Creating Predictable Innovation

A while back I was serving a public company that had recently created internal brand pillars. During a strategy meeting, I suggested to the CMO that they “might want to be careful about stating innovation as a brand pillar.”

“Why’s that?” he quickly asked.

“Well, because just about every other organization on the planet claims it as a brand pillar or core value. And, innovation is very hard to truly live up to, and even more difficult to demonstrate to shareholders in a disruptive sector. Your brand pillars should be both unique to your company and demonstrable over time.”

It seems like common sense that companies need to innovate. Peter Drucker noted in the 60s that there are really only two core functions of any organization: Innovation and marketing. That acceptable line of logic would make innovation table stakes to doing business.

The Ups and Downs of Experimentation

However, a culture of innovation isn’t as common as one might think. Innovation requires experimentation. Experimentation carries the risk of failure. The risk of failure creates tension and uneasiness. When innovation is successful, companies change. This creates more uneasiness.

And, as a company sees success, they become less and less likely to experiment, take risks, and innovate. This creates another tension. When forward-thinking team members feel frustrated by stagnation within a risk-averse organization, they are often seen as pushing against the tide of the status quo. These well-meaning people can unfairly be treated as trouble-makers.

The potential of failure and the inherent change that comes with innovation can terrify people. This uneasiness can feel a lot like conflicts from our childhood. These are tensions and conflicts we’re taught to avoid from a very young age. Those who create a risk-averse culture slowly strangle themselves with a lack of fresh ideas, and an unwillingness to confront internal risk-takers, or face the competition.

Embracing Risk

When a leader is willing to embrace the kinds of risks that we’re taught to avoid and creates a safe space for others to follow suit, then it frees the team from the illusion of safety. Thus making the way for the company to grow, change, and evolve. Over time, this becomes habitual. When this way of becoming the norm inside an organization, it both encourages risk and creates enough safety for team members at every level to innovate — perpetually and without asking permission or fear of retribution if a risk doesn’t pay off.

So, instead of hanging a brand pillar on innovation alone, I recommended to the leader who I challenged, that they first work to build a culture that created psychological safety, and only then, build their brand foundation on innovation. Without the right environment for safe risk-taking, consistent innovation isn’t likely to happen.

Some questions for you and your team about risk-safe cultures…

• How much does your company champion failure and the learning that come from it?
• How does your company encourage respectful dissent and dissonance?
• What kinds of questions are safe for your team to ask during meetings, not just brainstorming or innovation sessions?
• To what extent does your team feel safe challenging the status quo of organizational norms?
• How much better could your company be at innovation if leaders are willing to embrace and champion safe space?

Further, if you feel like you don’t currently have a risk-safe culture, what are the obstacles? The usual suspects include:

• The Fear Factors — A McKinsey & Company Study showed through data the three biggest fears that teams face (along with the five fundamentals that foster innovation). The study shows that three fears hold back corporate innovation more than others: fear of criticism, fear of uncertainty, and fear of the negative impact on one’s career. You can dig into that study here.
• N.I.H. Syndrome — The Not-Invented-Here (N.I.H) Syndrome is where your company culture believes that all the smartest people already work for your organization, and therefore, there’s not much more you can learn from an outsider’s perspective. Essentially the team believes it possesses a monopoly of knowledge of its market or industry, which leads it to reject new ideas from outsiders.
• Lack of diversity — In cultures that lace diversity, “group think” tends to predominate. Here a diversity of experiences, views, perspectives, and approaches that could lead to breakthrough innovations are lost.
• Lack of a Clear Vision or Strategic Alignment — A clear vision focuses a team on a destination. A strong strategy in place creates alignment between the people working in an organization and the collective efforts of the team. With a clear vision and strategy in place, a team can make and measure the appropriate trade-offs and choose the correct elements for their innovation system that matches the company’s vision.

I wouldn’t bet against a company that builds strong team trust. There are a million reasons to do so; predictable innovation is only one of them.

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Five fundamentals of innovation culture

From the McKinsey & Company Study:
“Organizations wishing to build a thriving culture of innovation need to be systematic and intentional. Our research and client experience has shown that all high-performing innovators embrace to various degrees five dimensions of innovation culture (exhibit).”

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