7 Strategies for Sustained Innovation
The need for constant reinvention is a given in today's business environment. And while a breakthrough product or concept can catapult an organization ahead of its competitors, in these fast-paced times, that advantage is often short-lived.
While major product or service breakthroughs make headlines, it's the steady incremental innovations made by employees every day that give an organization the sustained growth it needs.
Sustained innovation comes from developing a collective sense of purpose; from unleashing the creativity of people throughout your organization and from teaching them how to recognize unconventional opportunities.
As innovative ideas surface, a clear sense of mission empowers front-line employees to act on new ideas that further your company's purpose.
It Starts at the Top
Leaders create the psychological environment that fosters sustained innovation at all levels. The challenge is that as an organization grows, management structures and bureaucracies, designed to channel growth, tend to create barriers to small-scale enhancements.
While there are exceptions, in larger organizations employees tend to feel removed from the function of innovation and are less likely to take independent action or offer revolutionary ideas.
The commitment to establishing the right psychological conditions for innovation needs to start at the top. This means that, as a leader, you need to consider your own assumptions about innovation and their role in creating and changing your organization's culture.
You need to appreciate the value of incremental as well as major innovations, understand the psychology of innovation and take the lead in promoting an innovative culture. Otherwise, it's just not going to happen.
While your organization's innovative capability depends on multiple factors, there are several steps you can take to create the psychological conditions that favor inventive thinking, regardless of your industry or the size of your organization.
Establish A Clear Sense of Direction
Changing cultures involves changing minds, and that takes time. But as with any initiative, a clear sense of the target helps to speed the journey.
Your organization's mission helps to organize and direct the creativity of its people. What is the purpose of consistent innovation in your enterprise? Is it to add customer value to existing products and services?to speed delivery?to increase on-time arrivals?
Having a clearly articulated message allows everyone to focus on innovation where it can deliver the greatest value. Innovation, as Peter Drucker has defined it, means creating a new dimension of performance. A sense of mission clarifies the direction of performance and helps determine which new ideas to focus on.
Open communication between management and employees sets the stage for an atmosphere of trust. But if you want to establish a new, more trusting culture, you can't expect employees to take the first step.
Company leadership initiates the process of open communication by sharing information with employees on a regular basis. This includes good news and bad.
Southwest Airlines policy of sharing information enabled the company to weather the sudden increase in fuel costs during the 1990-91 Gulf War. The company kept everyone informed as fuel prices soared. Southwest's CEO Herb Kelleher sent a memo to pilots asking for their help. Through inventive thinking, the pilots found ways to rapidly drop fuel consumption without compromising safety or service.
Leaders of organizations that sustain innovation offer multiple opportunities for communication.
While not every company can offer an open-door policy for its senior executives, or even a chance for regular face-to-face contact, every organization can institute programs that enable front-line workers to feel heard. From CEO lunches with cross-sections of employees, to monthly division meetings between employees and the general manager, to open intranet forums for idea sharing and feedback, leaders can communicate their openness to hearing innovative ideas from those who are closest to the customer.
While larger organizations are often considered less entrepreneurial and inventive than their smaller counterparts, it's not the size of your company that inhibits innovation -- it's the systems. Bureaucracy slows down action and is a serious impediment to innovation.
Smaller organizations can often move faster on implementing innovative ideas because they have less bureaucracy. When Jack Welch was reengineering General Electric he said, "My goal is to get the small company's soul and small company's speed inside our big company."
Faster implementation encourages further inventive thinking. Think for a minute. If you had an idea for an innovation, and it required 6 weeks to clear channels and another 3 weeks to get funding, would you have lost any impetus for further contribution?
Instill A Sense of Ownership
An ownership mentality creates a powerful incentive for inventive thinking. When an individual is clearly aware of how his or her interests are aligned with those of the company, he or she has a strong reason to "go the extra mile" to further the mission.
Stock ownership is a significant, if not essential, incentive for employees. However on its own, profit-sharing doesn't guarantee your employees will think like owners.
When employees don't see how their individual efforts affect company profitability, they tend to be passive and reactive. To encourage greater involvement, make sure each employee knows how his or her work affects company performance.
Southwest gave pilots the freedom to design and implement a plan to reduce fuel consumption because they were in the best position to determine what would be effective. Pilots pitched in enthusiastically because they understood the impact their actions had on the bottom-line and ultimately, on their own futures.
Make Sure Recognition and Rewards are Consistent
While financial rewards are often tied to innovations, rewarding only the individual or team responsible for the "big idea" or its implementation, sets up a subtle competitive atmosphere that discourages the smaller, less dramatic improvements.
Even team-based compensation can be counterproductive if teams are set up to compete with each other for rewards. These incentives discourage the cross functional collaboration so critical to maximal performance.
Companies that successfully foster an innovation culture design rewards that reinforce the culture they want to establish. If your organization values integrated solutions, you cannot compensate team leaders based on unit performance. If your company values development of new leaders, you cannot base rewards on short-term performance.
A Tolerance for Risk and Failure
Tolerating a certain degree of failure as a necessary part of growth is an important part of encouraging innovation. Innovation is a risk. Employees won't take risks unless they understand goals clearly, have a clear but flexible framework in which to operate and understand that failures are recognized as simply steps in the learning process.
Toyota's Production System transfers quality management and innovation authority to front-line plant workers. Workers are able to make adjustments in their work if they see an opportunity for improvement. If the innovation works, it's incorporated into operations, if not, it's chalked up to experience.
A major psychological benefit of Toyota's method is the development of trust. Employees who trust their bosses are more likely to take intelligent risks that have potential benefit for the company.
