Managing with empathy is a leader’s superpower. Empathy opens the door to increased innovation, collaboration, and engagement.
Experts assert that empathy is the single most important skill in today’s workplace and the numbers don’t lie: 76% of workers with empathetic leaders are reportedly more motivated and engaged than those who experience leadership with less empathy.
Leaders can harness the power of empathy to create a more collaborative and engaged culture at work. In this article, we explore empathetic leadership in the following topics:
What is Workplace Empathy?
Becoming an Empathetic Leader
The Benefits of Managing a Team With Empathy
The Connection Between Empathy and innovation
What is Workplace Empathy?
Managing with empathy requires a keen understanding of the nuances of workplace empathy and empathetic leadership. Empathy allows one to understand another person’s emotions, actions, and thoughts. Our emotional or social intelligence helps us practice empathy and understand the mindsets and emotions of others.
Empathy belongs in the workplace. While work-related responsibilities should be top of mind, your team members won’t be able to do their best work if they feel as though their emotions and feelings are invalidated or ignored. It’s crucial that team members feel as though their feelings and emotions are prioritized both in their professional and personal lives. With the power of empathy, team leaders and managers can shift company culture for the better and motivate their team to be the best version of themselves.
Empathetic leaders understand the three types of empathy:
1. Cognitive Empathy
Cognitive empathy relates to connecting to another person’s mentality and understanding how certain situations influence their thoughts. Cognitive empathy is related to “theory of mind” that explores how someone can think like another and predict what their future behavior may be.
2. Somatic Empathy
Somatic empathy occurs when one experiences a physical response to another’s feelings or experience.
3. Affective Empathy
Affective empathy involves understanding another’s emotions and responding most appropriately.
Becoming an Empathetic Leader
Managing with empathy is possible for all leaders and team members willing to start within. To connect emotionally with others, you have to first prioritize your connection with yourself. By cultivating your emotional intelligence and understanding your own emotions and feelings, you’ll be better equipped to lead with empathy.
In today’s ever-changing climate, workers have to navigate the likes of diverse workforces, virtualized teams, and global economic challenges. Being able to adapt and sympathize with the perspective and experiences of others will help you improve your empathetic leadership.
Listening to your team is one of the fastest ways to start managing with empathy. With every conversation comes the opportunity to build a better relationship and affirm your team member’s emotions. In each conversation, be sure to pay attention, avoid distractions, and wait for the person to finish before you speak.
In addition to letting your team members fully share their opinions, the art of listening requires you to fully understand the emotions that are behind each conversation. This includes understanding nonverbal cues, identifying the tone of voice, and paying attention to body language. If you’re working remotely, managing with empathy can be particularly challenging. Take advantage of voice notes, video chats, SMS messaging, and sending photos and videos to ensure you’re virtually communicating as comprehensively as possible.
2. Get Personal
Though personal bonds in the workplace are often discouraged, building healthy professional relationships is an effective way to start managing with empathy. By forming personal connections with your team members, you’ll encourage a culture of open communication and alignment. As you both connect, you’ll find commonalities in your shared vision and values.
3. Adopt their Point of View
As an empathetic leader, it’s essential to gain emotional insight into what your team is feeling and thinking by adopting their point of view. Whether your company is remote or in-person, it isn’t always easy to understand the perspective or emotional state of your team. While some leaders shy away from discussing emotions and feelings at work, the truth is that learning more about each employee’s emotional state will help you understand how they approach their work and why they work the way they do.
4. Get Leadership Training
Managing with empathy doesn’t always come naturally. Take the opportunity to invest in leadership training to learn how to better incorporate your emotional intelligence and empathy into your management style. With the help of professional leaders, you’ll learn how to emotionally connect with your team and manage the personal and professional challenges that come your way. Consider courses in facilitation and change management as you learn the ins and outs of empathetic leadership.
The Benefits of Managing a Team With Empathy
Don’t put empathy on the backburner. While it takes time and intention to cultivate a company culture rooted in empathy, making the journey to create an emotionally intelligent environment is worth it.
Consider the following benefits of managing with empathy:
1. Better Relationships
Better relationships are a direct benefit of managing with empathy. Empathy helps team members emotionally connect as they identify personal interests and can freely communicate with each other. Use empathy to deepen relationships by asking questions about how others feel and providing careful and thoughtful responses.
2. Enhanced Teamwork
Empathy is a key ingredient in designing stronger teams. Managing with empathy encourages a desire for team members to help each other and work together. As you learn more about the challenges your team faces, you’ll naturally want to assist them in finding solutions. This type of cooperation encourages a culture of camaraderie where team members feel as though they are a critical part of each other’s success.
3. A Stronger Work-Life Balance
Empathy is a natural part of a stronger work-life balance. At times, challenges from one’s personal life can affect the way team members approach work obligations. Understanding their challenges will help you shape a better work-life balance for your team. Whether they need more time off or want more remote work, listening to and understanding their needs will help them create a healthier balance between their personal and professional lives.
4. Increased Innovation
A workforce of engaged and emotionally aligned employees allows for increased innovation. A workplace culture of empathy helps to develop soft skills such as curiosity, generosity, and equality, which encourages team members to design new creative and collaborative solutions.
The Link Between Empathy and Innovation
The link between innovation and empathy is undeniable. Empathetic leadership allows us to understand and relate to each other in a deeply profound and authentic way. Empathy is an incredible tool for innovation as it works to encourage companies and teams to center the needs and feelings of others.
By encouraging team members to adopt another’s point of view, leaders can utilize empathy as a problem-solving framework. Empathy places the experience and satisfaction of others at the heart of the creative and collaborative process. These empathetic techniques and behaviors are undoubtedly linked to the most effective designs, products, and creative solutions.
In the workplace, empathy naturally reinforces a culture of innovation as it encourages and validates the feelings and opinions of others. Regardless of the problems at hand, human-centered thinking encourages organizations to empathetically eliminate their biases, reservations, and judgment to arrive at the solution that benefits the end-user and their fellow team members the most.
If innovation is at the heart of your company, it’s time to start managing with empathy. Voltage Control offers custom programs built around connection, psychological safety, community, and play. Connect with us today to learn how to use empathetic leadership for the greatest good.
Our industry of innovation management software is quite an interesting one. It’s been around for a while, but it’s still not a mainstay that every organization would use, at least not in the same way as CRM and team communication software are.
Hence, there’s quite little independent research available out there to prove its efficacy, or even for determining which parts of it are the most valuable.
So, when I saw a new study, conducted jointly by a few German universities, come out on the topic, I was naturally curious to learn more.
In this article, I’ll share the key findings of the study with you, as well as some personal thoughts on the how and why behind these findings. We’ll also wrap up the discussion by considering how these findings relate to the wider trends within innovation management.
About the Study
Before we get to the results, let’s first briefly cover what the study was actually about and how it was conducted.
First, the focus of the study was to analyze the role of Innovation Management Software (IMS) adoption for New Product Development (NPD) effectiveness and efficiency, as well as the factors (software functionality and offered services) that actually led to successful adoption of said innovation management software.
The data was collected with an online questionnaire that was answered by innovation managers from 199 German firms of varying sizes, 45% of which used an Innovation Management Software, and 55% of which didn’t.
While this is the largest independent piece of research I’ve yet seen on innovation management software, we should remember that all research comes with certain limitations and caveats, and it’s important to understand and keep these in mind.
You can read the paper for a more detailed list, but in my opinion, this boils down to a few key things:
First, the study uses NPD performance as a proxy for innovation outcomes. This is an understandable choice to make the research practical, but in reality, innovation is much more than just NPD.
Second, while the sample size of companies is respectable, the demographic is quite homogenous as they are all German companies that employ an innovation manager, which obviously isn’t representative of every organization out there.
Third, the results are analyzed with regression analyses, which always brings up the age-old dilemma: correlation doesn’t imply causation. In other words, the study can tell us the “what”, not the “why” or “how”.
And finally, while the chosen variables are based on validated prior research, the questions still require subjective analysis from the respondent, which can introduce some bias to the results.
So, let’s keep these in mind and move on to the actual findings.
The Main Findings of the Study
The authors have done a great job in summarizing the hypothesis and respective results in a table, which you’ll also find reproduced below.
Let’s break the results down by hypothesis and cover the main takeaways for each.
Innovation Management Software Adoption Leads to Better NPD Performance
The first hypothesis was that using an Innovation Management Software would lead to better New Product Development performance. This can further be broken down into two parts: efficiency and effectiveness.
The results show that IMS adoption does indeed improve NPD efficiency, but the impact on NPD effectiveness wasn’t significant.
Innovation Management Software improves New Product Development efficiency, but the impact on effectiveness isn’t significant.
Intuitively, this makes sense and is also well in line with our experience. Innovation, especially in terms of NPD, is hard and requires a lot of work and difficult decisions, usually in the face of significant uncertainty. No software can magically do that job for you, but a good tool can help keep track of the process and do some of the heavy lifting for you.
This naturally helps with efficiency which allows innovators to focus more of their efforts on things that will lead to better results, but those results still aren’t a given.
Functionality That Leads to Higher IMS Adoption
The second hypothesis is focused on the functionality provided by the innovation management software, and the impact of said functionality on overall IMS adoption.
To be more specific, the respondents were asked how important they considered each functionality to be for their firm.
Here, Idea Management was the only functionality that had an impact for these firms.
Idea Management was the only functionality that had a significant positive impact for the surveyed firms.
Again, that intuitively makes sense and is well in line with our experience. Idea management is the part that you embed in the organization’s daily processes and use across the organization to make ideation and innovation systematic. And as mentioned, it’s the part that does a lot of the heavy lifting, such as increasing transparency, communication and collecting and analyzing data, that would otherwise take up a lot of time from people running innovation, which naturally helps with efficiency.
So, while Strategy and Product Management capabilities do have their uses, they are not nearly as essential to IMS adoption, or innovation success for that matter.
