and even used his PDCA cycle in your continuous improvement work. He is well known for his legacy in the field of quality management, particularly for his contributions to the improvement of production processes in Japan after World War II. To some degree, his work is also seen as one of the main inspirations for the agile movement.

Among his work, we can also find the “14 Points for Management,” where Deming outlines how essential it is to have a clear and unwavering commitment to a long-term vision or mission. 

He called it constancy of purpose. You can also call it your North Star. Regardless of the words you choose, it’s important to set your goals and align all activities, processes, and resources towards achieving them. How to do this?

  • Communicate the Purpose: Regularly communicate the organization’s purpose, mission and goals as well as how agility contributes to achieving them.
  • Define Goals: Clearly define objectives and goals that align with the organization’s purpose. These goals should support the overall mission and vision.
  • Empower Teams: Trust by default and enable teams to make decisions, take ownership of their ideas and work. Provide them with the autonomy and resources they need to innovate and deliver value.
  • Measure Progress: Measure progress towards your goals, but also establish metrics that can measure your ability to be responsive. Regularly review and assess how agile practices are contributing to the overall mission.
  • Adapt and Iterate: Embrace continuous improvement processes that align with your internal structures and needs. Encourage teams to experiment, learn, and iterate on their approaches.

Agile leadership

Adopt the ABC of leadership which drives innovation and makes the shift from “vertical ideology of control” to “horizontal ideology of enablement”.

Linda Hill, renowned professor at Harvard Business School, specializing in leadership and innovation makes a great point about the roles a leader should take if they want to drive innovation and agility.  

Over time leadership evolved from a purely strategic role, to providing a vision that guides people in the same direction. More recently, research showed that a visionary leader is not enough. You need leaders that can also shape the culture and capabilities needed for people to co-create the future. This requires a different approach to leadership.

Research has identified that in order to lead an organization that innovates at scale with speed, you need leaders that fill in three different functions:  

  • the Architect – to build the culture and capabilities necessary to collaborate, experiment and work.
  • the Bridger – to create the bridge between the outside and the inside of the organization by bringing together skills and tools to innovate at speed.
  • the Catalyst – to accelerate co-creation through the entire ecosystem.  

Here is Hill’s short summary on the ABC of leadership:

Another top voice is Steve Denning who has been an advocate of agile and agile management for years. He makes some great points about the agile mindset which requires a new way of running organizations.

For an organization to be truly agile, the so called industrial-era management needs to be replaced with digital-age management which is strongly driven by an agile mindset.  

The traditional management style makes it hard for agile to work because the old command-and-control approach goes against the agile principles. The top-down approach is riddled with bureaucracy which obstructs visibility to the customer and the realities at the lower levels of the organization.  

Some of the most successful and innovative organizations, like Apple, Google, and Microsoft understood this early on and shifted their focus to delivering customer value first, one of the agile principles. This required a change in mindset but also in the corporate culture, which is no easy undertaking.

To make this transition, Denning talks about five major shifts that companies need to make:

  • From profit-focused to customer-focused goals.
  • From direct reporting to self-organizing teams where management’s role is not to check on employees, but to enable them to do their work by removing obstacles.
  • From bureaucracy, rules, and reports to work coordinated by Agile methods and customer feedback.
  • Prioritize transparency and continuous improvement over predictability.
  • Encourage horizontal communication rather than top-down directives.  

While they are straightforward and make sense for most of us, these changes are maybe the hardest to make, especially for established organizations that are not used to challenging the status quo.  

These big undertakings are what make agile possible at scale. But even if you’re not there yet, you can still apply the agile principles at a smaller scale to enable innovation.  

Minimize complexity  

Complexity is the enemy of agility. People in companies both large and small try to come up with the perfect solution, that often doesn’t exist in the first place, and only end up having solved the wrong problem.

On the other hand, if you were to simply move ahead quickly with something that creates real value and solves at least some of the problems, you’ll see which of your assumptions and concerns are real, and which aren’t. You’ll also see which problems you can work around, and which ones you simply must address directly.

This obviously eliminates a lot of uncertainty and reduces the complexity associated with solving the problem, which again helps you focus your innovation efforts on what matters – creating real value.

The bigger and more complex the problem, the more important it is to take an agile and modular approach. 

Thus, the bigger and more complex the problem, the more important it is to take this agile and modular approach that focuses on the speed of making tangible progress. 

Conclusion

As we explained in our complete guide to innovation management, there is no single perfect way of managing innovation. Different companies have different approaches for innovation management.  

However, the common thread of successful organizations are structures and processes that mitigate the somehow chaotic nature of innovation management.  

In these two articles we explored agile as a method to enable innovation and improve its management for sustained success. We don’t believe in quick fixes or miracle solutions. That’s why we made the case of agile as a mindset that should permeate every aspect of the organization.

Article originally published in full format on viima.com/blog

Image credit: Unsplash, McKinsey

Subscribe to Human-Centered Change & Innovation WeeklySign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Agile Innovation Management

2 Replies

Agile Beyond Software Development

Agile Innovation Management

GUEST POST from Diana Porumboiu

Research reveals that 90% of executives recognize the critical importance of agility for their company’s future success, with 96% emphasizing the need to increase agility in the future. What’s more, agile companies grow revenue 37% faster and generate 30% higher profits than their non-agile counterparts.  

Incumbents are shaken by the highly dynamic environment they operate in, and they are too slow to respond to disruptive changes. 52% of companies in the Fortune 500 have either gone bankrupt, were acquired, or ceased to exist.

An AEIU survey, 27% of respondents cited their organization’s lack of agility as a competitive disadvantage in anticipating marketplace shifts. Unfortunately, it’s not enough to be better and stronger, you also need to be faster to swiftly adapt to the market race.

Based on our experience in working with top innovators, and on market insights and trends, we can see that the future of innovation management is agile. What does this mean, and how does it concern you, the ambitious innovator?

The following two articles dedicated to agile innovation aim to answer these big questions and act as a guide to agile innovation management. Let’s start by framing the major concepts and explain the thinking behind them and later continue with practical and actionable tips.

Let’s start by untangling the intricate connection between business agility and innovation management by shedding some light on all these terms: innovation, innovation management, agile and business agility. 

Innovation is a highly debated topic. You might be sick of hearing this buzzword everywhere, but whether you choose to use it or not, the concept behind it is here to stay.

The short definition of innovation comes from the Merriam-Webster dictionary: innovation is “the introduction of something new.”  

This is an oversimplification, so we have to take it one step further to explain the nuances.  

Innovation is not just about generating and implementing new ideas. While these ideas can refer to products, services or processes, adding innovation to the mix means that you bring about positive change and create value.

Through innovation you should identify new opportunities that can be transformed into tangible outcomes that address unmet needs, solve problems, or improve existing conditions. 

To achieve these results, you need to manage a series of activities that are involved in the process of introducing those new ideas. These activities can range from ideation, development prioritization, evaluation, to implementation and launching of new products or introducing new processes. This is what we call “innovation management”.   

The challenge is not only in managing all these activities to pursue innovation, but also in doing it fast.  

Here, we refer to the pace of innovation, which plays a crucial role in sustained business growth.

In a nutshell, the pace of innovation is the speed at which an organization can improve their existing products and services and their ability to develop them while capturing the needs of the constantly evolving markets. 

Your rate of improvement (so the pace of innovation), has compounding, exponential returns and thus gives a clear competitive advantage.  

Why are we talking about the pace of innovation? Because it goes hand in hand with the agile mindset, which in the past decade has developed into the more holistic approach, business agility.  

A short introduction to “agile”

Agile as a business concept emerged in 2001 with the “Agile Manifesto”.  

At its core, agile refers to a set of twelve principles and four values intended for teams that work on software development. It started as a manifesto, but the brains behind it never imagined that their vision on how to better develop software would play such a pivotal role in management at an organizational level. 

This is, in a nutshell, the 2001 version of agile:

  • The four values of the Agile Manifesto. The idea is that what is on the left should be valued more than what is on the right.  
  1. Individuals and interactions over processes and tools
  2. Working software over comprehensive documentation
  3. Customer collaboration over contract negotiation
  4. Responding to change over following a plan 
  • The twelve principles behind the Agile Manifest that the signatories followed.

Today, “agile” left the dark chambers of software development to capture the attention of leaders across many industries.  

These days there are countless frameworks and practices that ride the agile wave, but to be truly agile it’s more important to understand the thinking behind the agile concept, before deciding what methodologies are fit for purpose.

Agile 2.0

Agile 2.0 is the next iteration which comes from different authors who want “agile to pivot”. Given today’s use of agile and how it has been growing outside of its initial purpose, the initiative is understandable and laudable.   

Agile 2.0 is more anchored in today’s digital world and puts greater emphasis on some areas that were missing or misunderstood in the first version.

It’s also more balanced and encourages a more holistic approach. For example, even though the first manifesto does not incite chaos by making the case of self-organizing teams, it fails to address the importance of leadership, which agile 2.0 wants to rectify. To get a better understanding of agile 2.0, you can read the principles on the dedicated page.  

To summarize, “the agile way” refers to the ability to respond to change, adapt, build things in smaller cycles, get feedback, and unveil new opportunities. 

Why Business Agility is More Relevant than Isolated Agile Practices 

Agility promotes flexibility, collaboration and continuous improvement. It’s about adapting and responding quickly to changes. This is why it also helps increase the pace of innovation. Of course, easier said than done.

We have seen in the past twenty years how agile has outgrown its software development box. The problem is that most organizations that want to be agile are trying to fit a square peg in a round hole. This leads to frustrations especially on the receiving end, when employees are forced into these “agile ways” even though leadership did not set the stage for agile in the first place.

Instead of fixating on agile methods, the focus should be on how to scale the approach at a higher level through business, organizational and enterprise agility. They might seem one and the same thing, but there are nuances that differentiate the three.   

While business agility focuses on operational responsiveness, organizational agility emphasizes cultural and structural adaptability, and enterprise agility encompasses a broader perspective, incorporating external relationships and ecosystem dynamics in addition to internal capabilities.  

In all three scenarios, achieving an extensive agile transformation is a highly complex journey and requires a top-down approach. However, it doesn’t mean that agility can’t also be achieved bottom-up, outside the IT department. In our work with customers, we see many innovation champions who put the wheels in motion through their determination and commitment to embrace agility.  

Even though the agile concept is used as a badge of honor by many organizations, it’s still highly misunderstood.  

That’s why it’s also important to understand not just what agile is, but also what is not.  

What is NOT Agile  

Scaling agile thinking organisation-wide it’s very difficult and hard to achieve. One reason is the lack of direction. Leaders and managers rush into methodologies and frameworks that sound good because others seem to be successful in implementing those. But more often than not, they forget to ask themselves why they want to be agile in the first place. Is it for the right reasons? Is there a good understanding of agile before bringing on board an agile coach?

Using Kanban, organizing Sprints, and hiring Scrum Masters will not automatically make you more agile. It’s important to understand agile holistically and put it into context before getting to the actual tactics and tools.

Start by asking yourself, what do you want to achieve, and what problems you want to solve with agile?

If your goal is to increase efficiency, deliver more or faster, increase productivity, or quality, there are plenty of other methods that can help you achieve this. Agile can contribute to these, but it’s not a prerequisite.  

Agility is primarily about adaptability and changing conditions. So, the main reason for considering the agile approach should be market responsiveness: your organization’s ability to adapt rapidly to changes that are happening in the market. 

Without clearly understanding the above, it’s easy to see how, for many organizations, agile became synonymous with processes like scrum.

Just to give a bit of context, Scrum is the most popular method (even though it precedes the Agile manifesto) used now by agile practitioners. It’s an iterative framework that brings small teams together to find adaptive solutions for complex problems.  

source: unsplash.com

A scrum process is built around product innovation and works best when there is a lot of uncertainty, and you don’t know which way your product should go.

In Scrum, work is organized into short iterations called sprints, usually lasting 2-4 weeks, during which a cross-functional team works to complete a set of tasks or goals. Sprints have been adopted by other departments too, not just those working on product development.  

But whether these can be successfully implemented outside of software development and scaled to other departments, is still a matter of debate. We’ll explore the reasons behind this in the next section where we dissect the challenges and pitfalls of agile.    

Bottom line, scrum is most suited for exploration and validation of assumptions. Scrum is not about speed, efficiency, and predictability. If you’re in a highly exploratory environment Scrum is a valuable practice.

Then there are those teams that proclaim their agility through Kanban. We explained the tool in greater detail here, where we show how it’s used to improve flow efficiency and optimize operations.

While it can be a highly valuable tool within the agile transformation, Kanban on its own is not enough to increase agility.  

So, while these are very popular agile practices, useful in their own right, they don’t have the power of embedding agility at the core of the business.

What does this all have to do with innovation management and how can you actually drive agility to innovate?  Something to explore in the next article.

Article originally published on viima.com/blog

Image credit: Unsplash.com, viima.com

Subscribe to Human-Centered Change & Innovation WeeklySign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Innovation Management ISO 56000 Series Explained

Leave a reply

Innovation Management ISO 56000 Series Explained

GUEST POST from Diana Porumboiu

Are you one of the 84% of leaders who prioritizes innovation, yet you find your organization’s performance lacking in this area? It’s a familiar conundrum: How do we consistently create lasting impact, generate value, and achieve successful innovation?

The quest for an innovation recipe has been gaining momentum, but is it truly possible to standardize innovation?

The innovation standards that ISO (International Organization for Standardization) started to introduce in 2019 are promising just that.

Are the new ISO standards for innovation truly valuable? And if so, does it make sense to adopt them in the future? These questions don’t have easy answers, so in this article, we’ll delve into the ISO 56000 suite of innovation standards to uncover the good, the bad, and the ugly.

