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Where Are Your Innovators?

Tuesday, October 20, 2015
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These days, many published business books promote what I call “Rah Rah” leadership. While often entertaining and good reads, these books aim to make managers better motivators, teach leaders how to inspire their troops to achieve great accomplishments, and instill in managers the ability to communicate directives more effectively. In other words, these books are focused on a leader’s personal improvement.

Now all of us have a character trait or leadership habit worthy of inspection and adjustment. And for those who follow the prescriptive advice in “Rah Rah” articles and books, they may very well improve their performance. However, singular personal improvements rarely translate into growth or profitability gains for a company. Indeed, such business advice steals the limelight from other improvement areas where focus and energy have the potential to elevate a company.

Instead of focusing on a leader’s personal performance, let’s examine the innovation engine inside your company and determine if it needs an upgrade.

Know Your Business Challenges

After three decades of historically strong growth, the business climate is gradually beginning to turn downward. Prognosticators see leaner times, when profitability will fall and market leadership will be up for grabs. Adding to these dour predictions, competitive pressure is rising.

Some innovative companies are jumping across industry fences to leverage their competitive strengths in new markets. For example, both Google and Apple are making a foray into automobiles. Ecommerce companies like Alibaba or Tencent are expanding into the traditional banking arena by offering small business lending. Even more competitive pressure is coming from emerging economies. For instance, Chinese companies are growing at a pace that is four to five times their Western counterparts. To succeed in changing times, companies need new ideas and solutions around all facets of their existence—not simply personal improvement. Unfortunately, the structures and practices embedded in corporate America make change difficult. A recent McKinsey study uncovered that the year-over-year correlation between capital allocation equated to nearly 90 percent in a large sample of companies across the United States. In other words, companies are investing where they’ve always invested. They are doing what they did yesterday and expected different results. This is a rather poor recipe for success. The solution to these issues is to refocus companies and leadership teams on becoming more innovative—not individually, but as a company. 

Companies Need Problem Solvers

Nearly everyone is familiar with the success Apple enjoyed under Steve Jobs. He founded the company with Steve Wozniack, and during his two tenures at the helm of Apple, it was arguably the most innovative company in the world. Now for a moment, let us pretend Steve Jobs took a more traditional route and kicked off his career in an entry-level position. Would his innovative ideas have received airtime inside the company? Would the iPad, iPhone, or even the Mac been launched? Would he have ascended the corporate ladder with his passion for innovation? Let’s be honest. In all likelihood, it would have been bleed out of him long before he reached the executive floor.

Most companies today are organized around an authoritative leadership model. The top dog sets the agenda and tells people what to do. His direct reports tell the next layer of managers what to do, and on it goes down the corporate ladder to those who execute at the ground level. This “boss” managerial model is the dominant leadership model today, and it is reinforced by the “Rah Rah” leadership approaches. Now imagine you are a problem solver—someone who likes to dig into issues and opportunities, make a plan, and drive to a successful conclusion. Your ability to operate is compromised in this managerial model. Your analysis of opportunities and your proposed plan have to travel up the food chain for approval.

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Your innovations don’t stand a chance. Competing priorities between departments, political positioning amongst leaders, and corporate inertia pretty much assure your proactive endeavor will have its legs cut from underneath. Indeed, corporations do a terrible job of allowing innovations to grow and mature until they become something awesome. The problem solver is frustrated and either adapts to the culture or flees for greener pastures.

A far better ending would be that the employee was encouraged to identify opportunities and supported as they pushed forward. Fortunately, this vision of success can become reality without too much disruption of the current working environment. The goal is to build innovation pathways through the company.

Rev Your Innovation Engine 

Over the past year, I’ve consulted with a large company to build and harness its innovation capabilities. While the results won’t be truly known for another year, the results to date have been extremely promising. Our innovation program boils down to three primary themes. 

#1: Propogate a Shared View of Organizational Operations. In most companies, only a handful of individuals possess an enterprise perspective. In other words, how all the pieces of the company fit together to create products and services is a mystery to the vast majority of employees. Consequently, enterprise improvement ideas only come from a select group of individuals—often estimated as low as 5 percent of the workforce.

Imagine the possibilities if the full workforce understood at a basic level all the functions and connections across an enterprise. This knowledge is key because most major improvements encompass a large swath of the company. Having an understanding of the bigger pictures fosters ideas that are grounded in reality and that are not easily dismissed because they don’t consider the big picture.

Learning and development organizations are critical to developing this knowledge and disseminating it throughout the company. My personal favorite mechanism to accomplish this task is an enterprise process blueprint. An enterprise process blueprint represents an end-to-end view of the work completed in a company. It traces the flow of work from the raw materials suppliers to the end customer. In my book, Customer Focused Process Innovation, I devote a full chapter to how to create and utilize an Enterprise Process Blueprint for these purposes. 

#2: Request Employee Participation in Targeted Improvements. Setting up actual or digital suggestion boxes is never a good strategy for generating quality ideas. Ideas captured through suggestion boxes span the universe and are often not factual. It is blind shooting at its worse.

To vastly improve the quality of ideas, request input on opportunities based on real situations and data. Give the employees sufficient background to understand the situation, and then ask for their ideas. With my current client, this was an especially effective tactic. We highlighted the customer journey throughout the sales and delivery process. The ideas we received were simply outstanding and resulted in over a dozen improvements to the sale process. 

#3: Identify Business Owners to Shepherd Innovation to Fruition. Once the ideas are brought to light, they need a champion to further analyze, design, and develop the solution. As we captured ideas, we grouped them based on the processes they affected in our Enterprise Process Blueprint. This enabled us to assign a single owner for each major area of opportunity.

The owner worked across organizational boundaries to further examine each of the ideas. Invariably, some were discarded as impractical or they simply didn’t return a sufficient return. A surprisingly large number were implemented. In each instance, these ideas would likely have never seen the light of day were they not funneled through our innovation process. At the end of the day, the overall exercise to launch an innovation process helped us uncover innovators in the organization. Their ideas and energy were the fuel behind a major transformational effort. Since we launched the innovation process, over 300 ideas were generated, analyzed, and acted upon. Additionally, this new group of innovators embraced the transformation and many are now recognized as part of a larger innovation team.

About the Author
David Hamme is an innovation consultant and the award-winning author of Customer Focused Process Innovation: Linking Strategic Intent to Everyday Execution. He serves as managing director of Ephesus Consulting, an innovative consulting firm focused on driving game-changing initiatives for its clients. Prior to founding Ephesus, Hamme worked stints as a management consultant for Ernst & Young and the North Highland Company, as well as served as an executive in Lowe’s Home Improvement’s $3 billion Installation Business Unit where he oversaw the strategic planning, marketing, product management, pricing, new product development and sales functions. Contact him at www.davidhamme.org.
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