In our experience, this primarily comes down to the fact that most companies can manage those capabilities just fine even without an IMS. The value-add provided by the software just isn’t nearly as high for most organizations there.
Services That Lead to Higher IMS Adoption
The third and final hypothesis focused on the importance of the services offered by IMS vendors for the respective firms.
Here the spectrum covered consulting, training, customer support, customizations, as well as software updates and upgrades.
Here, the only factor that made a positive difference for the respondents was software updated and upgrades. This category includes both minor improvements as well as new functionality for the software.
Interestingly enough, for consulting that relationship was negative. Or as the authors put it, adopters more alienate than appreciate such services.
Software updates and upgrades were the only service with a positive impact, whereas consulting actually had a negative one.
Let’s first cover the updates and upgrades as that is probably something everyone agrees on.
Good software obviously evolved quickly and as most companies have embraced the Software as a Service (SaaS) model, they’ve come to expect frequent bug fixes, usability and performance improvements, and even new features for free. Over the lifetime of the product, these make a huge difference.
Thus, most understand that you should choose a vendor that is committed and capable of delivering a frequent stream of updates and new capabilities.
Let’s then move on to consulting and discuss why it is detrimental to adoption.
While we’ve always kept professional services to a minimum at Viima, this still came as a bit of a surprise for me. As I’ve raised this point up in discussions with a couple of people in the industry, that do offer such services, they seem to respond with varying degrees of denial, dismissal, and perhaps even a hint of outrage. When such emotions are at play, it’s always a good time for an innovator to lean in and dig a bit deeper, so let’s do that!
Looking at this from the point of view of the customer, there are a few obvious problems:
Misaligned incentives
… which leads to focusing on the wrong issues
Lack of ownership
Each of these could be discussed in length, but let’s focus on covering the keys here.
First, it’s important to understand that every software company makes most of their profits from software licenses. Thus, while generally speaking modern SaaS models do incentivize the vendor to make you successful, that isn’t the whole picture. The focus is actually on keeping the customer using the software. With the right product, that will lead to good outcomes, but that isn’t necessarily always the case.
However, when you add consulting to the mix, it’s only natural that it focuses primarily on the usage of the software because that’s what they know best, and what’s also in their best interest.
And, while making the most out of the software is important, it’s usually not the biggest challenge organizations have with their innovation efforts. In our experience, these are usually in topics such as organizational structure, resource allocation, talent, culture, as well as leadership buy-in and understanding.
And, even if the vendor would focus more on some of these real challenges the customer has, they rarely are the best experts in these matters due to their experience coming from matters related to the product.
Now, once you have a consultant come in, you of course want to listen to them. However, a consultant’s job is to give advice, it isn’t to get to the outcomes you want or need, and there’s a big difference there. That is one of the fundamental challenges in using consultants in general, and a big reason for why many don’t like to use them for long-term issues that are core to your future success, such as innovation.
Having said that, if you do use consultants, you can’t lose track of the fact you still need to take ownership for delivering those results. The consultant might be able to help you with that, or they might not. It’s still your job to make the decisions and execute on the chosen plan.
Put together, these reasons are also why we have been reluctant to do much consulting for our customers. We simply think the customer is best served by taking ownership of these matters themselves. We do, on the other hand, seek to provide them with the information, materials and advice they might need in navigating some of these decisions – with no additional cost through channels such as this blog and our online coaching program.
How do these findings relate to wider IMS trends?
Now that we’ve covered the key findings, let’s discuss how these are present in the wider trends within the Innovation Management Software industry.
In addition to what we hear in our discussions with customers and prospects, we’ve also discussed the topic quite extensively with industry analysts and would break these down into a few main trends.
Focus on enterprise-wide innovation
One of the big trends we see is that more and more companies are following in the footsteps of the giants like Tesla, Amazon, Apple and Google, and are moving innovation from separate silos to become more of a decentralized organization-wide effort.
This isn’t always necessary for pure NPD performance, which is what the study was focused on, but it is certainly key for scaling innovation in general, and one where efficient idea management can play a key role.
Once you embark on that journey, you’ll realize that your innovation team will initially be spread very thin. In that situation, it’s especially important to have easy-to-use tools that can empower people across the organization and improve efficiency.
Simultaneous need for ease of use and flexibility
That enterprise-wide innovation trend is also a big driver for the importance of intuitiveness, ease of use, and flexibility becoming more important.
In the past, you could have an innovation management software that is configured to match your stage-gate process for NPD. You might still need that, but it’s no longer enough. You probably want more agile processes for some of your innovation efforts, and more lightweight ones for some of the more incremental innovation many business units need to focus on.
If people across the organization don’t know how to use the software, or require extensive training to do so, you’ll face an uphill battle. What’s more, if you need to call the vendor whenever you need to make a change to the system, you’re in trouble. Top innovators often run dozens or even hundreds of different simultaneous innovation processes in different parts of the organization, so that quickly becomes very tedious and expensive.
Reducing operational complexity and costs
A big consideration for many is the operational complexity and running costs associated in running and managing their infrastructure and operations.
Extensive configuration work and on-premises installations significantly add to both of these, so even though they can be tempting for some organizations, the costs do pile up a lot over time, especially since it requires a lot more attention from your support functions like IT to manage.
What’s more, if you want to make changes or integrate these systems with new ones you may introduce, typically you only have one option: you need to turn to your IMS vendor.
As IMS tools have matured and off-the-shelf SaaS services have become much more capable, the compromises in increased rigidity, complexity and running costs, as well as less frequent updates are no longer worth it and off-the-shelf SaaS is now the way to go for almost everyone. With SaaS, you benefit immensely from economies of scale, and you are no longer held captive by the sunk cost fallacy of up-front license payments and extensive configuration and training work.
Commoditization in Idea Management
As the study pointed out, idea management is at the core of most innovation management software. However, in the last decade, the competition in the space has increased a lot.
There are now native SaaS platforms, like Viima, that are able to offer extremely competitive pricing due to efficient operations and a lean organizational structure. This has put a lot of pressure on many vendors to try to differentiate themselves and justify their higher price tags with additional professional services, as well as adjacent products and capabilities.
In our experience, while these might sound good on paper, they aren’t often leading to more value in real life, and the respondents of this study would seem to concur.
Conclusion
So, to conclude, what did we learn from the research?
In a nutshell, no innovation management software or vendor will miraculously turn you into a successful innovator. A good software, however, will help you become more efficient with your innovation efforts, as well as lead to softer benefits such as improvements in communication, knowledge transfer and culture. Put together, these can make your life a lot easier so that you can focus on actually driving results with innovation.
What then should you consider when choosing your innovation management vendor?
Well, the evidence shows that you should focus on idea management, as that’s where the biggest impact on the factors mentioned above come from. And therein, you should focus on vendors that continuously update and evolve their software with the help of modern technology and that has made all the above so easy and intuitive that they don’t need to sell you consulting.
And of course, ask them the tough questions. Ask to test the software in real life. If you can’t, that is a red flag in and of itself. See how flexible and easy-to-use their software really is. Does it require consulting or configuration by the vendor?
This article was originally published in Viima’s blog.
Image credits: Unsplash, Viima
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Successful strategy and innovation are about how fast you can become aware of your assumptions.
GUEST POST from Soren Kaplan
When it comes to strategy and innovation, success depends on how fast you become aware of your assumptions and then modify them. But it’s a paradox: You can’t see your most fundamental assumptions until you overcome them. This means that you can only understand your mindsets that were barriers retrospectively.
Let’s look at how this works. I have a quick story for you, then a question.
A bus driver was heading down Van Ness Avenue in my hometown of San Francisco. He went through a stop sign without even slowing down, then turned onto a one-way street going the opposite direction as the rest of the traffic. A police officer saw the whole thing but he didn’t stop him or issue a ticket because no laws had been broken. The question for you is this: How can this scenario be possible?
If you answered that the bus driver was walking down the street, you are correct. This is a very simple example to illustrate how we all make assumptions. Most people just assume that a bus driver is always driving a bus. But of course, that’s not the case. The most important part of this exercise isn’t to point out that an assumption may have been made in the first place – it’s only natural to do so. It’s to show that most of us only recognize that we’ve made an assumption after we’ve discovered that our thinking was invalid or that it led us astray. And by then, it can often be “too late.”
Let’s go back to the bus driver for a moment. What if I had framed things up in the scenario a little differently and included another statement up front that said “In San Francisco, people use cars, take the bus, or walk down the street to get where they’re going.” How would this have impacted your assumptions? For most people, the idea that it’s possible the bus driver could be walking down the street would have been planted in their brains as they read the rest of the scenario – and they would have more easily overcome their limiting assumption that bus drivers only drive buses. The goal is to continually broaden your perspective so that you can overcome your assumptions before they limit your options or slow you down.
Here are a couple of tried and true approaches I’ve used to challenge and expand mindsets.
Identify Areas of Intrigue
When it comes to developing your strategy or innovating, get clear on what you need to know and learn. List up to 4-5 topics. Examples might include things like board games children like most, the healthiest yet best tasting desserts, or the most successful social media influencers. For each topic, create a list of guiding questions that, if answered, would really give you a solid understanding of the area. For instance, using the board games children like mostexample, you could come up with questions like: What are the most popular children’s board games? How long do the best games take to play? Do adults usually play with the children? What does it take to win? This exercise will help you better understand what’s most important to further explore so you can broaden your perspective.
Adapt a Business Model
Find a company completely outside of your industry or market and look at what makes them different and what they do really well. Then adapt their model to your cause. Use the format “I want to be the ____________ of ____________” by putting a company name into the first blank and the area of your target market or innovation area into the second blank. For example, if you want to transform the fashion industry, you might try “I want to be the Netflix of fashion”, which could lead you down the path of high-end evening gown rental services like Rent the Runway. Consider companies like Starbucks, Twitter, Domino’s, NIKE, Home Depot, or any other innovative company you can think of.