What exactly is the ISO standard for innovation? Who is it designed for? Should your organization consider adhering to these standards? We’ll weigh the pros and cons and provide insights into what it means in practice to be ISO 56000 compliant and whether they have the potential to transform the way you approach innovation.

The paradox of standardizing innovation

When we talk about innovation and standards, we should first clarify a few concepts.

  • What is innovation?
  • Why should you manage innovation?
  • What is a standard in the context of innovation?

First, if you wish to transform the way you innovate, it is crucial to establish a shared understanding of what innovation means for you.

In its simplest form, the Merriam-Webster dictionary defines innovation as the introduction of something new. However, there are many types of innovation and therefore, ways of innovating. That’s why it’s important to define it within the context of your organization, your goals, and strategy.

Also, note that innovation is not just an ingredient you add to the mix and hope for a better result than before. It has to be placed at the core of the organization. That’s where innovation management comes into play.

Innovation has to be placed at the core of the organization.

Innovation management is the process through which you get to create and introduce that “something new”. This process can look different from one organization to another, which makes it more challenging to see it in perspective.

We usually structure the core aspects of innovation management into capabilities, structure, culture, and strategy. However, the International Standards for Innovation expand them further into eight principles.

eight principles of innovation management

We previously explored each of these topics in detail on our blog, as they all contribute to successful innovation. But maybe the most important one, which should be your North Star, is the creation of value. Unless you add value, you are simply creating innovation theater.  

Unfortunately, this is very common in organizations attempting to innovate through sporadic activities. But innovation is a complex, dynamic process that evolves over time.

At the same time, it’s understandable why the skepticism around the standards for innovation. Just as innovation is not easy, neither is adhering to a set of standards that will help you succeed at it.

Obviously, standards come with both downsides and benefits, but as pointed out in the ISO documentation, these innovation management principles are “an open set to be integrated and adapted within the organization”.

Naturally, now you might question how standardization is possible if innovation and its management are so complex and can vary so greatly across organizations and industries.

The problem is that traditionally, innovation has been seen as a creative and sometimes chaotic process that may or may not result in something new that adds value.

However, if we take a closer look at some of the most innovative companies, we see that it’s not about randomly generating wild ideas and hoping for the best.

The myth of the crazy innovator has been popularized by the media that portrays innovators as superheroes. This stereotypical view on innovation fed the belief that innovation and standardization are two opposing forces. Innovation comes from pure chaos, and standards fight it with order. In fact, creativity and standardization can be complementary. You need both for successful corporate management.

Creativity and standardization can be complementary. You need both for successful corporate management.

For example, even though Apple marketed itself as a group of rebels revolutionizing the computer, Steve Jobs actually instilled a disciplined culture where people had to adhere to his methods. In a way, he had his own set of standards for what an innovative product meant.

Similarly, Toyota, renowned for its enduring success, has developed its own system called “The Toyota Way”. Through this system, they have embraced continuous improvement as an approach to innovation, refining it into a set of principles that have become synonymous with their brand.

If it wasn’t for Toyota’s systematic approach to innovation, and Jobs’ eccentricity who insisted on doing things a certain way, today we might have had two very different companies.

Even though their way is by no means a “recipe” that can be replicated by others, we can see how having a framework sets the tone for how an organization is innovating on the long term.

Efforts have been ongoing to develop a comprehensive framework that can be universally adopted by organizations of all sizes and industries. The International Organization for Standardization (ISO) has taken a significant step in this direction with the introduction of the ISO 56000 suite of innovation standards.

Let’s next take a closer look at these standards to see if they have any practical benefits.

ISO 56000 Suite for Innovation

In essence, standards are meant to be a reference point for organizations, industries, and individuals. They are used to establish best practices, promote efficiency, enhance safety, and facilitate communication and cooperation. Even though they could seem just rigid rules, standards are simply ways of working and they are not meant to hinder creativity.

Where did the ISO standards for innovation come from? The International Organization for Standardization (ISO) is developing and promoting international standards that facilitate consistency, interoperability, and quality across various industries and sectors.

The ISO 56000 series of standards for innovation is a rather new initiative where experts from 50 countries came together in an effort to establish a common understanding of innovation and support organizations across all industries to improve their ability to survive and thrive in this uncertain world.

Also, note that some standards from the eight-part series are still under development (as per July 2023), so we will get back and update this article when necessary. If you consider complying with these standards, the ISO website is the official source to get them in full.

However, the standards we believe to be the most relevant in helping you succeed have already been published:

  • ISO 56000 Innovation Management – Fundamentals and vocabulary
  • ISO 56002 Innovation management – Innovation management system
  • ISO 56003 Tools and Methods for innovation partnership.

For a better understanding of the use and purpose of the ISO standards, let’s focus on the ISO 56000 Fundamentals and vocabulary, and the ISO 56002 for Innovation management system.

ISO 56000 Innovation management — Fundamentals and vocabulary:

  • Provides vocabulary, fundamental concepts, and principles of innovation management and its systematic implementation.
  • Applicable to various organizations, including those implementing an innovation management system, seeking to improve their innovation capabilities, or aiming for effective communication and common understanding in innovation management.
  • Suitable also for providers of training in, assessment of, or consultancy for, innovation management and innovation management systems.
  • It can be applied by all types of organizations, regardless of the sector, size, or maturity level. It’s useful for different types of innovations (product, services, processes, etc), and approaches (internal, open, design-driven, etc.)

ISO 56002 Innovation management system

  • Provides guidance for establishing, implementing, maintaining, and improving an innovation management system in established organizations.
  • Applicable to organizations seeking sustained success in managing innovation activities, interested parties assessing innovation capabilities, and policymakers supporting innovation and competitiveness.
  • Provides generic guidance applicable to all types of organizations, innovations, and approaches, with a focus on established organizations.
  • This standard goes beyond the foundational principles and offers more practical guidance on how to structure, implement, and continuously improve innovation processes. It emphasizes the importance of leadership, communication, and organizational culture in fostering innovation.
  • However, it does not prescribe specific activities, requirements, tools, or methods for innovation but offers general-level guidance.

How does this translate into innovation practices? Well, let’s take a step back and look at how most organizations approach innovation.

Traditionally, many organizations innovate by focusing primarily on episodic events that are centered around ideas. These could be hackathons, suggestion boxes, idea challenges, brainstorming sessions, or similar events. Something could come out of these sporadic activities, but mostly they turn out to be wasted efforts and resources.

Truth be told, ideas are not worth much. The execution is more important. The issue with the old, funnel approach, which is mostly about collecting numerous ideas, filtering, evaluating, and selecting a few for implementation, is that it can overlook the essence of innovation and focus on the wrong things.

Innovation at the corporate level is not, or should not be, just about creating something new for the sake of novelty. That is an invention and not all inventions are innovations. Instead, innovation should create value and align with the overall business strategy and goals.

All in all, the traditional funnel works fine at the ideation level, but is not an all-encompassing system to repeatedly innovate at an organizational level.

ISO 56002 brings together all the elements that can enable value creation through innovation. The innovation management system, which is at the core of the ISO 56002 is made of different interrelated elements that make up the framework on which an organization can develop and deploy innovation capabilities, evaluate performance, and achieve the intended goals.  

Source: ISO 56002 Innovation Management System: https://www.iso.org/obp/ui/en/#iso:std:iso:56002:ed-1:v1:en

As shown in this graphic, the innovation management system can be very complex, especially for larger, more established organizations.

The good news is that you don’t have to adopt all the elements at once. You can gradually integrate them to create a system that works for your organization and its specific context. As their guideline indicates, it all starts with committing and promoting the capabilities required to create such a system.

If you’ve read our articles before, you probably noticed that we talked extensively about continuous improvement, as well as the tools and processes that drive sustained innovation. So, it’s no surprise that the ISO 56002 also integrates the PDCA (Plan – Do – Check – Act) cycle, which enables continuous improvement of the innovation practices.

This model also ties together the business strategy with the innovation strategy. It gives insights into the intent and where the innovation activities should be directed.

So, instead of collecting ideas for projects that may not add anything valuable to the bottom line, you should generate ideas based on opportunities.  

In broad terms, this is how standardization can enable innovation. It’s not about a “to do” list, but about the bigger picture. The ISO 56000 suite highlights the need for an end-to-end approach to innovation, where barriers are removed, and creativity can flourish. It enables the conditions for innovation to thrive.

It’s great to see there is this attempt to establish a foundation for managing innovation as a process, through a holistic approach. Even so, there are still shortcomings that sceptics of the ISO standards are right to be concerned about. Let’s see what those are. 

The Pros and Cons of ISO Standards for Innovation

What should you know before deciding to make the leap, and what are the downsides of adhering to ISO standards for innovation? Also, what are the benefits, and is it worth investing the effort, time, energy, and resources? Let’s see.

The downsides of ISO standards for innovation 

  • Limited scope

Innovation is multifaceted and complex and the road to success looks very different for each organization. The size, industry, and specific goals of each organization mean that the processes required to innovate can also look very different. Adopting a set of standards with such a broad scope can be very challenging for organizations.

ISO 56000 lays the ground to define fundamental concepts and vocabulary, ISO 56002 provides guidance for establishing and implementing an innovation management system and ISO 56003 focuses on specific types of innovation. Even though they attempt to provide guidance in different scenarios, they still cannot fully address every organization’s unique needs.

That’s why you need committed, knowledgeable leaders who can show the way and understand how to adapt the system to the specifics of their organization.

  • Not a playbook for success

It should be clarified that even if you adhere to these standards and you put in all the work, the ISO standards are not a playbook for success.  

The impact of implementing these standards can vary from one organization to another depending on the industry, maturity of the innovation practices, size, culture, and so on. 

So, it’s important to set the expectations right and to take them for what they are. These standards can help you move ahead, but they won’t provide the recipe for disruptive or radical innovations, which can truly set you apart. 

  • Rigidity and too much focus on compliance

A lack of flexibility is on the top of leaders’ minds when they think of standards. Employees also fear that being compliant with specific standards will take away from the flexibility and freedom to think creatively or try unconventional approaches.

Source: Unsplash.com

But having constraints is not all bad. In fact, constraints can foster creativity. Having constraints can help you understand the problem better, it can force you to be creative and think outside the box, and can ultimately turn into a source of competitive advantage.

  • Costs and resources

The process of implementing ISO innovation standards can be time-consuming, complex, and costly. It requires allocating resources for conducting assessments, audits, and certifications, which can be a burden for smaller organizations with limited budgets. Other costs may include purchasing the standards, training employees on their implementation, and conducting internal assessments to ensure compliance.

What’s more, adhering to new standards involves a significant commitment of time and effort. Developing new processes, aligning existing practices with the standards, and undergoing audits or assessments demand substantial dedication. This can strain resources and may divert attention from other critical business activities.

  • Workforce resistance

Embracing ISO standards often require organizational change, which can encounter resistance from employees and management. Change management efforts are essential to successfully integrate the standards, but they can add complexity and take time to fully adopt the new practices.

Leadership commitment is essential and their approach to enforcing change can make or break the initiative. If the standards will be imposed rules, they can become a cause of friction between leaders and employees.

Despite these downsides, it’s important to recognize that investment in ISO standards can bring substantial benefits. What kind of benefits?

Benefits of Adopting ISO Standards for Innovation

  • Enhanced Innovation Management Practices

With the ISO standards you get the guidance and framework to develop more efficient and structured innovation management processes.

With such a complex endeavor it’s so easy to get lost in the details and forget the big picture. The ISO 56002 standards provide the guidelines on how to ideate, evaluate, and implement innovative ideas, leading to better utilization of resources and increased innovation success rates.

  • Improved Governance and Organizational Structure

Without structures in place there is no common understanding of how the organization understands innovation. There are inconsistent practices, fragmented activities that lead to no results, and no clear direction or alignment with the overall strategy.

The ISO standards are like a map, showing the team the best route to take and ensuring everyone is on the same page.

Armed with these guidelines, organizations establish a smoother and more organized innovation process. Everyone knows their roles and responsibilities, communication flows better, and collaboration becomes easier. It’s like having a well-oiled machine, where everyone knows what to do and how they fit into the bigger picture.

The ISO standards also emphasize the importance of leadership and accountability. Leaders take charge and guide the innovation process, while everyone is responsible for their part in making innovation successful. For innovation to succeed, you need a strong captain steering the ship and a crew that works together.  

  • Increased Competitiveness and Growth

Armed with these standards, you can identify new opportunities, develop innovative products or services, and gain a competitive advantage.

Standards act as a roadmap, guiding you towards effective strategies and practices that fuel the competitive edge. As we saw in the overall structure of the ISO 56002, it promotes a culture of continuous improvement and learning within organizations. This encourages the exploration of new ideas, the identification of areas for growth, and the development of innovative solutions. It enables organizations to stay agile, responsive, and innovative in a rapidly evolving business landscape.

  • Better Ability to Manage Risk

The concept of risk is too often seen as purely a negative issue that one should look to minimize by diversifying the innovation portfolio. Instead, you should look at risk through a broader lens, especially when it comes to innovation.

The concept of risk is too often seen as purely a negative issue that one should look to minimize by diversifying the innovation portfolio. Instead, you should look at risk through a broader lens, especially when it comes to innovation.

Risk is the potential of something either gaining or losing value, which means that it simply represents the uncertainty related to that something. Since working on innovation involves a lot of uncertainty, you should look at risk as more than just something to minimize. Of course, the acceptable level of risk depends on ambition, capabilities, and the types of innovations pursued.

Since working on innovation involves a lot of uncertainty, you should look at risk as more than just something to minimize.

For example, startups, particularly early-stage ones, are often more willing to take significant risks by dedicating all their resources to a single ambitious project with a high likelihood of failure but the potential for substantial rewards.

Therefore, even in the context of standards, flexibility and adaptability are crucial. You have to establish unified or separate structures for innovation activities with different leadership styles, competencies, and cultures.

