Top tips for building an innovation culture

A landmark report from Cambridge University recently proved something fundamental to all leaders. Innovation success is primarily dependent on corporate culture. In a study of 800 firms across 17 cultures company culture was the single greatest determinant of innovation success – not process, star hires, R&D spend, budget or national culture.

Yet developing a culture of innovation, especially radical innovation, is challenging – perhaps nothing could be more challenging for any corporation. But the rewards are rich indeed, as it gives all who do it a unique and lasting capability to overcome market challenges whist concurrently shaping the market to fit your own ideas and vision. We believe creating a open, collaborative innovation culture is the preeminent business challenge of this century.

Given the evolutionary law of requisite variety (organisms that thrive are those that most closely match the features of their environment), it is clear that organisations that match the increasingly open and networked culture of our emerging society will be best placed to capitalize on the distributed creativity and intelligence of the crowd to create profitable innovation. The era of GM stye hierarchies is coming to a close. The future belongs to those who innovate, and do so collaboratively.

1. Focus on fostering a viral innovation culture one person/team at a time

Top down hierarchical initiatives designed to ‘make’ a company innovative are expensive and far from certain to work, especially in challenging times when entrenchment is common and ‘change fatigue’ an issue. Whilst one needs definitive innovation leadership and commitment at the top, it it usually fastest, more efficient and more effective to create an innovation culture at the grassroots, one team / mind at a time. To make grassroots transformation happen fastest, one needs to create a set of simple (but not simplistic) tools, practices and principles, the best of which are set out below. As Buckminster Fuller said, small interventions – put into motion in specific sweetspots in the system – can create massive change. He called these trim-tabs (after the tiny part of a rudder that can alter the course of the largest tankers). A great way to find them in your organisation is observational / ethnographic research into how your teams do and think and what real and perceived obstacles exist for innovation. Then small but powerful changes can be designed to transform ‘business as usual’ into ‘innovation as usual’. The goal is to create the maximum conditions likely to lead to sustained innovation – not mandating it from on high. Lasting competitive advantage comes from harnessing distributed creativity inside and outside of the organisation as a matter of course – no longer from managing (through command and control) a small group of innovators in traditional R&D depts.

2. Build innovation habits

Innovation is really a mindset – a set of habits of innovative people in innovative organisations – not a ‘thing’. Apple’s “best feat may be the culture that helps generate so many folks who’ve gone on to create great products elsewhere” (BusinessWeek 2005). As well as coaching and training, we suggest designing a set of guiding principles, or heuristics (rules of thumb) which the organisation uses semi-religiously and becomes ‘the way things are done here’. E.g ‘Always look for the win win win.’ or ‘Fail fast but only fail once’ or ‘Do things nobody else will do’. This also includes strategically re-designing the way meetings are run, projects signed-off, people appraised etc that generates an innovation culture every day. For example, when people rubbish or critique an idea at any time in a meeting, ensure that any team member has the right to challenge them to think of two good reasons why the idea is good (and there are always two good reasons for any idea, no matter what). New recruits can be invited as a matter of policy to present to the team / management the 3 top things they would change about the organisation, the company or its products, perhaps a month after joining (when their critical capacities and lack of group think are keenest). These small changes ensure new habits are built in the everyday moments when culture is created and maintained.

3. Institutionalise what innovation looks like

It is vital the the organisation gains consensus on what quality, innovation and creativity look and feel like when you have them. This means knowing what the ‘minimal viable’ value add is. To create a common approach – as well as ensure optimal iteration of all ideas as far as they can be pushed – we use checklists, which are designed around organisational values, business practices and goals. Checklists have been proven to be extremely powerful in shifting behaviour in the real world and they are very simple. They can be put on credit card sized aides, desk accoutrement or within forms on and off line.

4. Give mavericks & their networks permission to innovate

Lack of ideas is never the problem. Most of the winning ideas already live within your teams, partners, customers / users and networks. The trick is to harness them within impactful and / or profitable innovation. Mavericks within the team (and outside the organisation) have more ideas and passion than most. But often they are sidetracked, ostracized or ignored. Clustered around them are often the other kinds of people needed to generate successful innovation – commercializers and those great at implementation. Centralised R&D / innovation prevents distributed innovators from prototyping, testing and iterating at the rapid pace they can work at when not managed centrally. Give natural innovators permission – and space / time / budget / credibility – to turn their ideas into innovations. Research also shows that diverse teams are often better than crack teams at solving complex problems so ensure that the team is made up of people that dont have the same perspectives. Encourage  team member to understand the vital importance of their own personal and professional networks in their innovation capacity – and give them time and space to nurture their strong and weak ties inside and out (including online and in social media). Banning Facebook may not make your organisation more competitive.

5. Celebrate benefits of creative-thinking, risk-taking & mistake making in personal and professional lives

Being innovative is a fundamental competitive advantage to a professional and also has many positive benefits within their personal lives. It allows us all to solve our own, and our organisation’s, problems no matter what life throws at us. Inspire your teams to explore their potential as innovators and creative leaders for their own benefit. As well as coaching and training, but there are other ways. If you want people to shift, show them the benefits of being innovative rather than shove them or threaten them. Fear rarely creates the right conditions for innovation and it is vital to repeatedly prove to people that taking risk and making mistakes will not lead to ‘pain’ (in the form of ridicule, alienation etc) Once they start to shift, it is vital that you trust them to grow and develop themselves and their ideas. All innovation projects can lead to valuable learnings for individuals and the organisation. This means you reframe ‘failure’ as ‘successfully learning how not to do something’.