Your mindsets naturally constrain your ability to consider alternatives and possibilities that go beyond the boundaries of your thinking. Your limiting assumptions can be about personal skills, team knowledge and abilities, organizational capabilities, market needs, technology, financial limitations, partnership possibilities, competition, or just about anything else. The goal is to recognize you hold assumptions and then act to surface them.
As the writer John Seely Brown once said, the harder you fight to hold on to specific assumptions, the more likely there’s gold in letting go of them.
Image credit: Pexels
This article was originally published on Inc.com and has been syndicated for this blog.
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Many would-be innovators obsess over ideas, wait for inspiration to strike, and believe that with the right idea, success can miraculously come overnight.
However, as we’ve written before, that’s just not going to happen. In fact, usually the only thing separating the winning innovators from the rest is execution. It makes all the difference in the world, and yet, it’s still a vastly underrated capability.
As part of our coaching program, we’ve asked hundreds of corporate innovators and innovation leaders to reflect on their strengths and weaknesses. And, by far, the most common answer is that they’re great at coming up with ideas and thinking about the big picture but lack the patience and discipline to see things through to results.
As such, it’s safe to say that as a community, we innovators need to take a hard look in the mirror and admit that this an area where most of us have a lot of room for improvement.
So, in today’s article, we’ll explore the topic of executing innovation in more detail to try to understand what the problems associated with it are, and what successful execution of an innovation really takes. This is designed to be a guide to help leaders get it right, but I think there’s a lot that every innovator regardless of job title can learn from.
What does executing innovation mean?
Before we dive deeper, it’s probably a good idea to clarify what we mean with the term “executing innovation”, and how it relates to “implementing innovation”.
These are often used interchangeably, but I think it’s useful to distinguish them from one another. The way we like to put this is as follows:
Implementing innovation is the process of taking an idea and then turning that into reality.
Executing innovation, on the other hand, is the entire process of creating value with innovation.
In other words, implementation is what you do for an individual idea to make that happen. Execution covers the implementation, but also the process of turning that (along with many other ideas and innovations) into something that actually creates value and can be scaled up.
Implementation isn’t always easy, but it’s still typically a linear project that you can usually plan out in advance. Execution, on the other hand, is a much more complex and multidisciplinary effort.
To succeed at delivering value, you need to get a lot of things right. And with innovation, there are many assumptions in that plan. Some of those assumptions will always prove to be false, and you’ll need to deviate from the plan.
That combination of multidisciplinary collaboration and the need to deviate from original plans often leads to a myriad of practical challenges in many large organizations.
However, before we dive deeper into those challenges, let’s first take a step back to realize why execution is so critical.
Why execution is critical for innovation success
There’s a reason for innovation being defined as the act of introducing something new.
Everyone has ideas. Many can even implement some form of them, typically a prototype, but few successfully realize the full potential of the idea by truly executing on it successfully.
To clarify, ideas are an important starting point, but with every great idea, there are hundreds or even thousands of people across the world who’ve had the same exact idea.
Most never start working on it. Many give up in the process. Some make it to market, and a few might even make that into a feasible business. There are usually only a couple of winners. Those are the ones that succeeded in executing that idea.
Everyone has ideas, but few successfully realize the full potential of their ideas. The ones that do are the ones that know how to execute well.
This is of course a bit of an oversimplification but should help explain the fundamental importance of proper execution.
And that is not just true for individual ideas and innovations, but it’s also the case for corporate strategies at large. Look at any given industry, and it’s quite likely that you’ll see many companies with a nearly identical strategy. Again, the difference comes down to how well the company succeeded in executing that strategy.
In other words, your idea or strategy sets the ceiling for your impact if successful, but execution determines how close to that ceiling you’ll get. Even the best idea or strategy is worth nothing unless it’s executed well.
On the other hand, even with a mediocre strategy or idea, you can achieve remarkable success if you just execute it well enough. There are dozens of well-known companies like McDonald’s and FedEx that are obvious examples of this. There’s nothing particularly remarkable or distinctive about their ideas or strategies. They weren’t the first in their respective fields, they just executed on their ideas brilliantly.
What’s more, if you’re a strong executor, you’ll soon find out the limits of the original strategy or idea, at which point you can adapt and change course accordingly. But, it doesn’t work the other way around.
Thus, no matter the situation, execution will always be more important than your idea or strategy.
Misconceptions about executing innovation
As you might have realized by now, execution is of course a massive, nuanced, context-specific and very complex endeavor. In practice, it’s an endless jungle of interlinked choices and actions affecting one another that you need to navigate with limited information to get to the other side.
Thus, the space of possible challenges and problems you might encounter is pretty extensive. So, instead of looking at the individual problems themselves, it’s more helpful for us to try to understand the common misconceptions that ultimately lead to teams underappreciating execution and thus subsequently failing at it.
A big factor behind most of these is the fundamental uncertainty that innovation is always associated with. Because you can’t know everything in advance, it’s not going to be a nice and linear process of doing simple steps one after another. Instead, it’s a messy and iterative process of creative problem-solving.
Anyway, with that, here are the top four that I most commonly see innovation leaders and their teams have.
1. The leader’s job is just to get the big picture right
This is probably the most common problem I’ve come across, and it’s especially common among inexperienced executives, or ones that otherwise lack execution experience, such as some management consultants and academics.
There are many shapes this one might take, and we’ll return to it later, but what it ultimately comes down to is the glorification of strategy work and/or surface-level creativity.
In business school, and in consulting, we’re taught to think about the big picture as the job of top management. We’re led to believe that a leader or innovator takes in a market analysis, compares a few scenarios, chooses a positioning, and then paints an inspiring vision to show direction for the company. Then the pieces will simply fall in place and success happens.
While the above mentioned are of course still useful activities, if you’ve ever actually turned an innovative idea into a successful business, you know that in practice, there’s a lot more to it than that, and experienced executives are of course well aware of that
Strategic choices can be made across the organization, but the responsibility for execution always lies at the top.
As Professor Martin has well put it, CEOs should stop thinking that execution is somebody else’s job, and the same applies for every innovation leader. Strategic choices can be, and frequently are, made where the action is. Yet, the responsibility for execution always lies at the top. After all, there’s a reason for the CEO being the Chief Executive Officer.
2. I don’t need to understand the details
The second is closely related to our first one. It’s easy to think that as a leader or visionary innovator, you’re the person responsible for the vision, ideas, and big picture decisions, and then the experts will then figure things out in practice. After all, that’s why you hired them, right?
Well, that might work if you’re operating in a static industry where all the variables are known and static, but with innovation that really isn’t the case.
You need to get the big picture right, but it isn’t enough to succeed. You need to also have the right product, business model, technology, customer experience, customer acquisition channels and tactics, operating models, etc. All of these have a wide variety of choices that depend on one another and changes in any of the areas will force you to change many of the other pieces in the puzzle too.
With innovation, the devil is in the details!
As an innovation leader, connecting the dots is ultimately your job, and you can’t do that without understanding the details.
That’s why you’ll find an obsession for the details in pretty much every successful innovator, both past and present. They have the same in-depth understanding and attention to detail as the best artists, athletes and top representatives of other fields do too.
So, while you absolutely need to engage with and empower the experts, they are experts in their own field and likely don’t know how to consider all the other moving pieces in the puzzle. As an innovation leader, connecting the dots is ultimately your job, and you can’t do that without understanding the details.
It’s the one responsibility you simply can’t delegate away.
3. Execution requires a clear and unambiguous plan
Even if you are an experienced executive and value the importance of execution highly, it doesn’t mean you couldn’t fail when executing innovation. Here the most common problems occur if the leader’s experience comes primarily from operations within the known and well understood confines of “business as usual”.
When the environment is well understood, and the scale large from the get-go, it’s of course valuable to try to plan carefully, analyze business cases and craft detailed project plans prior to execution.
Also, since everyone knows that innovation is a risky endeavor, it of course makes sense to try to reduce those risks before your start a big innovation project to try to avoid major mistakes and generally just ensure that you’ve done a good job in planning and preparation before committing to the project.
This often leads to large companies commissioning all kinds of market studies and strategy projects. Some of those can certainly be useful in increasing your understanding of the landscape, but most invest way too much time, energy, and money into these. Also, every now and then these projects seem to be ordered only to have a scapegoat in case something goes wrong.
Regardless, there’s a fundamental problem: with innovation, you can’t have all the answers in advance. You’ll always need to make a number of assumptions upon which your plan relies on, some of which will inevitably prove to be wrong.
With innovation, you won’t have all the answers in advance.
Thus, if you require innovators to propose clear, detailed and unambiguous plans for you, or conversely create such plans and then hold innovators accountable for successfully executing them, it just won’t work out. And, whenever it then comes to surface that everything hasn’t gone according to the plan, innovation projects are frequently shut down, even if they’d still hold a lot of potential.
You obviously still need to align with the strategy, plan ahead, and have a disciplined approach to execution, but it’s not so much about creating a detailed roadmap, as it is about choosing direction and figuring out which questions or problems you’ll need to address first.
In other words, you need to embrace the uncertainty and the fact that you can’t have a perfectly unambiguous and detailed plan before starting to execute it. Instead, figure out what the assumptions and uncertainties in your plan are and commit to a disciplined learning effort to figure out the right path forward.
4. Innovation is fun
There’s a stereotype around people working in innovation being these visionaries that are bursting with great ideas and seem to come up with great new concepts all the time. And as mentioned in the intro to this article, that is often true.
That skillset is of course very useful for innovation, but there’s also a downside. There are naturally exceptions, but many of us working on innovation can find execution too boring and repetitive, and/or lack the perseverance, discipline, and patience needed to succeed at it.
Innovators often spend too much on the creative and “fun parts” of innovation, as opposed to what’s really needed to turn an idea into a successful innovation
As a group, we generally love creative work, and are always looking for fresh, new stimuli to feed that inspiration. That often leads us to spend too much time and effort on the “fun parts” of innovation, and too little on the not so fun, more repetitive, and laborious parts of the process that execution essentially is comprised of. The reality is that for every minute you spend coming up with ideas, you’ll probably need to spend a day, a week, or even more implementing those ideas.