Implementing an innovation management system challenges the status quo, enabling effective management of uncertainties and risks.

  • Ability to Forge Meaningful and Valuable Partnerships

ISO standards help organizations forge meaningful and valuable partnerships by providing a common framework and shared language for collaboration.

The ISO 56003 can help you decide whether you should enter an innovation partnership, identify, evaluate, and select partners and assess the alignment and perceptions of value and challenges of the partnership.

Even more, through ISO standards organizations can also demonstrate their commitment to best practices and a high level of quality in their operations. This can attract potential partners who value reliability and trustworthiness. When partners see that an organization follows recognized standards, it gives them confidence that they can work together effectively and achieve mutually beneficial outcomes.

When organizations follow these standards, they can collaborate more efficiently and make better decisions together. This fosters trust and strengthens the partnership, leading to more successful projects and innovations.

  • Effective Intellectual Property Management

IP management is like a safety net for new ideas and inventions. It protects them from being copied or used by others without permission. When innovators get patents, trademarks, copyrights, or keep their secrets, it gives them legal rights over their creations. This protection encourages them to invest in more research and come up with even better things.

If you are concerned about IP management, the ISO 56005 was developed as a guidance and framework to address the management of intellectual property rights.

Clear guidelines for IP management can help you protect and capitalize on your innovations. The ISO 56005 explains the steps to carry out an IP order and create an IP strategy that aligns with your business goals.

Overall, the adoption of innovation standards paves the way for continuous improvement, growth, and impactful collaborations in today’s dynamic and rapidly evolving business landscape. But ultimately, the decision to invest in the ISO standards for innovation depends on your objectives, resources, and long-term commitment to continuous improvement.

What Next?

Now that you know what’s the deal with these ISO standards for innovation, what should you do next?

  • Assess Readiness: Begin by evaluating your organization’s readiness for implementing standards for innovation. It’s important to understand why transformation is necessary. Assess factors such as your maturity as an organization, your current innovation practices, resources, and commitment to driving innovation improvements.
  • Familiarize Yourself with the ISO Standards: Take the time to understand the ISO standards relevant to innovation, such as ISO 56000 and its related standards. Familiarize yourself with the content as much as possible to understand where to start.

    Note that you don’t have to get on board with all standards. If you are new to innovation work, you might want to start with the ISO 56000 to establish the concepts of innovation in relation to your organization. From there you will get more familiar with the topic and start to understand the basics.
  • Define Objectives and Benefits: If you already know you want to adopt ISO standards, make sure you have defined the objectives you aim to achieve. Consider the potential benefits for your organization, such as improved innovation management practices, enhanced competitiveness, and better risk management.
  • Gain Leadership Commitment: Having that clear understanding of what you want to achieve through the standards will also help secure leadership commitment, which is vital for the successful adoption of ISO standards. Engage top management, to gain their support and endorsement of the initiative.
  • Make a Plan: Next, develop a detailed plan for implementing ISO standards for innovation. The plan should outline the steps, timelines, responsibilities, and resources required for successful implementation.
  • Engage Stakeholders: Involve all relevant stakeholders in the process. Seek input from employees, teams, and departments that will be impacted by the adoption of ISO standards to ensure their buy-in and cooperation. Offer training and awareness programs to employees to ensure they understand the importance and benefits of adopting these ISO standards.
  • Continuous Improvement: As the innovation management system proposed by the ISO organization also outlines, continuous improvement is the backbone of any process. Once you execute the plan and start adhering to innovation standards, you should monitor progress, measure outcomes, and continually assess and improve your innovation management practices.
  • Consider Certification: Lastly, the elephant in the room. Whenever you think of ISO standards you think of the ISO certificates. While certification can signal a commitment to best practices and continuous improvement in innovation management, it is not mandatory for implementing effective innovation initiatives within an organization.

    You can adhere to the standards without additional investment into getting certified. The ISO 56002 is the only one that is eligible for certification, meaning that you can seek certification from accredited certification bodies to demonstrate your compliance with ISO 56002 as well as your commitment to effective innovation management. 

Conclusion

Because we don’t like to do things halfway, this was a lengthy article. We didn’t go into the details of each standard because that is beside the point here. Our goal was to provide you with the bigger picture of what it means to standardize innovation practices.

This will hopefully help you better understand that innovation is not a one-time activity you do after a workshop, and that a systematic approach is essential for long-term success and growth.

Innovation can be like deciding to go to the gym or sticking to a workout routine. Sometimes the most difficult part is to get started and make that first step.

With this information at hand, you can start digging deeper into the specifics of each standard that interests you and use them as a compass to steer you in the right direction. They can give a new perspective into the methods you can use to achieve success in innovation, and help you rethink how you manage innovation at an organizational level.

Image credit: Unsplash.com, Pixabay, viima.com, iso.org

Subscribe to Human-Centered Change & Innovation WeeklySign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

The Pitfalls of Crowdsourcing

Leave a reply

How to Overcome Them to Spur Innovation

The Pitfalls of Crowdsourcing: How to Overcome Them to Spur Innovation

GUEST POST from Diana Porumboiu

There is a lot of buzz around open collaboration as a driver for innovation. Studies, academia, research, and the myriad of examples from companies are boasting about the amazing results brought by ideas from external parties. A study shows that 85% of the top global brands have used crowdsourcing during the last decade.

But is crowdsourcing truly effective to spur innovation? Even though its popularity increased so much, there’s also plenty of evidence that dispute its effectiveness.

As tempting as it is to fall into the trap of the latest trends in innovation methods, it’s not wise to jump headfirst. So, we decided to write this article and show you the hard facts of crowdsourcing, which will help you decide if this is something your organization can benefit from.

For this, we’ll explain the pitfalls of crowdsourcing and provide practical tips on how to overcome them. To put things in perspective, let’s start with the broader picture, of what crowdsourcing is, or isn’t. 

What is crowdsourcing?

As the word indicates, crowdsourcing is all about leveraging the power of the crowds. If you’ve been reading our blog, or worked with innovation topics before, you might think that we are actually referring to open innovation. Not quite. Indeed, the two terms are oftentimes used interchangeably, and the concepts are similar.

But it’s best to make the difference between the two, because setting on the right terminology will also help you better communicate your innovation initiatives to your organization, and to external stakeholders too.

Basically, both crowdsourcing and open innovation refer to engaging external individuals to participate in the innovation process by suggesting ideas and solutions to a specific topic.

Crowdsourcing is the practice of obtaining ideas, solutions, or services from a large, sometimes undefined group of people through an open call. It is a process that leverages the collective intelligence and creativity of a crowd to solve problems, generate new ideas, or carry out tasks.

On the other hand, open innovation includes many other activities that involve people outside the initial working group (open data, scouting, trend research, idea management, etc.). If you want to learn more about the topic, our blog provides vast resources on open innovation which you can find here.

Now, while open innovation, as the name states, is specifically done to generate more innovation, crowdsourcing is used in other contexts too. Methods like crowd labor, crowdfunding, or crowd curation can be valuable if you need to outsource routine and well-defined tasks, manual work or fund your project. These can, in fact, be part of an innovation strategy, but they are not specifically targeting innovation.

That’s where crowdsourcing for innovation comes into play, and what we’ll focus on next.

The pitfalls of crowdsourcing

While crowdsourcing can be an effective way to generate ideas, solve problems, and engage with a community, unless it is properly planned, executed, and managed, it can come up short.

Let’s take a closer look at each of these pitfalls. 

  • Risk management: 

There are many risks that come with open collaboration, and some of the most cited are intellectual property and data privacy. Organizations are apprehensive about exposing themselves to the large public and weary about potential conflicts that could arise from ownership, and copyright as well as exposure to competitors.

So, when considering crowdsourcing as part of your innovation strategy, you should weigh the risks associated with it.

There are four main things to keep in mind when it comes to legal risks associated with crowdsourcing:

  • Existing patents and patents protection for technical solutions
    • Trademarks applicable when sourcing new product names, logos or brands
  • Design of the visual appearance of new products
  • Copyrights for any original texts

That’s why it’s best to have clearly pre-defined contractual terms, NDAs and confidentiality agreements that deal with intellectual property ownership and data protection. So, make sure to establish clear ownership and copyright guidelines upfront.

This can include requiring contributors to agree to terms and conditions that grant the sponsoring organization the right to use and modify the contributions. Providing clear attribution and recognition for contributors can also help to avoid disputes over ownership. Rewarding participation doesn’t just help with motivation and engagement, but it can also mitigate the legal risks.

  • Crowd management: 

The success of your crowdsourcing initiative hinges on the participation of individuals who provide ideas. However, many crowdsourcing projects fall short due to low engagement levels, inadequate idea generation, or low quality.

These issues may arise because contributors don’t recognize the significance of their contributions, lack motivation, misunderstand project requirements, or are unaware of the initiative.

Because crowdsourcing initiatives require a lot of time, effort and specific skills it’s best to delegate the project to someone who is not involved in everyday innovation activities (if you have those already in place).

Even so, crowdsourcing should still be aligned with the overall innovation and strategic goals, and therefore managed as part of existing processes. 

To ensure crowdsourcing runs smoothly, contributors are engaged, decide on the roles and responsibilities for managing the process and ensure that there is adequate support for contributors.

Also, to reach the right people, and as many as possible, you should design effective campaigns that encourage participation.

To ensure quality control establish clear guidelines and criteria for contributions. This can include specific requirements for content, format, and presentation, as well as screening and review processes to filter out low-quality or irrelevant contributions.

Using a platform that allows for peer-review or voting can also help to separate the wheat from the chaff. This what can also facilitate evaluation, which we’ll explore next in more detail.

  • Idea evaluation: 

Evaluating ideas is one of the most complex and challenging aspects of idea management, particularly when it comes to crowdsourcing initiatives where you have a significant number of ideas to sift through and assess.

  • First, it can be time-consuming and overwhelming to select the ideas to develop.
  • Second, ideas and perspectives might differ so there will be inconsistency and biases in the evaluation process.
  • Third, there is a tendency to pick the familiar over the distant ones.
  • And last, there is also the issue of the quality and level of detail of ideas varying widely, making it difficult to determine which ideas are truly innovative and valuable.

With all these challenges, you could overlook potentially great ideas. What’s more, in a crowdsourcing environment, there is often limited interaction between the idea generators and the evaluators, which can make it challenging to provide feedback and refine the ideas further.

To mitigate this, you need a methodical framework for evaluating ideas. You can learn everything about idea evaluation from this article.

In short, to create an evaluation process that works for you, it’s best to decide on a set of criteria that can help you sift through the ideas. For example, Viima’s evaluation tool gives you the flexibility to choose your own metrics and then analyze and make decisions based on those criteria, without the hassle of going through each of every idea individually.

To have a clearer understanding of how this works in practice, try out the crowdsourcing board template. We set it up so you can easily and safely start collecting ideas from outside the organization.

But remember that even with the best tool, before opening up the organization to the crowds, you will still have to work out your internal process and how that fits into the bigger picture, which takes us to the next point. 

  • Process integration: 

Poorly designed or executed processes can lead to low-quality submissions or misunderstandings about the goals of the initiative. A study suggests that besides the issue of managing crowds, organizations also fail to create a process around it.

This is a trap in which many organizations fall. Unless you build a process and plan that goes beyond the first steps of the crowdsourcing initiative, you might waste a lot of time and distract internal teams from using the time and resources on actually executing the strategy.

So, first thing first is to ask yourself if crowdsourcing will serve a bigger purpose. If so, how will it be part of your internal processes and what resources it will require?  Crowdsourcing shouldn’t impede internal practices and processes. It should align with the overall strategy and provide value for the organization.

Crowdsourcing shouldn’t impede internal practices and processes. It should align with the overall strategy and provide value for the organization.


Although we have discussed a number of potential pitfalls of crowdsourcing, it’s important to recognize that these issues are often complex and multifaceted. As such, there is rarely a single reason for failure.

To provide a more comprehensive understanding of crowdsourcing, we will next look at some examples of both failed and successful initiatives. 

When crowdsourcing goes wrong

1. Pepsi Refresh

In 2010, Pepsi launched “Pepsi Refresh”, a crowdsourcing initiative that invited people to submit their ideas for projects that could benefit their communities, with the winning ideas receiving funding from Pepsi.

While the initiative generated significant attention, it was ultimately considered a failure. Even though in terms of reach and visibility the campaign was a great success, the goal of increasing sale was missed. In fact, “Pepsi Refresh” did the opposite, losing the parent company some $350m.

One reason was the lack of alignment between the initiative and Pepsi’s core brand message. While Pepsi had traditionally focused on promoting its products, the Refresh Project shifted the company’s focus to community engagement and social responsibility.

Another issue with the Refresh Project was the complexity of the submission and voting processes. There were also concerns about transparency and fairness in the voting process. Some critics suggested that the system was easily manipulated, allowing certain ideas to receive more votes than they deserved, while others were unfairly overlooked.

This outcome highlights the importance of ensuring alignment with business strategy and values, as well as the big role played by transparency.

2. Nokia’s “IdeasProject”

Nokia’s “IdeasProject” was a crowdsourcing initiative launched in 2008 to gather ideas from customers and the public for the company’s product development. While the initiative generated significant interest and engagement from users, it ultimately failed to produce significant results, and was eventually discontinued.

One reason for the failure of the IdeasProject was a lack of follow-through and implementation of the ideas generated. While thousands of ideas were submitted and discussed on the platform, few were actually developed or brought to market by Nokia. This led to disillusionment and disengagement among users, who felt that their contributions were not valued or taken seriously.

Another issue was the lack of clear communication and marketing of the IdeasProject. Many customers and potential contributors were not aware of the initiative or did not understand its purpose, which limited the overall reach and impact of the platform.

