Innovation is a Leadership Issue
by Alan Patching
Let's take a look into how we can ensure innovation becomes a core element of our business. It will take leadership focused on:
- Top level management accepting innovation can be sourced from all levels of the organisation and not just the top
- All people realising innovation doesn't generally just happen. It must be a strategic objective with energy directed to ensuring it occurs.
Leaders are encouraged to appreciate the value of the 'two jobs' principle in the release and fostering of corporate innovation. This simply references the fact much innovation comes out of team effort, and usually in a project management context. Teams work best when leaders follow the advice of GE's former boss, Jack Welsh, who insisted managers give problems to teams and then get out of the way and let the teams solve them. In the two jobs approach, the manager gives an objective to a team and expects the team to deliver results and not excuses in solving the problem innovatively and effectively. However, to the extent the manager's input is required in getting to a solution, that manager must regard himself or herself a member of the team and subservient to the team or project manager in terms of giving the required input in the form required and in the time required. If the manager refuses to do so, and many simply cannot grasp the idea of being subservient in a team situation to someone who might be their junior in the hierarchical structure, it is no longer reasonable for the manager to continue to expect the team to deliver results and not excuses. It's as simple as that.
I have written extensively in the past about the techniques of replication, synthesis, extension and novel thought to tap into our creativity to produce innovative ideas. However, if innovation is to become a core business principle, we must ensure that the inspiration and motivation to apply these techniques is ever present within our organisations. The leader, of course, cannot motivate anyone but himself or herself, as motivation is an internal force which compels personal behaviour. However, the leader is very much required to provide the inspiration to people to choose to motivate themselves, including towards being part of innovative solutions.
Presuming you apply the 'two jobs' principle in your organisation and your people are aware of the techniques for tapping into creativity, I'd suggest two approaches to fostering innovation as part of your core business activity. Firstly, why not think about establishing an incentive system for innovative ideas that you apply in your business. Don't restrict the rewards to just innovative product ideas, but rather be open to any innovation that can improve your business in any way. For example, a suggestion concerning redecoration of the reception area or, perhaps, the manner in which your people answer incoming calls might be rewarded with a company sponsored dinner for the innovator and his or her partner.
There are a number of philosophies about reward systems. Some say the reward should be focused on personal recognition and does not need to involve great expense. Others feel material rewards are most appreciated. I see value in both positions and suggest that you keep your mind open on the issue. I've seen junior staff blossom from being rewarded with greater authority and responsibility. I'm also very much aware that the incentives industry keeps many of the hotels and resorts in Australia and around the world in business. The decision is very much a matter of judgement for individual leaders after consideration of various issues including the personality style of the people being rewarded, the value of the innovation gained, the corporate attitude and policy regarding rewards, whether it is to be a team or individual recognition etc.
A couple of tips regarding rewards policy
- Be sure to shape your incentives policy to fit the nature and size of your business, the attitude of your people, and your budget.
- Be sure not to apply negative incentives. The old approach of "sackings will continue until morale improves" never really was effective, and it certainly won't cut the mustard with today's better educated and more assertive employees.
It's important for leaders to educate their people regarding the ways in which innovation can be applied within the organisation. Avoid being restrictive while attempting to make some business sense of these potential applications. I find one approach to be very effective. This involves explaining how marketing cycles work and how innovation can be applied to each phase of the marketing cycle for each product or service that you offer.
Begin by explaining that all products and services go through a life-cycle of introduction, growth, maturity, saturation and decline. Most people have no trouble understanding the importance of innovation in developing new products and services for introduction to the market. There is often less understanding of the importance of innovative thinking in relation to the other phases of the product life cycle. Innovative marketing can significantly extend the period that a product spends in each phase of the cycle. Minor innovative changes to product design can have the same effect. Combining innovative product changes and innovative marketing can maintain some products in the growth and maturity phases for what can seem an age. Running shoes in the eighties and mobile phones in the nineties stand testimony to this.
As a 'future watch' tip, I suggest keeping an eye on the marketing patterns for digital mobile phones as satellite technology becomes more affordable. You can be sure there will be innovative packaging and advertising to stretch the market saturation and decline periods of digital phones as the satellite technology moves from its current introduction period through growth and maturity phases. This might be a while off but it will be interesting to watch.
When our human capital becomes aware of the wider range of application of innovative thinking within the organisation and of its importance to corporate growth (and, in turn, job security) they will see innovation as a very meaningful pursuit in their everyday work and the organisation will benefit.