So, if your innovation team is primarily filled with, or led by, such “idea people”, which is quite common, then there’s a big risk of a systematic lack of respect for and capabilities in execution. This will lead to a very suboptimal culture for innovation, and ultimately disappointing business outcomes.
Getting Execution Right
As already mentioned, there are a lot of similarities between successful execution in “business as usual”, and in innovation. However, there are also clear differences between the two.
So, to help you navigate the differences, and to succeed at executing on whatever innovation you’re working on, here are the five most important factors to keep in mind whenever you’re trying to execute on an innovation and build something truly novel.
1. Take the path most likely to succeed, but keep your options open
As mentioned, with innovation planning and strategy work need to be done a bit differently than you would with an existing business.
Good decisions here make it much easier for your team to figure out how to move forward and can save a lot of time money going down the wrong path. Regardless, you’ll soon end up at another crossroads and need to make another decision. Heck, sometimes you might even come across a dead-end and need to backtrack to an earlier crossroads. Sometimes Plan C or D is the way to go.
The point is that no matter which path you choose, you won’t see what’s ahead all the way to the end.
Thus, good strategy work requires you to embrace uncertainty, test assumptions critically, and think deeply about the real-life feasibility of each path ahead.
And it’s certainly not a one-time project you do at the beginning, but more of a continuous learning process as you unravel the puzzle piece by piece.
If you keep an open mind and build your teams and products to embrace that uncertainty, you can quickly recover and learn from setbacks, as well as embrace new opportunities you couldn’t even think of before you set out. This is what’s known as cognitive and organizational flexibility.
2. Solve the biggest problems first
As humans, most of us have a bit of a tendency to go for the comfortable low-hanging fruits and procrastinate on the hard but important problems, as well as uncomfortable truths.
I’ve certainly been guilty of this on many occasions, even while writing of this article. Getting a number of small things done makes us feel like we’re making good progress, but unfortunately that’s often a bit of a false sensation as we might not really be any better off than when we began.
With the inherit uncertainty in innovation, that is naturally a bit of a problem. When you’re executing any given innovation, there’s countless things that need to be done so it’s easy to just start checking off boxes like building more features, creating marketing materials, getting compliance approvals, or whatever you may have on your agenda.
But, it’s the big things that make or break your innovation early on. For example: will a customer benefit from my product, how much are they willing to pay, can I even build the product I’ve envisioned, etc.
While you need to care about the details, it’s the big things that make or break your innovation early on. So, start from the big problems, even if it hurts!
The key is finding a way to figure out what these big problems or critical assumptions are, and then find ways to quickly test and address them. This allows you to quickly figure out if you’re on to something, which of course saves a lot of time and money for you in the inevitable case that you weren’t quite there from the get-go.
Also, if you get the big things right, you can already deliver most of the value, and that means you can more quickly start capturing some of that value to get a return for your investments.
Plus, if you tackle these early on when you still have a small team, changing course will be much quicker and easier, and you’ll have spent much less money solving the same important problems than you would with a larger team later on.
In most businesses, these critical assumptions revolve around how much value you can deliver to customers, and how valuable they see that to be. However, in certain circumstances, those can be related to something entirely different, such as the feasibility of implementation when developing a new breakthrough drug.
Solving for the hardest problems first does generally require a bit more of a leadership commitment as you won’t always be able to show quick wins as early on, but at least it can save you from an embarrassing and costly failure like CNN+.
3. Build the right team
It might be a bit of an obvious statement, but it’s still probably worth pointing out: innovation is a bit of a team sport. So, to do well at it, you need the right team.
However, what might not be as obvious is that ‘the right team’ means in practice. In our experience, there are two key parts to this:
Multidisciplinary team with talented individuals in each area
Leadership and individuals that share the right mindset for innovation
The prior is pretty self-explanatory. Innovation is almost always a cross-disciplinary effort. The specifics depend on what kind of an innovation you’re working on, but usually you need expertise in at least design, engineering, commercial and operational matters.
The most impactful innovations are actually comprised of a stack of innovations in many of these areas, each designed to work together to address a specific problem or ‘job’ for the customer. Thus, if you have talent at every position, the outcome will be much more than the sum of its parts.
The latter, however, is the part that many teams fail to appreciate. Innovation is, by definition, doing something that others haven’t succeeded at before, so the journey won’t be easy.
Your team will face a lot of uncertainty and struggles, and will still need to perform at their best, often under a lot of pressure. That requires a very specific type of culture within the team, but also the right mindset for each individual. You want people that can cope with uncertainty and are able to remain optimistic and overcome difficult situations while still being realistic and ruthlessly critical of their own capabilities. They need to have an innate passion to strive for excellence, and a lot of discipline, grit, and perseverance.
And, of course, because it’s a team sport, people need to be able to work well together and perform as a team. This, however, isn’t usually much of an issue as long as people can leave their egos at the door. The struggles you will face together as a team will build bonds and gel you into a team.
4. Make sure every decision and detail are aligned
As we already discussed, you don’t need (and usually can’t have) a clear and unambiguous plan for an innovation project where every role and task would be charted out in advance. However, as we also discussed, the devil is often in the details and seemingly small things can derail the project from its goals?
So, what gives?
Well, the point is that with innovation, you need to keep an eye on everything. As an innovation leader, you need to maintain excellent awareness of both the big picture and the details throughout the project. But, because the environment changes dynamically and you need to move fast, you can’t really do that work upfront.
Nor can you just look at some KPIs and financial reports to figure out if things are moving in the right direction because the important things won’t show up in these for quite a while, and at that point, it’s often too already too late to react.
As a leader, your primary job is to keep up with what’s going on both with the ever-changing big picture, and the details on the ground so that you can spot problems early and intervene before it’s too late, no matter where the issues might arise from. If you don’t understand how everything works in practice and know what problems everyone is working on and why, it will be pretty much impossible to do that.
Some might see the latter as micro-management, but it doesn’t mean you have to dictate what everyone does. It just means that as a leader, you need to be the person that connects the dots and then empowers the team to succeed. There’s a clear difference.
Which brings us nicely to our last point.
5. Take full ownership for the execution
As we’ve covered, execution is the make-or-break part in the lifecycle for every innovation.
It’s always a bit of an exploratory process where you need to remain flexible, while still moving forward quickly and executing at a high level.
And, at the same time, seemingly inconsequential low-level choices related to implementation turn out to become existential issues for any innovation project.
Again, you don’t need to decide everything on behalf of your team. In fact, often it’s best to let the experts solve problems and do their job, as long as you can give them the right guidance and constraints to work with. Instead, you need to think of every potential problem as your fault and then figure out a way to get past them together with your team.
The bottom line is that being an innovation leader isn’t easy. It takes a lot of time and work to understand and stay on top of things, but as already mentioned, that’s the one thing you can’t really skip, automate, or delegate. Essentially everything else you can.
The only way to succeed at that is to take full ownership and commit to the process.
Conclusion
We’ve covered a lot of ground, so let’s do a bit of a recap.
Innovation isn’t a linear project that you can plan out in advance and monitor progress with a Gantt chart. There will always be plenty of surprises. Many unpleasant, but usually some positive ones too. You’ll need to be flexible enough to react to these and alter course accordingly.
It’s an inherently messy and iterative process of figuring out a way to build new things and align all the pieces so that everything works out.
Fundamentally, an innovation leader’s job is to show direction and try to keep track of everything that’s happening, align those puzzle pieces together with the big picture while always being on the lookout for potential problems and then eliminate those before they derail the project, as there will be many.
It’s not an easy or comfortable job, but if you can get it right, it’s an incredibly rewarding one.
Ironically, despite all the talk about practical issues and attention to detail being vital, this has been a bit of a high-level overview on the topic. So, if you’re interested in learning more about the details related to what we’ve discussed today, I have a couple of practical recommendations for you:
First, the best way to learn to innovate is by doing. So, get your hands dirty, keep these tips in mind, do your best, and I’ll guarantee you’ll learn a lot.
But, if you currently don’t quite have the time to commit to an innovation project, a good alternative way to learn more about innovation management is with our Innovation System online coaching program. We’ve now made the program completely free of charge for the first 1000 readers to sign up for it.
This article was originally published in Viima’s blog.
Image credits: Unsplash, Viima
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It’s been almost two and a half years since most of us shifted to working virtually and remotely, which, in turn, seriously disrupted most of our business-as-usual behaviors and learning habits. Interestingly, this also disrupted our habitual unconscious safety and comfort zones, and, in many cases, disconnected our overall sense of security. For some of us, our ability to make sense of ourselves and our futures, has been impacted, impacting our abilities to find new ways of being creative and innovating through the range of constraints and adverse situations.
Looking inward
Some of us have also had our confidence to survive and thrive in a world severely impacted, and many of us have felt exploited, exhausted, and depleted by our employers. According to Lynda Gratton, in a recent article in MIT Sloane Magazine “Making Sense of the Future” many of us are looking inward — working through the impact of our changing habits, networks, and skills, and begin to imagine other life trajectories and possible selves.
Looking outward
Again, according to Lynda Gratton, some of us are now also looking outward to analyze how talent markets are changing and what competitors are doing, which is creating momentum and a force for change, but also frustration and anxiety, given institutional lag and inertia.
The larger-than-life, terrible, and confronting conflict in Ukraine has also inflated, for some of us, a deeper sense of helplessness and exhaustion, and amplified our concerns and fears for a sustainable future.
The momentum for change is growing
Yet some people have successfully responded to worries and concerns about the inertia holding our companies back, and have adapted to working, learning, and coaching online. Using this moment in time to help de-escalate our reactivity to what’s been going on to deeply connect, explore, discover, listen, and respond creatively to what is really important, to ourselves, our people, teams and our organizations.
To help shift the tension between today and tomorrow, through regenerating and replenishing ourselves and our teams, by shifting the dialogue towards renewing and innovating through constraints and adversity in uncertain and unstable times.
