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Wednesday, April 28, 2010

Silos and Innovation - Break Down or Work Around?

by Stefan Lindegaard

Silos and Innovation - Break Down or Work Around?"How do you break down internal silos in order to improve at innovation? Open innovation - or any kind of innovation - suffers with silos. What are your insights and experiences on this issue?"

I posted these questions in the 15inno by Stefan Lindegaard group on LinkedIn about a month ago. We got 28 comments with lots of great advice. (Click on Discussions in the group if you want to read this). I have been looking through these comments a couple of times as I wanted to write a blog posts with an excerpt on this.

This has not yet happened and one reason is that I have begun thinking differently about silos and their impact on innovation.

Perhaps we do not have to break down silos to drive more innovation. Perhaps we should just accept the silos and work around the issues they can create on innovation. Perhaps open innovation will change things by itself.

Let me share some thoughts on this.

The smart people with drive and energy - and an interest in innovation - that I meet are most often attracted to great ideas and initiatives with a potential to really make a difference. Often, they do not care about the nitty-gritty kind of incremental innovation which proven and time-tested processes in silos also can take care of by itself.

We all know that corporate executives also crave for innovation that can really make a difference and as they begin to accept the loss of control and potential side-effects (check this blog post on open innovation side-effects) that are related to open innovation, it becomes easier for smart people from different parts of a company as well as for external partners to gather around the ideas that can really make a difference.

Why? A key reason is that we are getting more and more tools and solutions that allows us to innovate across corporate as well as industry boundaries. Just take a look at these initiatives: InnoCentive@Work, Intuit Brainstorm and Inno360. The latter is a software developer working with still un-identified open innovation leaders to develop the next generation open innovation platforms.

When corporate executives willingly accept more experimentation and a fair amount of failure on the innovation process itself, they will begin to understand that innovation delivers best when different business functions - and external partners - come together to develop products, services, solutions and processes that meet the needs of users and customers. This mindset change can be re-enforced by the above technology development.

We also have to remember that innovation can be radical in many different ways. It does not only apply to market approaches or technologies. Innovation can be just as radical with regards to the internal processes.

This is what this is really about and as with any kind of initiatives with a radical, disruptive or breakthrough potential, we need different approaches and setups that provides protection from the bureaucracy and corporate politics we have to deal with in any larger organization. So if companies really want to embrace open innovation, they will have to make organizational adjustments.

I believe this development will reduce silo-related obstacles on innovation although it will take several years before most companies reach this level of innovation maturity. Until then, it might still be relevant to check out the advice given in the LinkedIn discussion that inspired this post...


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Stefan Lindegaard is a speaker, network facilitator and strategic advisor who focus on the topics of open innovation, intrapreneurship and how to identify and develop the people who drive innovation.

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Importance of Trust and Transparency to Innovation

by Geoff Carss

Importance of Trust and Transparency to InnovationThere is lots written about how hard/challenging/difficult transformation/change/innovation are in companies - the bigger the more difficult - but there are two key issues which don't get raised enough (in my view).


Hard decisions and transparency

First - hard decisions. A couple of years ago I attended a Financial Times Innovate conference in London. The speaker that stood out was Syl Saller - the Innovation Director at Diageo (it owns Guiness, Baileys, Smirnoff etc) and her honest insights into innovation and change in global companies. Syl described a series of key meetings about what they were going to invest in to support the growth of new global brands and what they needed to stop in certain countries where investments were being made in local brands. The (relatively) easy bit was where to invest - the (really) hard bit was agreeing on what to stop.

Being a big company metrics drive behaviour so country managers, who ran the local P&L made local decisions to meet their revenue/profit targets. This was counter to growing global brands which, by implication, meant focussed investment in some geographies and lowering investment in others.

The hard decision was working with a country manager to free up local marketing spending for bigger projects - but that meant a country manager may miss their targets - which could impact their careers etc - so 'deals' had to be done - based on trust - such is the reality of big companies - and having worked in IBM for 6 years, these issues are a function of size and reach and really hard to mitigate.

Second - transparency is a killer. An organisation kicks off a transformation or change program - gets consultants in to design and initiate. Consultants leave after the first phase when all kinds of projects have been initiated - and the whole thing stalls as most people go back to their day job and the rate progress is no longer as apparent. In many cases this may be due to lack of visibility rather than actual progress as people are spread across different countries and business units and are trying to manage via conference calls, spreadsheets and monthly powerpoint slide packs.

This lack of transparency can cause confusion, reduced alignment and additional work which in turn makes decision making slower, harder and interventions less effective.

The above is one story, but every CXO and middle manager I know can tell similar ones, regardless of the sector, geography, company culture, etc. Having ways to surface these debilitating and often invisible organizational dynamics is incredibl important for management.

So what are you doing to drive transparency, trust, and hard decisions in your organization?


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Geoff CarssGeoff Carss is VP Sales & Marketing at element8 software. I was previously with Ernst & Young Consulting and IBM Consulting, but I now enjoy working with clients and partners explaining the new ways we can help their organizations transform.

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Monday, April 19, 2010

Praise the Behaviors You Want to See

by Paul Sloane

Praise the Behaviors You Want to SeeIf you want to change the culture of the organization then one of the best ways to do it is to praise the behaviors you want to see. If you want your people to be more adventurous, more entrepreneurial and more innovative then make a point of singling out for recognition those people who are acting like that. Catch someone doing something good and make a fuss of them.

Say you have a culture which is risk averse; where people are reluctant to try new things for fear of failure. Find someone who tried something that did not work and then call them out at an all hands meeting:


"John tried an experiment. Unfortunately it did not work. But you know what? Trying things is exactly what we need around here. I want to say well done to John for having the guts to push this prototype. We have learned a valuable lesson. If we are going to be innovative we have to try more things and be ready to cope with some inevitable setbacks along the way. So let's have a big round of applause and hear it for John!"


This is much more powerful than praising those whose initiatives succeeded - though you should certainly do that too. By praising someone for failing you are sending a strong message that countervails the current culture.

