Getting Innovation Right

Throughout the year we’ve been talking about innovation. Innovation equals success. Innovation is about adding value to your organization and to the marketplace. As the year draws to a close, it’s a good time to reflect how you can position your organization to leverage the marketplace and add value.

In his book, Getting Innovation Right, Seth Kahan's theme is the best ideas are useless if they don't add value. Kahan highlights suggested activities for leaders in order to drive success for their innovations in the marketplace.

1.  Pursue and leverage inflection points - those dramatic and decisive shifts in your relationship with the market whether positive or negative. Anticipate them and use them to your advantage. Positive ones can grow your base, increase you offerings and customer loyalty, and improve your place in the market.

2. Build innovation capacity. Developing new products and services has a stress factor. Does your organization have what it takes to channel those pressures and turn them into productive use? Strong innovation leaders do this through strong internal leadership, exceptional talent management, and robust idea management. They manage critical forces, talk to the right people, build partnerships, and hire and develop people who understand and embrace the power of innovation.

3.  Collect intelligence. The best innovation rises from a sea of products, services, customers, competitors, and internal equities. Your intelligence gather efforts should start with the interrelated areas of customers, market conditions and organizational capabilities. Be sure you’ve defined the scope, determined your goals, conducted interviews, consulted sources, and performed your due diligence.  Gathering and applying pertinent information must be an on-going effort to enhance the quality of your strategic decisions.

4.  Shift perspective. Challenge your own assumptions. They may be constraining your ability to see new opportunities. Get out from your own box. Listen to your employees, partners, customers and competitors.  Seeing the world through new alternatives and points of view helps to identify opportunities to pivot into a positive inflection point that will drive success.

5.  Exploit disruption. Disruption is part of business life today and it can come from anywhere. Just like conflict, if it’s ignored or mismanaged, it can be disastrous. Successful leaders identify the opportunity embedded in adverse conditions and exploit it – disruptions such as customer challenges, industry change, fierce competition and new business models. Turn turmoil to your advantage.

6.  Generate value.  Value is what causes people to separate from their hard-earned cash, drive investors to invest, and shoppers to shop. It’s a perceived benefit – such as the value of brand (Coke vs. Pepsi). Skillful innovators understand what drives value, what it looks like to customers and all their stakeholders, and how to generate by delivering something more, better or new.

7.  Drive Innovation uptake – customer acceptance of a new product or service. When you align your innovations with what your customers value, they become your ambassadors. Every stage of the innovation process holds opportunity to introduce new ideas into the market and engage your customers. Working together you move from a mere transaction toward a generative relationship.

To help his readers get innovation right, Kahan provides tools and techniques, templates and guidelines, and step-by-step instructions. If you’re thinking of what you want to accomplish in 2016, this may be a great place to start!

What the World’s Most Innovative Organizations are Doing Right

Fast Company magazine does a yearly review of innovative companies.  In the most recent study published in March of 2015, they list the Top 50 Most Innovative Companies of 2014.  Not surprisingly, Google tops the list but there are others on the list that are lesser known but still innovative and interesting organizations.  Their study was conducted over 6 months time and they reviewed thousands of organizations.

As they reviewed the data they used, some trends emerged and we’ve summarized five of them for you to consider as you, hopefully, work to encourage innovation in your organization. 

·       “Exceptional is expected”—Google is number one on the list because its people execute at a high level often.  Word like exceptional aren’t often used in business but should be!  We all should be striving to do great work as frequently as possible and to take whatever our role is to new heights—not just once in a while.  I would love to work for an organization that expected me to be exceptional—how about you?

·       “Innovation is episodic”—interesting that only a few of the companies that made last year’s list are on this year’s list and the authors think that is not because those people “lost their edge,” it’s because innovation isn’t a constant in most places—it comes and goes!  This should remind us to grab on to an innovative idea when we find one and not let it go as it may never come again!

·       “Making money matters”—it’s nice to have a workplace where ideas are flowing but if those ideas can’t be translated into new business opportunities or improvements, they really don’t matter.  The really innovative organizations generate new ideas that result in moving the business forward and are self-sustaining.

·       “Happy customers make you happy”—their example of this is Yelp which works hard to reward its customers by adding features that make it easier to use their product. This is in contrast to organizations that were on previous lists that appear to be doing the reverse—making it more difficult to be their customer.  Do you listen to your customers and use that feedback to move your organization forward?