Innovating through constraints enabled the collective at ImagineNation™ to design and deliver a bespoke, intense, and immersive learning journey for an executive team aiming at igniting and mobilizing their collective genius to step up to face their fears, adapt, take smart risks and innovate in uncertain and disruptive times!
Some of the constraints we collaboratively and creatively mastered included adapting to differing:
Geographies, we are based in Melbourne, Australia, and our client was based in Canada, which made managing time zone schedules challenging, including some very early 4.30 am starts for us – Making flexibility and adaptiveness crucial to our success.
Technologies, balancing Zoom-based online webinars and workshops, with Google chat rooms and jamboards, completing one on one coaching sessions, and assigning, completing, and presenting group action learning assignments – Reinforcing the need for constant iteration and pivoting to ensure the delivery of outcomes, as promised.
Communicating, including air freighting hard copy reflection packs, scheduling, and partnering virtually, all within a remote and fractured working environment –Ensuring that clarity and consistency would lead to the successful delivery of the outcomes, as promised.
Shifting the dialogue
Demonstrating that we can all be resilient and creative when we live in times of great uncertainty and instability through investing in reskilling people and teams to become more purposeful, human, and customer-centric.
We can all break the inertia by challenging our business-as-usual thinking and shifting the dialogue towards exploring our inner challenges and navigating the outer challenges of our current environment.
If we commit to doing this with more consciousness, hope, optimism, and control, to follow a direction rather than a specific destination by:
Perceiving this moment in time as an “unfreezing opportunity” and an opening to shift out of inertia and complacency, to re-generate and re-invent ourselves and our teams?
Knowing how to connect, explore, discover, generate and catalyze creative ideas to rapidly and safely unlearn, relearn, collaborate and innovate through constraints and adversity?
Committing to letting go of our “old baggage” and ways of making sense of our new reality, by experimenting with smart risk-taking, and making gamification accessible in an environment that is unpredictable?
Re-generating and re-inventing in uncertain and unstable times
In fact, many of us successfully adapted to online working, learning, and coaching environments by de-escalating any feelings of helplessness and hopelessness.
To bravely focus on regenerating and reinventing ourselves and our teams and using this moment in time to be curious, shift the dialogue, explore possibilities, harness collective intelligence and ask some catalytic questions:
What if we intentionally disrupted our current way of thinking?
How might we think differently to shift our perception and perceive our worlds with “fresh eyes”? What might be possible?
What if we shift the dialogue to engage people in innovating through constraints?
How might we shift the dialogue to activate and mobilize people towards taking intelligent risks through constraints?
How might thinking differently empower, enable and equip ourselves and our teams to navigate the current environment with more hope and optimism?
What if re-consider and perceive these constraints differently?
How might we support people to ignite their creativity?
How might we equip people to be creative and develop better ideas?
How might we resource people to force more change and innovation?
How might we discover new ways of creating value for people in ways that they appreciate and cherish?
Grappling with the future is paradoxical
Finally, Lynda Gratton suggests that we need to:
“Acknowledge that this is not straightforward. Right now, many leaders are stuck between two sources of tension: the tension of enlightenment, where they can begin to imagine what is possible, and the tension of denial, where they are concerned that more flexible working arrangements will negatively affect performance. They grapple with whether the change will be necessary or possible. These are legitimate tensions that are only exacerbated by the sense of exhaustion many people feel”.
If we perceive these constraints as catalysts for setting a clear focus and direction, it might force us to experiment with creative ways of acting and doing things differently.
It might also force us to make tougher decisions around our inner and outer priorities, by exploring and discovering more balanced, creative, and inventive ways of constantly iterating and pivoting whatever resources are available to get the important jobs done.
An opportunity to learn more
Find out about our learning products and tools, including The Coach for Innovators Certified Program, a collaborative, intimate, and deep personalized innovation coaching and learning program, supported by a global group of peers over 9-weeks, starting Tuesday, May 4, 2022.
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It’s been a tough two and a half for everyone since the COVID-19 crisis began. Some of us have been hit very, very hard, by the impact of the pandemic exacerbated by the rate of exponential change and now, by the impact of the conflict in Ukraine.
As result, many of us are feeling overwhelmed and exhausted and languishing in varying states of anxiety and discomfort. Some of us are struggling with “not knowing” how to deal with the extreme uncertainty existing within our business and personal environments, whilst many of us are optimistically seeking to prepare and manage for what might possibly come next.
At the same time, many of us are seeking collaborative partnerships to support us and explore options for keeping both ourselves, our people, and teams engaged in moving forward creatively in a constantly changing world. Where both the work environment and the nature of work are in a state of flux, where we are going through exceptional and extraordinary changes, and, where to both survive and thrive, we need to get comfortable with being uncomfortable with it all.
Safely stepping into the unknown
This creates an opening and a threshold to partner with others in resourceful and creative ways to support them, to safely and bravely step into the unknown.
To perceive this unique moment in time as an opportunity for growth, shape-shifting, and change – by empowering and equipping them to cautiously abandon and exit their comfort zones and get comfortable with being uncomfortable. Because the patterned worlds of our “business as usual” existences, which traditionally kept us get comfortable and calm, and helped us stay emotionally and mentally even, free from anxiety and worry to a great degree, are no longer certain, predictable or stable.
Where constant and accelerating change, coupled with uncertainty are the harsh realities of today, and of tomorrow, in the decade emerging as one of both disruption and transformation.
Impact of our neurological survival mechanisms
As humans, we have an internal need for consistency, represented by our internally mapped, largely unconscious, neurological comfort zones, our own unique places for getting comfortable, and amenable to what we habitually do. When we experience cognitive dissonance, in an extremely uncertain and disruptive operating environment, we unconsciously encounter apparent inconsistencies between what is really happening and what we believe to be really true.
As result, we often, mostly unconsciously, slip into our auto-pilot range of varied aggressive and passive defensive, reactive responses: including avoidance, denial, anger, opposition, and resistance to change. Often described as the “retreat, freeze, or take flight or fight” reactions to what is “seemingly” going on. This is because we distort and generalize our thoughts or feelings into believing that have no control over events. Which is a normal and natural neurological, yet primitive, survival mechanism that enables us to cope with the situation.
However, when we operate this way, we lose our personal power and question our abilities to shape and manifest the outcomes we want, or feel we lack the ability to influence others or constructively impact our environments.
Resistance is futile
Manifesting as feelings of discomfort, most of us will do anything to move away from – because we want to avoid pervasive, visceral, challenging thoughts and feelings, derived from our conflicting beliefs and values. Our auto-responses or neurological urges to remove the discomfort, and typically keep us in our comfort zones, where we procrastinate, make excuses, shift into denial, avoidance, and justification, resulting ultimately, in immobilisation and inaction.
The outcome is that we may feel paralysed, and become inert, inhibiting and preventing us from developing the mindsets, behaviours, and actions required to thrive in the future. Where our only “new normal” will depend on our abilities to flow with constant change, unpredictability, instability, and uncertainty and get comfortable with being uncomfortable.
Hidden costs of resistance
Resistance to change prevents us from:
Adapting to the current and future environment is not the survival of the fittest, it’s he or she who is the most adaptive, who ultimately survives, and thrives!
Exploiting this moment in time as an opportunity and threshold to improve our confidence, competence, and emotional capacity to effectively transition through the range of professional and personal crises, brought on by uncertainty and disruption.
Exploring possibilities and unleashing opportunities available in this moment in time as a turning point to learn and grow, as a coach, leader, or team.
Strategizing in the new global, hybrid, and virtual work environment to improve, competitiveness, productivity, and innovation grow our practices and help our members expand their roles, and grow their teams and businesses.
Breaking down silos that add to many of our member’s current states of disconnection and loneliness, and inhibit connection and collaboration.
Creating permission, tolerance, and safety for members to safely download and let go of their fears and anxieties, share their negativity and pessimism, fears of failure, and co-create positivity and optimism towards thriving in an uncertain future, together.
Embracing the new world of digitisation and experimentation, from implementing change, enhancing individual and organisational agility, and developing the mindsets, behaviours, and skills to be comfortable in constantly changing contexts.
What can we do about it?
Being agile and adaptive
In normal times, creating a comfort zone is a healthy adaptation for controlling much of our lives. Yet having the boldness, bravery, and courage in extreme uncertainty, to step up and out of our comfort zones helps us be agile and adaptive in transitioning, growing, and transforming through the enormous challenges, disruptions, and adversities many of us are confronting.
Entering the learning zone
In fact, once we do take the first baby steps out of our comfort zones and into our fear zone (fear of loss, blame, shame, envy, punishment, retribution, opposition, being controlled, humiliation, being envied or made wrong) we can safely enter the learning zone. Being in the Learning Zone is the first stopping point toward generating creative energy and expanding our comfort zones.
Facing the fear
Doing this builds the foundations for being more comfortable with being uncomfortable by facing, feeling, acknowledging, and letting go of some of our deepest fears by dealing with them rationally and realistically, with empathy and compassion, and without bias and distortion.
Reducing our levels of anxiety
By withdrawing, discerning, and deciding to let go of the need to be constantly in charge and in control and be willing to enter the Growth Zone, where everything that happens is a resource for being tolerant, and accepting, of the possibilities for making positive change.
Stepping into being comfortable
This is a great opportunity to co-create a new playbook for ourselves, our people, and their teams by enabling and empowering the mindset shift to the Growth Zone, to transform cognitive dissonance, and use it as the creative tensions toward being comfortable with being uncomfortable.
This involves engaging in a set of consistent and regular practices, to build and support a willingness to embrace change, disruption, and uncertainty, to take on even the impossible.
Hit your Pause Button: retreat from activity, get grounded in stillness and silence, and be fully present to your energetic state. Be mindful and pay deep attention to recognise your patterns, attune to what is really going on, and get unhooked from any internal chatter, stories, and unconscious default patterns.
Label Your Thoughts and Emotions: be fully present and get connected to yourself and to others you are interacting with, feel the feeling, knowing that it is transient.
