A New Approach to Innovation
Approaching innovation as a capability, rather than an outcome, improves your ability to make meaningful change..
Previously we explored how companies can thrive in rapidly changing business environments and how even successful companies can become rigid and struggle with innovation.
We concluded that the key for any company aiming to survive is to build the right set of reinvention skills: innovation, engagement, and agility.
Today, we'll discuss how to approach innovation as a capability and how it can improve your capacity to innovate continuously.
Describing companies as "innovative" often refers to the outcome of their efforts at a specific point in time, rather than the process of how they got there.
Great companies, however, know how to continuously string together instances of great innovation and effectively take them to market. That is true innovation capability.
Innovation capabilities are a company's skills, processes, know-how, and unique ways of using assets and resources that provide a competitive advantage.
Shifting the focus from being innovative to building an innovation capability gives you the capacity for continually adapting to markets, creating new opportunities, and developing new solutions that lead to long-term success.
Without developing that capability, even the best ideas may never see the light of day. In fact, a survey by Innosight found that 81% of respondents believe that top management in their organization sometimes or often ignores new growth products and ideas.
Right from the start, eight out of ten ideas that your team comes up with are never even suggested because they believe that management won't listen. That's a failure to launch.
Leadership often tries to kickstart innovation by encouraging people to bring their ideas forward, running brainstorming sessions, and other initiatives to become more innovative.
However, if you truly want to be successful at innovating, you need to create a fertile environment for it. The most feasible and long-lasting approach is to treat innovation as a capability that can be built and maintained over the long run, creating an environment where innovation can thrive.
To understand how, let's examine how to build your innovative capability by looking at the skills, processes, know-how, and unique ways of using assets and resources.
Innovation skills are the abilities that allow individuals to contribute to the process of creating and implementing new ideas. Some you can foster include:
• Psychological safety: By creating a safe space for risk-taking and learning, leaders encourage employees to experiment and share ideas without fear of punishment. This is essential to creating a culture of innovation.
• Curiosity: A curious organization is characterized by a relentless pursuit of knowledge and a desire to understand the world around them. It's modeled by leaders who ask questions, seek new perspectives, and encourage a culture of continuous learning.
• Illumination: Illumination is a powerful skill. Illuminators possess the ability to shed light on complex issues and ideas. Illuminating leaders bring clarity to the team, making intricate concepts understandable and guiding others toward innovative solutions.
One of the best examples of a master illuminator was Steve Jobs. He was often unnecessarily cruel in the way he responded to others' ideas, but he loved to kick around problems and try out concepts with people.
Jobs once said, "When a good idea comes, part of my job is to move it around, just see what different people think, get people talking about it, argue with people about it, get ideas moving...get different people together to explore different aspects of it quietly, and, you know—just explore things."
• Self-critical and openly questioning: Self-criticism is an ability to openly examine what you're doing in a way that encourages new thinking and continuous improvement. This can extend to any part of the business.
• Objectivity and bias reduction: There is a skill to being objective. An objective innovation leader remains impartial and focused on the goals and vision of the organization, making decisions based on facts, data, and a clear understanding of the bigger picture, ensuring that the innovation efforts align with overall objectives. Importantly, they also help others reduce their natural biases.
Next, an innovation process is a structured framework that organizations use to generate, develop, and implement new ideas. Having the right process can weed out bad ideas and help others flourish.
The topic of creating the right innovation process is too long for this post. But key elements of the process include flexibility, collaboration, customer focus, experimentation, validation, and iteration.
Attributes of the process are as important as the process itself. Amazon's approach to developing a new product proposal is to have the product champion write an overview in the form of a press release as if they were announcing it to the public, extolling the new product's customer benefits in a one-and-a-half-page document. This is not a trivial exercise, as product leaders obsess over how to describe the benefits of their product or service in great detail.
Finally, when it comes to assets, resources, and know-how, your people, knowledge, and time are a company's most valuable innovation assets, even though they can't be listed on a balance sheet.
The right knowledge systems, ways of acquiring new knowledge, and the ability to build cross-functional teams are important for high-performance innovation.
Details are important. Former Amazon CEO Jeff Bezos had a rule for maximizing team effectiveness: no team should be so large that two pizzas can't feed the whole group. This is, of course, a shorthand method for ensuring that, as is often the case with big groups, no one can sit out or have their ideas get drowned out.
Just as important is taking a holistic view of innovation, which can lead to building innovation capabilities in any area of the company. Companies that understand the concept of building layers of innovation know how to look beyond technological innovation capabilities and define innovation in design, operations, go-to-market strategies, and business models that help build layers of advantage.
As you examine these skills, processes, and applications of assets and resources, think about ways you can create a safer, more innovation-seeking organization.
Every company faces the imperative of reinvention. As market trends shift, threats emerge, and customer preferences evolve, the survival of organizations hinges on their ability to adapt and thrive amidst uncertainty.
Innovation is not simply about having good ideas but about having the structure, culture, and processes in place to turn those ideas into reality. Approaching innovation as a capability can enable your organization to continuously develop and implement new ideas and processes.
Next week we’ll talk about the importance of engagement, which has reached a state of crisis in most organizations, and how organizations can build it.
Some things to consider:
How might shifting your perspective from innovation as an outcome to innovation as a capability impact your approach to innovation?
How does your company foster psychological safety for employees to take risks and share ideas without fear of punishment?
In what ways does your organization encourage curiosity and continuous learning among employees? How might leaders actively model and promote these behaviors?
Do company leaders possess the skill of illumination, guiding teams towards innovative solutions?
Reflecting on your organization's innovation process, how flexible and collaborative is it? Are there specific elements you believe could be enhanced to better support idea generation, development, and implementation?
Does your organization take a holistic view of innovation, considering various aspects beyond technological advancements? How might expanding the definition of innovation to include areas such as design, operations, and business models enhance overall innovation capabilities?
Until next time, lead with purpose.
Will
About Leading Matters:
Leading Matters is the trusted source for aspiring and seasoned leaders alike, providing them with the tools, insights, and inspiration to become intentional leaders that build more innovative, engaging, and agile organizations.
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