Eliminate Projects and Processes that Don't Work
As your organization innovates you need to practice what Peter Drucker calls "creative abandonment." Projects and processes that no longer contribute should be abandoned to make room for new, progressive activities.
While no organization wants to squander financial resources on unprofitable activities, it is actually the irreplaceable resource of time and employee energy that is wasted if a company holds on to the old way of doing things.
Innovation requires optimism. It's about an attitude of continually reaching for higher performance. You can't expect employees to maintain an optimistic attitude if they feel compelled to continue in activities that are going nowhere.
© 2005 Dr. Robert Karlsberg & Dr. Jane Adler
Dr. Robert Karlsberg and Dr. Jane Adler are senior leadership consultants and founders of Strategic Leadership LLC. They work with senior executives to maximize performance, facilitate transitions and accelerate major change initiatives. Contact them at 301-530-5611 or visit http://www.ExecutiveEffectiveness.com
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Hiring for Success
Hiring someone new to work in your business is one of the most critical decisions a business owner makes, although it is not always given the justice it deserves. If a position is vacant, or additional staff are needed, recruitment decisions are often driven by the pressure to get someone in quickly, rather than waiting for the best person to fill the job.
Hows Your HUB?
Marketing gurus are always coming up with new lingo but oftentimes they are restating the old tried and true concepts in new terms. Marketing students from the 70's and 80's will be familiar with the acronym USP.
Why Do Managers Create Low Morale? Or Does My Bum Look Big In This?
Why do managers create low morale as a product of their management and what can we do about it?The answer to the initial question is easy.We all know what managers do to the workforce that causes the workforce to feel the way they do about their jobs.
Burger on a Bun Decision Making
When approaching any decision, it's important for individuals to maintain the healthy state of openness called for by WYSINWYG (what you see is never what you get). Remember that there is always more going on than simply meets the eye.
Creativity and Innovation Management - Idea Progression
Creativity can be defined as problem identification and idea generation whilst innovation can be defined as idea selection, development and commercialisation.There are other useful definitions in this field, for example, creativity can be defined as consisting of a number of ideas, a number of diverse ideas and a number of novel ideas.
I Cant Use This Approach Unless My Boss Does - Power, Accountability, and Consequences
People who work with us often struggle with this dilemma: in theory, they come to believe that it would be very helpful to use our approach with people who have more power than they do, and in practice, sometimes it seems too risky to try. Some examples of things that feel too risky include raising questions with your boss about his or her performance, disagreeing publicly with people who have more power , or otherwise sharing information that might lead you or the person in power to feel put on the sp ot.
Why You Need a Business Plan
This article was originally called "Do You Need a Business Plan?"The title was changed because in truth, every business needs a business plan. It's a common misconception that business plans are used only for raising capital, as in "my bank wants to see a business plan before they will approve a loan," or, "I need a business plan so I can get venture funding.
Communicating with Case Studies
A few weeks ago, a couple of colleagues and I discussed a new business idea. But, we had trouble expressing how this new business would provide value.
Plan for Business Success - 6 Reasons to Succession Plan
Succession Planning provides many valuable assets to your business. Yet it is easy to do, with a game plan.
Smart Staffing: Replacing a Key Manager
Have you been in this situation? One of your top managers left suddenly and you're under the gun to replace her quickly. So you promoted her assistant.
Get Meeting off To a Great Start
When asked what part of their job they find a major time waster, many will answer loud and clear..
Is Your Employee Newsletter Management Propaganda?
It should not be. If it is an effective newsletter, it will serve the needs of readers (employees) as much as it serves the needs of the publisher (management).
Planning For Growth
Are you planning your business or are you planning your growth? If you are like many high-performing business people, you have an annual ritual to set your plans for the coming twelve months. Some people do it in December, others at weird, miscellaneous times of the year, but most -- me included -- tend to do it the beginning part of the New Year.
Organizational Culture and Creative Blocks - the Similarities
Few Decision makers see the link between between creativity and innovation management, as performed by MBA's in firms, and creative endeavours such as screenwriting. In fact, there are very strong linkages.
Take Your Firm to the Next Level
So you did such a good job in 2003 at bringing in new clients to your firm that you're swamped with business, your firm is large and growing, and all parts of your marketing system are in place and running smoothly? Congratulations - you're off to a great start for 2004!If you can confidently answer "yes!" to the following metrics, then you're ready to take your practice to the next level (and if your answer is "no," get back to basics at http://www.turningpointemarketing.
The role of a manager is evolving in response to the needs of companies operating on the international stage. The complexities of globalisation brought to the area of management are great and require the 21st century manager to adapt in order to offer modern solutions to modern problems.
The Changing Boss-Secretary Relationship
THE CHANGING BOSS-SECRETARY RELATIONSHIP: Imagine a partnership at work. One member is outlining the agenda for the annual stockholders' meeting, the other is managing the logistics.
Guidelines For Conducting A Good Meeting
Okay, so you've figured out what kind of meeting is needed, you've planned well and you have all the right materials. How about the meeting itself? How can you be sure the meeting you've so carefully planned and prepared actually comes off as expected?The checklist below can help you through the process.
Employee Orientation: Get New Hires Off To a Great Start
The good news is that a new hire orientation program offers an opportunity to build a lasting impression of the new company. The bad news is that that is going to happen whether you plan it or not.
Dont Sweat the Small Stuff with Your Credit Policy
Do you know how many customers you have that are past due right now? How many bad checks are sitting on your desk that you don't know what to do with? How many dunning letters do you send out a month?How would you like to answer those questions with none, or very few? In a new book, "Become the Squeaky Wheel," Michelle Dunn, explains and outlines some easy procedures you can use to erase bad debt, and prevent it in the future."One thing that is often overlooked is how to prevent future credit issues," says Michelle Dunn.
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