Practice 1: Make Innovation Everyone’s Responsibility In too many organizations,

Question

Practice 1: Make Innovation Everyone’s Responsibility

In too many organizations, innovation is assumed to be the responsibility of the top management team, or

the research and development unit. While these two groups of people are essential, this emphasis will

fail to capture the “wisdom of the anthill.” Innovation is essentially a collaborative endeavor, where

collective imagination yields new business opportunities.

According to Peter Drucker, innovation and entrepreneurship are capable of being presented as a

discipline. In other words, it can be learned and practiced. Most important for us in this chapter, Drucker

asserts that it can be fostered and encouraged throughout an entire organization. One of the keys

appears to be to create a collaborative, “information-rich” environment in which all employees are invited

to contribute. Commenting on the success of the Sundance Film Festival, Robert Redford stated, “If you

create an atmosphere of freedom, where people aren’t afraid someone will steal their ideas, they will

engage with each other, they will help one another, and they will do some amazingly creative things

together.”

Practice 2: Hire and Retain Creative Employees

All innovation depends on the generation of new ideas, but no new ideas will be generated in the absence

of human creativity. Consequently, the hiring process needs to emphasize the importance of selecting

individuals who have creative potential. More importantly, the human resources system needs to focus on

developing that creativity and retaining individuals who show creative promise.

However, creative individuals aren’t the only ones required to cultivate a more innovative culture. Other

individuals, such as “knowledge brokers,” are also essential. Knowledge brokers are individuals who

constantly collect ideas and combine them in unique and valuable ways. They often are not the originators of the ideas, but they have a skill at keeping new ideas alive and seeing where they lead. Sometimes

older workers lose their creative spark but serve as knowledge brokers to keep the spark alive.

Most organizations are uncomfortable with “mavericks” who shake up the status quo and display

irreverence for accepted wisdom. However, mavericks play a vital role in making an organization more

innovative, especially larger organizations. For example, Jack Welch, a relatively famous maverick who

led General Electric through a very innovative period, stated, “Here at GE, we reward failure.” Indeed,

there is scientific research that demonstrates that when the reward system recognizes and retains creative

employees, the organization behaves more innovatively.

Practice 3: Put as Many Promising Ideas to the Test as Possible

A popular but controversial mantra in innovative organizations is “fail fast, fail cheap.” The idea here is

that it is important to get your new ideas in rough form out into the marketplace, and learn from your

customers. This is in contrast to the “go–no go” approach where companies want new ideas to be 95%

right before taking any action. Perhaps this is why IBM’s Thomas Watson, Sr., once said, “The fastest

way to succeed is to double your failure rate.”

However, fast and cheap are not enough; the innovative organization also needs to learn from the

experience in order to make the “failure” pay off. This is where testing comes in. Hence, a key ingredient

to becoming more culturally innovative is the importance of designing relatively small-scale, but rigorous

tests or “experiments.” For example, Capital One, a highly successful retail bank, was founded on

experimental design where new ideas were constantly tested. Tests are most reliable when many roughly

equivalent settings can be observed—some containing the new idea and some not. Similarly, IDEO,

perhaps the most innovative design firm in the world, is a staunch proponent of encouraging

experimenters who prototype ideas quickly and cheaply. In sum, innovative cultures fail fast and fail

cheap and learn from their failures.

Practice 4: Use Your Human Resources System to Create Psychological Safety

Organizations operate in increasingly competitive environments. The concept of “winning” is an

important one, and being labeled a “winner” is usually a key to organizational advancement. Unfortunately, failure is an integral part of innovation, so innovative cultures need to create the

psychological safety whereby failure in certain circumstances is acceptable.

Some mistakes are more lethal than others, so mistakes that do not jeopardize the survival of the

organization need to be accepted, even welcomed by leaders. Relatedly, it is more important to focus on

the ideas rather than the individuals behind the ideas so that failure is not personalized. And “failure tolerant leaders emphasize that a good idea is a good idea, whether it comes from Peter Drucker, Reader’s

Digest, or an obnoxious coworker.”

Once again, the human resources system can be instrumental in helping to create the psychological safety

to enable innovation. In this case, the system can be designed to permit and even celebrate

failure. Clearly, this involves a balancing act between rewarding success and tolerating failure.

Consequently, the key is to create sufficient psychological safety within a culture so that the organization

can “dance on the borderline between success and failure.”

Practice 5: Emphasize Interdisciplinary Teams Throughout the Entire

Organization

In the 1970s and 1980s, many organizations tried to create specialized subunits where their mandate was

to make the organization more innovative. This structural approach to innovation largely failed, either

immediately or in the long term. For example, General Motors created the Saturn division as a built-from scratch innovative new way to produce and sell cars. At first, Saturn had spectacular success. However,

the lessons learned from Saturn never translated to the rest of the organization and recently the Saturn

division was eliminated. Similarly, too many large organizations try to rely solely on their research and

development units for innovation, which greatly constrains the idea production and development

process.