·       “Unlocking global talent unlocks possibilities”—they cite a company in Kenya, IHUB that is unleashing Silicon Valley potential by signing up 10,000 members, launching 152 companies, and expanding into Tanzania and Uganda.  Are you thinking globally for ideas and markets?

  Our world has become so focused on short-term results that we often neglect the ideas that have long-term impact.  What are you doing to ensure that your employees and dare I say you, are encouraging innovation?  If you’re not coming up with new ideas, what’s to become of you?  Robert Sefan writes in the Fast Company article, “Breakthrough progress often requires wide-eyed hope.”  Not something we think about in business today but maybe we should!

It is encouraging that Fast Company says, “Risk of failure and collapse are always with us. But the culture of innovation across the globe is more robust than ever!”

The Red Suitcase

I was getting ready to board a flight with my husband, the second leg of a flight to our final destination.  I travel light and carry my luggage on board.  With me was my red roller-bag – the one that has an interesting, deceiving contour.  It slopes up, but the highest part of the case is the same height as a normal roller-bag.  It fits in the overhead bin, handle first versus wheels first.  It’s the same size as all the other roller-bags.

The gate agent stopped me and said, “You’ll have to check the bag – it won’t fit.”  “Yes it will,” I said.  “Wheels first?” he asked.  “No, it fits ….” I started to reply before he cut me off.  “Then you’ll have to check it,” he scowled.  As I began to measure it to prove that its dimensions were a standard fit, my husband joined the conversation. “It fit in the overhead bin just fine on the last flight.”  The gate agent finally acquiesced, after wasting precious time during the boarding process – all because my suitcase had a slightly different look.   I understood his concern – that if I placed it in the bin horizontally it would take up too much room.

We were early to board, and after settling in my seat, I observed one gentleman very nonchalantly placing two bags horizontally in the overhead bin – not appearing to care about other passengers.  I couldn’t help but wonder if he was scolded by the gate agent as I was.  I observed a woman place a carry-on bag that should have gone under her seat in the overhead bin without a care in the world taking room where another roller-bag could have gone. 

We make assumptions all the time.  Sometimes they are based on people’s characteristics, sometimes prior experiences.  We make assumptions about new or different things or ideas because we've had no experience with them. Ninety-five percent of what we do, we do with an unconscious mind. The gate agent was so focused on the shape of my suitcase, he lost sight of the other passengers. Focus is good – I certainly want the pilot focused on his job. When focus becomes rigid, it runs the risk of taking all judgment out of the process.

Bottom line is that when we make assumptions, we're looking backwards and making judgments.  We're blocking our ability to see how the person, thing or idea can contribute to the organization.  We're letting our biases overshadow our thinking.  We’re stifling creativity and creativity and innovation are important in today's business environment. 

Curiosity Sparks Innovation

There is a wonderful new book out by Brian Grazer and Charles Fishman titled A Curious Mind…The Secret to a Bigger Life.  You may recognize Brian Grazer who is the Academy Award winning producer of such films as A Beautiful Mind, Apollo 13, Splash and more. He also produces award winning television shows which have been nominated for 43 Oscars and 149 Emmys—in other words, he is a successful entertainment producer!

I first heard about the book from an interview with Brian in the United Airlines magazine and I loved reading about how for years Mr. Grazer has been holding “curiosity conversations” with just about anyone you can think of!  He’s sought out interesting and accomplished strangers—from spies and Nobel laureates to artists and CEO’s. These talks have inspired many of his films and TV shows.

The book makes a strong case that “curiosity is the tool that sparks curiosity and curiosity is the technique that gets to innovation.”  He suggests that questions create the mind-set of innovation and creativity. Curiosity presumes that “there might be something new out there.”  I love the way Brian explains it—he says” he keeps asking questions until something interesting happens.”

He says that “being curious and asking questions creates engagement” so there is a link to one of the most frequently discussed management topics today—employee engagement!  Another link to the world of work is his belief—and I totally agree—that curiosity sparks innovation.

So, what should you do if you want to have a curious conversation—especially one that might lead you to innovation?  The authors suggest you start close to home with people you already know—family, friends, work-related colleagues. Think of someone who might have an interesting job or who has had a very different life experience from yours.  Begin the conversation by telling the person that you’ve always been curious about their work (or their achievements or education or whatever makes them unique) and that you’d like to spend 20 minutes or so talking to you about what they do (or what their challenges are or…)

Here are some tips for having a successful curious conversation:

·       Be sure to clearly state that you want to hear their story—not that you are looking to sell them something or looking for advice—you are curious about them and their story!

