Innovation = Leadership
How practicing innovation is about developing leadership skills
In the past, innovation typically happened in one of two ways:
- Through an R&D department, whose purpose was to help find new and innovative solutions to the company’s challenges. These solutions would help with continuous improvement, but some cutting edge research projects also allowed for market differentiation.
- Senior leadership would use their knowledge in a domain, their years of experience in a given function and thought leadership to guide the company’s “product roadmap”, aka ‘where to next?’ With a lifetime of experiences in success and failure, they have the confidence to take the next bold step.
These functions very much still apply today; the big difference is that most companies have now been made aware that (1) in-house R&D simply isn’t enough anymore given how quickly change happens, (2) seniority doesn’t equate to having all the answers; in fact, the prosperity sought by big companies in the past is now seen as a dangerous state to be pursuing — the more comfortable you are about owning a strong position in the market, the least likely you are to believe you will be disrupted.
Comfort is the enemy of greatness.
Feeling too comfortable and confident in your current success translates to investing heavily toward continuous improvement, while under-investing in risky R&D that might yield no return; my opinion on this: you should probably make riskier investments while you still have a dominant share of the market.
If you have the sad misfortune that a new entrant comes in, providing value in ways that will disrupt you, you are typically left with 2 choices:
1) Consider acquisition to gain some level of competitive advantage; at this point, the investment is not so risky anymore given that the new entrant has proven that there is value in the offering.
2) Start heavily investing in R&D to catch-up to (and hopefully surpass) the new entrant.
Innovation is in most companies’ strategic agenda. One big question companies should ask themselves when they prioritize innovation is: are we doing this because it’s trendy, because we are looking to transform ourselves into an innovative organization, or are we doing this because of the fear of being disrupted?
I personally think the right answer is that you seek to become an innovative organization if you’re playing the long-run game. Innovation isn’t all about buzzwords, having an innovation-branded department, or having seats in an innovation hub; you will unlock true innovation if you can leverage these to change the mindsets in your workforce.
- Are people in your organization curious about what is going on, or are they solely focused on executing deliverables? (check out my other article around allocating time to innovate)
- Do people in your organization have a space to share ideas (this includes ideas outside their own department)?
- Are people in your organization action-driven?
- Are people in your organization leaders in the different functions and roles they hold, from the intern and new-grads to the top senior executive?
Again, as mentioned in my article around allocating time to innovate, innovation won’t magically appear because everyone has received a design thinking training, and knows about agile; innovation won’t occur if your workforce has a lot of ideas, but none of them are brought to life. The magic thread is the cultural element.
The fact that a lot of organizations looking to innovate want to be close to the start-up scene is for these key reasons:
- Start-ups are very attuned with the current and future trends
- Start-ups are led by entrepreneurs, and the entrepreneurial DNA is all about finding solutions to problems that come your way — resilience as you search for investors, as you iteratively explore and test your value proposition, perseverance as you narrowly define your customer base, focus as you define and test the viability of your business model.
At the end of the day, the entrepreneurial mindset is about reactiveness, and this is what corporates and more established businesses really seek:
- “How to quickly react if I sense that I am lagging behind or about to be disrupted?”
- “How can I continuously and effectively gather ideas from employees across the board?” — on this topic, the variety of ideas you get will be richer if you can tap into your entire workforce, as opposed to leaving it to the “innovation department”.
- “How quickly can I turn an idea around to generate value, throughout the organization?”
- “How adaptable are my processes should I need to react to a disruptive force? Can I do so quickly?”
A lot of these questions are answered through behaviors, behaviors that can be learned through influence from the start-up / entrepreneurial world; behavior is a manifestation of thinking, so changing key behaviors can help change employees' mindsets across the board. However, acquiring the desirable behaviors would require people to take action, to turn their ideas into action, to make them tangible.
I really wrote this piece to convey this message: taking action is a sign of leadership and a cornerstone of innovation. Leaders aren’t people you want to follow just because of their friendliness or power; leaders are people you want to follow because of the influence they can have to affect change, because of their ability to turn chatter and ideas into action and change, because of their perseverance & resilience when faced with hardship. Like any skill, leadership takes practice — practice in making decisions, practice in taking action, practice in navigating and feeling comfortable with failure.
Food for thought:
I leave you with this thought: when trying to innovate, organizations push their employees to find creative solutions and develop entrepreneurial skills; design thinking and agile trainings are provided, but not many organizations provide employees with the leadership tools, the space and psychological safety to practice turning their ideas into actions.
My two cents on the topic: I think for innovation to thrive, organizations should be grooming a workforce of leaders. I’d love to hear your thoughts in the comments!
