Innovation – Essential in today’s economy.

Tuesday, October 18th, 2011

If you’ve been in business for a while, you will (hopefully), from time to time, have sat back and thought about your business; about what you make or sell and how you do it; about your customers and how to grow that base; about how best to utilise your employee skills.  Some of you may even have gone to the extent of having a formal strategy session once a year – perhaps facilitated by an independent consultant.  They’re always helpful.

In most cases, however, annual strategy sessions don’t amount to much. (Other than a time to get your people together for a bit of team building.)  With the best intentions, and unless they’re well-managed, they can turn into an opportunity for the detractors and whiners in your organisation to air their views on why your business doesn’t work! (And have a go at you at the same time!)  It can also end up as a foundation for issuing new top-down instructions on how to do business the boss’s way!

Tony Manning, a local strategist and management consultant says this:

“Ask people what they understand about strategy.  Here are some common answers:

  • ‘It’s a plan for taking your company into the future.”
  • ‘Vision, mission, values, and action plans.’
  • ‘A long-term view of where we’re headed.’
  • ‘A SWOT analysis.” (An exercise that forms part of just about every planning workshop and fills lots of flipchart pages, yet seldom leads to radical thinking.  More often, the same issues get recycled year after year and never go away.)
  • ‘The analysis you do to make sure you hit the numbers.’

“Management tools such as this can come and go with mostly disappointing results……

I’ve attended and facilitated more than my fair share of these sessions, and I have to agree with him.  They do stimulate quite a lot of thinking, and some of it can turn out to be very good, but – and this is a big but, unless we can turn that good thinking into solid action, it’s just more words on the wind.

I’ve just moved from a fairly large city to a small rural town.  It’s not retirement – just relocation.  Work goes on – but it now has to go on very differently; and this requires a different strategy.  And let me tell you, this is not so easy!  When you’ve been doing something a certain way for a long time, it’s quite difficult to get your head around the fact that you have to change your methods to get the same (or better) results.   Just living in a new house has its challenges.  Crockery and cutlery doesn’t spring quite so easily to hand; it takes a little extra thought to remember where the socks and the groceries are now kept, and if you’re like me without a landline, faxing a document means scanning and using the internet.  I’ve had to change my daily routines to fit in with the (much) slower pace here in Montagu – like I’ve been told by this wine/brandy community – the best things in life take time!

I’ve had to innovate.

The big mistake we make about change is that we think we can package it, and then dish it out to everyone in our organisations as standard operating procedures.  Now, I’m not knocking the need for SOP’s – order is good, but not to the extent that everyone is strait-jacketed into systems and policies that strangle the life out of any form of innovation that may exist.

In our modern fast-paced economy, we cannot afford any strait-jacketing – either of ourselves or our employees.  In fact, we need to be encouraging innovation, innovation, innovation!  There’s always a better way to do something, and dare I say it, even if that better way is not to do it anymore, at all!

Marcus Buckingham, in his new book “Stand Out” says this:

Every organization is on a near-constant search for “best practice.” They convene conferences of top performers, pick their brains for the precious few actions, and then capture what they hear in online “knowledge centres,” in videos, or in the course books of their corporate university. Though it is not always stated explicitly, the vision driving all of this activity is that innovation can be harvested and that, once harvested, it can be deployed at scale. Find a few key innovations, so the thinking goes, and we’ll spread them to the many.   It is very rare to discover a best practice that is transferable person to person at such scale, with no lessening of its effectiveness.

True innovation has to be seen to be almost unique – no two people will do things exactly the same way.  This means that we have to encourage our employees to think out-of-the-box.  Some of the questions they need to start asking are: “Is there a better way to do this task?” “Should we be doing this at all?” This can be risky because we don’t necessarily want a free-for-all, but we do want them to be excited about what they do, and energized to come up with new innovative ways of doing things.  But, just because one person comes up with a great idea, doesn’t mean that everyone will necessarily take to it, or do it the same way.

Business right now is tougher than it has been for some time.  Margins are down, competition, and business risk, is increasing.  Businesses everywhere, and in every industry are looking for ‘an edge’ – some little thing which will allow their product or service to come out on top – and as a result, innovation has become the all-consuming goal.  Buckingham goes on with:

We all revere innovation. It is the mystical driver of progress, the secret sauce, the touchstone we reach for whenever our backs are against the wall. Our managers, our leaders, even our president cajole us to outthink, outsmart, “out-innovate” the competition. In these accelerated times, only innovation will keep us relevant, only innovation will allow us to keep thriving, only innovation can get us ahead and keep us there.

And when we say this, what do we mean by innovation? Usually we mean invention and we point back to that Golden Age of invention, the Apollo years, when anything was possible, when failure was not an option, when necessity created Teflon and freeze-dried food, the Stairmaster and digital photography, the technology inside every kidney-dialysis machine and the materials for your running shoes, solar panels and better golf balls, and, of course, ARPANet, the forerunner to the Internet.

Heady times.   No wonder our leaders hark back to them. For most of us, though, innovation is a little less dramatic. We aren’t looking to invent the Internet. We just want a better technique, a better way of doing things. We are tantalized by the notion that someone in our field has devised a method or figured out a shortcut, the “control-C” or “control-P,” of our job, something that if we could just find and replicate, we would be able to take a giant leap forward in our performance and in our career.

Instead of waiting for someone else to come up with these magical, mystical solutions, how about starting some thinking of your own?  Break it down into the things you do every day.  Do you need to do them all?  Every day? Can you do them better and simpler?  And don’t be too proud to ask your employees for their ideas – you will be pleasantly surprised.

Innovation has really just four components:

  • Anticipation. Being alert to change.
  • Insight. Seeing opportunities to offer something different and new.
  • Imagination. Dreaming up new ways of doing it.
  • Execution.  Doing it consistently and to the highest standards

Here’s an example:

You’re a small contractor.  Your revenue is project-related.  Each job has to be separately priced and evaluated.  You do all this estimating at night because your day is too full of other things.  Because of your experience, you are able to estimate the materials and labour required to do the job fairly easily – based on the way that it’s always been done before.  But who says it has to be done that way?  When last did you go out and physically do the job yourself – bearing all those innovation components in mind?  Who knows but that you could discover a novel way to get the job done, with less material, minimal labour, and have a very satisfied customer at the same time? And with the right technology and software, you could easily come up with a price for each new job at the touch of a button – and not at night either!