Acknowledge and Accept: allow yourself to accept and embrace the range of feelings, be empathic, compassionate, and open-hearted with yourself and with others.
Detach from and Observe your Thoughts and Emotions: be willing to create and sustain an open mind, be inquisitive and curious, explore the non-judgemental space between your feelings and how to effectively respond to them.
Identify difficult feelings: as you experience them and find more appropriate ways of responding instead of reacting, be willing to become a “detached observer”.
Be emotionally agile: learn to see yourself as the operating system, filled with possibilities, knowing that you are more than one part of it and flow with it
Be courageous and brave: challenge the status quo, and your habitual thinking, feeling, and decision-making habits and build your confidence to reboot, consistently disrupt yourself and be comfortable with being uncomfortable.
Be imaginative and creative: reimagine your most desirable future state, be optimistic and positive about choosing the best ways to reset, and walk your way forward into the unknown.
Focusing your attention and being intentional
Being comfortable with being uncomfortable, enables us to re-think creates openings and thresholds for developing 21st-century superpowers, limitless possibilities for change, growth, learning, and innovation.
By empowering us to respond positively to uncertainty, and dynamic change that respects and engages people’s values and humanity, in co-creative and innovative ways that improve the quality of people’s lives in ways they value, appreciate, and cherish.
An opportunity to learn more
Find out about our learning products and tools, including The Coach for Innovators Certified Program, a collaborative, intimate, and deep personalized innovation coaching and learning program, supported by a global group of peers over 9-weeks, starting Tuesday, May 4, 2022.
It is a blended and transformational change and learning program that will give you a deep understanding of the language, principles, and applications of an ecosystem focus, human-centric approach, and emergent structure (Theory U) to innovation, and upskill people and teams and develop their future fitness, within your unique context.
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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.
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.
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.
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:
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.
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.
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
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I was first introduced to gamification upon meeting Mario Herger, in 2012, when he was a Senior Innovation Strategist at SAP Labs LLC, in Israel, as a participant in his two-day gamification workshop for Checkpoint Security Software. It was an exciting and exhilarating journey into the playful and innovative world of gamification pioneers such as Farmville, Angry Birds, and BetterWorks. Creatively exploiting the convergence of trends catalyzed by the expansion of the internet, and by the fast pace of exponential technology development making gamification accessible to everyone.
Propelled further by people’s increasing desire to socialize and share ideas and knowledge across the globe. Coupled with their desire to learn and connect in a high-tech world, to be met in ways that also satisfied their aspirational, motivational, and recreational needs, as well as being playful and fun.
The whole notion of making gamification accessible to corporate learning simmered in my mind, for the next ten years, and this is what I have since discovered.
Evolution of the gamification market
In 2012 Gartner predicted that – Gamification combined with other technologies and trends, gamification would cause major discontinuities in innovation, employee performance management, education, personal development, and customer engagement. Further claiming that by 2014, 80% of organizations will have gamified at least one area of their business.
It seems their prediction did not eventuate.
In their Gamification 2020 report, Gartner then predicted that gamification, combined with other emerging trends and technologies, will have a significant impact on:
Innovation
The design of employee performance
The globalization of higher education
The emergence of customer engagement platforms
Gamification of personal development.
It seems this prediction is now an idea whose time has come!
According to Mordor Intelligence – The global gamification market was valued at USD 10.19 million in 2020 and is expected to reach USD 38.42 million by 2026 and grow at a CAGR of 25.10% over the forecast period (2021 – 2026). The exponential growth in the number of smartphones and mobile devices has directly created a vast base for the gamification market.
This growth is also supported by the increasing recognition of making gamification accessible as a methodology to redesign human behavior, in order to induce innovation, productivity, or engagement.
Purpose of gamification
The initial purpose of gamification was to add game mechanics into non-game environments, such as a website, online communities, learning management systems, or business intranets to increase engagement and participation.
The initial goal of gamification was to engage with consumers, employees, and partners to inspire collaboration, sharing, and interaction.
Gamification and corporate learning
The last two years of the coronavirus pandemic caused many industries to deal with their audiences remotely and combined with an urgent need for having the right technologies and tools to:
Reach out to, and connect with, both their employees and customers, in new ways
Acknowledging the range of constraints and restrictions occurring globally we have an opportunity to couple these with the challenges, disconnectedness, isolation, and limitations of our remote and hybrid workplaces.
While many of us are seeking more freedom, fun, play, and adventure, yet, we are still mostly bound to our laptops, TVs, and kitchens, and locked up within the boundaries of our homes, local neighborhoods, and hometowns.
Expanding knowledge, mindsets, behaviors, and skills
At the same time, this period has also created incredible opportunities for expanding our knowledge, and developing new mindsets, behaviors, and skills!
In different ways to help teams and organizations adapt, innovate, and grow through gamification, which increases our adaptability to flow and flourish and drive transformation, within a constantly, exponentially changing, and disruptive workplace.
Benefits of a gamified approach
Companies that have focused on making gamification accessible within their learning programs are reaping the rewards, as recent studies revealed:
The use of mobile applications gamified individually or as a complement to an LMS or e-learning platform has been shown to improve employee productivity by 50% and commitment by 60%.
That 97% of employees over the age of 45 believe that gamification would help improve work.
The shift from face-to-face and live events to online created an opening for improving the quality of coaching, learning, and training experiences in ways that align with the client’s or organization needs and strategic business goals.
Keeping people and teams connected, engaged, and motivated in the virtual and hybrid workplace for extended periods of time is a key factor in business success.
Atrivity is a platform that empowers employees and channels to learn, develop, and perform better through games have identified eight trends influencing the growth and adoption of gamification including:
Gamification for Digital Events are here to stay, people are time and resource-poor, and will more likely attend a digital event rather than invest time and resources in travelling.
Gamification for Millennials and gen-Z is their new normal, being a generation who have grown up with, and become habitually attuned to Facebook and Instagram.
The start of Virtual Reality and Augmented Reality is speeding up and offers new creative approaches.
Remote onboarding becomes standard as we all adapt to a globalized and diversified work environment.
Gamification helps to reduce hospital strains with emerging telehealth innovations.
Customization of, and access to contents allows us to visit museums, galleries, libraries virtually
Knowledge evaluation metrics have become common proactive through the use of app-based dashboards and scorecards that provide gamified reward and recognition processes
Gamification is an Enterprise “must-have” tactic to attract and retain talent.
Corporate learning is also finally at an inflection point
Innovative new organizations like Roundtable Learning focus on co-creating one-of-a-kind training programs that utilize innovative technologies, reflect the client’s brand, and show measurable business results by enhancing traditional corporate learning practices and embracing more interactive, engaging programs.
This is what ImagineNation™ is collaborating with Binnakle Serious Games to bring newness, creativity and play, experimentation, and learning in gamified ways to enable people and teams to innovate, by making gamification accessible to everyone!
We have integrated technology and co-created a range of blended learning solutions:
Digital and gamified learning experiences for groups and teams.
Playful and experiential learning activities that deliver deep learning outcomes.
Co-creation of customized or bespoke blended learning programs that deliver what they promise.
Making corporate learning accessible, affordable, and scalable
Our aim is to make corporate learning agile, by making gamification accessible, and scalable to everybody, across all time zones, modalities, geographies, and technologies.
Where people have time and space to unlearn, relearn, reskill and upskill by engaging in and interacting with both technology and people:
Understand and learn new innovative processes, concepts, principles, and techniques and feel that their new skills are valued.
Retreat, reflect and explore, discover and navigate new ways of being, thinking, and acting individually and collectively.
Question, challenge the status quo and experiment with new ideas, explore effective collaborative analytical, imaginative, aligned problem-solving and decision-making strategies.
Safely fail without punishment, make and learn from mistakes, to iterate and pivot creative ideas and innovative solutions that really matter.
To meet our client’s short- and long-term learning needs in terms of innovation focus or topic depth and breadth. Through enhancing teaming, teamwork, and collaboration, by offering products and tools that make gamification accessible to suit all peoples learning styles, time constraints, diverse technologies, and cost needs.
Who was I to know that it would take another ten years for making gamification accessible enough to reach a tipping point!
An opportunity to learn more
Find out about our learning products and tools, including The Coach for Innovators Certified Program, a collaborative, intimate, and deep personalized innovation coaching and learning program, supported by a global group of peers over 9-weeks, starting Tuesday, May 4, 2022.
It is a blended and transformational change and learning program that will give you a deep understanding of the language, principles, and applications of an ecosystem focus, human-centric approach, and emergent structure (Theory U) to innovation, and upskill people and teams and develop their future fitness, within your unique context.
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I recently read a couple of excellent articles by Nick Skillicorn, and Prof. Rita McGrath where both discuss the challenges and intricacies involved in structuring and governing innovation within a large organization.
This is a classic topic that every corporate innovator has without a doubt come across, and it’s also one where “the right approach” is often quite elusive.
Inspired by those articles, we’ll present the most common archetypes and then dig a little deeper on the topic and share our thoughts and experiences to help you figure out how innovation should be structured within your organization.
Why organizing innovation is challenging
Before we dive into the different models for governing and organizing innovation, it’s important to understand why this is such a challenging topic to begin with.
That’s of course quite a lengthy and nuanced topic, but in short, there is no such thing as a perfect organizational structure or governance model. The bottom line is that a large organization is simply such a complex entity that structuring everything perfectly so that there aren’t any kind of bottlenecks, misaligned incentives, or any duplication of work just isn’t very realistic. If you’ve ever worked in large organization, you’ve certainly come across some of these challenges.
Now, most of these challenges are likely to be worse with innovation than with “business as usual” as, by definition, innovation means introducing changes. And most organizations simply aren’t designed for constant change.
What’s more, businesses are naturally very different from one another. A structure that works for a single product software company probably isn’t ideal for a CPG manufacturer or a house of brands because not only are their industries different, so are the innovations they are going after. So, what works well for some organization probably won’t be ideal for you.
