The challenge of change...
First published July 23rd 2010 by the National Business Review - Where has all the innovation gone?
New Zealanders are world renowned for coming up with breakthrough thinking and ideas. We have a DIY and entrepreneurial culture that has at times brought us great national pride and international recognition. So why is it that we don’t seem to be able to commercialise many of these great ideas? What is the gap and what are we doing wrong?
Perhaps it would help to understand the behavioral preferences of managers and leaders involved in decision-making in large organisations in New Zealand. A study conducted in 2000 by J.C Kennedy, Commerce Division, Lincoln University on Leadership and Culture in New Zealand revealed that; “In comparison with other countries, New Zealand managers reported a high level of Performance Orientation, the highest out of the 62 countries in the sample”. A high score in Performance Orientation means that we have high expectations of our achievements both as a nation (in the sporting arena) and in our business environments with our staff; unfortunately maintaining such a high level of achievement means that managers may have a tendency to focus on initiatives that deliver short term value, instead of focusing on long term gain.
“We also scored a high ranking in Uncertainty Avoidance, 8 th highest in the sample”. This is an indication that managers in New Zealand prefer to lead structured lives, with an emphasis on orderliness and consistency. The fact that managers take comfort in certainty indicates that they maybe reluctant to do things differently, stand out from the crowd or take risks. “At the other end of the scale, New Zealand scored lowest of all countries on the Assertiveness dimension. Respondents clearly believe that assertion, dominance and aggression are not normal aspects of social relationships in New Zealand”. So challenging the status quo or questioning the way our organisations operate isn’t part of the New Zealand psyche and isn’t a socially accepted practice. Assertive behaviours in the workplace are often referred to as pushy or aggressive.
So how do we start to develop organisations that; focus on long term innovation strategies rather than short term payback. That encourage staff to challenge and question business practices and that develop leaders who actively seek and embrace change for growth?
Choose the right growth strategy for your organisation;
There are many different ways to grow your organisation; new products, services, new channels to market, new business models - choosing the right type of innovation and growth for your organisation and offsetting this against the risk profile that you are comfortable with is important. At the same time ensuring that your senior leaders have an in-depth understanding of the key drivers of innovation performance is important in developing the right strategy for growth;
1. Make innovation part of your business strategy - focus people and teams on areas that will drive both short and long term growth for your organisation. Changing your business strategy will change the types of innovation that you pursue and the approaches and methods that are adopted.
2. Get senior sponsorship - use senior leaders to break down barriers and bring cross functional team together to provide different perspectives and gain buy-in at critical phases of development.
3. Identify areas for improvement - identify and select key areas of opportunity where you can maximise value and improve your performance - be specific. Use research as a tool to focus your thinking on initiatives that are targeted, measurable and tangible.
4. Set key targets and measures - focus on long term strategic goals and use appropriate measures and KPI’s to assess innovation performance.
5. Accept failure - not all of the things that you try will work, fail fast and use knowledge gained as a learning experience to inform new initiatives.
Engage your people and teams in the process - make it real;
The value that innovative thinking brings to an organisation is largely through the collaboration of people and teams. When embarking on a growth strategy it is important to engage your people in the process. People are your organisations biggest asset they know and understand your business more than anyone else. Making time to generate and develop ideas and solve business problems will encourage and empower staff to contribute to the future of your organisation and develop solutions that fit both the customer and the organisational objectives. At the same time developing an environment where change, challenge and risk are more accepted parts of the organisational culture will help to break down barriers to implementation and commercialisation;
1. Reward and recognise success - ensure that you recognise and regularly reward the efforts of others in your team; simply saying thank you goes a long way.
2. Learn to work together more effectively - ‘innovation is a team sport’. Use all the teams’ skills to develop and commercialise your innovations. Understand and appreciate your team’s differences and use each member to their best advantage.
3. Develop skills through innovation training - learn to think about opportunities and problems from different perspectives. Challenge assumptions and make innovation part of business as usual to ensure you are producing the very best results.
4. Provide inspiration - share your knowledge and experiences with others. Collaborate with partners and trusted third parties and bring in specialist to provide new information and knowledge.
5. Refine your innovation strategy - everyday innovation is about continuous improvement, so have a plan and updated it based on new information and knowledge. Focus your planning around three key areas; developing an innovation process, managing innovation projects and engaging the organisation in innovative thinking.
So…the role of the leader is not to be the innovator but to create and sustain conditions (a culture) that allow teams to innovate more effectively. In 2010 it is now recognised that Innovation is a key driver of business performance; the outcomes of innovative thinking always impacts on our customers, their purchasing
decisions and channels to market.
Organisations must develop a culture that is conducive to generating, capturing, developing and launching ideas to market. Simply defending business as usual isn’t enough - at some point defending existing revenue streams actually becomes more risky than growth. Growth through innovation is not an option it is a necessity.