14 - Building a Culture of Innovation
Fear prevents innovation. Fear of being punished for failure prevents people from trying anything new. Fear of being ostracized for questioning the status quo discourages them from even suggesting a new idea. To be innovative, one must be in a safe environment that encourages discussion and tolerates failure.
The recent economic downturn has also been discouraging. While energy is focused on keeping organizations afloat and functioning during difficult times, the risk of doing something new is too much for many companies to bear. Few companies took the strategy of innovating their way out a the slump - most simply battened down the hatches, stuck to business as usual, and found ways to tighten up their operations to weather the storm.
Meanwhile, there's a great deal of interest in innovation - at least verbally. Companies acknowledge the need to innovate, wish to become innovative, and even call themselves innovative in their press releases and annual reports. But their behavior indicates otherwise.
(EN: There's more content here, but not much meat. Just buzzwords and happy-talk about the innovative spirit.)
Innovation as a Culture
One way in which firms get innovation wrong is treating it as a program - a temporary campaign in which executives sing the praises of being innovative but employees return to their desks to do business as usual. Another common mistake is creating small innovation teams, who meet and discuss ideas that never get off the ground while the rest of the company carries on in the usual way.
Innovation is not a campaign or a sideshow, but must be part of the culture. It is something that all employees participate in every day, whether they are the originators of new ideas, give direct support to innovative ideas, or simply stay out of the way of innovation
Aside: not all companies need a culture of innovation. High-tech companies and those in rapidly evolving industries must "innovate or die," but companies with few competitors in stable industries whose products have changed very little over the years do not need to be aggressive in the pursuit of innovation. A little innovation might help to grow markets or decrease expenses, but there is no reason for a company that sells table salt or aluminum foil to engage in aggressively rethinking their product, brand, and organization.
But fear of change is never a valid reason to avoid innovation. A company who insists that customers like the product exactly the way it is, while steadily losing market share, is in a state of denial that will end in collapse.
Innovation from Below
The authors mention the Hindi word "Jugaad," which roughly translates as "improvising a solution using limited resources." (EN: the description continues, and it seems similar to the English concept of "bricolage.") A few examples are given of improvised solutions that led to more permanent ones - such as the use of paper clips in surgery leading to the development of inexpensive single-use surgical clamps, or the makeshift use of mosquito netting in hernia repair surgeries leading to the development of medical meshes.
Similarly, many ground-level employees in organizations come up with their own solutions to problems. When the firm won't invest in the tools employees need, they improvise solutions. When the official procedure for doing things is cumbersome, employees find their own shortcuts. However, because working around the rules is discouraged, many of these innovations are kept secret and covered up rather than shared and propagated.
There is this unreasonable expectation that innovation is the sole province of executives, when in reality those who are closest to the front lines are often the most aware of procedures that are harmful and the best equipped to identify opportunities for improvement. If they are punished for breaking the rules, they still innovate - they just hide their innovation, taking on the extra work to keep up the appearances that they are following orders.
Getting these great ideas out of the closet means changing the manner in which management reacts to deviation from standard practice. Instead of punishing disobedience, management must reward innovation - and tolerate the taking of small risks (and small losses) as the acceptable cost of innovation.
It's also suggested that western culture is a bit too obsessed about the autonomy of the individual, and tends to romanticize the "lone innovator" who came up with a revolutionary idea. In truth, people are most creative and innovative in groups, each building off the work of others, learning from one another. A company cannot be saved by a single innovative individual, but must build a community in which all can contribute.
It is also ironic that companies that are risk-averse use threat of punishment to prevent people from breaking from established procedures. People still innovate - but they are forced to keep their work secret for fear of being punished. It an innovative person could speak openly about his ideas, he could be coached and advised to mitigate the risk. Very often, a person who innovates in secret ends up doing a lot of damage when he makes a mistake - because no-one saw what he was doing until it was too late, because he feared punishment and attempted to hide his mistake rather than getting help, a problem that might have been corrected with a slight adjustment does great damage by the time it is discovered.
Finding a Voice
In a culture of fear, innovation is thwarted: people are reluctant to speak out or draw attention to themselves when they expect there to be no support or even punishment for suggesting new ideas. As a result, they contribute their effort, but not their knowledge. The author avers that "there is so much untapped potential in most organizations" but at the same time the management culture fails to support contributing, and very often actively discourages it.
