Leading for Innovation

By Tom Stevens 

Does the future success of your organization require ongoing innovation? Let me ask another way, if you keep doing things exactly as you do them today will you be just as successful in five years? If your organization is dependent on knowledge work and professional competencies it’s highly unlikely the winning formula will remain unchanged. Innovation is essential!

The challenge is that leading a team or organization for continuous high-performance innovation requires different structures, processes, and culture than managing for continuous high-performance operations. The latter conventionally focuses on rewarding high performing individuals who get results most efficiently using tightly controlled structures. In contrast, organizational characteristics that encourage ongoing innovation include:

~ Rewards emphasizing group performance over that of individuals

~ Minimal formal structures and hierarchal roles

~ A climate that is personal and non-critical

The implications are that leaders must do the following to create opportunities for innovation in their organizations.

~ Establishing rewards for innovation

~ Aligning innovation structures with operational ones

~ Encouraging a climate conducive for innovation

Establishing Rewards for Innovation
Reward process as much as results. Innovation requires experimentation, false starts, stretching for possibilities…and therefore typically includes failed attempts. Effort must be rewarded. If you only reward results, you’ll only get what people can safely accomplish without stretching.

Reward group performance over that of individuals. Likewise, innovation requires increasing the information pool, a cooperative process. Group rewards encourage collaboration, whereas individual rewards can create incentives for competition that squelches contributing to the group effort.

Aligning Innovation Structures with Operational Ones
Innovation thrives where there are minimal formal structures and hierarchal roles, because this most encourages everyone to contribute to the information pool from which creative ideas can originate. This may not be an issue in organizations that have a naturally open structure, say, a new high-tech start-up. Organizations that have established hierarchal structures can apply one or more structural strategies to promote innovation – each has pros and cons that should be carefully considered:

~ Creation of functional units dedicated to innovation, the ol’ R & D department

~ Cross-matrix structures, bringing people together across regular functional boundaries to address common issues

~ Support for communities of practice, which are semi-formal organizations within or across companies where people with similar professional interests share information regarding professional issues

~ Retreats or meetings that get people out of routines and functional structures, with established objectives, third party facilitation, and ground rules that encourage wide participation

Effective leaders create alignment of functional and operational structures with more innovation and open structures by communicating a shared purpose. They also support careful hiring and development of people who can manage multiple roles and work well with others in complex environments, in addition to technical expertise. Think about organizations such as SouthWest Airlines, that manage to integrate these high-innovation and people-oriented characteristics with high-performance operational functions, despite their competing natures.

Encouraging a Climate for Innovation
Stimulating innovative ideas means getting people’s brains to work at their best, and brains work best when people are emotionally open and invested. Leading for innovation requires establishing a climate that is supportive, non-critical, and personal. Two ways that effective leaders can encourage this climate are to model it, and to support development of leadership in the truest sense of the word.

Leaders modeling the climate they wish for their organization serves as a powerful example indeed. This includes not just saying the right words, but backing it up with a congruent emotional tone.

Finally, organizations do well to develop leadership in its truest sense. By truest sense, I mean leadership not based on position but on influence that gains willing followers for a course of action when the way forward is unclear. When an organization develops, supports, and nurtures a wide base of leadership – people who know how to gain willing followers regardless of their position – then there is a solid basis for collaborating creatively for innovation. Give a wide group of real leaders a shared purpose and you’ve given an organization its best shot at enduring success.

by Tom Stevens (c)2004
Tom Stevens helps individuals and organizations create brilliant futures and make a difference. To contact him, visit www.ThinkLeadershipIdeas.com