6. Incentivise inner motivation as much as financial or professional rewards

Much research has shown that human beings are highly motivated by the excitement and kudos of cracking a problem or mastering a new skill. In fact, when we reward inner motivated people with money or promotion, often their performance falls! True innovators are highly motivated by problem-solving, making things better and taking on new challenges so allow them to self-organize and self-direct. That said, for many others types of people necessary within innovation teams, unless innovation habits or behaviours are measured in evaluation programs, it will not be prioritized. Ensure your incentivisation levers are balanced, rewarding innovation with a mix of credibility / kudos, promotion and material benefits. With open innovation, sharing rewards is as important as sharing the efforts. Incentivising entire teams can work better than incentivisng individuals which can just drives non-collaborative practices.

7. Give innovation (a) space & bring it to life

GIve people time to experiment, try new protocols, shift their mindset as well as space to take real risks and make mistakes. Signal to teams that some areas of the office (which can grow over time as the viral innovation culture spreads) are set up for innovation. In some cases, taking people out of the office into a new space like a ‘skunkworks’ – where new habits / principles apply rather than the old ways of doing things – can radically shift their behavior towards innovation (and it can replicate the start-up atmosphere that leads to more disruptive innovation). Turn complex innovation processes and approaches into visual tools that can go on walls, in rooms and even on the floor. We even work to turn innovation process into 3D experiences, as in the latest museum exhibits, that act as both training programs, design tools and aide memoires.

by Nick Jankel-Elliot, 100%Open Associate and Found of WeCreate

Comments

  1. Hi – another great post, guys!

    I think great innovation needs such a diverse mix of people with very different working styles and personality types – from disruptors/creatives who generate ideas and connectivity, to planners/process managers who convert the idea into an efficient output/product – that it’s all too easy to for the organisation’s culture (mindset) to become unbalanced (e.g. too risk-averse, or all ideas and no action). Or it ends up with different factions creating internal politics that damage the environment for innovation.

    I blogged about this recently, concluding with “Innovation is an attitude, not a process” (http://original-ventures.net/2010/11/12/the-innovation-culture-clash/), and I think you’re so right in point 2 about building innovation habits! It’s easier for some companies than others, depending on accumulated baggage and old habits, but developing the right mindset across the organisation is the only way to move from ‘good’ to ‘great’ when it comes to innovation.

    Thanks for the signpost to the Cambridge report – will check it out.

  2. Thanks Robyn – really glad you enjoyed it.

    Hi Clare – many thanks and thanks for sharing the link to your post too which I enjoyed too.

    All the best,
    Roland

  3. This is a very succinct and informative list of tips for encouraging innovation.
    I am keen to introduce more innovation into Local Government in Australia. They certainly need it!
    Your tips help me understand why there is so little innovative thinking in local government,
    but give me a platform for moving forward (persevering) with my passion. Thank you.

  4. Hi Darren,

    Thanks for your comment and glad you found it useful. And don’t worry I think local government in the UK needs it just as much. Keep on persevering with you passion!

    Roland

  5. Hi there,

    Congratulations!!. I also enjoyed the post very much. I work building innovation cultures in the Spanish market, and very much agree on your tips.

    I will add to it the importance of transforming the culture towards one of innovation through the work on the management team.

    We do this by following a process whereby we measure a) the values people have in the organization, b) the values and behaviours they perceive they have in their current culture and c) the values and behaviours they would like to have in a desired culture.

    Doing these measurements at different organizational levels (top management, middle management and staff) we give top management the needed information to realize how their culture is been perceived throughout the organization and then help them evaluate its impact in their business results.

    Then we guide them in deciding which values and behaviours can lead the company towards creating a culture of innovation where they can leverage the talent of their people, and often more importantly, increase their results as their alignment can be increased once they start to walk the talk.

    After the decision is taken we act as team coaches for the time needed with monthly team interventions. In this period it’s for them to transform themselves and thus their impact on the culture they consciously or unconsciously were maintaining.

    I recently posted about this in my blog, but so far it’s only in Spanish ;(.

    I expect to have recent posts translated into English in the coming months.

    Best,

    Matti Hemmi
    http://www.inknowation.com
    http://www.mattihemmi.com

  6. Hi…

    Interesting post with lots of great information for the converted, but in all my work with organisations and individuals, these sorts of ideas mean absolutely nothing. They fundamentally disagree with these sorts of sentiments because they lack tangibility, and to use wiki languages, are just stubs.

    The one I think that is most dangerous is giving new employees the chance to present to management on ideas they would change about the company / products. Ideas are great – there are millions of them out there – but unless they have something more behind them, management can’t do anything about them, and likewise, if management do nothing with these ideas, the new recruits end up jaded: “They did nothing with my great idea” or “They asked me for my opinion and did nothing with it, why do I bother?”.

    To get around this problem, innovation needs to be based around projects that are implemented. In the example above, a better way would be to create a competition between recent graduates about identifying opportunities, and then the winning idea is implemented by a team of new graduates, guided by a senior executive. This creates something tangible for everyone in the organisation, and before long, it won’t just be the new recruits that want to be involved, it will be everyone. Bit by bit, you have innovation, and more importantly, an innovation culture.

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  9. Great tips – couldn’t agree more with point 6.
    You often hear the phrase “it is important to build the culture” and it’s very helpful to see actual tips on how to go about actually building the culture.
    Thanks!

  10. Hi,

    I’ve just read your great article, I agree to most of your ideas, I have though one comment, it might be a good idea to start impelmenting teh innovative habits and mindset from a grassroot level, but it also need to be top of mind and supported by toplevel management – otherwise it is totally dependent of a random passionated employee. I also beleive you need to have some strong implementers as well, WHO understand how to Work with agile project management….

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