Talent certainly helps when it comes to driving innovative thinking, but the real art is in harnessing the skills you have within a business so that people feel empowered to come up with new ideas and aren’t afraid to fail. Fundamentally, an organisation has to possess a sense of direction and purpose that is communicated clearly from the top.
Graeme Butterworth, General Manager of Global Process Services at IBM, says: “The board sets out major market themes which anticipate market trends, the direction for the company and provides a clear focus for the different parts of the… business to be brought together to develop innovative market solutions.”
It’s about unlocking the excellence that exists within a business. Geraint Anderson, CEO of TT electronics, comments: “When I came to TT electronics people were not used to sharing knowledge, so we had to create ‘virtual teams’ to link up our people – manufacturers and software designers – and allow their passion to come through.”
Graeme adds: “IBM dedicates people to work on driving… innovation, pulling them in from different parts of the organisation including from the research [division]… Distributing knowledge through our people, processes and systems is one of the keys to making innovation flow throughout [the business].”
Choose your target
The goals and overall ambition of an organisation have to be defined. Geraint says: “You need to create symbols – hooks – for change too, so that the new focus becomes permanent and embedded in the culture of the business… As leaders, we must create the environment where innovation can happen.”
Linda Grant, MD of A&N Media’s Free Division, the consumer media company whose titles include the Metro newspaper, says: “The leadership team needs to put time and effort into creating the right environment and kick-starting initiatives to encourage people from across the business to come together to problem solve or invent.”
A similar point is made by Steve Pateman, Head of UK Banking at Santander: “Agility and innovation is within everyone’s grasp. Often it’s about making choices as businesses must be rewired to respond more efficiently to a customer’s changing wants.”
Linda adds: “You must also bring your customers into the mix with a commitment to truly listen to them and understand what they want… Well-prepared, innovative research that is predicated on understanding can give you invaluable insights into your customers.”
It’s something that appears to have been encoded into the model of the most innovative companies. Alison Esse, Co-founder and Director at change consultancy The Storytellers, says: “It’s the relationship with the customer that is going to differentiate your product or service… if you can put the customer at the heart of your story, it can lift people out of their silos and unite them behind a common purpose. It breeds innovative thinking.”
Geraint says: “We work with customers such as BMW that are looking 10 years ahead, so we must have the capability to innovate with them, beyond our own three-year plan… You need a clear strategy; one that has carefully considered where your business and its offering fits into the market and can carve out its niche.”
In many cases, this means being brave about where you see your relevance and long-term traction in specific markets. David Plumb, General Manager of Enterprise at O2 UK, argues that the first steps to innovation can be deciding what you don’t want to do so that “investment, time and resources can be released to create something new”.
Dipak Jain, a Criticaleye Thought Leader and Dean of international business school INSEAD, suggests that companies that put the customer first and have a pragmatic strategy for innovation tend to go beyond simple ‘transactional’ thinking to create enduring value and relationships. He explains: “Apple and Starbucks, to cite two prominent examples, have enjoyed customer loyalty because they create experiences that transcend the ordinary in terms of quality and engagement. They do this in many ways, including by paying attention to design: Apple seems to put almost as much attention into the way it packages its ideas as it does for the ideas/products themselves.”
Innovation is propelled by listening to and anticipating what customers want. Dipak continues: “Both companies also have robust digital strategies that focus on building relationships, not on conventional marketing. With a website like mystarbucksidea, the coffee giant has been active in soliciting insights from its customers and bringing them inside the company… Of course, Apple and Starbucks also maintain vibrant digital channels on Facebook, Twitter, and YouTube, all of which help strengthen communication — two-way communication — between the company and its customers. Such tools bring complexity that must be managed well, but they also bring undeniable benefits.”
Talking about innovation is straightforward enough. At the board level, it’s about making sure that, while the reputation of a business is protected, your people are rewarded for their forward thinking and not only defending and being ambassadors of the status quo. Unfortunately, many of the businesses getting into trouble today fell victim to the cultural malaise of the latter and are suffering the harsh consequences.
As David says: “While it sounds illogical, you have to think about the overall profitability of the business in the future as today’s successful division may not be tomorrow’s.”
Please get in touch if you have any comments about the issues raised here.
I hope to see you soon.