Trends

Building a Culture of Innovation

How to Remove the Two Most Common Barriers to Innovation and Invention

By Paul Tibbert, CEO of GRID

If you were to ask most senior leaders and members of the C-suite at corporations large and small whether they wanted their companies to innovate, you’d likely get a resounding affirmative in response.

Yet, in survey after survey, like this one conducted by McKinsey, leaders are reporting either a disappointing lack of innovation or a company-wide de-emphasis placed on innovation—especially since the pandemic. 

That said, a focus on innovation will soon return, according to McKinsey, which notes that, “The executives in our survey strongly believe that they will return to innovation-related initiatives once the world has stabilized, the core business is secure, and the path forward is clearer.” 

But having an emphasis on innovation is not the same thing as actually innovating, iterating and inventing. What’s needed, in other words, is not so much a “mission of innovation,” but rather a “culture of innovation,” in which true innovation is authentically woven into the DNA, processes, ambitions and day-to-day metrics of the entire enterprise.

The Two Main Drivers of Stasis

So what gets in the way of innovation? Corporate boardrooms commit to it, at least in lip-service; initiatives are conceived and implemented around it; and yet, when measured against actual progress and performance, little success nor meaningful advancement is reported.

I think there are often two natural states that medium-sized and large organizations fall victim to, each presenting its own barriers to innovation:

1 – It’s natural to do nothing.
Innovation involves a certain degree of risk. New endeavors and inventions are unproven, by their very nature. They often result in failure, which comes at a cost (in time and money). As a result, few inside the company raise their hands to take ownership of new ideas and progressive thinking. Nobody gets noticed for not failing—and if innovation isn’t expected, demanded or rewarded, many will feel more comfortable succeeding at not failing then they will risking failure by not succeeding. The result? Stasis.

2 – Innovation becomes too big to fail—so it can’t ever get the chance to succeed.
Too often, we think of innovation as one big massive endeavor. The misperception is that innovation needs to truly move the needle in huge noticeable ways in order for it to be considered a success. Large-scale endeavors require resources and drain human capital. Moreover, once a single mammoth leap toward major innovation has been authorized and implemented, it becomes a magnet for the entire company’s set of individual or departmental pet projects and wish lists. Inevitably, people will try to get their own personal priorities tacked on after everyone knows the idea is critical to the company but before the scope and price is pinned down. Scope creep then turns an already massive undertaking and bloats it out to be an immense immovable object that gains no traction and reaches no milestone. Again, the result is stasis.

Neither state is particularly helpful toward creating a culture of innovation. In fact both will undermine it at every turn. You can’t do nothing; and you can’t try to boil the ocean. 

Perhaps the answer is somewhere in between, as it so often is?

Fire Bullets, Then Cannonballs

“Fire Bullets, Then Cannonballs” is a concept developed in the book Great by Choice by Jim Collins, perhaps best known for his best-selling Good to Great:

First, you fire bullets (low-cost, low-risk, low-distraction experiments) to figure out what will work—calibrating your line of sight by taking small shots. Then, once you have empirical validation, you fire a cannonball (concentrating resources into a big bet) on the calibrated line of sight. Calibrated cannonballs correlate with outsized results; uncalibrated cannonballs correlate with disaster. The ability to turn small proven ideas (bullets) into huge hits (cannonballs) counts more than the sheer amount of pure innovation.

It is these incremental steps toward progress, Collins argues, which begin to accrue and compound interest almost immediately, that are the most effective ways to eliminate stasis and implement change. 

For one, they mitigate the risk of ownership baked into scenario 1 above. If you can remove fear as a demotivator, you will encourage smaller steps and behaviors toward iteration—maybe not full-blown invention or reinvention, but iteration. You will see more hands raised, and more frequently.

Secondly, you as a company leader will then find more opportunities to recognize and reward smaller (but more plentiful) innovations, and the rest of your leaders and teams will take note and want similar accolades and recognition—especially if they are intentionally baked into more frequent performance reviews. 

This is how occurrences begin to become culture. And where there is a true culture of innovation, the ongoing need for compelled innovation and sweeping mission initiatives is replaced by invention that comes naturally, organically, fluidly and repeatedly.

How to Implement Innovation Iteratively

Here are some ways leadership teams can effectively move forward in creating a culture of innovation immediately:

1 – Don’t disconnect from reality.
Keep your emphasis on innovation rooted in the real world, not some pie-in-the-sky, unattainable dream-casting. Too often, “Big Hairy Audacious Goals” (BHAGs) distract the company from its mission-critical objectives. Keep company-wide innovation refined to areas that will improve core business drivers—optimizing the customer experience, supply chain or production methodologies. There’s little risk in iterating toward progress that will actually improve real-world outcomes day-to-day.

2 – Find, identify and empower your true innovators.
Not every great idea has to come from the board room. Sometimes, the people who think about innovation every day are the personnel “on the front lines” or working with the client and product each and every day, hands-on. Just as you can’t assume that every individual you hire is a true innovator, it is dangerous to ignore that voice in the room who is constantly considering new approaches, ideas or innovations. Some people just have a general knack for it, even if they don’t attend the management meetings. Find them, encourage them, and continue to mine them.

3 – Build innovation into the budget.
When innovation becomes a part of the corporate culture, it will be nearly impossible to predict when and from where the next great idea will come, and at what cost or investment. Innovations will start to come on the regular, and you don’t want a lack of resources to stand in the way of progress. Remember, since the innovations will be more iterative and manageable, you needn’t fear that every new innovation will bleed the bottom line. If you bake a little bit of financial cushion into the unknown of future innovation, you won’t often have to say no to a great idea, nor to the enterprising innovator who offered it. There’s nothing that stifles innovation more than constant denials.

4 – Don’t overcomplicate things.
Don’t build too much process, rigidity or bureaucracy into the path toward innovation. Make it easy to achieve and celebrate progress. If coveted creativity is rewarded only with onerous pushback, paperwork and painstaking process, it will deplete the energy you’re trying to generate, encourage and harness.

Remember, it’s that constant flow of “bullets” that will demonstrate and reveal just how much progress the company is making toward innovation. The “cannonballs” will only be deployed when necessary, and at far lower risk and cost.

Do that, measure it, and celebrate each of the many wins along the way, and you will move innovation beyond being a mere emphasis or mission and toward it becoming the very fabric of your business—its culture.

 

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