3. Yahoo’s “Assignments”

In 2007, Yahoo launched “Assignments,” a platform aimed to leverage the collective intelligence of its users to generate high-quality content. The initiative allowed users to submit original content, including articles, photos, and videos, which other users could rate and review. Yahoo planned to use the best-rated content to enhance its news and information websites.

Yahoo failed to create a strong community around the initiative, which made it difficult to generate high-quality content. Furthermore, there were concerns about copyright violations, as some of the content submitted by users was copyrighted material.

Because the platform was plagued with issues, including a lack of quality control over articles submitted and disputes over payments to writers, the platform was eventually shut down in 2012.

When crowdsourcing goes right

Despite the challenges associated with crowdsourcing, we should acknowledge that there is still potential for success, and not all crowdsourcing efforts are doomed to fail.

1. Linux

Linux is a popular open-source operating system that was developed through a crowdsourcing initiative. The project was started by Linus Torvalds in 1991, who was a computer science student at the University of Helsinki in Finland. Torvalds wanted to create a free and open operating system that could be used by anyone, and he enlisted the help of other developers from around the world to contribute to the project.

The project’s success is attributed to its collaborative and decentralized development model, which fosters innovation and customization, as well as a strong community of passionate and supportive developers. Moreover, Linux’s technical merits, such as stability, security, and flexibility, make it a popular choice for a diverse range of applications, from web servers and supercomputers to smartphones and home appliances.

2. Ford

The “Make it Driveable” crowdsourcing campaign by Ford was launched in 2018 to gather ideas and solutions for making vehicles more accessible to people with disabilities. The campaign invited individuals and organizations to submit their ideas for features or modifications that would make driving and traveling in a car easier for people with disabilities.

The campaign engaged a diverse range of people and organizations, including disability advocates, engineers, and designers, in the co-creation process who generated a broad range of innovative ideas and solutions.

The “Make it Driveable” campaign showcased Ford’s innovation and leadership in the automotive industry, demonstrating the potential for crowdsourcing to drive meaningful change and create value for both the company and its stakeholders.

3. Lego

As mentioned above, Lego’s crowdsourcing platform, Lego Ideas has been running successfully since 2008. The platform allows Lego fans to submit their own designs for new Lego sets, and the community votes on their favorite designs. The Lego Ideas platform has been hugely successful, with several of the winning designs becoming popular and highly sought-after sets.

For Lego, crowdsourcing is a cost-effective approach to supplement its in-house capabilities and expand their line of products. Even more, because of the voting system they can assess whether a product idea has potential and demand among its customers.

For participants, Lego Ideas provides a valuable platform to share and contribute to the company’s mission of inspiring future builders. Users can gain recognition from their peers for their ideas and benefit financially if their product is successfully released to the market.

These are just a few examples which show how crowdsourcing can be applied successfully, as long as it’s in line with the company’s core values and goals, and it’s built on a framework that enables systematic use of the ideas from outside the organization.

But as previous examples have shown, crowdsourcing can also go wrong even for the most successful organizations. These examples can hopefully help you make a more informed decision, and inspire in the way you approach crowdsourcing, or open collaboration in general.

To recap, you need alignment between your crowdsourcing initiatives and the overarching strategy, integration with internal processes, a framework that enables idea management, evaluation and development and last but not least, an effective campaign to gather the crowds around your organization.

How to start crowdsourcing

First thing first. Does crowdsourcing align with your current strategic plans? If it does, the first step is to develop a clear plan for using crowdsourcing effectively.

If you are not sure which way to go, as a first step in choosing your approach, you can find inspiration in this chart from Deloitte, which shows a variety of crowdsourcing activities that cater for different needs.

Viima Crowdsourcing 1

Depending on your strategy, industry, and your company profile, you will probably know what type of crowdsourcing is most appropriate for your organization.

This will help you decide on other factors such as the type of contributions you are after, the resources required, and the audience you will target.  

Viima Crowdsourcing 2

 

1. Define your goals and set boundaries

The first step is to set clear goals for your crowdsourcing campaign. What do you want to achieve: is it brand awareness, ideas for improving products or customer satisfaction?

Decide on a set of metrics that will help you evaluate the success of the campaign and measure its impact. This will help you adjust as needed but also set realistic targets about the outcomes you think are possible. If you’re set to get disruptive or completely novel ideas that require technical knowledge and complex solutions, you have to carefully consider whom you want to target with the campaign.

2. Define the target audience and the engagement mechanisms

This step is essential for the success of your crowdsourcing. Without the right participants, you won’t have enough relevant ideas.

Think about who would have the most knowledge and expertise in this area and who would be most interested in providing their ideas and insights. Consider demographics such as age, occupation, location, and interests.

Depending on the goals you set or the types of ideas you are after, you will need different audiences. Sometimes there might be more generic ones, while in other cases you will want specific people with knowledge of the topic or interest in the field. On the other hand, sometimes it is more beneficial to have a diverse audience that can bring new and fresh ideas.

Once you have identified your target audience, you need to develop engagement mechanisms that will motivate them to participate in your crowdsourcing campaign.

Engagement mechanisms refer to the various ways in which you can interact with your target audience and encourage them to contribute their ideas. These mechanisms may include online platforms, social media channels, email campaigns, targeted advertising, events, and rewards or incentives.

It’s important to remember that engagement mechanisms should be designed specifically for the target audience.

3. Decide on a platform to support your activities

Once you have decided on the goals, determined the target audience, and the engaging mechanisms, you should next look for a platform that can cater to all your needs.

The platform should act as a transparent communication and exchange forum for participants. It should be easily accessible and simple to use, but also flexible enough to allow different use cases.

As mentioned above, many crowdsourcing failures are related to the inability of organizations to manage and integrate the initiative in their existing processes. Providing feedback and encouraging ongoing participation are also other important elements to consider when scouting for a crowdsourcing tool.

To get an idea of what open innovation platforms are out there and how they can be used for crowdsourcing, you can read this Guide to Open Innovation Platforms: How to Unlock the Power of Collaboration.

The selection criteria should consider factors such as accessibility to the target audience, the ability to integrate relevant engagement mechanisms to promote ongoing participation, and the capability to distribute incentives after the completion of activities.

4. Pilot and iterate

Consider starting with a pilot initiative to test the approach before scaling up.

No matter how well you prepare for something new, like crowdsourcing might be for some, you will most likely stumble a couple of times. And that’s completely fine.

No amount of research and shortlisting will give you the full scope of how it works in practice for your organization. That’s why it’s important to pilot on a smaller scale. And once you’re happy with the pilot results you are ready to scale up.

Doing pilots allows you to test the platform, check for compatibility with the platform, and test your plan and ways of working.

If you are not sure about the first step, get started with a platform and see how it would work in practice internally. Some vendors offer free user-based versions, like us here at Viima, and some have demos or other free trials.

Additionally, piloting may also help evaluate if you’re searching via the wrong criteria (of if your goals are misguided), or if your ways of working or processes are wrong for what you want to achieve. Also, consider using feedback from participants to iterate and refine the initiative over time.

Conclusions

As you can see, just as there are good parts about crowdsourcing, there are also bad ones. There is no one size fits all solution when you want to innovate, and just like many other methods and tools, crowdsourcing can be a great enabler for innovation.

Regardless of the pitfalls and numerous failures from other companies, crowdsourcing can still be highly beneficial for your organization.

To summarize, let’s recap the positive aspects of using crowdsourcing for innovation and the main factors to consider to fully leverage its benefits.
First, for crowdsourcing to work well, it should make sense for the organization’s strategy and overall goals. Make a plan, assess the needs and the capabilities to manage a process like this. Because indeed, crowdsourcing should be designed as a process that complements, and doesn’t hinder other activities within the organization.

Second, make sure you choose the right platform from the get-go. For optimal results you should aim for something that is flexible enough that allows multiple uses, from external idea collection to managing the entire innovation process.

Lastly, don’t over-rely on technology either, because that is just a tool that helps you move forward and be more efficient. The true benefits come when you start building connections, nurture talent and find new approaches to solve problems.

Image credits: Viima, Pixabay

Subscribe to Human-Centered Change & Innovation WeeklySign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

A Guide to Effective Brainstorming

3 Replies

A Guide to Effective Brainstorming

GUEST POST from Diana Porumboiu

Brainstorming is one of those hyped terms that these days has a reputation of its own because of the controversy surrounding it. Is it just a shallow activity, organizations do when they are stuck in a rut? Or is there an efficient way to go about it without wasting time?

The debate still goes on, and both sides have valid arguments. The opposing sides of the debate are the experienced facilitators or managers who vouch for its value when done right, and the academic research that points out the flaws and the short-sightedness of the approach.

But we don’t live in a black and white world, and as is the case with most things, brainstorming is more nuanced than that. Since brainstorming first became a thing, in the ‘50s, the world has changed radically. In the past 70 years, we got the Internet, we went digital, and our working life looks completely different.

Even so, the basic rules of brainstorming haven’t really adapted to these new realities. So instead of asking ourselves if there is a point in brainstorming, and whether it’s good or bad, maybe we should update the old ways of brainstorming to make it more effective for modern organizations.

So, in this article, we’ll answer essential questions like what the value of brainstorming is, and provide practical steps and up-to-date rules of thumb that can lead to effective brainstorming sessions.

But without further ado, let’s get to it.

What is brainstorming and what’s the hype around it?

To set the scene, let’s recap what brainstorming is and how it became such a key concept in creative thinking.

In a nutshell, brainstorming refers to the group ideation technique where people get together for a session to generate and contribute ideas around a specific theme or problem.

Nowadays, brainstorming is the overarching term for a variety of methods, tools, and techniques that have been developed to facilitate creativity and encourage idea generation.

As a short background story for those who are not familiar with the source of brainstorming, Alex Osborn is considered the father of this method. A creative theorist, and businessman he imagined the technique in the 50s, and was actively using it in his agency, BBDO. Reportedly, every day they were running a brainstorming session, in a bright yellow room where up to 12 people would gather to bounce around ideas. After 401 sessions, they had a total of 34000 ideas, which in the end resulted in 2000 good ideas.

If we do the math this translates to 5 decent ideas per session. 70 years ago, this might have looked like a good use of time, but considering today’s technologies and methods, those results could be achieved with far less effort and way faster. Current tools allow easier and faster idea collection, which leaves more time for actual development and implementation work.

Brainstorming caught the attention of researchers in the academic world, which made this one of the most researched creative thinking methods. This is also how the technique became very controversial.

The first ones to show interest in brainstorming were researchers at Yale, whose studies led to an unexpected outcome: individual ideation led to more ideas than group ideation. As academic settings are different from corporate ones, understandably the results were not deemed reliable.

The Traditional Rules of Brainstorming and Their Benefits

Osborn came up with the brainstorming technique as a tool to generate a large number of ideas for a specific problem. Brainstorming, which he initially called thinking up was grounded in a few basic rules that would govern each session.

1. Quantity first: come up with as many ideas as possible and the winning ideas will eventually come.

Ideas are the main purpose of a brainstorming session, so we couldn’t agree more, you want as many as possible. However, when it comes to traditional brainstorming sessions, you drastically reduce the number of ideas that could be generated.

The traditional approach suggests getting together 10 to 12 people who can work together. There’s an obvious limitation to this approach, as we saw in Osborn’s results, they needed over 400 sessions to get to 2000 decent ideas.

Limiting access to only a select few, is diminishing opportunities and the number and diversity of ideas that could be generated. It might have worked well in a small agency and in the 50’s offices, but in today’s complex and global work environments, this approach is highly restrictive.

When people work remotely or from different corners of the world, it is highly inefficient to get them together for a brainstorming session. Let alone involve those who don’t happen to work in the figurative Ivory Tower at headquarters. Ideas should come from all employees in an organization, not just from top managers.

2. Encourage bold, crazy ideas

Don’t rule out any ideas because you never know where a spark can come from. The risk with this rule is that people have the tendency to focus more on pointing out problems than solutions. But this doesn’t mean that there is no value in that. Even if the solution isn’t right, you might uncover something that was not obvious up to that point that helps you solve the right problem down the road.

Opening the door to wild ideas can come with the challenge of keeping people focused on the goal, especially since the next rule makes it even harder to get participants back on track when they veer away from the purpose of the session.

3. No evaluation or criticism of ideas

Understandably, the role of this rule is to not discourage or cut people off from churning out a flow of ideas. As the best ideas often build on top of other people’s ideas, this is as an important rule.

However, it also leads to some issues. Even though fostering a safe environment is essential in creative thinking, a brainstorming workshop won’t do the trick. Building a safe environment comes from the overall organizational culture and can’t be suddenly created when brainstorming if it was nonexistent before.

Even though on paper this is a good rule to balance the flow of ideas and give voice to everyone, in practice you will always have the most extrovert, open person in the room speak more and drown out others. Someone more opinionated or with a stronger personality could easily discourage the more reserved, introverted people. And this can happen even when enforcing this rule. Some people will always feel more comfortable speaking up than others.

Also, if there is no instant reaction and no healthy debate, groupthink will settle in. The last rule of brainstorming is meant to combat this, but can it?

4. Combine and improve ideas

Osborn was not wrong to believe in the creative power of a group and in his circumstances, he made it work. When ideas are transparently shared, it’s easier for people to contribute, build upon those and get more creative together.

At the same time, the proponents of brainstorming tend to blame the critics of the method for being inexperienced, unskilled, or simply ignorant. Basically, they don’t see any flaws in the method.

There might be a grain of truth there, but it’s just one side of the story. Even skilled facilitators have a hard time choosing and using the right tools to reach their goals. Sometimes you can expose yourself to others’ ideas at your own pace, when you can digest the information, not when your boss asks you to be creative.