This means that benchmarking and then applying “best practices” likely won’t work too well. Unfortunately, there just isn’t a single correct way to organize innovation.
Exploring the organizational archetypes for innovation
Having said that, there are a handful of common approaches, which we like to call archetypes, that most organizations use as the foundation for their efforts to organize and govern innovation.
Both McGrath and Skillicorn have done an excellent job in presenting many of these approaches, so a lot of credit for the following descriptions goes to them and I’d warmly recommend you read their takes too. Regardless, we’ve summarized their main points and combined them with our own experiences to create the following archetypes.
We’ll next explain each of these briefly, along with a quick summary of the key strengths and weaknesses for each.
No in-house innovation
The first and simplest way to organize innovation is to not do it, or to completely outsource it. Perhaps the most common method here is to simply keep tabs on promising startups and then acquire them, or to have tight collaboration with universities and other research institutions.
While this obviously keeps things simple organization-wise and minimizes fixed costs, it also means that you no longer have control over your own destiny, and are instead reliant on third parties, which puts you in a very vulnerable position long term. Furthermore, in the last decade, we’ve seen a huge inflow of capital to fund startups, which means that valuations for promising startups have skyrocketed and acquiring them on the cheap is simply no longer a very feasible strategy.
Suffice to say, if you want to build an organization that thrives in the long run, I wouldn’t recommend this approach.
Pros
Low fixed costs
Structurally simple
Cons
Lack of strategic control and ability to build the future of the organization
Lack of differentiation
Reliance on third parties for both execution and especially exploration
Acquisition of promising innovations has become expensive
Centralized
Perhaps the most common way large organizations set up innovation is by creating a centralized department that serves the innovation needs of the entire organization including each business unit and support functions, such as IT or HR. This can be a subdivision within R&D, but these days it’s typically a separate cross-departmental unit serving the innovation needs of business units.
Either way, such a unit is quick and easy to set up, and the approach has some other obvious advantages too, such as innovation expertise being built and managed centrally, which speeds up learning, as well as management and reporting being easy to organize.
It’s these advantages that make centralization the obvious choice for many who are just starting out with innovation. This is also an especially common approach for large industrial companies that typically have a strong R&D tradition.
If all of the innovation has to go through a single team, that team will inevitably become a bottleneck for innovation, no matter how skilled or large it is.
However, in the long run, this approach is also one that is likely to significantly limit your innovation potential. The reason is simple: if all of the innovation has to go through a single team, that team will inevitably become a bottleneck for innovation. No matter how large or skilled the team, they’ll never have enough resources. What’s more, this will also disincentivize everyone else in the organization from innovating and that prevents you from creating a true culture of innovation.
Pros
Quick, easy, and cheap to set up
Dedicated resources for working on innovation
Easy to govern, manage, and report on the overall innovation portfolio
Centralization can speed up learning
Cons
Poor scalability as centralized team will inevitably become a bottleneck for innovation
Likely to be pulled into too many projects, which leads to poor execution
High risk of degenerating into a support function serving business unit requests instead of strategically building the future of the organization
Likely to disincentivize others in the organization from innovating
Conflicting interests between business units can make prioritization difficult
Typically lack authority to make important, hard decisions
Dedicated
Popularized by Clayton Christensen as a solution to the Innovators’s Dilemma, dedicated business units for innovation have become increasingly popular in large organizations that are looking for the next stage of their growth. Sometimes these units have proper P&L responsibility, and they might even report directly to the CEO or others in senior management, but at times they can also be innovation labs responsible primarily for testing and piloting new ideas before they are to be integrated into the core business.
Regardless of the particularities, these approaches have some specific strengths, but also clear weaknesses. The good thing is that because the unit is independent, it can usually avoid being held back by the restrictions of the business as usual and can build their talent and approaches from scratch.
If innovation is the job of a select few, it will be incredibly hard to build a pro-innovation culture.
The downside is that they also don’t necessarily play to the strengths that the organization has already built. Without strong and clear leadership, these kinds of innovation efforts are likely to have an equally poor success rate as your average startup – but without the asymmetric upside.
The reason is simple: if you already have hundreds of millions or billions in revenue, most new businesses just don’t move the needle enough – unless they can quickly grow to a massive size or be combined with the strengths and competitive advantages of the core business.
And just like with the centralized model, this model again limits innovation to one part of the organization. As before, that will likely prevent you from creating a true culture of innovation, and thus lead to the unit becoming a bottleneck down the road.
Pros
Freedom to operate independently from processes of existing business units, which is essential for trying new things and creating disruptive innovations
Ability to hire and organize specifically for innovation
If led well, ability to focus on the long-term instead of short-term performance
High profile innovation unit can also be used for marketing and employer branding purposes
Cons
Conflicts of interest and lack of cooperation between core business and innovation unit likely to lead to politics, tension, and other challenges in integrating innovations into core business
Independence and lack of communication between business units might hurt strategic alignment and prevent the innovation unit from benefiting from the existing strengths of the organization
Can easily degenerate into a cost center performing innovation theaterwithout a clear strategic focus, strong leadership, and evidence-based processes
Likely to disincentivize innovation in other parts of the organization and thus prevent the creation of an innovation culture
High initial investment with lots of uncertainty can make the business case for investing in innovation look bad
Embedded
Many organizations have relatively independent business units or product and brand teams, and for them it can often make sense for innovation to be embedded within these units.
Traditional examples of such an approach are companies like P&G and other CPG companies with strong brands. These companies are working hard to keep up to date with evolving trends and consumer needs to innovate and create new products for the consumer. However, the same can also be true for many other kinds of businesses, such as software companies with multiple products.
Depending on the industry and organization, these units might have varying levels of control over their innovations once they are on the market. For example, in CPG companies manufacturing, logistics and many other functions would likely be managed by core business operations instead of this unit.
Pros
Better able to focus innovation on things that matter for each business, be they strategic projects or emerging customer needs
More control over innovation resources and ability to get talent that meets specific needs
Parallelization over different units can increase innovation throughput of the organization overall
Easier to align innovation with business needs and plans within the unit
The business case for investing in innovation is typically easy to make as you can start from low-hanging fruits that provide immediate value
Cons
Innovation likely to be biased towards more applied and incremental projects due to focus on immediate business needs
Some efforts may be duplicated between teams, especially if more long-term R&D work is being done
Can lead to a silo-effect, extra need to focus on facilitating knowledge transfer between units
Ambidextrous
Our fifth approach is usually referred to as the ambidextrous organization. We’ve also seen it be referred to as the Hybrid model, and it’s quite a natural evolution from the previous archetypes as it seeks to combine the best of both worlds.
In a nutshell, the idea is that innovation should happen across the organization with existing business units focused on exploiting their current position through incremental innovation, and a separate dedicated unit being responsible for exploring and building the future of the organization through more radical or disruptive innovation.
In the ambidextrous model, existing units use incremental innovation to exploit the current position and new units are set up to explore and build future.
In practice, a new P&L responsible division will be setup for new non-core businesses, and the more incremental innovation will then be organised either as Embedded or Centralized.
If an organization does successfully implement such an approach, it can lead to exceptional long-term performance, but that’s of course easier said than done. For most organizations, this is likely to require a significant transformation, and it can be challenging to get everyone onboard, build the right processes, as well as to align goals and incentives the right way across the organization.
Pros
Easier to build a balanced innovation portfolio with both strong short and long-term performance
Enables building an innovation-oriented culture across the organization
Enough resources for key projects across the organization
Makes it easier to communicate the innovation strategy with clear roles and responsibilities for each part of the organization
Can customize governance models to meet the needs of different types of innovation in different parts of the organization
Cons
Expensive and difficult to build, as well as to maintain
Requires clear leadership and a commitment to a transformation from the top
Can demotivate innovation-oriented employees that are in the core business
Usually requires extensive changes to processes and the re-skilling of managers and employees across the organization
While easier than with most other models on paper, prioritization and division of responsibilities can still be challenging in practice
Decentralized
Our final model is the decentralized approach. If you look at any of the best innovators in the world, be it Apple, Tesla, SpaceX, or Amazon, this is closest to the model they use. None of these organizations has a centralized or dedicated team responsible for all innovation in the organization.
Instead, the organization decentralizes the responsibility for innovation to happen in individual teams (which are typically cross-functional and relatively small) across the organization. Each team is focused on figuring out how they could help the organization better reach their strategic goals, and innovation is just one of the key tools in that process.
If a team (or an individual leader or employee) comes across a big idea that shows promise but would require significant additional investments, they’ll apply for additional resources from management via a quick and streamlined process. If approved, that typically leads to another team being set up to pursue that idea.
This approach is sometimes called the permissionless model due to the significant freedom each team possesses to make decisions affecting their own work. The obvious advantages are that they usually know the problems intimately and have the resources, incentive, and know-how to solve them, and have fewer dependencies to other parts of the organization. That leads to an extremely high pace of innovation and innovation throughput for the organization, which together create a tremendous competitive advantage.
Having said that, this too isn’t exactly an easy model to implement for most organizations. Typically, this would require a fundamentally different mindset, leadership philosophy, and a significantly higher talent density. For the average organization, that means a full-blown transformation where most fundamentals in the organization would need to change, which of course isn’t feasible for many.
Pros
Extremely high throughput and pace of innovation
Ability to adapt, re-organize and meet changing demands quickly
Strong focus on execution and value creation
Clear roles and responsibilities
Cons
Would require a fundamental transformation for most organizations
Requires strong communication and strategic clarity from management
Active management involvement required to remove barriers and to organize teams so that the portfolio remains balanced
Requires high talent density across the organization, which can be very challenging to achieve in practice
Continuously evolving and rapidly changing landscape might be too intensive for some employees
Some work often initially duplicated across teams, but can be managed by creating horizontal support teams
Choosing the right approach for your organization
As you can see, every approach has their benefits, but also their disadvantages.
