The Innovative Brain Archive
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Getting to “YES:” How to Initiate Innovation at your Organizationby Robert TuckerIn the field of organizational innovation, we have a number of professional associations, one of which is the Innovation Network. The Network puts on their annual Convergence conference (produced in partnership with the Institute for International Research), which just took place in Minneapolis. I’m on a plane heading home to California as I write this, and I have to say, this was the best conference I’ve attended in quite some time, and attendance was two-and-a-half times greater than last year. The talk in the hallways was about the uptick in the number of companies launching innovation makeovers. Just as some of us predicted, as the global economy has improved and CEOs get past their hunker down/cut costs/survival mentality, the question of how to drive growth begins to dog them. But getting senior management to take action on innovation often needs a catalyst. To address this issue at Convergence, I led a CEO/Senior Management Panel titled “How to Present Innovation in a Way That Gets to Yes.” We jettisoned the traditional panel discussion draped table and moderator podium and replaced it with a more dynamic talk show format. Guests on the lighthearted program included Carol Pletcher, Cargill Innovation Officer; Stephen N. Oesterle, M.D., Senior Vice President Medicine and Technology, Medtronic, Inc; Virginia Albanese, Vice President of Service, FedEx Custom Critical; and Alex Cirillo, head of 3M Commercial Graphics. In my opening monolog, I noted that each time another company says yes to innovation, you can be sure there was a champion at work behind that decision. And quite often a team of committed people as well. They did their homework. Amassed the evidence. And made the case for embarking on a new approach to innovation as a way to drive growth. With PWC and Accenture surveys showing that innovation has risen to the top of CEO priorities, you might think this would be easy. It isn't. CEOs know there is a great need to master innovation. But there's a lot of trepidation. People often say, “innovation” without without an understanding of how to create it at the organizational level. As a result, companies have long favored interventions and initiatives that promise immediate returns: lean manufacturing, TQM, reengineering, Six Sigma and scores of others. These process improvements, none of which are easy to implement, have the benefit of showing short-term cost-savings, elimination of inefficiency, and the need for fewer staffers. They are, therefore, easier for consultants from outside and/or advocates on the inside to sell to the guys in the head shed. But here’s what is not often clear: they do nothing to create top-line growth. They only improve the bottom line, and after awhile you run out of places to cut. Oh sure, you can achieve growth from mergers and acquisitions, thus the M&A boom of the 1990s. Guess who did a phenomenal job of selling CEOs on that strategy? Banks, lawyers, accounting firms, M&A consultants. The only problem: study after study demonstrates this is a strategy fraught with problems of integrating incompatible cultures, and turf battles. It's a very expensive gamble over the long term. The big ‘AHA!” is that they just don’t create long term shareholder value, as longitudinal studies by McKinsey and others clearly demonstrate. Again: innovation is the only way to unlock organic growth, and the only way to sustain it is with an innovation strategy that has metrics, is comprehensive, involves the whole enterprise and is cross-functional and cross-silo. Innovation will never be an easy sell because it can’t promise a quick payback. It took agribusiness giant Cargill, for example, almost a year of internal debate and study of best practices in innovation before folks there got clear on how they even should define it. With almost 100,000 employees, they knew it was a journey, but that they had to start somewhere if they were going to transform the organization. And as the feisty and outspoken Carol Pletcher, Cargill’s innovation maven, told the audience at Convergence, now they are on their way. Cargill has the advantage of being a privately-held company. Many CEOs of publicly-traded firms, with Wall Street ever more impatient for steady quarterly earnings, are apt to be gun shy. Innovation conjures up sinkholes of investment and missed earnings… and too soon the axe. So if you’re in an organization that hasn’t yet gotten to yes, you’re going to have to overcome a lot of what professional salespeople call objections, both real and imagined. How can you make a stronger case for innovation? How can you present innovation in a way that gets to yes? By doing your homework. By keeping current on this ever-evolving field and knowing what works and what doesn’t. And by selling benefits (growth, transformation, talent retention), not features (it works like this, ain’t this clever, etc.). Key: Identify and reference companies that are enjoying the fruits of their systematic approach to innovation. This is vital, and in future editions of this newsletter, we’re going to pass along more success stories to you. Here’s one: when Louis Geerhing, a senior partner at Deloitte-Touche, got his divisional organization to embrace what they now call InnovationZone, they doubled the size of that enterprise (Deloitte-Touche, South Africa) in two years! That’s the kind of “evidence” you pick up at Convergence, and it’s essential to have anecdotes like this at your fingertips. More benchmarking is needed by both practitioners and consultants/thought leaders alike. Constant benchmarking saves you from making the same mistakes others have made. At Convergence, I heard speakers challenge the famed Stage Gate Process, pointing out its limitations for the first time; a perspective that we hear more and more from innovation professionals. I also heard another seasoned veteran in this field challenge the effectiveness of innovation governing boards as a way to accept/reject ideas entering the funnel (the issue: they immediately set off turf battles, no matter how cross-functional, according to this view). We need more case studies from companies like 3M, Medtronic and others that have sustained their innovation edge over time, and have profited from it year after year. We’d like to hear from you on this: what issues or problems are you confronting as you try to get buy-in on innovation? What challenges do you confront as you attempt to sustain your innovation initiative? All comments will be kept confidential, if so desired. comments@newandimproved.com As you work on driving more and more innovation into your organization, we urge you to share stories with colleagues, look for measurable benefits, keep an eye out for top line growth opportunities, and pay attention to companies inside and outside of your industry who are doing things right and who are doing the right things. Don’t get discouraged. Innovation is not a short-term sprint, but a long-term journey that requires changing opinions, mind-sets, biases, and accepted practices. And remember to enjoy the journey. Robert B. Tucker is author of Driving Growth Through Innovation: How Leading Firms Are Transforming Their Futures , a 3 year study of 23 of the most innovation-adept companies in the world. He is president of The Innovation Resource, a consulting & speaking firm. Phone: (805) 682-1012. Website: www.innovationresource.com To subscribe to Robert’s newsletter, Tucker on Innovation , send an email to rtucker@innovationresource.com . By the way, no, not everything we share is written by New & Improved. We’re more concerned with bringing great thinking about innovation, than pretending that we have a lock on the subject. The world has complex problems that need as many innovative people working on them as possible. We’ll do everything we can to improve your innovation skills…wherever we find ways to do that. |