To harness these ideas and moments, organizations should enable the transparent flow of ideas in an asynchronous approach. This will enable them to leverage the creative and collaborative power of hundreds and even thousands of people.

Luckily, modern technology and the myriad of tools available today allow for simultaneous interaction between thousands of people who can transparently collaborate and build on top of each other’s knowledge a snd ideas.

It’s interesting to note that even though these ground rules were first introduced in the 50s, they are mostly valid, and can still be relevant in small agencies and working groups that need a fast fix to a specific issue.

When vouching for brainstorming, many supporters of the method bring up two important benefits:

  • Synergy, (which comes from the fourth rule of brainstorming) and
  • Social facilitation 

Synergy

In essence, synergy refers to the results produced by collaborative work. When people get together, the overall result is greater than the impact they would have had individually.

So, when it comes to brainstorming the ideas generated by some can inspire and motivate others to come up with more ideas. It generates a chain reaction that enables people to build on top of each other’s ideas.

However, organizations are highly complex these days and information is spread across teams, departments and functions.

There are also many other things at play when it comes to team dynamics and human behavior when we interact in person.

For example, the more cohesive a group, the greater the risk of groupthink, conformity, and the tendency to want to reach unanimity. There is also the risk shift issue, which is the tendency of a group to make riskier decisions than they would have made individually.

Then there is also the social loafing concept which refers to how people work less hard for ideas when in a group, rather than if they were doing it alone.

A study on group performance also brought to discussion another phenomenon: downward norm-setting, where a group performs at the level of the weakest person.

Teamwork and cohesive groups are essential for the well-functioning of an organization, but there is always the flip side of the coin. While all these things are not bad per se, they do inhibit the possibility of great, diverse, out-of-the-box ideas. The vacuum in which  brainstorming tends to operate, can favor such behaviors which can become bottlenecks for the idea-generation process.

Social facilitation

Again, this is a vast topic, but the main idea here is that people tend to behave differently when in the presence of others. Some research states that people perform better certain tasks when they are with other people than when they are alone.

These theories are hard to prove or explain even for social scientists, so in the context of brainstorming, it’s even more controversial to state that mere collaboration with others can improve one’s performance. There are just too many factors at play.

One of the most obvious is that each brainstorming brings together different personality types. Not everyone will feel energized by the chaos that some brainstorming sessions can turn into. From the personal experience of the introvert writing this piece, brainstorming sessions can be energy-draining, exhausting exercises, and not the most inspiring, motivating types of work meetings.

Most leaders who decide to run a brainstorming workshop do it for one or more of these reasons:

  1. A fun activity to energize and motivate the team (as mentioned, it hardly applies to everyone, since you will never have completely homogeneous teams, something you shouldn’t even strive for)
  2. Improve communication and get people on the same page (indeed, when you bring people in the same room it’s easier to communicate the same thing to everyone and bring clarity).
  3. They involve people in decision-making or at least give that illusion. In some cases, it can work, as people engage and feel motivated when they are listened to. But over time if their ideas are ignored, cynicism can creep in and people will stop believing and engaging in these workshops.

The main purpose of brainstorming, which is creative thinking and idea generation is mostly overlooked, but for these other benefits, it can still be a valuable exercise, especially in small teams and organizations.

That being said, for medium to large organizations who want to make the most of the basic idea of brainstorming, generate as many ideas as possible and get the best results, there are better ways to go about this. Some new, up to date rules, and tools, should be considered if you want to brainstorm in a 21st-century organization.

So, let’s see why and how you can revamp the traditional rules of brainstorming and bring them to modern working life.

The Improved Rules of Brainstorming

Before diving deeper into each of these rules, let’s start by setting the scene of brainstorming: when should you brainstorm, and what are the prerequisites that would make the effort worthwhile.

The most common criticism towards brainstorming is that it doesn’t build momentum and things come to a halt once the session has ended. The reasons could be:

  • There is no systematic process in place to manage ideas and to include ideation methods in these processes
  • The goals where not clearly defined before the brainstorming. Closely linked to the previous reason, there was no accountability for the outcome of the session and no one in charge of moving ideas further.

So, before jumping into a brainstorming session take a moment and reflect on the purpose. Are there other possibilities, tools, and solutions that might work better?

For example, in recent years a new concept has gained traction, painstorming. If we disregard the not so inspired choice of words, there’s actually something to it.

With painstorming the focus is shifted towards fixing customers’ pain points, so you work to uncover pain points and come up with better ideas around those. Of course, there is nothing new about it, but when you look at why you wanted to brainstorm in the first place, this might bring a new perspective, and with it, new methods and tools, like the Jobs To Be Done framework or How Might We statements.

Of course, these tools aren’t mutually exclusive or replace the need or role of brainstorming. So, if you decide that brainstorming is still something you want to do, you might as well do it right. Here are some amendments to the traditional rules of brainstorming.

1. Quantity: for more ideas, go virtual

As already mentioned, we stand by this rule: to get the best ideas you need a larger pool of ideas to choose from. And in the digital world we live in, you can’t rely just on pen and paper for that.

It’s simple: if you want more ideas, you need more input and more participants, which in an office setting is hard to achieve. We can’t imagine brainstorming with 30 people in the same space; how they would interact, take turns, suggest ideas, how long it would last, and what the outcome would be. Even finding a calendar slot that works for all 30 participants will likely take months. But we can imagine a hybrid workshop with 30 participants or even a completely virtual brainstorming session with hundreds of people.

There are even studies that show how virtual brainstorming sessions are more productive because the environment can provide a better experience for the group members, balancing introverts and extroverts, optimists, and pessimists.

2. Encourage bold, crazy ideas: create the right environment

The crazy ideas come in the most unexpected moments, so don’t miss the opportunity of capturing those. Ideas should not be tied to a place or a moment and because you rarely have the wildest ideas on the spot in a brainstorming session, it’s best to provide the tools and create the processes that allow for idea generation and collection anywhere, and at any time.

That’s also why going virtual is essential. The standard approach is to squeeze some juicy ideas during brainstorming, or to dump them in a collaboration tool as a DM or in a group, where it will probably get lost among the hundreds of messages and conversations.

An idea management tool gives you the freedom and flexibility to come up with ideas at any moment. Then you can discuss them, build upon them, and develop even better ones before, during, or after your brainstorming session.

3. No evaluation, or criticism of ideas: for healthy debates, nurture creative abrasion

Another big topic that goes far beyond brainstorming is the culture in which these sessions take place. The premise is not wrong: you don’t want people to feel intimidated, so you don’t criticize or put their ideas down.

The backbone of brainstorming is collaborative work, but to collaborate doesn’t mean to agree with others all the time. In fact, we get better ideas through debate and discourse.

While Steve Jobs is to this day labeled as a bad leader for his aggressive style and insensitive ways, we could see how his approach helped build a couple of the most innovative companies in the world. Between his style and today’s overly polite approach to conflicting ideas, there is a middle ground: creative abrasion, the ability to create a marketplace of ideas through debate and discourse.

Creative abrasion is not about creating conflict, and irritating group members. It’s about creating cultural, disciplinary, and thinking style diversity, encouraging diversity of ideas, and managing the resulting abrasion for maximum creativity.  

To have creative abrasion you need a work environment that provides psychological safety, where people feel safe to advocate for their point of view and disagree with their colleagues or even superiors. Ideas should be challenged, and so should people. If you are a facilitator, ask questions like “what happens if…”, “have you thought of…” or “how might we…”?

You can read more about the topic of psychological safety in our article on how to lead innovative teams.

4. Combine and improve ideas: turn the sessions into a process

A good rule that could also use some refinement to make it even better. In the traditional setting, once ideas are generated and collected, people are expected to react to the pool of ideas they have in front of them. Yet again, there is no such thing as a stroke of genius, the a-ha moment that comes spontaneously.

The key here is to give people the time to reflect on what they’ve learned, research and work on those ideas in order to come up with novel, updated versions of those ideas. In traditional brainstorming, all of that should happen in the same session.

However, this is not something you can do in one session. It’s not just the conclusion of Yale researchers. Jake Knapp, inventor of the design sprint method, and author of Sprint, was using brainstorming workshops at Google for years, until he realized the outcome was not the expected one. Individual ideas that were thought through, of people who took the time to think and analyze, were better and more valuable than those that came out of the brainstorming workshops.

So, what you can do instead is to turn brainstorming into a primarily asynchronous collaborative process that includes a few joint sessions where people can come together to discuss, debate, and find alignment.

If you want to rush brainstorming into a few hours session and expect great results from that, there might be no point in brainstorming at all. You might as well just ask some experts for their input on that specific issue or challenge. And you might still get better results than doing rushed brainstorming sessions.

With these new rules in place, let’s see how you can organize and run successful brainstorming sessions.

Virtual Brainstorming

How to Setup a Virtual or Hybrid Brainstorming Session

The most exciting part is always getting our hands dirty. Before getting started you need to decide on a shared collaboration tool that is easy to take into use, flexible, and intuitive for everyone to contribute. Ideally, you will choose a tool that doesn’t allow just idea collection, but can support multiple simultaneous idea management processes, can be easily customized, and allows evaluation, transparency, and participation from different kinds of stakeholders, both inside and outside the organization.

The right tool will enable you to run both virtual and hybrid brainstorming sessions where you have some teams remote and others in-person.

1. Set the stage

This first step takes us back to the last rule on the list. Start by defining the process(es) for the sessions you wish to organize.

What is the main goal and focus that will guide the session? It’s best to start your workshops, brainstorming or idea challenges by deciding on the process that best fits your situation.

2. Set up the environment for idea collection

At this stage, you should already know who will be responsible for monitoring the process, who will participate, and what channels of communication will be used. As an example, we used Viima’s brainstorming board template which has the right settings already in place.

This will allow you to communicate in advance the why, what, and how and invite people to participate. For easier monitoring and better organization, create different types of categories of ideas you are looking for. These can be around solutions, opportunities, challenges or problems you want to solve.

3. Generate, collect, and organize ideas

If you’re running a hybrid or an in-person brainstorming, make sure to send the agenda beforehand. This will give people time to prepare, think about the topic and make research if necessary. If your brainstorming is part of a longer process, like an idea challenge and you run it asynchronously, you should set a deadline for submitting ideas.

Ask participants to contribute in advance so that during the brainstorming session you can focus on discussing and refining those ideas.

It’s also good to define the development process of ideas through statuses that indicate where certain ideas are in the process.

For example, for the purpose of brainstorming you can have ideas collected before the sessions, and during the sessions. After the brainstorming and based on data you collected, ideas with potential can change status and move to the next phase. This could be, for example, a new session to discuss and work on the remaining ideas.

Encourage participants to build upon other ideas by commenting and providing their own insight and expertise.

4. Evaluate

An idea evaluation process to get the information that will allow you to make the best possible decision. When evaluating ideas you need a set of criteria, or metrics to consider the various aspects of an idea. When you combine these metrics you get a numeric rating, the score, which can provide an estimate for the potential of the idea.

A systematic set of criteria for evaluating ideas will help you take better and more consistent decisions. However, these criteria vary greatly depending on the industry, type of ideas, strategic objectives, etc.

What is the impact of the idea, how much effort it requires to implement it, and so on. Some of these metrics are best evaluated by managers or subject matter experts, while others can be evaluated by other participants in the brainstorming, based on their own knowledge and involvement in the process.

This is where many brainstorming sessions end. But in reality, this is just the beginning. Once you are done with the brainstorming, idea collection, and evaluation, you need to prioritize them and decide on the next steps. All these steps should be transparent, so people understand the reasons behind certain decisions, why some ideas might be left behind and why others are considered.

5. Prioritize and follow-up

This is the step where the magic of a good idea management tool comes in play. An idea management tool can help you prioritize and select the ideas that meet your criteria and get the highest score.

At this point, you can choose a few ideas to go forward with and prepare for the next session and invite people on an even more focused brainstorming around those ideas.

If you get to one idea with high potential, you can zoom in on that, move it to another session for validation, or maybe even create a new board to collect more ideas around the development and refinement of the “winning idea”.

Before you get to implementation, depending on the complexity of the ideas you’ll be working on, you can repeat the process.

Conclusions

As mentioned above, brainstorming should only be a starting point, a piece in the puzzle of the internal processes you’ve worked hard to develop.

To wrap up let’s recap some of the main points we believe you should take away from this.

  1. First, don’t put the cart before the horses by looking for ideas before defining a clear problem or issue you want to brainstorm around. Narrow down the objective to provide focus and increase the effectiveness of the session.

  2. Second, build the brainstorming and ideation process around specific questions. You can start with 15-20 questions that are tied to your business goals and will provide direction and inspire good ideas. Thought-provoking questions will help the session flow in the right direction. “how can we…?”, “if you had no constraints how would you…?”, “how can we put these pieced together in a new way?”, “what do these insights/ data reveal?” etc.

  3. And last, when it comes to setting expectations, consider the existing limitations you have to work with. As much as everyone wants to come up with “outside the box” ideas, the counterintuitive truth is that constraints and limits are what often lead to the most original ideas. Plus, they help you focus on what matters, and remain grounded in reality.

Image credits: Pexels, Unsplash

Subscribe to Human-Centered Change & Innovation WeeklySign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.






How to Lead Innovation and Embrace Innovative Leadership

1 Reply

How to Lead Innovation and Embrace Innovative Leadership

GUEST POST from Diana Porumboiu

Leaders are bombarded from all directions with advice on how to behave as leaders. It seems like we all know what it takes to lead innovation, at least in theory, yet the attention is mostly focused on famous innovators who oftentimes are the exceptions, rather than the rule.

What’s more, we tend to forget that the greatest, most famous innovators, with all their qualities and contributions to the world, are not necessarily the best of leaders. Great leaders who rarely make the headlines, if they ever do, are usually less controversial.