At your next department meeting see if you can find someone to praise for:
  • Coming up with some great ideas.
  • Trying something new.
  • Challenging the conventional way of thinking.
  • Bringing an external idea into the company.
  • Collaborating with a different department or organisation.
  • Taking a risk.
  • Making something happen.

Praise is one of the most powerful weapons in the leader's armory. It should be used often.


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Paul SloanePaul Sloane writes, speaks and leads workshops on creativity, innovation and leadership. He is the author of The Innovative Leader published by Kogan-Page.

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Friday, April 09, 2010

Employee Traits Hierarchy for the Creative Economy

by Hutch Carpenter

In his keynote for the 2009 Spigit Customer Summit, management guru Gary Hamel discussed the Creative Economy. What is the Creative Economy? Combining descriptions from this BusinessWeek article and Gary's keynote, here is a simple way of conceptualizing it:
  • Industrial Economy was based on physical capital
  • Information Economy was based on information
  • Creative Economy is based on ideas

Ideas around business models, products, improving existing processes. These define the basis of competition in the future. In a way, these economic cycles reflect Maslow's Hierarchy. As our society gets better at solving our basic physiological and safety needs, we see the economy tracking to higher order human needs.

In considering the Creative Economy, Gary put forth his own hierarchy of employee traits that will define the winners in the future. His representation of this hierarchy is below:

Employee Traits Hierarchy for the Creative Economy
The chart above depicts six traits that any of us can recognize in ourselves and others. Notice the line separating the bottom three traits from the top three. That's the separation of winners from everyone else in the Creative Economy.


The Line of Commoditization

As Gary observed, the bottom three traits are those that defined success in the Industrial and Information Economies. The Industrial Economy required the mass scaling of production and distribution. This required the design of systems for scale, and the ability to plug workers in to execute their specialized tasks. The Industrial Economy has been incredibly successful and beneficial to humanity.

The Information Economy has brought us new advancements, as workers have applied their intellect to solving problems with data. Information is used to uncover patterns, reduce the costs of production and consumption and find new solutions to vexing issues. The Information Economy continues to evolve and drive forward societal advancement.

The traits that defined success in these eras include obedience, diligence and intellect. All are valuable, and represent the expectations of modern work. That third element - intellect - is what a lot of us go to college and grad school to demonstrate.

As Gary Hamel sees it, though, these traits are becoming commoditized. Not that every individual has an abundance of these traits; but with a generation of expectations and a global workforce, they are easier to secure than ever. Note IBM's 2008 study found that corporations are conducting "global searches for sources of expertise".

These traits are valuable, they're indispensable... but they no longer represent a competitive advantage.


What Determines Leadership in the Creative Economy

Employees with these traits are best positioned to help their companies - and themselves - in the Creative Economy:

Initiative: Seeing opportunities to try something new, and actually following up on them. This is a marked contrast to the obedience trait.

Creativity: Designing something different than what exists currently, be it business, product or process. Contrast creativity with intellect. Creativity is less bound to the rigors of logic and proof, more responsive to our individual yearning for things that are new.

Passion: Our internal engines provide the fuel that spurs us to action. We pursue something because it answers an internal calling. Contrast this with diligence, which is the application of one's mind and efforts to a task or project. Diligence is a more mechanical effort, passion is an emotional one.

These are the traits that fuel advances in an economy based on ideas. And as Gary Hamel notes, they cannot be commanded. They are intrinsically persona. But when they are given full bloom in employees, they are the basis for competitive advantage in the Creative Economy.


The Creative Economy Traits are Advanced Enterprise 2.0

Gary Hamel gave some great examples of companies that are innovating in terms of management to encourage these traits in their employees. W.L. Gore is one such example. It has made the list of Best Places to work for the past 25 years. The Great Place to Work organization noted these four aspects of W.L. Gore's culture:


"People experience tremendous freedom at Gore: the freedom to talk with whomever they need or want to, the freedom to make comments and provide input, the freedom to bring who they are to work, and the freedom to make commitments."


Enterprise 2.0 ethos includes the traits of greater information visibility, tapping the emergent knowledge of employees and increased collaboration. Those characteristics are the fertile ground for growth in the Creative Economy.


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Hutch CarpenterHutch Carpenter is the Vice President of Product at Spigit. Spigit integrates social collaboration tools into a SaaS enterprise idea management platform used by global Fortune 2000 firms to drive innovation.

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Tuesday, April 06, 2010

The Paradox of Open Innovation: Internal or External?

by Robert F. Brands with Jeff Zbar

The Paradox of Open Innovation: Internal or External?What came first, the chicken or the egg? This paradox has perplexed philosophers for millennia.

In the progressive workplace, a similar dilemma confounds executives. In the pursuit of open innovation, what comes first: Innovation created internally, or innovation developed beyond the organization?

People talk about open innovation. It's the mantra of leadership experts and workplace counselors across the business landscape. But internal versus external innovation also presents a dichotomy. Often conflicting in nature, many proponents of open innovation get tripped up on why external innovation can fail to take root.

In my opinion, the paradox is easily answered: External innovation is destined to fail if the imperatives of internal innovation have not first been developed, deployed and adhered to. Workplace pundits extol the virtues of external innovation, but if innovation isn't alive and thriving internally, innovation itself will fall on the scrapheap of failed initiatives.

Effective innovation isn't about the Chief Innovation Officer or even the CEO mandating from on high what milestones R&D or Engineering must pursue or achieve. In fact, innovation that's required to come from R&D, Engineering or some other Department of Innovation is susceptible to the Not Invented Here syndrome. If it wasn't created by someone who's mandate it is to do just that, it's often likely to be squashed by exactly those who didn't come up with the idea. "Quit meddling in my sandbox," is the complaint.

Those barriers have to be removed. Effective innovation begins with breaking down silos that separate departments, divisions or teams - and encouraging, even welcoming participation from across the organization.