Innovation is clearly a team sport, one that should pervade the entire organization. As a result, ad hoc

interdisciplinary teams appear to be the proper structural approach to fostering innovation. Today, IDEO

is one of the most innovative firms in the world, and their approach to business is centered around interdisciplinary teams. In sum, the ad hoc interdisciplinary team appears to be the structural solution

to innovation, not a self-contained innovative subunit as some suggest.

Practice 6: Change Cultural Artifacts and Values to Signal Importance of

Innovation

Recall from the previous chapter that one key way to change a culture is to intentionally shift the cultural

artifacts in the direction of the desired change. When creativity and innovation is desired, it is important

to be more flexible in the work environment. So flexibility in working arrangements, dress codes, and

organizational titles becomes important.

New myths and rituals are required that focus on creativity and innovation. For example, some

organizations celebrate failed experiments based on imaginative new ideas. Other organizations promote

individuals who took a risk on a promising new idea that did not work out. And changing the formal

values statement to incorporate an explicit statement about creativity and innovation highlights its new

importance. Still others change the metaphors used in the organization. For example, creating a “blank

canvas” culture evokes an image of artists operating without artificial constraints. Fundamentally, cultures are not changed by new thoughts or words, they are changed by new behaviors

that reinforce the cultural attributes that are desired. For example, GM’s automobile plant in Fremont,

California, transformed its culture by adopting the lean manufacturing behaviors advocated by its new

venture partner, Toyota Motors. For example, nothing was as transformative at this particular plant as the

“simple” act of empowering frontline employees to stop the productive line at any time due to quality

concerns. This new policy had dramatic impacts on the revitalization of this unionized plant.

Practice 7: Change Cultural Assumptions to Signal Importance of Innovation

Culture change does not occur until the underlying assumptions that pervade the organization are

challenged and replaced with some new assumptions. Therefore, ordering new behaviors isn’t enough.

The organization must thoughtfully identify what the old assumptions are and work to instill new

assumptions that support the culture desired. Consequently, contemplation and reflection are essential to any culture-change initiative. Perhaps this is why Gary Hamel and C. K. Prahalad note that “true strategy

is the result of deep, innovative thinking?”

Some observers call for “disciplined reflection”; while others urge leaders to identify “constraining

assumptions.” Whatever the term that is used, organizational members need to think deeply about

where their culture limits innovation, and to identify what cultural assumptions are the limiting factor.

This requires a collective perspective; very rarely can a single leader come to this realization. Since most

organizations have a bias for action, this reflection can be especially difficult. However, organizational

learning often requires unlearning old and harmful assumptions and this is especially true for cultivating

innovativeness.

In conclusion, the eighth and final dimension of organizational capacity for change is an innovative

culture that fosters and celebrates creativity and innovation. This dimension is an essential

counterbalance to accountability systems. Together, these two dimensions complete our understanding of

how to make your organization more change capable.

Question:

You have taken over an organization where there is very little creativity and innovation. The employees are not encouraged to put forth new and vital ideas and it’s seems that very few people in the organization from top to bottom voice the importance of innovation.  Describing how you would build a change-capable organization and innovative culture. Describe what the change would mean to you.

Please help. Greatly appreciate it and thank you :)

Explanation / Answer

There are some of the ways which can be implemented to build a change-capable organization and innovative culture, such as –

-          Prepare workforce with the required skills and embed the same into competency training and development

-          Showcase and formulate the organizational value statement in such a way that it should reflect what is intended

-          Updating the job descriptions and hiring guidelines to get on board right set of employees

-          Goal setting for each employee should show the expected behavior and performance

-          Offer training to each employee and rewards for the change and innovative behavior

-          Regular communication with the employees on how they can contribute to the overall business success

-          Share the updates on organizational strategic goals and what does that mean to each employee

-          Ensure that each employee understand the importance of his or her effort is bringing new ideas on table and at the same time they are the change agents

-          Open dialogue with employees and encourage them to ask questions, offer valuable feedback and share results of the actions taken on their feedback

-          Continuous evaluation of the sustainability strategy, risk plans, etc.

-          Generate more awareness among the workforce

-          For innovative ideas, motivate employees to file patent and at the same top management should offer full support to the employees for get going

-          Maintain the emotional intelligence levels

-          Have change capable managers at all the levels of management in the organization

-          Focus toward capability building

The change means to me in terms of available opportunities which can help me in a better person or a great professional. Opportunities which can offer me more capability and competency building, upgrade on soft skills, ready to take on any type of challenge, which will help me to sustain in competitive marketplace.

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