However, their lack of fame doesn’t diminish their innovativeness. That’s why this article wants to provide some insights into what it takes to lead innovation with the practices, methods, behaviors, and mindsets of successful innovation leaders.

As our previous article focused on nurturing innovative behaviors in employees, this time we’re down to some practical aspects of leading innovation at an organizational level.

Innovative leadership and commitment

A McKinsey research sheds some light on what successful innovators get right, and how their organizations become high performing by committing to a set of essential practices.

In short, their survey revealed that the bar is rising among innovators, and during the past five years they have become more successful at innovation as they committed to a larger array of operating models. In 2016 high performing innovators focused mostly on vision and strategy. But In 2021 they pulled further away from competitors by extending their focus to new business models and to scaling their innovations faster and more effectively.

These are all interesting insights into how innovation practices support the growth of organizations. But what are they telling us about specific abilities and behaviors required to lead innovation? To better understand this, let’s look into some of the research conducted by Linda A. Hill, top expert on leadership, change and innovation, who paints a clearer picture of the specific qualities.

  • Adaptability

In times filled with ambiguity and uncertainty, it’s becoming more difficult to make decisions and guide others on the right path. Adaptability might come natural to some people, but others need to cultivate it through practice, exposure to different circumstances and activities. Developing adaptive behavior helps in taking bolder decisions, an essential aspect for innovation.

We’ve seen in other cases how innovators with strong convictions on their vision or new ideas are not very open to new data. This is tough to balance: maintaining your confidence and showing the way for the team, while remaining adaptable.

Practical tip: Instead of building a detailed project plan for an innovation project, try building a plan based around clear goals and time framed milestones, but leave room for the team to figure out the path to get to them.

  • Comfort with ambiguity

This is closely linked to the previous point because to become comfortable with ambiguity you also have to adapt and operate in a somehow hazy and confusing reality. This is very important especially in the early beginnings of innovation, when the fuzzy front-end stage of the innovation process creates a lot of ambiguity.

But as you might know, innovation means to dive in the unknown from time to time. As a leader you need to navigate the tough road of visualizing the goals for the team while admitting that you might not always know the way. At the same time, you want to get the team on the same journey and help them feel comfortable with that ambiguity.

Practical tip: Managing innovation is one way of becoming more comfortable with ambiguity. We created a free, in-depth guide on how to manage innovation which you might find useful. This is a comprehensive toolkit that can help you plan your strategy, build your processes, and drive more innovation in the oganization. You can find it here.

  • Curiosity

Curiosity pushes innovators to new discoveries. It’s also what fuels learning and change. As a leader you need to be able to learn and prepare for the future. Sure, curiosity, even more than adaptability can’t be easily measured or taught. But curious leaders should always ask questions, and not just any questions.

The best innovators understand things deeply and address root problems, not just surface level symptoms.

Practical tip: Whether you are naturally curious or trying to boost curiosity in the team, the five whys is an effective technique for getting to the root of underlying problems. The idea behind this technique is to ask “why” five times in a row, whether you think you previously received a good answer or not.

Viima Five Whys

  • Creativity

Creativity plays an important role in innovation, whether it fosters novel ideas or ingenious solutions. However, being creative is not enough to make innovation happen. Many leaders consider creativity an important skill for leading innovation. This begs the question: should leaders be the most creative ones, or should they work to enable creativity in others?

The answer lies somewhere in the middle, as creative leadership is essential in bringing clarity and purpose to the team. A creative leader can change perceptions and show the way. However, the strength of leaders who lead for innovation lies in managing for creativity. So as a leader you don’t have to be the source of all genius ideas but engage people at the right time to do the creative work.

To sum this up, there is a role for leaders in creative work, but not in the traditional sense of generating ideas and asking others to implement them.

Practical tip: If you want to spur creativity in your team try setting constraints and challenge the team to come up with solutions despite perceived challenges. Inevitably, the environment in which you operate will come with some constraints, whether those are operational, financial, legal or of a different nature.

Don’t look at constraints as negative things. Research shows that innovators usually succeed because of constraints, not despite of them. Brian Chesky, Airbnb co-founder & CEO believes “constraints create creativity” and without some of those he probably wouldn’t have done half the creative decisions that would lay the foundations for Airbnb’s remarkable success.

Practical steps to lead innovation

If leading innovation were that simple, we’d have more leaders and organizations excelling at it. However, as difficult as it might sound it’s not impossible and luckily, we have plenty of examples to learn from.

A survey conducted by Forbes among 100 innovation leaders revealed that their success lies in actively trying to build and shape their organization for the future. This means that they actively challenge the status quo, experiment, ask questions, are keen observers and engage in conversations with people who are very different from them.

This discovery work of observing, learning, and experimenting leads to better decision making on less risky ideas with higher impact.

Start with the big picture…

The best innovation leaders aren’t just visionaries, who set big goals that show the way to the future. They also enable people to work through the challenges by removing barriers and empowering them to hop on the same boat towards that future.

  • Start with the strategy because any innovation program should be anchored to an organization-wide strategy. Just with the vision and without a tangible business case you don’t really have innovation.
  • Come up with a plan that stirs everyone in the same direction.

Many innovators, especially those who disrupt their industry, are not the best executors and sometimes they don’t have to be, if they have the right people on the job. To this end, collaboration and co-creation are essential, just as it is the empowerment of those who are knowledgeable to make important decisions to get to those goals.

A high-level plan which serves as a good example of how innovators set clear, ambitious goals is Elon Musk’s series of Master Plans, from 2006, 2016 and the 2022 one, to be released soon. These plans played an important role in Tesla’s success, giving a clear direction for the future illustrating how they are actually going to move towards fulfilling their mission of accelerating world’s transition to sustainable energy.

Tesla Unsplash

Of course, there’s more to a plan than an ambitious statement, but people need to be inspired, to feel that through their work they can change the world around them. That being said, an ambitious plan still needs to be flexible to some degree to allow for different ways of achieving it.

The cleverness of these master plans lies in their simplicity which makes them easy to understand and remember. They capture the big picture but still leave room for the team to find the best way of accomplishing them.

…then zoom in on the details

  • To achieve those ambitious goals, leaders need innovative teams, and to nurture internal talent.

With internal scouting systems organizations can develop the skills of existing teams. As is the case with innovation, if you can’t buy something, you have to build it yourself.

It’s beyond the scope of this article to talk about the winning strategies in the war for talent, but there should be a stronger focus on nurturing existing talent and creating the capabilities to innovate through talent development programs, learning opportunities, and a positive employee experience.

Innovation can come from various areas of the organization, and it all comes down to how employees are led to innovate. Former Volkswagen CMO, Luca de Meo managed to unify VW’s branding by discovering and nurturing the mutual sense of purpose of the employees.

He achieved this by involving employees in the creation of a centralized brand. For example, one brainstorming workshop was organized as a design lab to prototype, test, analyze and openly discuss ideas with employees from different departments and areas of expertise.

Engaging employees in innovation work can unlock the wealth of knowledge in an organization. Empowering them to innovate it’s even more powerful, as employees become innovators themselves. As Linda Hill also observes, people’s talents are not used to their fullest, but when it eventually happens, the results show up as well. In Volkswagen’s case, de Meo’s approach was fruitful, the brand moving up the global ranks from 55th to 39th.

…and take one step at a time towards that goal

The last piece to the puzzle, and maybe the most important is to take things one at a time while keeping your options open. There’s a lot of emphasis on the bigger picture, planning and strategy, but these won’t eliminate ambiguity.

So, the best way forward is to keep that vision in mind and help the organization move towards it. You don’t need to know each step in your path in advance, as long as you keep up a good pace and keep moving in the right direction, one step at a time.

Like with all innovative work, you’ll encounter challenges and things won’t ever go as planned, so be prepared to alter the initial plan. That’s why it’s not advised to put all your eggs in one basket. As John Carter explains, you need two interlinked systems that can help you select and grow the best products or ideas.

  • An annual, systematic portfolio planning process, tied to budgeting, and
  • An ongoing, agile, portfolio management process

Another thing to consider is the modular approach, which helps speed up learning. As Rita McGrath explains in this recent article, making your offerings modular you can begin to generate benefits early in the projects’ life. Put together, these two approaches are very helpful in building capabilities that provide economies of scale while still remaining flexible.

Leading innovation by example

In the following section we didn’t go for single success stories of leaders because systematic innovation doesn’t come down to one person. Instead, we’ll show at a higher level how leadership models enabled everyone in the organization to turn innovation into an everyday habit.

Netflix

Even though Netflix might go through a rough patch, we can’t deny its leading position as an innovator in the entertainment industry. From a DVD sales and rental company to a global streaming service, the current organizational structure at Netflix provides plenty of freedom and responsibility to its employees.

Netflix is divided in three main divisions and is maintaining the principles of total quality management: the functional team (CEO, legal, content communication etc.), geographical teams (in charge of local and international streaming) and the product teams who ensures the effectiveness of operations. This unitary form, the corporate headquarters direct strategies implemented in geographical divisions.

Viima Netflix Org Structure

  • The first division, the functional one, is led by Reed Hastings, CEO and Ted Sarandos, Co-CEO. They meet regularly with the R-staff, the group made of Netflix veterans and the general counsel.
  • The next in line is the E-staff group, made of executives who oversee different teams within the company. They each have a different area of focus, like platform engineering, regional marketing and content.
  • There is also a group of directors, below the vice presidents, who meet to review the current state of the company.

The flat organizational structure at Netflix encourages a culture of independent decision making, openness, high effectiveness, and flexibility. This approach to leadership is based on their business need of staying ahead of the curve by making decisions fast.

Apple

Apple is to this day one of the most innovative companies, and much of its success is attributed to Steve Jobs. However, in this case we won’t focus on his leadership skills, which are rather controversial, but on his legacy and how the company’s structure has evolved over the years.

What makes Apple unique is that it’s organized around expertise, rather than the traditional business units.

This requires open mindedness from senior leaders, to inspire, and influence colleagues to contribute towards the goals. Ultimately, decisions are made in a coordinated manner by the most qualified people. There are no general managers at Apple. Instead, there are expert leaders who need to have 3 main characteristics.

  • Deep expertise.

It’s easier to train an expert to be a manager than to train a manager to be an expert. So, at Apple experts lead experts. They have over 600 experts working on camera hardware technology, and they are led by Graham Townsend (a camera expert himself).

  • Deep immersion in the details.

In Apple’s case leaders should know the details of their organization 3 levels down and be able to push, probe and smell an issue and know which issue is important and where to focus attention. For example, they are very particular with the shape of the corners of their devices. Apple leaders insist on continuous curves, a small difference but executing it demands that they commit to precise manufacturing.

This relentless pursuit of perfection is what differentiates some companies. Even though overdoing it can lead to micromanagement and make feel employees like they are not trusted, you need to strike a balance between the two.

  • Willingness to collaboratively debate.

Having so many teams of experts requires a lot of back and forth and debate. An overly polite culture can hinder creativity, as people might not speak up because they don’t want to upset someone. So, creative abrasion is very important in collaborative work.

To develop the dual lens camera portrait mode, Apple had 40 teams of specialists working together and they disagreed, pushed back, promoted or rejected ideas and build on top of each other’s ideas.

At the same time, leaders should be able to make decisions even when there’s no data available. For this, they first have to listen to everyone. It might be that there is no agreement or reliable information that can help in the decision making, but that’s where good leaders excel and what Jobs did at Apple as well. He used his own judgment to make decisions, even though not everyone was happy about those. Otherwise, debates could go on forever, become bottlenecks or compromises that lead to substandard results.

Apple Unsplash

However, there are also challenges that come with Apple’s managerial structure, which is not very common in other companies. When organizations grow, their leadership also needs to adapt and scale accordingly.

For example, while the number of employees grew eight times, the number of VPs reporting to executives only doubled. To handle all the new responsibilities, they could no longer be immersed in the details. So, they decided to focus on a few core activities that bring most value and those that require less attention are pushed down to people who are trained to handle them. That being said, leadership models need to be flexible in any innovative, growing organization.

Conclusion

With the right leadership, processes and structures in place, innovation can thrive in your organization. As leaders is important to set ambitious goals which can inspire and show the way for your team.

Innovation can seem like an insurmountable task. Even though the details matter and aspiring to excellence is important, you always have to keep focused on the end goal and take one step at a time towards that. At the same time, keep an open mind, stay curious and inspire others to follow suit.

In the end, leading innovation also means building the capabilities, processes and environment that foster innovation and encourage others to become innovators.

This article was originally published in Viima’s blog.

Image credits: Viima, Unsplash, Pexels

Subscribe to Human-Centered Change & Innovation WeeklySign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.






What Can Leaders Do to Have More Innovative Teams?

4 Replies

What Can Leaders Do to Have More Innovative Teams?

GUEST POST from Diana Porumboiu

Talent is one of the main drivers of innovation and its scarcity and high value makes it a frequent cause for concern for leaders from all over the world. And for good reason. Quality talent can make a business up to 800 times more productive.

But some of the biggest managerial challenges of senior leaders are finding the right talent and encouraging innovative behavior in employees. In fact, only 23% of managers and senior leaders believe they have good methods in place to acquire and retain the best talent.

So, how do you find the right people, retain them, and get them to drive more innovation? Putting together innovative teams and making sure that you have the best talent in the organization is not just an HR responsibility. From top executives to managers and leaders, they all have a part to play in the quest for talent that can help the organization drive more innovation.

To this end, we wrote this article for people in large organizations, whether they are innovation managers, leaders, or executives, who want to build talented teams that can actually drive more innovation.

We’ll go through some important points on the characteristics of innovative employees and provide some practical tips on how to get better talent and tap into the potential of current workforce to drive more innovation.

Why organizations need more employees involved in, and trained for, innovation work

We know that at a global level there is a shortage of highly skilled employees, and that even large companies with all their resources, don’t excel at finding and retaining talent.