Sure, those directly charged with leading innovation might come up with good ideas. But will they speak to the heart of the organization and how it interfaces with its customers or constituency?

For example, since 1967, Hollywood Woodwork in Hollywood, Florida, has specialized in custom woodwork for use in premier hotels, spas, casinos, country clubs, public projects and corporate offices throughout the United States and Caribbean. Then the recession hit, and the company saw a drop off in its traditional business.

Then the company opened up and solicited ideas from all employees - not just those in Product Development. This led to a simple question: "Can we do church pews?" No deep analysis by skilled research teams or high-paid consultants. Just a simple query that made company executives wonder: Can we?

They could. And now, Hollywood Woodwork does, making many other products utilizing their assets. Building church benches helped diversify the company - and keep it afloat during the recession.

The request also made executives there realize something else: We must be receptive to potential innovation from all internal sources. Not-invented-here doesn't exist at Hollywood Woodwork. Innovative suggestions are welcomed from across its workforce of 150.

With the foundations of open innovation secure within an organization, only then should a company seek innovation from beyond its walls. If you don't have internal innovation down pat, and you haven't removed all the emotional barriers that inhibit the free exchange of ideas, you never will embrace what comes from the outside.

Successful open innovation, then, becomes the preamble to effective external innovation - if it's needed at all. Paradox solved, the entire team can focus on true innovation.


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Robert F BrandsRobert Brands is the founder of InnovationCoach.com, and the author of "Robert's Rules of Innovation: A 10-Step Program for Corporate Survival", with Martin Kleinman - to be published in March by Wiley (www.robertsrulesofinnovation.com).

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Monday, April 05, 2010

Breaking Down Internal Barriers to Innovation

by Paul Sloane

Breaking Down Internal Barriers to InnovationWithin larger organizations one of the biggest obstacles to innovation is poor internal communication. A silo mentality develops so that departments guard information and ideas rather than share them. People work hard - but in isolated groups. Internal politics can compound the problem with rivalry and turf wars obstructing collaboration. It can reach the ridiculous stage where the enemy is seen as another department inside rather than the competitors outside.

The leader has to tear down the internal fences, punish internal politics and reward cooperation. This sometimes calls for drastic or innovative actions.

Nokia has an informal rule that no one should eat lunch at their desk or go out for lunch. People are encouraged to eat in the subsidized cafeterias and to mix with people from outside their department. They have found that the informal meetings across departments are beneficial in sharing ideas and understanding.

Every organization has to find ways to promote internal communication and collaboration and to fight internal division and competition. Here are some ideas for breaking down barriers to communication:
  • Publish everyone's objectives and activities on the intranet so that people know what other people are working on.
  • Organize cross-functional teams for all sorts of projects. Make them as loose or as formal as you see fit but be sure that there is good mixing and that all of the departments contribute.
  • Arrange plenty of social and extracurricular activities, such as sports, quizzes, book clubs, hobby clubs, special interest groups etc.
  • Have innovation contests where cross-functional teams compete.
  • Have people frequently take secondary assignments in other departments.
  • Deliberately rearrange the office layout from time to time so that people move desks and sit with new groups (or adopt a 'hot desk' approach).
  • Organize a cross-functional innovation incubator.
  • Encourage department managers to look for ideas, input and solutions from outside their departments. Publicly praise managers who do this.

Conclusion

It is natural for departments in organizations to become more insular. As the organization grows, good internal communication becomes more and more difficult. There was a saying in Hewlett Packard: "If only HP knew what HP knows!" Very often the knowledge and skills needed to solve your problem exist elsewhere in the company. Knowledge sharing and collaboration are essential for innovation success. A key responsibility of the innovative leader is to constantly fight the silting up of the internal communications and to force contact and sharing between departments.


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Paul SloanePaul Sloane writes, speaks and leads workshops on creativity, innovation and leadership. He is the author of The Innovative Leader published by Kogan-Page.

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Innovation Perspectives March Wrapup

Innovation Perspectives
Innovation Perspectives is our monthly feature to present our loyal readers with different perspectives on a single topic all in one place along with the ability to compare, contrast and discuss them in the comments here on Blogging Innovation and in the Continuous Innovation group on LinkedIn. This month's topic was:


"How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?"
  • Thank you to Drew Boyd for submitting this month's topic

Here is a list of all of the authors that participated this month and links to their articles on this topic.

  1. Drew Boyd - Kill Your Innovation Champion

  2. Holly G Green - Excellence Only Happens in Context

  3. Cynthia DuVal - Designing Your Organization and Culture

  4. Dan Keldsen - Assessing and Building Innovation Strengths

  5. Rowan Gibson - Building Deep Innovation Capabilities

  6. Michael Soerensen - Challenge Your Specialists

  7. Willings Botha and Andreas Constantinides - Mechanistic or Organic?

  8. Braden Kelley - Where's Your Innovation Friction?

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If you would like to suggest a topic for next month's Innovation Perspectives, or would like to contribute, please leave a comment or contact us.
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Braden KelleyBraden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

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Sunday, April 04, 2010

Innovation Perspectives - Where's Your Innovation Friction?

This is the eighth of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?'. Here is the next perspective in the series:

by Braden Kelley

Innovation Perspectives - What's Your Innovation Friction?When it comes to creating an innovation culture, often people make it far too complicated. If you're part of the senior leadership team and you're serious about innovation then your job is simple - reduce friction.

If you're serious about innovation and you're not a senior leader, then your job is to do what you can to convince senior leadership that innovation is important. Then, gently help your execs see the areas of greatest friction in your organization so they can do something about it.

When it comes to creating a culture of innovation, the most frequently cited area of friction in organizations is the acquisition of resources for innovation projects (the infamous time and money). Senior leaders serious about innovation must eliminate the friction that makes it difficult for financial and personnel resources to move across the organization to the innovation projects that need them (amongst other things).

But this particular impediment is just a part of a much larger barrier to innovation - the lack of an innovation strategy. When senior leadership commits to innovation and sets a strong and clear innovation strategy then policies and processes get changed and resources move.