In our experience, the Hybrid and especially Decentralized are the likeliest approaches to lead to sustained levels of high innovation performance in the 21stcentury but implementing either isn’t exactly a walk in the park for a large organization. If you have the luxury of meeting (or are close to meeting) the prerequisites, these are the models I’d personally go for.
However, for many, that just isn’t the reality. Even if you’re like most organizations and don’t quite have the talent, leadership, or other prerequisites needed for these approaches, I’d keep either the Hybrid or Decentralized approach as your eventual goal to build towards.
Move control and decision-making down in the organization to be able to move faster, make more informed decisions, respond to changes quicker, and to simply innovate more.
However, instead of a major overnight transformation, you should be prepared for a set of smaller, gradual steps that build your capabilities and culture towards that future while solving the current problems with your processes and structures.
While not ideal in theory, in practice the journey towards becoming a mature top innovator typically first leads towards centralization for most incumbent organizations. They need to build their innovation strategy, knowledge and capabilities before they can successfully decentralize and move control and decision-making down in the organization to be able to move faster, make more informed decisions, respond to changes quicker, and to simply innovate more.
With that background, if such an approach is used, it’s crucial that this centralized innovation function understands and embraces their temporary role so that they are willing to relinquish control and power over innovation to others. All too often we see these leaders clinging on to the team, budget and power they’ve built long after it would’ve been in the organizations’ best interest to re-organize.
Best practices for organizing innovation
As we’ve discussed, if you’re planning to make changes to the way you organize innovation, most decisions will depend on your context. Still, there are a few things that are good to keep in mind regardless of the approach you end up choosing. Here’s my top three:
The best innovators continuously evolve
The first, and perhaps the most important point to remember is that the best innovators continuously evolve and improve the way they work. They don’t just pick one organizational structure and go with that forever. Instead, they are constantly looking for ways to re-organize their efforts so that they work on whatever is likely to best help them reach their goals. This is of course one of the fundamental strengths of the Decentralized model but applies to other approaches too.
This is also in line with how the most successful organizations approach re-organizations in general. They don’t just wait until the old structure is burning, they act proactively to position themselves for the future they want to create.
Clear roles and decision-making structures
It’s pretty obvious, but if people don’t know who can make a decision on an idea that they may have, or even who’s responsibility it would fall under, odds are that not a lot of innovation will happen.
The reality is that there will always be some ambiguity and overlap, especially in fast moving environments, but clear roles and decision-making structures are regardless important for an organization that wants to innovate.
If projects or decisions seem to get stuck, or turf battles seem to consistently pop up in your organization, unclear roles and ambiguous decision-making are likely to be the main culprits.
Organize according to strategy and plan for the execution
Again, it might sound obvious, but especially with innovation, the differences can be dramatic. Organization is the link between your strategy and your execution, so make sure it isn’t detached from the realities of what it will take to reach your goals with innovation.
To use a bit of a simplified example, if your strategy is focused on creating new business from emerging disruptive technologies, then the Embedded model probably won’t cut it as your innovators will be kept busy by the priorities from the core business.
Plan for the execution, on the other hand means that each team should have the resources and the freedom needed to reach your goals. If, using our previous example, you allocate just a few engineers to the team and then hope that sales will magically turn those technologies into booming businesses, odds are very much against you.
In other words, try to allocate resources so that the team has everything they need to reach their goals. While this sounds super basic, we still see these mistakes frequently when innovation is a bit of an afterthought for management.
Conclusion
As is probably evident by now, no structure or approach to governing innovation is ever going to be perfect, at least for long. As your goals change or your business and industry keep evolving, you will need to change and evolve too.
Even though organizing innovation doesn’t seem to get the same kind of attention as innovation strategy or culture, it’s extremely important, nevertheless. Get it wrong, and it will be almost impossible for your organization to succeed at innovation. Get it right, and you’ll at the very least have a realistic shot at that.
Hopefully this article has provided you with more thoughts on the topic, and some views on what to do and not-to-do.
As many of my colleagues are aware, I am at heart, a maverick, an unorthodox or independent-minded person. Who is curious and inquisitive, and finds change and challenging the status quo exciting, fascinating and stimulating. I am also, considered, by some, as a misfit, someone whose behaviors and attitudes sets them apart from others in an uncomfortably conspicuous way, that often rocks the boat. There is a range of consequences for people like me, who dare to think differently, especially now that I have also achieved the status of a Modern Elder – “the perfect alchemy of curious and wise, with curiosity leading to expansive inquiry while wisdom distills what’s essential.”
Coupled with both the challenges and constraints of the currently disrupted Covid-19 and digitized world, I am finding that the consequences of being different have intensified, become more impactful, and are often, quite confronting. Where differences cause resistance to change, divisiveness, and conflict, rather than maximizing differences in ways that embrace our humanity, diversity, to harness collective intelligence to make the organization, or world a better, more inclusive, and safer place.
Which exists in the home, in the street, in our workplaces, communities, and countries where we constantly encounter groups and cultures whose ideas and ideals are unlike ours. “That can be experienced as a profound threat to identity. Identity divides.” Considering that “the world is not a single machine, it is a complex, interactive ecology in which diversity – the biological, personal, cultural and religious – is of the essence.”
“When difference leads to war, both sides lose. When it leads to mutual enrichment, both sides gain.”
As is currently being evidenced by the tense and tentative Ukrainian and Russian border confrontation, with its potentially tragic consequences. Where Yuval Noah Harari states in a recent article in The Economist – “At the heart of the Ukraine crisis lies a fundamental question about the nature of history and the nature of humanity: is change possible? Can humans change the way they behave, or does history repeat itself endlessly, with humans forever condemned to re-enact past tragedies without changing anything except the décor”?
People Who Dare to Think Differently
Adam Grant, in his book “The Originals – How Non-Conformists Change the World” describes an original (n) as “A thing of singular or unique character; a person who is different from other people in an appealing or interesting way; a person of fresh initiative or inventive capacity”.
The book goes on to explain strategies, through studies and stories how to champion new ideas and fight groupthink, in constructive ways that maximize diversity and differences and promote dissent, as the basis for cultivating original thought to effect positive change.
Ray Dallio, in his book Principles explores this further, suggesting that “if you are like most people, you have no clue about how other people see things and aren’t good at seeking to understand what they are thinking because you’re too preoccupied with telling them what you yourself think is correct.” Often causing divisiveness rather than inclusion, resistance to change, and as a consequence, missing the possibilities and opportunities that may be present.
This also impedes our overall adaptiveness and creativity in an exponentially changing, world, to make real progress, and constructively change and limits the potential for innovation, growth and ability to contribute to the common good.
Change Management Has Changed
In a recent article from the Boston Consulting Group, they stated that “Effective change management requires leaders to shift away from one-size-fits-all approaches and develop an expanded set of context-specific strategies”.
Which are truly adaptive, collaborative, energize, catalyze change, harness, and mobilize people’s and customers’ collective intelligence, in ways that are appreciated and cherished by all, and contribute to the common good.
To ultimately collectively co-create a set of different, empowered future-fit leaders, teams, and organizations – who courageously, compassionately, and creatively contribute toward an improved future, for customers, stakeholders, leaders, teams, organizations as well as for the good of the whole.
Welcoming Dissent and Thoughtful Disagreement
At ImagineNation™ we dare to think differently and teach train, and coach people and teams to maximize their potential to lead, manage, coach, through implementing and embedding change and innovation, differently.
We enable people to lead in the imagination age by empowering, enabling, and equipping them to be and think differently to:
Flow with some people’s need to be “right” and in control, when they are being defensive, abusive, and divisive, even when disagreement and conflict occur.
Artfully and skillfully use cognitive dissonance and creative tension to pull people towards a new possibility and envision a new and compelling future.
Be inclusive to support mutual enrichment, through co-sensemaking, that helps them create “order” (in their own context) and simplicity from complexity and change.
Self-regulate and self-manage emotionally in the face of uncertainty and volatility.
Be relatable, empathic, inspiring, and artfully and skillfully influential in helping people open their minds and hearts toward co-creation, collaboration, and experimentation that ensures a shared contribution for mutual gain.
In ways that engage deep generative listening, inquiry, questioning, and differing that uses cognitive dissonance to unleash the creative energy that triggers and generates thinking differently.
When people are trusted and empowered to think differently, they co-create a frequency that allows, awakens, and activates their adaptive and innovative leadership qualities, consciousness, states, and qualities of mind and heart, to effect positive change.
Taking wise and intelligent action
It also enables them to wisely choose the most intelligent actions that result in adaptive and innovative outcomes.
This helps creativity to flourish and disrupts and interrupts those people, whose complacency, conformity, and rigidity create divisions, and feelings of desolation and exclusion that kill our capacity and competence to collaborate, create and invent.
Leaving me to wonder and inquire;
What if the “strangers” among us simply listen, with open minds and open hearts to the thought, feelings, and opinions of others, with both curiosity and detachment?
What if we could collectively co-create safe containers and collective holding spaces, that maximize our differences and diversity, and simply share a creative conversation about what could be possible?
How might we maximize our diversity of thought, to enable us to think differently about the issue, opportunity, or problem in ways that supported differences for mutual enrichment?
There is no wisdom on one point of view
Might this result in a deeper connection when there is polarization between people?
Might it be possible to co-sense and co-create a sense of inclusion, and an opening for a deeper philosophical exploration and discovery for thinking differently about the role, nature of and impact prescriptive points of view on how people truly feel, really think, and deeply act in our globalized and connected world?
Might it help us collectively to co-create making it a better place?
Find out more about our work at ImagineNation™
Find out about our learning products and tools, including The Coach for Innovators Certified Program, a collaborative, intimate, and deep personalized innovation coaching and learning program, supported by a global group of peers over 9-weeks, starting Tuesday, May 4, 2022. It is a blended and transformational change and learning program that will give you a deep understanding of the language, principles, and applications of an ecosystem focus, human-centric approach, and emergent structure (Theory U) to innovation, and to upskill people and teams and develop their future fitness, within your unique context. Find out more.
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