Even though unemployment is still a big problem in many areas of the world, the rapid pace of change in recent times have showed that there is also an increasing shortage of talent.

Before 2020, a Gallup survey revealed that 73% of respondents were thinking of leaving their job. The pandemic hit, along with a crisis for many workers, but also with a wakeup call for other employees. And the Great Resignation, where 25 million people in the US quit their jobs in the second half of 2021, is proof of these unpredictable changes.

So, maybe now more than ever organizations should make sure that they are prepared and that they have the right workforce to help them thrive in the future.

Finding top talent is difficult, it takes time and it’s expensive. There is no way around it, organizations need more people once they start growing. At the same time, inside most companies there are also huge opportunities to unlock value from the existing workforce.

  • Untapped internal innovation potential

As it’s becoming more difficult to recruit top talent who can make more innovation happen, businesses that lack the knowledge and support for future growth are on shaky grounds.

But the conversations around the war for talent are not enough to provide real solutions on how to get more people involved in innovation work. Of course, as businesses grow, the need for more people to support that growth is obvious. However, when it comes to innovation capabilities, we don’t hear that often discussions around internal scouting and training of the existing workforce who can turn into assets for innovation.

How to tap into the full potential of employees? The approaches can vary, but a good start that works for almost any company, is to include everyone in the conversation, create a sense of belonging and give them a voice. This option is always worth pursuing and for a more in-depth guide on how to do that you can also check our article on collecting ideas from frontline employees.

Include everyone in the conversation, create a sense of belonging and give them a voice.

A second approach is to actually have them implement and drive innovation, but this is more complicated and requires a very structured approach and well implemented innovation management processes.

Either way, employees would benefit from training on innovation as is understood and applied within your organization. A common understanding of what innovation is for you, as a company, and how to achieve it, can reveal more potential than you first imagined you had.

There is still some controversy around the topic, and some believe that not everyone can be an innovator. While that can be true to some extent, innovation comes in different forms and shapes and almost everyone can contribute to innovation in one way or another if the context allows for it. Which takes us to our next point.

  • Innovation can be everyone’s job

While innovation might not come natural to most people, it doesn’t mean that we can’t learn the skills and mindset required for it. Even though not everyone has the curiosity and openness to explore new opportunities and ways of improving their work, they should still be encouraged and incentivized to be more innovative. And we believe it all starts at the top.

Innovation should be approached both top-down and bottom-up, but unless it starts from the top with great leaders who set the tone and support innovation, the chances of success are slim. At the same time, the front-end of innovation is where everyone can and should contribute, while the back-end execution requires more specialized skills and knowledge.

Viima Innovation Management Funnel

The bottom line here is that you can achieve a lot more innovation if you give everyone an opportunity to contribute. Most ideas, especially those that lead to incremental innovation come from the front-line employees, as they are the ones in close contact with your customers, products, and services. Even though most of these won’t necessarily change the trajectory of your business, when you put them together, they can make a huge difference in the performance of the core business.

  • Knowledge — source of innovation and competitive advantage

Speaking of competition, intangible assets, more prominently knowledge, are one of the major competitive advantages for organizations. Even more, tacit knowledge, the know-how, wisdom and experiences of employees which is not codified or explicit, represents an important driver for innovation.

As soon as you start working on harnessing that knowledge by creating the environment that enables transparent communication and flow of information, you will have more people involved in everyday innovation activities like idea challenges.

If you promote an innovation culture …

“Even if people themselves might not be innovators, they are still likely to support innovation instead of blocking it by being resistant to change.”

So, if we look at it from this perspective, everyone in the organization can contribute to innovation with the right leaders at the helm, some good skills development programs, and a sound scouting system in place. But for that, we first need to understand what makes an employee innovative and what are the traits that define innovative thinking.

What makes employees innovative?

In simple words, innovation stems from a mix of creativity and action. However, even if creativity is important, it is often overrated compared to execution, which makes change happen and gets things done. To get to execution in the corporate setting, you also need good communication and collaboration.

At a macro level, things seem simple but at the micro level, the individual’s set of skills and traits required for innovation can’t be summed up in a couple of words.

Employee Pondering

So, let’s see what makes someone innovative, what to pay attention to, and what skills innovators should learn and develop. This can help you assess whether some of your team members excel in some areas or if they need to refine other skills or behaviors.

  • Growth Mindset

The road to innovation is paved with uncertainty and risk, so innovators will always need to push into the unfamiliar. This comes natural to those with a growth mindset, who are usually inclined to be more open to change. On the other hand, those with a fixed mindset will be more reluctant to try something new or explore beyond what they are used to.

In short, a growth mindset is compatible with innovation because those who possess it, believe their abilities can be developed through hard work and dedication. Innovation work will most certainly mean that you will fail at some point, or your assumptions will prove to be false. Those with a growth mindset are resilient, curious, and eager to learn, so such failures won’t hold them back.

There is a common misconception that a fixed mindset can’t be transformed, since it is after all, fixed. The good news is that neuroscience has proved the plasticity of our brains, which means that behaviors and mindsets can be changed, even at a more mature age. But more on that, in the next section.

  • Skills

As mentioned earlier, if you want to build an innovation culture and inspire innovative thinking within your organization, it’s not enough to have the most creative people. There are certain skills that encourage the proactive “doers” to act and execute on innovation.

Some of these skills for innovation are critical thinking, which helps with problem solving, curiosity, which allows for exploration and learning, good communication which enables collaboration and teamwork, and of course the hard skills necessary to actually implement innovation.

This is by no means an exhaustive list of skills for innovation, but they can be seen as the basis on which people can build and improve their skills. The key thing to remember is that for some types of innovation, you want people that can move things forward and get them done.

  • Values

Maybe less pragmatic, but just as important in getting more people on the innovation boat, are the personal values. Values guide behavior and explain behavioral patterns. We tend to act instinctively according to our core values and according to empirical studies, certain values foster innovative behavior while others might impede it.

Our previous article on cultural differences and innovation explains more in depth the relation between people’s beliefs and innovation, so we won’t go too much into detail here.

While some theories like the Theory of Basic Human Values of Schwartz or Hofstede’s cultural dimensions theory stem from cultural psychology and communication, they have been extended and applied to economics and the corporate world as well.

For example, one of the ten broad personal values identified by Schwartz, self-direction, is defined as someone being independent in thought, inclined to choose, create, and explore. On the other hand, someone that values conformity and security more, will be less inclined to accept change, or challenge the status quo.

Schwartz Theory Basic Values

Source: https://i2s.anu.edu.au/resources/schwartz-theory-basic-values

These can be measured through the Schwartz Value survey and the Portrait Values Questionnaire. Of course, this is just one practical method, and it has its limitation, as it’s not always easy to apply in a corporate context. However, these methods can still be helpful in providing some guidelines on personality traits and values that are more inclined toward innovation.

So, let’s move from theory to practices that can encourage and nurture innovative behaviors in employees.

How to nurture innovative behavior in your organization

Most leaders concerned about the future of the organization they work for have asked themselves at some point how to unlock more innovation potential and it’s not easy to find the right answer. That’s because there is no single correct answer, but rather a mix of strategy, leadership approaches, resources, and practices.

The first noteworthy element that ignites innovation behavior is as simple as having the ambition to pursue specific goals that highlight the role and value of change and innovation.

Having the right goals that provide focus and direction is essential to set the stage and make it explicit that everyone has a role to play in improving the way they, and the company at large, operate and behave.

The next steppingstone that reinforces and support the goals are the processes that can lead to change and innovation. These are essential in strengthening teams that work on those goals and make things happen. Such processes will look different for each organization. Whether it’s a specific time allocation like the 15% or 20% rule for innovation, or idea management processes, these are crucial for long-term success.

Now, there are also other methods that are essential in nurturing an innovative behavior and these are mostly related to leaders’ soft skills and their ability to create the environment where innovation can flourish.

  • Foster a growth mindset

As already mentioned, there is a myth that you either have the growth mindset or you don’t. In fact, brains keep on changing, together with the cognitive abilities, and a fixed mindset can be developed into a growth one. How to achieve this in practice?

Start by identifying the fixed mindset patterns in your employees. Is someone giving up quickly? Maybe they avoid challenges and prefer the comfort zone, or they avoid negative feedback and are always prepared with the answer “It’s not my job” or “I’m not good with words, or creative enough”. These are all signs that point to a fixed mindset.

To change this, set smart goals and offer learning opportunities that are aligned with those goals. People with a fixed mindset usually hang on to old habits because they had success with those, and they’ve been measured based on them. So, create reward systems that encourage new ways of working and challenge people to take risks.

People with a fixed mindset usually hang on to old habits because they had success with those, and they’ve been measured based on them.

For example, Tata Group worked on developing an innovation culture for many years and as part of their initiative they have a prize for the best failed idea. The purpose is not to fail for the sake of failing but to encourage innovation.

Such initiatives should come from leaders who are willing to address the root causes of their employees’ uncertainty and reluctance to novelty. However, to be able to implement similar initiatives, leaders should take a step back and consider another element, which is critical: psychological safety in the workplace.

  • Psychological safety

The concept of psychological safety dates to 1999 and it refers to the belief that one will not be punished or shamed if speaking up or coming up with ideas, questions or concerns. Studies show that when employees feel comfortable to challenge the status quo without fearing negative consequences, organizations can innovate faster and adapt well to change.

Leaders have the greatest impact on team climate, and they have the power to influence internal behaviors more than anyone. A McKinsey survey reveals how leaders should develop their skills through leadership programs that focus on specific skills. Among the skills that have the biggest influence on creating psychologically safe work environments are the open dialogue skills, sponsorship, and situational humility.

While the theory helps us understand the importance of psychological safety in the workplace, it doesn’t provide practical answers. So, let’s briefly look at some concrete examples that leaders can put in practice to inspire more trust, and safety.

A good place to start is Laura Delizonna’s framework for psychological safety, which is based on four key pillars: Care, Courage, Co-elevate, Commitment.

Laura Delizonna Psychological Safety Framework

Care

Care is about empathy and the openness to understand one another even if you don’t agree. Showing care means practicing active listening, showing interest and empathy.

For example, some organizations have team rituals like check-ins. One technique is the PIE check-in when each person in the team takes a few seconds to talk about their Physical, Intellectual and Emotional state.

Another technique you could use is the Rose Bud Thorn, where you ask each person to share a positive of the week (rose), something that emerged (the bud) and something that is challenging (the thorn).

There are other techniques and most of them work well even in remote environments. Also, something as simple as coffee chats, ask me anything sessions, sharing rituals like celebrating birthdays or holidays can all help in showing care and empathy. Leaders should constantly offer their support, assess people’s needs and burnout risk.

Courage

To inspire courage, leaders first have to show courage. They should walk the talk and be open with their vulnerabilities, mistakes, and challenges. So, while it might be difficult for some, true leaders show the way by admitting when they don’t know something, asking questions and showing interest to learn and improve their skills. Owning errors publicly and as soon as they happen has a big impact on team morale and attitude towards failure.

As a leader you can share your learning journey where you include the goal, the adversities you faced, experiments you made and failed and lessons you learned.

Co-elevate

Co-elevate is about inspiring and empowering others to bring their best, not just cooperate. Study shows that leaders think they give recognition 80% of their time, while team members feel they receive recognition 30% of the time. There is a disconnect in how we communicate.

Some best practice to co-elevate is to express appreciation that is frequent and specific. What do you appreciate in someone’s approach? How did their work influence the results and you personally? What specific behaviors can you praise?

Just as important is to solicit input and how you do that makes all the difference. Instead of leaving room at the end of a meeting for people to add something, change the approach to ask opposing views, or what someone would do in your place, etc. Remember to thank those who speak up and give an opposing argument.

As you can see, there are many nuances when communicating, providing, and asking for feedback. Once you create procedure and different pathways that allow for contribution, things will get easier.

Commitment

Commitment is what brings everything together. Leaders need to commit to experiments and to try to do something differently. Set goals for things you want to change. You can start with one experiment every day.

Psychological safety and a growth mindset are essential if you want to unleash the innovation potential of employees. However, nurturing them takes time, so you won’t see results overnight. It’s important to remember that as leaders you set the scene and lead the way. Unless you take baby steps to display the innovative behavior you expect from others, you won’t be able to move the needle in the right direction.

Conclusion

Neuroscience taught us that even as adults, our brains are malleable, so if some employees might seem resistant to change, disengaged or lack creativity, first ask yourself if there is something you can do differently. Maybe they don’t have the environment where they can flourish, or they are not led by people who allow them to shine.

Inevitably, there’s always going to be someone who resists change, who can’t be converted to a growth mindset or innovative thinking. This doesn’t mean that there isn’t room for improvement. Their support can contribute to incremental innovation and continuous improvements. It’s also more cost-efficient to train existing workforce than always looking for something you believe it’s missing.

When you’ll inevitably have to scout externally for new talent to support innovation work, consider a few key elements: the employer brand, innovation culture, leadership training programs, as well as the processes and mechanisms that facilitate innovation.

This article was originally published in Viima’s blog.

Image credits: Viima, Unsplash, Pexels

Subscribe to Human-Centered Change & Innovation WeeklySign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.






Leveraging Tacit Knowledge to Drive More Innovation

Leave a reply

Leveraging Tacit Knowledge to Drive More Innovation

GUEST POST from Diana Porumboiu

The value of intangible assets in organizations is nowadays five times greater than the one of tangible assets. In fact, 84% of value in S&P companies is currently represented by intangible assets, like intellectual property, knowledge, or brand recognition, compared to merely 16% for tangible ones.

Even so, some leaders still have difficulties in grasping the power of knowledge and how it can be leveraged and managed to drive more innovation in their organizations. One of the biggest challenges for these leaders is that the majority of knowledge that makes more innovation happen is tacit, and therefore it’s harder to tap into its full potential through the traditional methods: processes, procedures and policies available in databases and documents.