I recently ran a poll on LinkedIn asking people to identify their organization's biggest barrier to entry. 548 people responded and 58% of respondents identified either the absence of an innovation strategy or the psychology of the organization as the biggest barrier. 'Organizational psychology' came out on top with 32% of the vote, with 'Absence of an innovation strategy' a close second (26%). Other choices in the poll included - 'Organizational structure', 'Information sharing', and 'Level of trust and respect'. See the poll results and comments here.

A second major area of innovation friction is the movement of information. Too often there is information in disparate parts of our organizations that remains separated and unknown to the people who need it. Organizations that reduce the friction holding back the free flow of relevant information to where it is needed will experience a quantum leap in not only their product or service development opportunities, but in many other parts of their organization including sales, marketing, and operations.

So, what are the areas of friction that are holding your organization back from reaching its full innovation potential?

What are the barriers to innovation that have risen in your organization as you struggle to maintain a healthy balance between your exploration and exploitation opportunities?


My contribution to the body of innovation literature out there will be published this fall from John Wiley & Sons and focus on some of these issues.


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You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?' by clicking the link in this sentence.
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Braden KelleyBraden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

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Saturday, April 03, 2010

Innovation Perspectives - Mechanistic or Organic?

This is the seventh of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?'. Here is the next perspective in the series:

by Willings Botha and Andreas Constantinides

Innovation Perspectives - Mechanistic or Organic?Innovation is one of the most important pillars on which successful companies rely on. Employees are the vital component in the innovation equation. Therefore, it is of utmost importance for a firm to have the right organizational structure, culture and incentives in place in order to allow its employees to be innovative and perform to their maximum ability.

Organisational structures can be classified as either mechanistic or organic. Mechanistic structures have high degrees of formalization and standardization and information flow tends to be unidirectional top-down. Furthermore, employees in mechanistic structures are constrained to conform to their job descriptions and there is tight control through sophisticated control systems. On the other hand, organic structures tend to be more free-flowing and have low degrees of formalization and standardization. Employees with expertise and knowledge are influential, irrespective of their hierarchical position. The communication channels in organic structures are open and allow free information flow and exchange of ideas. Practice has shown that organic structures are more conducive in promoting and recognizing the potential for innovations.

Organisational culture is also a very important characteristic of innovative firms. The general firm culture should be inspiring to employees, encourage risk-taking and experimentation and tolerate failure. Employees should learn from failures in order to improve chances of success in the future. The firm should also put great emphasis in training and education of employees in order to improve their technical skills and creativity techniques. Managers should be concerned with how to improve the skills of individuals and teams and how to enable their participation and commitment to innovation. They should realize that innovation is not innate or instinctive, but a skill, like carpentry or accounting, and as such it needs to be learned. Set rules or principles should support innovation and idea management. The culture should also allow teams to look for innovative ideas and concepts outside the firm's boundaries.

These can be either done by establishing synergies with other firms or by posting their research problems on electronic marketplaces for ideas, such as InnoCentive. Finally, innovative culture leverages on diversity, cross-pollination of ideas and cross-functionalism.

Apart from the organisational structure and culture, motivation and incentives also play a big role in promoting and enhancing innovation. Basically, there are two types of motivation - extrinsic and intrinsic. Extrinsic motivation comes from the outside; it can be a promise of a reward or a threat of punishment that drives employees or teams to do something in order to get something desirable or avoid something painful. Intrinsic motivation, on the other hand, is built on a passion, an interest and an internal desire to do something that no one has been able to do before. Alternatively, intrinsic motivation can be thought of as a drive to do something primarily by interest, satisfaction and mere challenge of doing it and not by external push.

Intrinsic motivation is what is essential for innovation. At a firm level, this can be achieved by continuously seeking to make innovators feel good about their achievements; recognition can take the form of a special mention or a technology award. Furthermore, innovators may be placed as leaders of teams responsible for taking their innovation to market. Firms should try everything possible to keep money out of the innovation equation because practice has shown that monetary incentives do not necessarily promote innovation.


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You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?' by clicking the link in this sentence.
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Willings Botha and Andreas ConstantinidesWillings Botha and Andreas Constantinides are both students in the MSc program in the Management of Business, Innovation and Technology at Athens Information Technology in GREECE. They blog at http://open--innovation.blogspot.com/ and tweet at http://twitter.com/_innovation.

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Friday, April 02, 2010

Show Them Some Love!

Three Strategies for Creatively Recognizing Employees


by Holly G. Green

Show Them Some Love!Usually we stay away from the topic of love at work but we're talking about positive recognition here, not the stuff that gets you in a sexual harassment lawsuit!

Smart leaders and managers know that it's a good time to show your employees some love as well. In other words, let them know how much you appreciate their hard work toward achieving your organization's goals. (You did set the goals in January, right?)

Recognition doesn't have to be big, time-consuming, or expensive. In fact, the most meaningful recognition often comes simply from saying thank you for a job well done. But there are times when the situation calls for more than just a simple verbal acknowledgment. There are a lot of things that get in the way, but you do need to do it.

Here are three strategies for letting your employees know how much you care:


1. Start Small

Start by saying thank you on a regular basis. Over time, change what you say and how you say it so that it doesn't become routine. Be specific. Instead of, "Nice job," say, "Nice job on the quarterly audit. I know you worked incredibly hard to get it in on time."

Recognize individual accomplishments with a short e-mail note or comment in a team meeting. Send the employee a handwritten note of appreciation, and send a copy to your boss. How many of us have those handwritten notes saved away because they are so rare and really do mean something? Leave a sticky note with a snack thanking the person for his or her efforts. Leave a message on their desk that the employee will receive first thing in the morning.

Give small gifts such as cards, desk toys, picture frames, gift cards, or chocolate. To make sure your gift will truly be appreciated, check out the employee's work area to see what types of things they display. Or find out where they go for coffee in the morning or lunch at noon. A gift card to a favorite coffee shop or restaurant shows that you are observant and thoughtful.


