A widely used term, it means different things to different people. For me, I look at innovation in broadly 3 categories:
- There’s your ‘everyday, sustaining innovation’. This is the continuous cycle of iterative improvements that you need to engage in. It sustains your place in the marketplace vis-à-vis your customers and your competitor peers.
- There’s more ‘transformational innovation’ which helps your organisation to transition between its historic and current customer base and into the needs of your next-gen customers. This is more significant than the first category and frequently involves changes to your operating model, to systems and processes and your partnership ecosystem (often involving a move towards a collaborative network).
- And thirdly there’s ’10x innovation’. This is full-on game-changing stuff that disrupts industries (as opposed to sustaining them), fundamentally changing our view of how business models operate; this could be referred to as ‘the Uber moment’ for your industry.
As a corporate, you definitely need to have the first embedded into your operating model, be significantly investing in the second and – if you’re not in the business of being the next Uber or AirBnB – at minimum running some experiments and keeping a very close eye-out for how the third category could be about to impact you.
The trend for corporate innovation theatre
I’m sure I wasn’t the only person to raise a wry smile on seeing CB Insight’s recent infographic on Corporate Innovation Theatre: the “8 song and dance routines that corporations use when trying to look innovative”.
Few big corporates publicly deny the need to be innovative and really, it’s pretty easy to “talk an innovation game”– hire a Chief Innovation Officer, re-brand existing in-house teams, scatter some bean bags and ping-pong tables around newly created break-out areas, let people wear jeans and the obligatory sci-fi T-shirts or black turtlenecks…
But talking a good innovation game does not make you innovative by default and frequently results in being an expensive exercise in “so what” that doesn’t result in any meaningful value creation for the business.
Avoiding the trap
I’m all for ripping out the cubicles – the sooner the better! And I’m not averse to a bean bag or two around a ping pong table (yes, we have them in our offices☺). BUT, there’s really only one way for a corporate to become innovative and that’s through cultural change that’s driven from the top down. And I don’t mean via the newly appointed Chief Innovation Officer or Chief Disruption Officer (or other sci-fi T-shirt wearing team members), but from the CEO.
Here are the top five qualities and behaviours I see most consistently demonstrated in successful corporate leaders when it comes to true innovation:
- Corporate culture doesn’t trust in strategies by themselves – it trusts in the leaders who bring it strategies. These leaders need to be up-close-and-personal with their customers and their front-line staff every week… There is no place for ivory towers.
- The most compelling leaders are those who are deeply and emotionally committed to the purpose of their corporation. The primary purpose is not about maximising sales or profits, but about the problem the company is solving for and its role in society today. If the leader is emotionally engaged around the corporate purpose and if they can instil this same level of engagement and commitment in their corporate culture, they have created a killer workforce to drive the corporate strategy forwards.
- Innovative leaders live in a constant state of excitement and anxiety. Excitement about the increasing pace of disruption and what it could mean for society (“How can we be the game changers of our industry?”) Increasing anxiety over the question of “How can we win?” These leaders look outside of their industries and into the startup ecosystem for tangential inspiration – you cannot afford to take a siloed stance or ignore the new kids on the block. We live in an era of David and Goliath stories and no corporates are immune to this.
- The vast majority of startups end in failure… what do founders do? They reflect, learn and move forwards with the next idea. Innovative corporate leaders remodel their remuneration structure and reward experimentation, creativity and vision over traditional business results.
- Innovative leaders show greater levels of comfort and openness towards collaboration and partnering than traditional corporate leaders. There is simply too much talent, speed and diversity in today’s market to stay on top of everything. Mature innovation leaders are open to buy, build or partner and recognise the value of putting skin in the game.
If you don’t already have it, creating an innovation culture is not easy. In fact, I think it’s often pretty painful for established leadership teams. As a relatively “British Brit” living in Silicon Valley, I’ve had friends rib me for my use of SV jargon. And I’ve certainly had to go through my own rite of passage around truly understanding corporate culture and being able to clearly see the difference between “talking” it and “doing” it.
I think there’s a certain element of “fake it ’til you make it” here. Innovation Theatre is, after all, about creating a façade of doing something and it can have a valid place in your journey towards being a truly innovative corporation: it shows strategic intent and there’s nothing quite like stating your ambitions publicly to make you follow through on them.
“Amazing innovation is happening all around us every day & you never know where inspiration may strike.”
But what is critical is that you don’t get stuck in this phase of theatre and that you move into meaningful culture change that will ultimately grow your business and earn your right to stay in the marketplace of the future.
So consider what you can start doing now as a leader that moves you towards this point. Go and speak with your customers and front line staff (today!), roll up your sleeves with some undercover guerilla customer testing of your company and your competitors and above all, try to approach the experience with a beginner’s mind.
Be humble, be inquisitive, be bold.
Amazing innovation is happening all around us every day and you never know where inspiration may strike.