Unfortunately, companies that were not able to keep up with these changes in value distribution faced difficulties and were surpassed by those that leveraged tacit knowledge better. Now, the question that arises is how top companies tap into the full potential of tacit knowledge.

So, in today’s article we’ll explain how different types of knowledge trigger innovation, what is the true value of tacit knowledge, as well as some practical tips on how to make the most of tacit knowledge.

Tacit Brain Knowledge

Explicit, implicit, and tacit knowledge and their role in driving innovation

Before diving into the practical things, we’ll go through some theoretical aspects which can help clarify the reasoning behind some actions. There’s a lot of literature on tacit knowledge and knowledge management which you can explore more in depth if you’re interested, but for the purpose of this article we chose the essential information which can serve leaders, managers and decision-makers who want to tap into the potential of tacit knowledge.

The goal of this article is not to offer a perspective rooted in cognitive science and we are aware that there are different interpretations and a variety of opinions on the topic. That being said, let’s get to it.

Knowledge, especially tacit, is hard to quantify and measure, which makes it elusive and difficult to capture, but its role in driving innovation is undeniable. To exploit its innovation potential, it’s essential to understand the different types of knowledge, how they can be managed and how they come into play in an organization.

For this, we’ll briefly explain the three main types of knowledge and their role in making innovation happen.

First, there is explicit knowledge, which is the easiest to manage and understand. It’s the most basic type of knowledge that can be collected and transmitted throughout an organization. It comes from organizing, structuring, and processing data and it’s usually stored in databases or files like internal documentation, reports, analytics and financials, process maps, handbooks, and so on.

For example, all metrics and KPIs are forms of explicit knowledge. Explicit knowledge supports everyday improvements which primarily leads to incremental innovations.

Next is implicit knowledge, which oftentimes is put under the same umbrella with tacit knowledge. However, we prefer to separate the two because there are small differences in how you should manage them in practice.

Implicit knowledge is essentially explicit knowledge applied: how we make use of existing information and put it into practice. Each of us has different past experiences and ways of thinking. As you’ve probably seen, that means that we can draw different conclusions from the same data, and thus apply the same explicit knowledge in very different ways.

This is true especially when we think of how people communicate and transfer information. For example, when we create a report or a presentation, even if we work with the same data points and results, different people may choose to focus on different pieces of information and tell a very different story.

Last, but not least, is the focus of this article: tacit knowledge. Tacit knowledge refers to the wisdom we accumulate through experience but that is not codified or clearly expressed. These are the things we know but can’t really put into words. Think cognitive skills, mental models, intuition, and general know-how.

Different sources are citing various figures of how knowledge is distirbuted in an organization. From 80% all the way to 95%, tacit knowledge seems to be the bottom of an iceberg, hidden under water. Regardless of what the specific number really is, it’s probably safe to say, that the vast majority of information is tacit.

Tacit Knowledge Pyramid

It’s believed that turning tacit knowledge into explicit knowledge is extremely difficult because of its nature. Many times, when we think we articulate or codify tacit knowledge, we might deal with implicit knowledge instead. Why is it then so hard to capture tacit knowledge — and should we even try to make it explicit?

In practice, people often aren’t aware of the tacit knowledge they possess, and that’s a big part of what makes it so elusive. Transferring know-how and cognitive skills requires regular contact, interaction, and trust between people. When this can be turned into a conscious, systematic effort, that’s when we start to get its value and make the best of it.

The importance of tacit knowledge and how to make the most of it

In the era of information technology, it’s so easy to become obsolete, that retaining and acquiring knowledge has become a central focus for most organizations.

Today most companies recognize employees’ talent and knowledge as a major competitive advantage. We’ll explain later in the article why most innovations and breakthroughs don’t come from explicit, but from tacit knowledge.

Losing employees with the tacit knowledge that hasn’t been passed on can lead to the inability to complete projects or meet strategic targets. For example, an engineering company lost its dominant market position simply because it lost the experienced engineers that major clients were looking for. Typically, that relationship isn’t as obvious, but the same principles still apply. The most talented or experienced employees create dramatically outsized returns for the organization.

As already mentioned, explicit knowledge refers to the public information, which would be easily accessible if desired, because it can be codified and transmitted in writing. As we know, such knowledge generally contributes to incremental improvements, but breakthrough innovations require truly novel knowledge, and that usually starts at an individual level.

From a highly experienced floor worker who comes up with ideas to streamline processes to a researcher’s insights that help develop a new product, the key is to make this individual knowledge available to others. That is one of the main sources of competitive advantage in knowledge-centric companies.

How tacit knowledge impacts organizational performance

Traditionally, knowledge isn’t systematically measured against financial results, so some executives might not be aware of how knowledge loss impacts their performance. It’s understandable, given that it’s easier to measure and track the impact of tangible assets, so the focus usually goes in that direction.

However, nowadays we have plenty of research that supports the idea that losing knowledge has a significant negative impact on an organization’s performance. This helps us better understand how losing tacit knowledge affects the bottom line. At the same time, if leaders can articulate the role of tacit knowledge, they can also assess the real costs of managing it and raise awareness on the investments required to create, retain, and transmit it.

Losing knowledge capital can affect the performance of an organization in different ways.

From reduced organizational capabilities or ability to achieve strategic objectives, to disruptions, increased time to accomplish tasks, increased costs, or reduced customer satisfaction.

Let’s take the example of a company where a veteran sales executive who played a major role in dealing with important customers is leaving the organization. His strong customer relationships developed over the years could affect the firm, leading to a loss of up to $ 10 million. The business will not only lose significant revenue but its ability to acquire new ones will also diminish.

In such cases, the external social capital is useful for the organization at large. Having access to a diverse external network allows people inside the organization to tap into a wide range of information.

On the other side, when these connections are exclusively internal, politics can get in the way and affect the transparent flow of information.

To summarize, losing knowledge capital can affect the performance of an organization in different ways. From reduced organizational capabilities or ability to achieve strategic objectives, to disruptions, increased time to accomplish tasks, increased costs, or reduced customer satisfaction.

On the other hand, if you focus on developing a knowledge-creating company that encourages continuous learning, interaction, and constant dialogue you will see additional benefits, as well as positive impact on the bottom line.

By now, you’re surely thinking what all this theory means in practice, so let’s take a look at that next by going through some methods that can help reap these benefits.

How to capture tacit knowledge

As already mentioned, turning tacit knowledge into explicit knowledge requires some work and effort, but by starting with baby steps like getting people to share thoughts, issues, or ideas on a regular basis you are already one step ahead.

We believe there’s no need to overcomplicate things and the good news is that something as simple as gathering ideas will force people to turn their tacit knowledge into something more tangible. Obviously, each organization has its share of bad ideas, but even so, it’s still a great way of bringing people’s insights to the table because it can uncover new opportunities, sometimes even unrelated with the idea itself.

It might not be the first thing that comes to mind when trying to access tacit knowledge, but an idea management tool can help you turn it into a systematic, continuous practice that on the long run, can lead to more innovation.

Collaboration Unsplash or Pexels

However, at the end of the day, a tool is just a tool. It helps you organize your processes better, automate tasks, and facilitates easy communication. The complexity and nature of such methods and processes varies greatly from one organization to the next.

If you are operating in an industry with higher risks, codifying tacit knowledge becomes even more complicated. A continuous ideation process could reveal new creative ways of accessing it as well as maintain communication and a constant flow of information.

To put things in perspective, let’s take the example of a maintenance technician who retired from a plant that produced soybean oil. After he left, the produced oil quickly started to go bad. It took the company two years and it cost them millions of dollars before they realized that the maintenance worker had been changing a seal on the machines that pressed the oil every week, instead of the eight weeks that was instructed in the maintenance manual.

The first reaction would be to blame the technician for not transferring that information before leaving, but in reality, it’s the company’s responsibility to have in place processes that ensure smooth transfer of information and knowledge.

Managers and leaders should be aware of these differences in procedures and in this particular case the mistake could have been easily avoided with a better process of documenting the steps taken to produce the soybean oil.

As this example shows, different organizations need different processes at various levels of complexity. Developing those processes that support knowledge creation and retention is still up to you, so let’s have a look at three simple steps that can make a big difference.

  • Bring to the surface the knowledge losses and the risk associated with that. What knowledge supports the strategic objectives and business goals? To run a diagnosis process you could, for example, start with a series of interviews that will help you surface potential issues.
    Here’s where you want to identify the critical knowledge that might be lost and its impact, the interviewees perception of existing knowledge and the transfer processes and opportunities to leverage knowledge in case employees leave.
  • Map the employees and the roles whose knowledge is essential and play a key role in transmitting it. The previous step can also guide you in creating this map or list.
  • Create the environment and practices that encourage socialization and interaction. Since tacit knowledge is about the know-how and the skills we acquire through experience, these are best learned through emulation, imitation, and repetition.

There are many ways to go about this, and in the best practice section we go a bit deeper into these details.

Best practices for accessing tacit knowledge

These are three first steps that could be applied in any organization, regardless of their profile. They can become the foundation for a more thought-through process which you can develop in time. On a more practical level, the methods and processes you decide on, can be supported by some of these best practices:

Build a continuous improvement culture as it helps to reinforce the social capital.

It encourages contribution and collaboration between people. It enables networks of relationships that help the organization function effectively. When these connections are strong and built on trust and transparency, they facilitate the transfer of know-how and other skills that otherwise would be lost.

Encourage constant social interaction and exchange of ideas

As already mentioned, tacit knowledge is about the know-how and the skills acquired through experience. These skills are better transmitted through emulation, mentorship, and repetition. This knowledge is deeply embedded in people’s minds and human interactions are essential to facilitate the transfer of information.

Make idea generation and collection a systematic process

This won’t help you just to find answers and solutions to specific problems but also to uncover opportunities that have an impact on the entire organization.

Collecting ideas systematically enables the entire workforce to get involved and build on each other’s knowledge. Moving from a traditional “suggestion box” to a more wholistic and transparent approach with an idea management tool can dramatically help in sharing and making knowledge more accessible.

Encourage storytelling in different forms

You can create a “lessons learned” database where people can learn about successes and failures that lead people to acquire their knowledge. The best way to tell these lessons, might be through stories.

Storytelling is a powerful tool because it allows people to reflect on their learnings. Essentially, you want people to share their (true) stories that serve as metaphors which make difficult-to-grasp information easier to digest and understand. Stories are powerful because they convey meaning and knowledge, not just unconnected bits of information. For example, you can put this in practice through internal newsletters, or casebooks.

Create succession planning, retirement policies, and mentoring programs

Retirement is one of the causes of knowledge loss and some companies don’t tap into the tacit knowledge of older employees. The loss of experienced employees can threaten core capabilities that rely on complex experiential knowledge. Organizations should have mentoring programs to train less experienced employees, as well as retirement policies and plans that help maintain the balance of the workforce.

Examples of codifying tacit knowledge:

As you’ve seen so far, there are different factors that can help you either capture tacit knowledge or turn it into explicit knowledge. And as mentioned, sometimes learning new things also comes from emulation and imitation. With that in mind, let’s see what other companies are doing to address the issue of tacit knowledge and think of what you could also learn from their experiences.

Matsushita Electric

The first example is one that helped popularizing the concept of tacit knowledge as well as the idea that it supports innovation.

Kneading Bread Unsplash or Pexels

In 1985 Matsushita Electric, now Panasonic, was working on creating a better home bread-machine. However, they lacked the knowledge a baker had. So Ikuko Tanaka, a software developer at Matsushita decided to learn from the best. He trained with the master baker at The Osaka International Hotel and observed the technique he had for kneading the dough.

The know-how of the baker, his special stretching technique, was the tacit knowledge that Matshushita was lacking, and that Tanaka was able to uncover and reproduce through imitation and observation. After working with the baker, experimenting, testing and developing the product, Matsushita created a final product that led to record sales.

Rolls-Royce

Even though it’s not a recent example Rolls-Royce is still a good case to look into. Rolls-Royce turbojet engines powered Concorde, the aircraft that introduced supersonic air travel to the world. The Rolls-Royce engineers held most of the knowledge on how to maintain the sophisticated supersonic jet engines and many of them were preparing for retirement.

Before the Concorde was retired in 2003 the company identified how the big number of retirements would impact their key capabilities. This helped them prepare for uncertainties and decide on future investments.

Bessemer

Last, but not least, an example that takes us even farther back into the history is Henry Bessemer and his patent for an advanced steelmaking process. Bessemer sold his patent, but he was later sued because they couldn’t make it work. So, Bessemer set up his steel company because he knew best how to do it, even though he wasn’t able to articulate it.

As you can see from these examples, tacit knowledge spans its impact in various areas and at different levels in each organization. So, it’s important to remember that tacit knowledge plays an important role in all stages of innovation.

It can be in the early stages, where there’s a higher degree of ambiguity so more knowledge to be harnessed. Or, it can be in the later stages of innovation, where execution and implementation require you to tap into the tacit knowledge of your employees to speed up the process and get better results

Conclusion

“We can know more than we can tell”, said Polanyi, the one to whom we attribute the concept of tacit knowledge. We couldn’t agree more. We can’t possibly articulate everything we know, so we need to find other means to go about it.

As leaders, managers, or someone with decision-making powers, you have to maximize the opportunities of expressing this knowledge. You can choose to develop a culture of innovation where continuous learning, improvement and knowledge exchange are encouraged and sustained. With a strategic and systematic approach, the flow of information will become more natural and easier to manage.

This article was originally published in Viima’s blog.

Image credits: Viima, Pixabay, Unsplash, Pexels

Subscribe to Human-Centered Change & Innovation WeeklySign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.