2. Get Personal

For performance that requires more than your basic pat on the back, orchestrate a thank-you letter or e-mail from senior leadership. Have the company leader call the employee with personal thanks. Make sure the employee is recognized publicly perhaps in a company e-newsletter, on the intranet, or at an all hands meeting. Send flowers or a gift basket on behalf of the company to the employee's home.

Offer the employee an assignment or project that will stretch their current skill set. Give them an increase or change in responsibility and authority. Offer them an opportunity to shadow someone in a job they want to have next. Increase flexibility of work hours and/or occasional comp time (hint: employees really like this one).

Give employees a relevant book inscribed with a message from leadership recognizing their accomplishment. Allow them to observe a team or project that would represent a big promotion (and thus a learning opportunity to observe). Arrange for your manager or a senior leader to take your group out to lunch or dinner to celebrate a team accomplishment.


3. Use Peer Recognition

It is just as important for employees and teams to recognize each other as it is for leaders and managers to acknowledge good work. One good way to recognize a team, department, or organization is to establish a 'Caring Credits' program.

At the beginning of the month, give everyone three cards. Employees write notes acknowledging their colleagues for going above and beyond their job requirements, and submit the cards to a designated individual (someone in HR, the team leader, etc.). At the end of the month, the person with the most cards written about them earns some sort of recognition. Distribute all the cards collected to employees acknowledged so people can see the praise they received from co-workers. That way, everyone gets recognized, not just the winner.

Another good strategy involves setting aside some wall space for public recognition. Pick a Friday afternoon to engage employees in creating their own (and your own) "What's Great?" wall boards.

Employees use the boards to write a brief note about something great that occurred during the week. Notes can include professional or personal achievements or events. Encourage people to contribute to each other's boards as well as their own, and watch how easily they begin to add to the boards without weekly prompting. The different handwritings and colored markers will brighten up the workspace. And others will stop by just to see what's new on the boards.

So take a few moments to show your employees some love today - the legally appropriate kind! Then look for simple and effective ways to do it throughout the year. A little bit of recognition goes a long way toward maintaining a happy, motivated workforce. Remember, recognition doesn't have to be big, time-consuming, or expensive. It's not brain surgery... sometimes it's harder!


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Holly G GreenHolly is the CEO of THE HUMAN FACTOR, Inc. (www.TheHumanFactor.biz) and is a highly sought after and acclaimed speaker, business consultant, and author. Her unique approach to creating strategic agility, helping others go slow to go fast, will change your thinking.

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Innovation Perspectives - Building Deep Innovation Capabilities

This is the fifth of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?'. Here is the next perspective in the series:

by Rowan Gibson

Innovation Perspectives - Making Innovation a Systemic CapabilityWhen I go into a large company, one of the first questions I usually ask is this:

"Does your organization have a worldwide innovation infrastructure where anyone, anywhere can get access to the cash, the talent, and the management support they need to turn their ideas into market success stories?"

No prizes for guessing the answer. Most companies claim they want to encourage creativity, risk taking, and rule breaking, but what you invariably find is that their management infrastructure and corporate culture actually inhibit these things. Talk to successful innovators in any large company, and you will probably hear a familiar story: "I succeeded despite the system." But if would-be innovators can only succeed in an organization despite the system - if they have to fight their way heroically through a minefield to push their ideas forward - then by definition, innovation is not a systemic capability in that organization, nor is it a core value that is deeply ingrained in the corporate culture.

For innovation to become a core competence and a tangible cultural value, there has to be a substantial degree of internal consistency between processes, metrics, reward structures, rhetoric, and top management behavior - and it is precisely this synchronicity that is lacking inside most companies.

Let's take structure. In the majority of organizations, innovation is still forced to live in a disconnected silo like R&D, New Product Development, a Skunk Works, an incubator, or a New Ventures division, where it neither involves nor infects the rest of the organization. By their very nature, these enclaves lead a solitary existence, operating as an adjunct to the real work of the company, and in my experience they produce very few ideas that ever make a big impact on a company's profits.

If we want to create the kind of structure that is required for opening up innovation broadly to the organization and to people outside it, we need to think about the social systems or institutional structures that have proven to be most conducive to innovation - universities, cities, industry clusters like Silicon Valley, or, most recently, the Web itself. What creates the vibrancy and serendipity in these structures is the matrix of ever-changing human connection and conversation. However, in a large organization, over time, the conversational patterns tend to become etched in stone. There are fixed reporting lines, committee groups, task forces, and so forth. Companies tend to consign innovation to a small cadre of 'experts' in specialized departments, and they end up having the same people talking to the same people, year after year, so they lose that conversational richness. In many ways, the organizational chart actually inhibits rather than increases the chances of making random, serendipitous connections.

To make innovation a pervasive and corporate-wide capability, the responsibility for innovation needs to be broadened beyond traditional structures and spread throughout a company's businesses and functions. This is exactly what happened to quality in the 1970s and 1980s when it ceased to be the exclusive responsibility of a specific department and, instead, became distributed to every corner of the company. What is required is a similarly systemic infrastructure for innovation that starts at the corporate level and infiltrates every part of the organization chart. An infrastructure that makes managers accountable at all levels for driving, facilitating, and embedding the innovation process into every nook and cranny of the culture.

The best innovation infrastructures I have seen are linked directly to the CEO and include a global Vice President of Innovation (VPI), regional VPI's, business unit innovation officers, innovation boards, innovation consultants and innovation mentors. These new, pro-innovation structures are designed to actively foster interaction across the organization and to distribute the responsibility and expertise for innovation throughout the company. They destroy the structural silos that usually separate people, ideas, and resources, and create a high level of cross-boundary connection, conversation, and collaboration.

