Like the weather, many leaders talk about agility and innovation, but few managers do much about it. Unlike the weather, there’s a great deal managers can do about building agile and innovative cultures.
Innovation and organization learning often falls into the same trap as strategic planning, economic forecasting, and change management. There is no orderly path that can be mapped out and budgeted. The best new products, services, or methods often come from the wrong people, at the wrong time, in the wrong way, for all the wrong reasons.
Purposeful Accidents and Opportunistic Experimentation
In their classic book Built to Last: Successful Habits of Visionary Companies, Jim Collins and Jerry Porras report on a key trait that sets apart companies with exceptional and sustained success, “In examining the history of the visionary companies, we were struck by how often they made some of their best moves not by detailed strategic planning, but rather by experimentation, trial and error, opportunism, and — quite literally — accident. What looks in hindsight like a brilliant strategy was often the residual result of opportunistic experimentation and purposeful accidents.”
This is consistent with the findings of Harvard Business School professor, David Garvin. In his article “Building a Learning Organization,” he writes, “Experimentation involves the systematic searching for and testing of new knowledge … A study of more than 150 new products concluded that ‘the knowledge gained from failures (is) often instrumental in achieving subsequent successes.’ …in the simplest terms, failure is the ultimate teacher.”
Four Steps to Balancing Agile Leadership and Innovation Management
Agile organizations are knowledge-creating cultures thriving on controlled chaos. It’s a big competitive edge. New products and services can be “knocked off” or copied. But it’s much, much harder for competitors to duplicate a leadership culture and management system producing a continuous stream of successful product and service improvements, innovations, adaptations, and extensions.
Controlled chaos is a tricky process with four main stages. The first two stages depend on people or leadership skills. Stages three and four lean heavily on disciplined management systems and processes.
- Exploration — a broad, open search for strategic partnerships, unresolved problems, latent or unmet needs, new markets and customer segments that potentially fit the organization’s Focus and Context (vision, values, and purpose) and its core competencies.
- Experimentation — pilots, clumsy tries, and “fast failures” to test the potential opportunity for viability and learn what’s needed to make it successful.
- Development — major resources are committed to developing or refining the new products, services, or businesses that are ready to be capitalized on.
- Integration — the new product, service, or business enters the organization’s mainstream.
These four innovation stages aren’t neat and orderly. They run in parallel, overlap each other, and sometimes clash.
Innovation and Organizational Learning Tips and Techniques
If your organization doesn’t have an inspiring leadership culture balanced with a disciplined management system, innovation, and organizational learning are wishful thinking.
Here are some approaches to consider:
- Ensure the “voice of the market” pervades every corner of your organization. Bring customers into your company offices and plants for visits, joint problem-solving and planning sessions, celebrations, focus groups, conferences, barbecues, presentations, and the like. Regularly get everyone in your organization out to see customers.
- Make senior leaders responsible for some business development and ongoing customer service. Link part of their compensation to new business or development success.
- Don’t allow managers to cost cut their way to profit and performance bonuses. Make sure it’s balanced with innovation and growth.
- A great example of servant-leader innovation is the architect who waited to put the sidewalks into the new residential complex until the buildings’ customers had worn pathways in the grass. Then he laid the sidewalks over those paths.
- Sales and frontline service providers are innovating every day to meet unexpected needs, beat a competitor, or capitalize on a new opportunity. This is a rich source of innovation. It needs a user-friendly, easy process to gather that experience and market intelligence.
- Bring leading-edge external customers and partners into your product and service development processes. They’re likely pushing everything and everybody to the limit and always looking for new and better ways to use your products and services.
- Establish a regular review process for your team/organization to reflect on the reasons for failures and successes. This is a key component of organizational learning. Based on the input of everyone involved, you can document “lessons learned” following a major new product, service, or project.
- Set up an internal “best practices and good tries” system, clearinghouse, or network to spread the learning about what works and doesn’t work across your organization.
- Run regular product and service fairs for teams to show off their results, explain what they’re working on, and swap ideas. A giant two-day fair at a large housewares manufacturer resulted in 2,000 ideas for new products.
- Build strong innovation measurements and feedback loops. If you don’t know how you’re doing, you can’t improve. Lack of feedback is one of the biggest contributors to learning disorders.
- Ensure that your recognition, compensation, and promotion processes encourage cooperation, open learning, and innovation across boundaries and departmental lines. If you’re not sure, ask.
- Hire and promote unconventional thinkers, “boat rockers,” and passionate people who have a history of successfully bucking the system.
As Jim Rohn, entrepreneur, and personal effectiveness author, put it, “Finding is reserved for the searchers. We don’t find what we need; we find what we search for. Needing is not a prerequisite to getting value. You can’t be a needer; you have to be a searcher.”