We must remember our innovative products and services must meet market demand. We are faced with a business dilemma. Do we attempt to set trends with our new products and services and to then convince the market that they need to consume these products, or do we research the market to identify needs that we can satisfy with an innovative product response?
That question can only be answered by each individual business. Setting trends where no apparent demand exists is a risky business, but if the market responds positively the risks are generally very well rewarded. Let's look at a couple of examples of this.
Who would have believed that the 'Teenage Mutant Ninja Turtles" concept of a decade ago would have paid dividends. There would have been many a nervous executive involved in the decision making on that idea. Yet the amazing market response soon saw merchandising and movie spin offs being produced. On the other hand, the concept went from introduction to decline in a relatively short space of time.
Another similar idea was the Japanese electronic pet/friend. One paid a greatly inflated price for these devices that were carried around in one's pocket and had to be electronically nurtured or they would 'die'. This idea also relatively quickly progressed from introduction to decline. That is not to say it was not successful. Quite the contrary. It sold in the millions worldwide, and still is, fuelled by a veritable bonanza of free advertising as the news channels of the world broadcast the success story of the improbable sounding devices. Spin off business like cemeteries for the devices quickly cashed in on the deal.
This is a great example of innovation that deserved its rewards, in my opinion.
Readers from smaller organisations might be more risk averse than the intrepid manufacturers of the devices discussed above. Small business is more likely to focus on the identification of growing market needs and to respond to these with products and services that provide innovative solutions. Perhaps the ideal lies in the middle ground, where organisations might identify a need and expand on it a little in the product response.
For example, in the late nineteen nineties, companies like Australia's StrathAyr and many from overseas, have responded to the market needs in respect to arena design in modern stadia. Their market sensitive responses have been appreciated and it is rare indeed to see a 'standard' or non-reinforced turf system being installed in modern world-class stadia. Imagine the market domination that would have resulted if the response could have been broadened to include a grass that would thrive without high sunlight levels.
Keep in mind innovation to which the market does not respond can lead not only to the demise of the product, but could also to the demise of the organisation that produced it.
Rather than single out any unfortunate organisation which has suffered this fate of acting in good innovation faith but gaining far from the wanted response from the target audience, allow me to demonstrate the point in abstraction, and from a personal rather than business experience. I once went with my wife, after presenting at a large convention in Singapore, to the silver service Grill Restaurant in Raffles Hotel. Annie was not aware of the reason for the extravagance, which was to ensure an appropriate environment in which to present her with a diamond eternity ring. I had planned the occasion in detail, and had earlier visited the Maitre D to arrange his involvement in the evening. He was enthralled with the idea I had presented and most excited about being part of this special evening.
After the main course, right on cue, I could sense a silence pervading the room, and feel every eye present focused on the entrance. From there, five immaculately tailed and bow tied waiters strode with practiced purpose towards our table with silver domed platters on their shoulders.
A pin dropping would have sounded like an earthquake as all eyes stared at five silver platters being placed on our table. The domes were lifted to reveal magnificent desserts and crystal glasses of fine French dessert wine.
At this point I have to tell you that this was very much in excess of what I had arranged with the Maitre D.
Finally the man himself raised the last dome, beaming a "Donnie Osmond' smile as he said, 'Mrs. Patching, we have a very special dessert for you.'
Beneath the dome was a silver caviar dish. On cue, Annie rolled back the semi spherical lid. Where the caviar dish would normally sit in the sparkling crushed ice, stood the diamond ring.
The silence was broken by numerous 'oohs' and 'aahs' from the women in the audience while one or two of the men shot me looks that could kill (largely because one woman advised her husband quite audibly that 'George, you should learn from this man' and many other women gave their partners endorsing looks). Despite the threat, I felt just about the most romantic man in the world.
Just about this time, Annie reached across and said 'I'm so embarrassed. Do you realise that everyone in this restaurant is staring at me?'
It seems my Maitre D friend had delivered in excess of the customer's expectations, and my innovation backfired. I learned a message for life and business from the experience and I hope you can as well.
By the way we visited the same restaurant the following year. This time I arranged for a single waiter to deliver a single silver platter. No one took notice as Annie raised the dome to reveal a small chocolate with a note that said 'You don't get lucky two years in a row!'
She loved it.
Another lesson, innovation does not have to be expensive and grand to be effective. Good luck with your own innovation, both in business and home life.
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