In addition to building such an infrastructure to orchestrate and support innovation from everyone and everywhere, companies need to create the cultural conditions that serve as catalysts for breakthrough thinking. It's not enough to simply list innovation as a core value in your corporate mission. When companies refer to innovation as a value, most of them are using the wrong term. If an organization has not yet succeeded in making innovation a truly tangible core value for all its employees, the leadership team should be calling innovation an objective or a commitment, not a value. Innovation may well be something the leaders consider to be an imperative, and that they plan to put considerable effort into, but that does not mean that it has yet become a deep value for the company. Talking about innovation - using it as a slogan in an advertisement or on a corporate letterhead - does not make it a value. Values are less about what you say and more about who you are. They define the beliefs an organization holds deep down about what is important and right, and they drive the way its people behave on a consistent basis. It is absolutely crucial to make this distinction.

For innovation to become a genuine value, it has to be deeply internalized and clearly tangible to an organization's employees. It must be something, as Marcus Buckingham might put it, that helps to "change the daily rituals" and "introduce new heroes and language" throughout the organization. It becomes the net sum of a whole variety of messages and behaviors. In fact, in many ways, it is not really something a company can work on directly; it is something that comes from addressing a lot of other issues.

Innovation can only become a true value in a company through collective learning across all its levels, functions, and businesses - usually over considerable time. People need to not just hear that ideas are welcome from everyone and everywhere, or that rule breaking and risk taking are encouraged, or that ideas are allowed to fail without incurring punishment; they need to experience these things every day. That is when a corporate value becomes tangible enough to guide patterns of behavior across the entire organizational culture.

There are certain mechanisms a company can employ and institutionalize which can help to make innovation a tangible core value. They include things like consistent messaging from leaders (in both word and deed); a discretionary time allowance for reflection, ideation, and experimentation: broad-based innovation training; an open market for ideas; easy access to incremental seed funding; management structures for mentoring and support; and incentive and reward structures that encourage challenging the status quo, risk taking and entrepreneurship.

When these mechanisms become firmly ingrained in the corporate culture they provoke the right attitudes in people. Employees get the feeling that they are part of a vibrant, innovative company. They get hooked on the excitement and energy of innovation. They find it stimulating to work in a collaborative, open culture. They see that innovation is not just management rhetoric but a widely held and deeply embedded value. And they automatically begin to demand more innovation from themselves and their peers. Thus, the demand for innovation ceases to be the sole province of the CEO or other top level executives. It starts to be driven from all levels of the organization. This is what it takes to make a corporate culture more conducive to innovation.

HR professionals can add a lot of value here. Their challenge should be to create a company culture where everyone in the company is responsible for innovation - whether as an innovator, mentor, manager, or a team member. That means that all HR systems - pay, spot awards, the long-term incentive plan, the balanced score card objectives - need to be hardwired into the company's innovation strategy.

The bottom line: building a deep innovation capability requires a systemic approach. It requires your company to patiently assemble all of the above components, and to put the necessary drivers in place so that your corporate innovation system becomes sustainable.


April Sponsor - Brightidea
You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?' by clicking the link in this sentence.
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Rowan GibsonRowan Gibson is widely recognized as one of the world's leading experts on enterprise innovation. He is co-author of the bestseller "Innovation to the Core" and a much in-demand public speaker around the globe. On Twitter he is @RowanGibson.

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Tuesday, March 30, 2010

Innovation Perspectives - Excellence Only Happens in Context

This is the second of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?'. Here is the next perspective in the series:

by Holly G. Green

Excellence Only Happens in ContextExcellence only happens in context. Think about the last time you had a cruddy boss or your client forgot to give you information on something you were working on. Did you produce or deliver as well as you could have? Of course not.

A system has to work together. And your current system produces exactly what it is set up to produce. So if you want to be more innovative, you have to think about and address the whole system. Just addressing one piece of it will not serve you well.

In our work with organizations, we believe it is critical to think through and get clear on:
  • How being innovative helps you more effectively achieve your strategies

  • Why creating or refining a culture of innovation including the leadership behaviors that support it will serve you well

  • The benefits of creating management practices (everyday ways of working) that generate ideas

  • What tools, systems, and platforms will best enable you to achieve innovation

Too often, companies think they need to focus on just generating more ideas. This is only a piece of the system and it is highly likely everything else in your system is set up to shut down idea generation. Have you ever heard or said any of the following:

"It's too much work. Don't rock the boat. Yeah. We've tried that before. You have a point, but... It costs too much. We don't have the time. It won't work. It would take too much effort. We did fine without it before."

These are common refrains in most organizations and they stop innovation in its tracks.

Gary Hamel, business strategist, enjoys shocking audiences by asking about their corporate sperm count. If you need 10 million sperm to fertilize a single egg, then you are unlikely to come up with a winning idea unless you have lots of material to work with. Create an environment where ideas are free flowing, but pre-filtered by the focus on customer value and clarity of strategies. Constantly ask "What if...?" in meetings. Use tools like stakeholder analysis to pause and focus people on considering new perspectives, new lens through which to view the world.

Leaders must model the behaviors necessary for innovation to thrive. It is their responsibility to build and encourage diversity in thought, approach and style; to use supportive language and behaviors themselves; to communicate and acknowledge ideas even if they are not pursued; to use a goal oriented management style so that everyone is clear on how ideas link to achieving the strategies and objectives; and to encourage informed risk taking.

Create a team, a process, tools, etc. to work within your environment. Often, employees don't know what they don't know. Make sure you provide the tools and understanding of how and when to use them. Develop and implement ways of using them in standard, ongoing operations (business unit reviews, quarterly board meetings, all company presentations, etc.) to generate ideas and value them against strategies and objectives.

Without constant focus and specific people responsible, your efforts will quickly fade - remember everything within us works to keep us in our comfort zone. Most of us have great ideas. It is whether they link to the strategy, get heard, evaluated and acted on that are the real hurdles today.


March Sponsor - Brightidea
You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?' by clicking the link in this sentence.
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Holly G GreenHolly is the CEO of THE HUMAN FACTOR, Inc. (www.TheHumanFactor.biz) and is a highly sought after and acclaimed speaker, business consultant, and author. Her unique approach to creating strategic agility, helping others go slow to go fast, will change your thinking.