There is mention of the "suggestion box," which appears to be a gesture on the part of management to encourage employees to express ideas - but at the same time it belies a culture in which employees do not feel comfortable speaking up and must be given an anonymous method of contributing their ideas. There is also the perception, quite justified, that the suggestion box is ignored - it is a way of allowing employees to "vent" but results in no real action.
Because management has very often acted to discourage participation, it is necessary for management to undo the damage by encouraging participation - but more importantly, to create an atmosphere in which people feel free to participate.
(EN: The author throws out a bit more advice about this, but it does seem rather naive and simplistic - management must first rebuild trust before attempting to foster participation. There is no shortcut or simple method to doing so, and encouraging participation without removing the threat of punishment will not be effective, but merely stressful for workers who are then placed in a position where they do not know which action - speaking or remaining silent - will result in the greater punishment.)
Encouraging Innovation
The author provides a number of suggestions and inspirational statements about encouraging innovation within an organization:
- Compelling employees to obey orders and follow procedures prevents them from discovering better ways of getting things done.
- Trust is the foundation of innovation. Without it, there is no involvement or engagement.
- Being hostile about employees who ask questions is a sure way to crush curiosity, and a sign that the status quo cannot be changed. Encourage healthy dissent.
- Hierarchy is misleading. The people "at the top" are actually the furthest from the customer, and far less capable than those lower on the totem pole of discovering problems or opportunities.
- Knowledge is not static. Firms with a penchant for creating documentation will seldom update it, and follow obsolete procedures for decades.
- To survive, one must grow. The only things that stay the same are dead and in a process of slow decay.
- Consistency is overrated. No firm ever experienced dramatic growth as the result of being consistent.
- Innovation is intuitive. A good idea often defies being articulated or measured by conventional means.
- Innovative companies often give their people time and resources to experiment and develop ideas. Highly innovative companies give them quite a lot of time.
- The attitude of "don't reinvent the wheel" is based on the assumption that the wheel is perfect the way that it is and that there could not be a better solution. The wheel could never have been invented if "don't reinvent the log" had been the order of the day.
- Being innovative is actually quite easy. Selling innovative ideas to others is difficult. Consider creating a position or department whose task it is to champion the ideas of others.
- Punishing someone in order to set an example is highly effective in discouraging innovation. Rewarding someone in order to set an example is effective in encouraging it.
- Capitalize on the thoughts and ideas of new people who have not yet been institutionalized, and who are not restricted by the knowledge of what can't be done.
- Explore the problem thoroughly before attempting to define a solution. Quick and dirty solutions are not very good, and people tend to stop thinking creatively once they think they know the answer.
- Market research is a great way to discover what problems customers are trying to solve, but it is often a very poor way of determining the solution.
- It's OK to not know something. A person who admits that they do not know the answer is better able to find it than someone who feels confident in their assumptions.
- People often allow their roles to limit their contributions - they feel limited to their areas of expertise, not recognizing that they are capable of making broader contributions.
Random Stuff
Again, there were a number of short diversions that didn't fit in the context in which they were presented, but seemed interesting:
Innovation requires defying conventional thinking to come up with new approaches. To a person who follows convention, a chair is just something to be sat upon and nothing more. To a person who is trying to solve a problem, a chair can be many things: it can be a stepladder, a method to block a door, a shield to defend against an attacker, fuel for a fire, or whatever use is serviceable to their needs.
Innovation also requires improvisation - doing things that are not known, through a trial-and-error process. Conventional approaches are much less risky - they have been proven by years of practice to achieve predictable results. But "predictable" is not necessarily good. Particularly when you're doing the same thing that everyone else does, you gain no competitive advantage.
There's brief mention of "marginal innovation" - rather than undertaking a sweeping change that creates radical transformations, seek to improve small parts. The author tells the story of an engineer who developed bicycles for the British Olympic team. Rather than seeking to radically transform the device, he looked at each of over 100 parts, seeking ways to make it lighter, more durable, less fricative, etc. By many small changes, he engineered a much faster bicycle.