I was honored to present and be part of a panel discussion at one of Silicon Valley’s legacy innovation centers, PARC, a Xerox Company in Palo Alto, July 26, 2018.
I began my presentation by asking if everyone believes that culture can be measured and managed? Not everyone understands this, despite overwhelming evidence from InnovationOne and other researchers, such as Harvard’s Dr. John Kotter. Culture can be measured. What you can measure, you can manage. Kotter’s research shows that organizational culture can either get in the way of or support needed innovation—and that culture can dramatically affect financial performance.
At InnovationOne we have an empirically developed model to assess, benchmark, measure, lead and manage an organization’s culture of innovation. Our studies include empirical evidence on the financial success of innovation, some case studies, one of which has been published in the Journal of Innovation Management.
While it is hard to cover each of the 10 of the talent strategies that will support cultures of innovation in a single blog, I will highlight the three that engendered the most discussion during my presentation:
- Transparency
- Trust
- Employee creativity
Transparency is essential in at least three fundamental ways
- Executives need to share their innovation strategies broadly. Our research at InnovationOne has found that employees and external partners have many innovative ideas if only executives would share their strategies for innovation and ask for suggestions and solutions.
Many executives are very reluctant to share their strategies — often because they are not 100% committed to them or are unsure. Trial and error go hand-in-hand with innovation. Uncertainty is no reason to hold back. Gathering input, sharing ideas, running prototypes, failing and learning is part of the innovation journey. Innovation works best when executives have a vision and strategy for what they want. They don’t have to have the solution. That is the work of their employees, external partners, and customers on innovation teams.
- Executive share business, marketing, customer, and technology intelligence. This might not seem like a talent strategy, but transparency with business intelligence is essential for innovation. Executives and technology centers have a common tendency to hoard their secrets. But this is the wrong instinct for innovation and adaptive cultures. You need to broadly share the business intelligence with your innovation teams, workforce, and external partners so they can use the knowledge to fuel innovation.
- Invest in organizational learning. Learning about what worked and what failed with innovation projects is critical. Many executives understand the importance of investing in the hard capital such as buildings, labs, and the latest technology for their products and services. Just as important is investing in the digital technology for big data analysis, artificial intelligence and collaboration software. While hard capital is essential, so is organizational learning. In our joint survey published with TCB, we have found that while both highly innovative and less innovative companies invest in hard capital, highly innovative companies also invest in organizational learning, so that their cultures are open to innovation, recognize what will work in the marketplace and rapidly commercialize it. You can read the full report here: Insights from Highly Innovative Companies: Results from The Conference Board and InnovationOne Global State of Innovation Survey 2017.
Trust helps build effective teams and empower leaders.
Consider the following attributes:
- intelligence
- passion for work
- technical expertise
- team structure and clarity
- extroversion
- trust
Which is the most important and valuable? By far, it’s trust, according to four different studies I cited. Why? In one of the studies, by the MIT Human Dynamics Lab, the elusive group dynamics that characterize high performing teams—teams with a lot of energy, creativity, and shared commitment—was based on effective and empathetic communications which created trust.
In a study released in 2017 by the Google People Operations Analytics team, psychological safety (an industrial psychology term for trust) was far and away the most important of the five dynamics found, and it is the underpinning of the other four dynamics which were dependability, structure and clarity for the team, meaning of work, and impact of work.
For more on this research, please read Four studies identify the critical dynamics that contribute to team success.
Employee creativity helps companies move beyond hierarchies and boundaries.
Just as culture can get in the way of learning, collaboration, and rapidly innovating new ideas, so can organizational structure and the boundaries caused by structure, hierarchy, silos, and bureaucracy.
One area many companies struggle with is how to prevent their organizational structures and hierarchies from limiting innovative work. To be innovative, executives do not have to tear down structures and hierarchies. Structure, hierarchy, and approval levels are part of maintaining focus on the company’s mission, values, purpose, strategic focus, accountability and commitment to customers.
The problem is when structure and hierarchy get in the way of sharing and innovation.
I have worked in corporate cultures where for one of our engineers to speak with someone in another business or at a university, it took a lot of permissions from above. That hurts innovation. Instead of the “Captain may I” systems, you need to allow your innovators to reach out to whomever they need to speak with whether it is across the hallway, at corporate, in another business unit of the company or an external research center or another company. The freedom to ask questions of strangers spurs innovation.
In companies with protective cultures, these conversations are stifled. Sometimes it can be the corporate technology center that gets in the way by trying to protect its turf or its own claim to expertise.
3M has had a long-standing fantastic culture for sharing expertise. They have a rule that it should take no more than three calls to get the information you need. 3M has a culture that promotes collaboration, not fiefdoms.
The support of human resources executives is critical to a culture of innovation. If the HR leader would rather stay meshed in the administrative work of HR or believes that culture is the charter of the executive team without HR, you won’t go far. HR leaders need to be strong partners with the executive teams to spur innovation. Companies that have become the innovation leaders in their domains have HR organizations that can have dynamic, fast-paced HR capability to attract, recruit, develop, assess and motivate the continually emerging workforce the company needs as it fosters innovation. These HR leaders embrace the digital technology and artificial intelligence that makes HR administration easier and allows them to find the new talent the organization needs quickly.
Finally, for innovation to be successful, the CEO and executive team need to treat innovation as a strategic imperative—just as urgent as the annual operating plan, product technology plan, and sales and marketing plan. These CEOs need to be visible supporters of innovative cultures and integrated talent strategies. The CEOs who get it, continually share what they learn with their workforces and external partners, asking them for help, and pointing them in a common direction.
With this leadership, they can sleep well at night knowing that an excited, energized workforce will find the necessary solutions.
I was not the only speaker at this event. Ataman Ozyildirim, an economist, and Director of Business Cycles and Growth Research for The Conference Board also presented on Using Better Metrics to Build an Inclusive, Collaborative Culture Of Innovation.
The event was organized and hosted by PARC, whose beginnings go back to 1970. Innovations that PARC has contributed to include the computer mouse, laser printing, the ethernet, VSLI circuit design, multibeam lasers and Thinfilm. Since its inception, PARC has created $1 trillion in new industries, $60 billion in startups and spin-offs, and almost 6,000 patents and patent applications.
Victor Assad is the CEO of Victor Assad Strategic Human Resources Consulting and is a Managing Partner of InnovationOne. He consults and provides “hands-on” support for innovation, global talent strategies, using digital technology to improve recruiting and retention, developing agile leaders and teams, and other strategic initiatives.
Are you interested in measuring and improving your culture of innovation? Contact Victor Assad at [email protected]. For research on innovation visit http://www.InnovationOne.io.
Visit http://www.victorhrconsultant.com for more insights on talent strategies to support cultures of innovation and valuable free reports.