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Monday, March 29, 2010

The Four Currents of a Culture of Innovation

by Mitch Ditkoff

The Four Currents of a Culture of InnovationI've been doing a lot of thinking these days about "culture of innovation" - trying to get down to the root of what the heck it's all about.

It's easy to wax poetic about the topic (and a lot of people do), but too much of the stuff I've been reading sounds like bad advertising copy for motherhood and apple pie.

So, at the risk of oversimplifying the whole thing, here's my blogospheric whack at boiling the mumbo jumbo down to the core.

If you want to create a sustainable culture of innovation, you will need to understand that there are always four forces at work - four currents that are always interacting with each other:
  1. Top Down
  2. Bottom Up
  3. Outside In
  4. Inside Out

TOP DOWN: Although the "revolution" never starts with the King, it is imperative that top leadership plays their "culture-enhancing role" far more than they currently do.

The people in the trenches need to know that the head honchos not only care about innovation, but are willing to do whatever it takes to establish a company culture conducive to it.

I'm not advocating phony pep talks from the C-Suite. I'm advocating that senior leaders actually lead the effort. I'm advocating that all those wonderful people with three letter acronyms after their name walk the innovation talk... stir the soup... shake and bake... and do everything they can do to martial company resources in whatever way is necessary to transform "business as usual" to "I love this place and I can't wait to get to work." Yes, it's possible.


BOTTOM UP: If an organization wants to innovate, it will need to get everyone into the act. Not just senior leaders. Not just R&D. Everyone. Ideas - the fuzzy front end of innovation - can come from anywhere, anytime. When an organization really GETS this and finds new ways to tap the collective brainpower of the workforce, the culture starts changing for the better. People become more proactive. More energized. More passionate about their work.

Indeed, it could easily be said that the democratization of the workplace is one of the most important social movements of the 21st century. As power and decision-making trickle down, creative output ratchets up. People become self-organizing, self-directed and, on a really good day, selflessly committed to being a force for positive change.


OUTSIDE IN: Establishing a culture of innovation is only meaningful if the fruits of the effort yield the kind of results that are valued by your customers. Otherwise, the effort to "change the culture" will turn into some kind of weird, solipsistic ritual that will have no impact on the people you are serving.

Do you know who your customers are? Do you know what they want? Do you have any kind of process in place to track changing market conditions, demographics, and emerging trends? Have you figured out how to get real feedback and input from your customers - how to include them in your ideation process?


INSIDE OUT: Ah... now we're really getting down to it. If you want a culture of innovation, you will need to find a way to unleash the passion, fascination, and inspiration of your workforce.
Not by dangling carrots and sticks (read Dan Pink's new book, Drive, if you doubt me), but by finding a way to activate the innate desire for meaning, enjoyment, and success that is buried deep within the bones of every single person who shows up for work day after day.

Organizations don't innovate. People do.

If you can find a way to unlock the primal mojo of your workforce, you won't need to manage as much as you do. You won't need to rely so heavily on incentive plans, performance reviews, pep talks, frowns, and punishment.

That stuff only exists because your workforce is disengaged.

But when people are on fire with purpose, in touch with their own authentic desire to create, a culture of innovation will naturally evolve.


A big thank you to Val Vadeboncoeur, Tim Moore, Barry Gruenberg, Paul Roth, and Michael Pergola for their humongous collaboration, insight, creativity, and perseverance on this topic.


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Mitch DitkoffMitch Ditkoff is the Co-Founder and President of Idea Champions and the author of "Awake at the Wheel", as well as the very popular Heart of Innovation blog.

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Innovation Perspectives - Kill Your Innovation Champion

This is the first of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?'. So to kick it off, here is Drew Boyd's perspective:

by Drew Boyd

Innovation Perspectives - Kill Your Innovation ChampionHere are five things companies need to do to develop the organizational structure, culture, and incentives to encourage successful innovation:

1. Kill Your Innovation Champion: It seems like a great idea to establish an 'innovation champion' - responsible and accountable for driving innovation within the organization. In reality, it stifles innovation. Assigning a champion lets everyone off the hook. Why innovate when we have our 'champion' to do it? A study by the Association of Innovation Managers found that when companies assign innovation champions and establish separate funding, it threatens the R&D and the commercial departments.


"This kind of sponsorship opens the door for subtle forms of sabotage if the established business units believe that the innovation funding is inhibiting their ability to accomplish short-term objectives and take care of current customers. Without involvement, the commercial arm of an organization can also claim no responsibility for success or be blamed for failure."


Instead of relying on champions, a better approach is to encourage 'innovation subversives'.

If you won't kill your champion, no worry - they will go away on their own. The study also looked at what puts innovation managers at risk. Of the 15 innovation champions in the study, ten left their organizations and became consultants, four joined smaller or start-up companies, and one retired. None returned to a Fortune 500 company.


2. Don't Give Credit for Good Ideas: Tanya Menon from the University of Chicago describes the paradox of an external idea being viewed as "tempting" while the exact same idea, coming from an internal source, is considered "tainted."


"In a business era that celebrates anything creative, novel, or that demonstrates leadership, 'borrowing' or 'copying' knowledge from internal colleagues is often not a career-enhancing strategy. Employees may rightly fear that acknowledging the superiority of an internal rival's ideas would display deference and undermine their own status.

By contrast, the act of incorporating ideas from outside firms is not seen as merely copying, but rather as vigilance, benchmarking, and stealing the thunder of a competitor. An external threat inflames fears about group survival, but does not elicit direct and personal threats to one's competence or organizational status. As a result, learning from an outside competitor can be much less psychologically painful than learning from a colleague who is a direct rival for promotions and other rewards."



3. Fire the Lone Innovator: Innovation is a team sport. Keith Sawyer in his book, "Group Genius" highlights one of the most significant aspects of successful innovation - that groups of people are likely to be more creative than individuals working on their own. A properly facilitated approach with a carefully selected 'dream team' of employees yields innovation sooner, better, and bolder than the lone genius.