·       Be careful to stay within the timeframe you agreed to before you started so that you honor them.

·       Prepare your questions ahead of time and be sure to ask open ended questions like, “Tell me about why you decided to study … “or “What was your first professional success?” or “What’s surprised you the most about where your passion has taken you?”

·       Even though you have thought your questions through ahead of time, be flexible if the conversation goes in a new direction!  That’s where you will learn the most!

·       Listen carefully and respectfully.  Follow up questions with probes like, “Tell me more…,”  “How so?”  Your goal is to learn as much as possible from the conversation. 

·       Be grateful for the time the person spent talking to you.  Of course, you would thank the person at the end of the conversation but the authors suggest you send a handwritten thank you note in which you mention something that was particularly interesting or in which you share a story of how something they said caused you to think or behave differently.  You can also send a thank you email but handwritten notes get a lot of attention because no one sends them anymore!  And, remember, a thank you note should not ask for anything—it is to say how much you appreciated their time and information!

We challenge you to use curious conversations to drive innovation in your organization and let us know how it works for you!

Reengineering Performance Management

The practice of reengineering started in 1993 with Mike Hammer and Jim Champy's book, Reengineering the Corporation, followed two years later by Champy's Reengineering Management. Twenty years later, we're still reengineering things in organizations. The latest is performance management.

Remember when your mother told you "If you don't have anything nice to say, don't say it"? Well, some organizations are taking this to heart when it comes to performance management. In February, The Wall Street Journal reported on companies that have been reengineering their performance appraisals to put the focus on employees' strengths and accentuate the positive. The companies include VMware Inc.; Wayfarer, Inc.; and the Boston Consulting Group.

Marcus Buckingham and Ashley Goodall recently wrote in Harvard Business Review about the work they are doing at Deloitte to reinvent the company's performance management system. They are making it nimbler, real-time, and more individualized, with a focus on fueling future performance rather than assessing it in the past. Out with the once-a-year, time-consuming event that's dreaded by managers and employees alike, and on to meaningful conversations between managers and employees. The objectives of the new system are to recognize performance, to see performance clearly, and to fuel individual performance.

To achieve the second objective, team leaders are asked to answer -- on a periodic basis, not just once a year -- four future-focused questions regarding what they would do with each team member, rather than what they think of the person.

Two questions use a five-point scale from "strongly agree" to "strongly disagree" to measure:

1. Overall performance and unique value to the organization: Given what I know of this person's performance, and if it were my money, I would award this person the highest possible compensation increase and bonus.

2. Ability to work well with others: Given what I know of this person's performance, I would always want him or her on my team.

The remaining questions use yes-or-no responses to identify:

3. Problems that might harm the customer or team: This person is at risk for low performance.

4. Potential: This person is ready for promotion today.

The simplicity and ease of this "appraisal instrument" should make everyone leap for joy. However, the process doesn't stop with answering the questions. Remember, performance management is a system, not an event. An integral part of the new Deloitte process is tied to the last objective -- to fuel performance -- and the conversation or check-in between employee and team leaders. Their purpose is to provide clarity -- what's expected, why it's expected, what great work looks like, and how it can be achieved in the short term (we're talking days). Check-ins must be frequent to be effective, and to ensure that they happen, the system is designed to have the team member (who's eager for feedback and guidance) initiate them. Talk about innovation -- a radical redesign to the entire process and culture of performance management.

While everyone's been buzzing about Deloitte's four questions, I was most taken by the third objective, to fuel performance rather than improve performance. It's exactly what the other companies are doing. Recognize strengths and leverage employee talent to grow the individual along with the organization. There's much to be said about lessons learned -- but too often, those exercises focus on the negative. Yes, the past can give us great feedback, lessons, and history, but they might as well sit in dusty books on shelves (or in file drawers) if we aren't going to take them into the future.

It's often been taken for granted that good performers need no encouragement for future performance. Finally, organizations are discarding this assumption and putting energy into inspiring all employees.

Rock, Roll, Recycle

The word innovation connotes new - new ideas, new things, and new ways. What about new ways of doing old things – out-of-the-box thinking that counters the mentality of "we've always done it that way?"  What about new uses for old things?