4. Teach Innovation: Innovation is a skill, not a gift. It can be taught using structured innovation processes and templates. Many universities offer courses and programs to learn innovation. It is unacceptable that a corporation seeking growth through innovation would not have its employees properly trained in the skill of innovating.


5. Build Innovation Muscle: The best companies see innovation as an ongoing capability, not a one time event. These companies work hard to build muscle around this capability so they can deploy it when they need it, where they need it, tackling their hardest problems. Companies do this to keep up with the ever changing landscape both inside and outside the firm. What does it mean to build innovation muscle? I think of it as the number of people trained, the frequency of using an innovation method, and the percentage of internal departments that have an innovation capability. Call it an Innovation Muscle Index: N (number of trained employees) x F (number of formal ideation events per year using a method) x P (percent of company departments with at least one employee trained in an effective innovation method). Innovation Muscle Index = N x F x P.


March Sponsor - Brightidea
You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?' by clicking the link in this sentence.
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Drew BoydDrew Boyd is Director of Marketing Mastery for Johnson & Johnson (Ethicon Endo-Surgery division). He is also Visiting Assistant Professor of Marketing and Innovation at the University of Cincinnati and Executive Director of the MS-Marketing program. Follow him at www.innovationinpractice.com and at http://twitter.com/drewboyd

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Saturday, March 27, 2010

Enemy inside the Gate - The Biggest Barrier to Innovation in the Middle East

by Kamal Hassan

Enemy inside the Gate - The Biggest Barrier to Innovation in the Middle EastWhat are the drivers for innovation in the Middle East? I recently asked this question of my colleagues in the social mediasphere. I wanted to better understand how people innovate in the Middle East, and compare the drivers for innovation here with that of other societies.

My question provoked many responses, several of which pointed to one underlying driver - necessity. As they say, necessity is the mother of invention. However, necessity is the most basic driver for innovation. Many other societies have moved beyond necessity.

In China, for example, innovation is technologically and industrially driven, and their R&D spending matches that of the U.S. and Europe.

The Japanese believe that if they lose money, they will recover it, but if they lose time, they won't. So a driver of innovation there is the need to produce new offerings quickly, and to be the first to market.

In the U.S., there are multiple factors that support innovation - a higher education system that encourages thought leadership and innovation, and a strong entreprenurial spirit and privately funded venture capital system. These factors combined lead to increased competition, which further drives innovation.

In the Middle East, we have necessity. The need to develop viable means of income in addition to oil. The need to improve quality of life for those in poor Middle East countries. The need to solve the water shortage crisis, unemployment among youths, technological backwardness, and more.

We also have government-led initiatives designed to foster innovation and support entrepreneurship. The Mohammed bin Rashid Al Maktoum Centre for Entrepreneurship and Innovation is a good example, as is the Qatar Foundation, and the King Abdullah University of Science and Technology in Saudi Arabia. All represent significant government investments to drive innovation. Certainly the resources and the will to innovate are there. Where we are in danger of falling short is the execution and sustainability of these plans.


Apathy - The Enemy of Innovation

It is interesting that in response to my question, what drives innovation in the Middle East, many responses listed the barriers to innovation here - the "buy versus make" culture; lack of support for entrepreneurship, especially among youths; too much talk and not enough action.

I believe that all of these problems are rooted in apathy. During the past year, I have visited many companies throughout the Gulf region. Although everyone expresses an interest in innovation, few put any resources into it. One organization, a multi-billion dollar telecom company, had one person in charge of R&D who was let go two years ago. Another, a $50 billion company with diversified holdings, has an R&D budget of $0.

These are not isolated examples. A 2008 report from the Economist Intelligence Unit put the region's R&D expenditure at less than one percent of profits. Compare that to Japan, which allocates more than twe percent to R&D.

In addition, some companies confuse innovation with suggestion boxes or brainstorming sessions. More often than not, these poorly planned programs merely generate "opinions" from unhappy employees, or incremental improvements to existing products, services and business models. These approaches are not a substitute for true innovation.

How do these companies survive? Because we have made it acceptible to rely on the innovation of others, which we reuse and resell. Where some societies and organizations struggle with the "it's not made here" mentality, we have the opposite problem. If it's not made, tested, proven and sold elsewhere, we tend to distrust it. We have created a culture of apathy that can afford to buy innovation elsewhere.

As a result, local ingenuity is often overlooked or discouraged in favor of imported innovation, and we become a hub that innovation passes through. We verbally commit to entrepreneurship, but the costly and difficult system of establishing a business here belies that commitment. In addition, there is too little privately funded venture capital to support entrepreneurs or new innovative models.

This culture of apathy threatens to negatively affect the execution and sustainability of current innovation initiatives. It is not enough to set aside financial resources for innovation and entrepreneurship. Without a systematic approach to innovation execution, any progress made will be minimal and difficult to sustain.

What would such an approach look like? Here are some high-level steps:
  • Understand that innovation is a process and a system that needs to be well managed.

  • Revamp business infrastructure so that it not only supports entrepreneurs, but allows them to fail and learn from their mistakes.

  • Increase micro-financing and venture capital funding, and remove the red tape that discourages private funding.

  • Increase the competitive landscape by easing government control on growing industries that require significant new technologies and innovation.

  • Increase R&D budgets across the board, and educate organizations on how to maximize R&D spending (through systematic innovation).

  • Embed innovation training in all levels of the education system, and for all employees.

  • Focus on necessities instead of luxuries (water resources versus high-rises, enabling technologies versus shopping malls, production versus consumption).

On a personal scale, we need to work to overcome apathy and encourage creativity. This means we stop accepting the status quo and resolve to change it. We challenge old assumptions. We think outside the box. We share knowledge. We start trusting each other, and our abilities.


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Kamal HassanKamal Hassan is President and CEO of Innovation 360 Institute, and is responsible for leading the company's global operations and customer acquisition.

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