Remember pay phones? Some readers, and I'm not suggesting who they are, remember going to meetings and conferences and waiting in long lines to use the phone to check in with the office. Pay phones and phone booths are iconic parts of our infrastructure that are no longer used.

New York City has re-imagined them for modern use. A consortium of advertising, technology and telecom companies will deploy thousands of modern-day pay phones throughout the city that will offer 24-hour, free gigabit WiFi connections, free calls to anywhere in the country, touch-screen displays with direct access to city services, maps, and directions for tourists, and charging stations for cellphones. They will be capable of connecting to first responders and broadcasting alerts from the city during emergencies like Hurricane Sandy. The system will be the largest free municipal WiFi network in the world. But the old will not be totally abandoned. Some old pay phones will be retained for sentimental value, including three original Superman-style phone booths with operational phones, on the Upper West Side - for posterity.

Outdoor clothing company, Patagonia, holds a deep commitment to the environment. It lives the values of reduce, repair, reuse and recycle and has added a fifth R, reimagine.  They've introduced a new platform that redirects potential buyers of new clothing to an on-line auction that facilitates the sale of used Patagonia clothing. Its Common Threads portal is an evolution of its environmentally sustainable clothing – quality, durability and classic styling. Despite its investment in the portal, only eBay, not Patagonia, received commissions on the sales of its used clothing. So what did Patagonia gain? Brand awareness and engagement soared.

Music Go Round recycles music. More specifically, this retail store in Albuquerque NM, recycles musical instruments. When you walk in, you wouldn't immediately know that their merchandise is used. The walls on one side are lined with guitars that look like they just came from the manufacturer. Music Go Round buys and refurbishes used instruments and sells them for a profit. The telltale indicator - the price tag on each piece of merchandise proclaiming "Reuse, Recycle, Rock." They offer affordable merchandise that might otherwise have ended up in landfills.

John Lennon asked us to "Imagine." These endeavors are pushing the limits and challenging us to reimagine. Creativity is at the core of these innovations without any new product being created. Creativity is positively impacting the carbon footprint. If creativity is part of your organization’s DNA – imagine the possibilities!

Cornelia Gamlem, SPHR

Innovation—It’s More Important than Ever!

A recent study conducted by IBM’s Institute for Business Value surveyed 1500 CEO’s and found that creativity is the number one competency of the future, according to the respondents.  A lot of things have happened to us over the past few years to cause these leaders to see the need for creativity—none the least of which was the recent global economic downturn.  Organizations realized, if they hadn’t known it before, that we are all interconnected and to succeed, we have to reconsider some of the old ways of doing business.

The issue, I believe, is how to get organizations to shift how they manage people in order to encourage the innovation and creativity needed to stand out!  So many leaders have not owned innovation—they’ve put that off on their research and development teams or said it was a marketing challenge.  The CEOs in the IBM study who said creativity is the number one competency for the future better be taking it on at the highest levels.

How do you create an environment that encourages innovation to flourish?  Well, first of all you have to have the right people.  You have to hire people who know how to think “outside the box” and who aren’t afraid to speak up in order to challenge the status quo. Consider how Richard Branson hires at Virgin—they’ve made innovation one of six key characteristics they screen new hires for.  He says, “to get hired at Virgin, you have to demonstrate a passion for new ideas.”  So, you’d need to craft some questions to get at whether or not the applicant has that passion.  You might ask a question that Jeff Bezos at Amazon asks applicants—“Tell me about something you’ve invented.”  Another way to get at the creativity is to ask an applicant; “Tell me about the most creative idea you’ve ever had at work.  What was it? What was the reaction to your idea? What happened to it?  If it didn’t work, what did you learn from putting it forward?” 

If you are truly serious about hiring creative, innovative people, your culture must be transparent.  You have to listen to your employees, your customers, your competitors, and your stakeholders. Your rewards and recognition policies have to reward people who challenge the status quo and you most likely will need to untangle some of your long-held policies that keep your great employees from being their most creative.

A truly innovative organization encourages creativity at all levels—from the people who are on the front lines with your customers or members to your leadership team.  In other words, innovation has to be in your organizational DNA.

What are you doing to encouraging creativity in your organization?  Share your ideas with us at www.bigbookofhr.com.  From time to time in this blog, we’ll share ideas on great ideas that are working for other organizations.