Building an innovation culture requires small ‘climate’ changes, leader support: Expert
Over the last number of years, innovation has taken hold as a critical business concept across the globe, according to Atul Dighe, research leader at the Gartner-owned Corporate Executive Board (CEB) in San Francisco, Calif.
“The world has changed,” he said. “In a short period of time, we’ve dramatically changed the way in which we interact with each other, the way business is conducted, the way we travel and shop and engage with society in the marketplace.”
“Those fundamental changes are creating real challenges for us in the business world. They’re profoundly impacting the way in which we all work together and the way our companies interface with the marketplace.”
Technological advancements have shifted customer expectations in terms of on-demand and digital interactions, resulting in business model transformation, said Dighe, speaking at a recent SCNetwork event in Toronto.
“These changing expectations have profoundly reshaped the way in which we think things should work,” he said. “They should be here on-demand, customizable, deliverable.”
All of these things create the conditions under which innovation is in demand, said Dighe.
“Innovation is the word that people use to say, ‘That’s what I want. That’s what I need. That’s what I must have.’ And yet it is fundamentally the most difficult concept to imagine... Innovation is a monster noun. It means different things to different people.”
While sometimes confusing, innovation still matters greatly and is often demanded by investor, employee and marketplace communities, he said.
Innovation is as much about solving problems as selling new products, and is driven by resources, people, processes, ideas and culture.
But the majority of employers attempting to implement innovation strategies struggle to do so, said Dighe.
Many attempt to have all employees share in the innovation vision — a method often resulting in little to no innovation being conducted.
Other companies are too timid to risk assets on unfamiliar concepts, with short-term pressure overcoming long-term investment, he said.
Refocusing company culture towards innovation is a tall order, requiring smaller, more focused “climate” changes in order to be conducted, according to Dighe.
“Culture is the deeply held beliefs and assumptions a company has that are part of the DNA of the organization. Culture isn’t something that you can immediately change overnight. It evolves slowly over time.”
Climate, meanwhile, is a shared perception of the way in which we work, according to Dighe.
“It’s how we do business. It’s the way our teams operate, the way our company interacts with each other when we’re at work,” he said.
“Climate is something we can change. And when we change climate, over time, we can change culture.”
“Stop trying to change the culture and start changing your climate.”
An innovation climate consists of components such as high-quality ideas, the delivery of innovative products, retention of innovative workers, continuous innovation, and delivery in the marketplace, said Dighe.
Employers that deliver on those components are rewarded by increased worker engagement and retention levels and, as a result, creating an innovative climate is “absolutely a worthy pursuit,” he said.
CEB recently surveyed 100 global companies and 500 research and development leaders in an attempt to better understand the impact of innovation culture.
Eighty factors were tested, grouped under terms such as senior leader behaviour, management, collaboration support and failure tolerance.
The research revealed that senior leadership, rewards and the ideation process had the greatest impact on strengthening innovation climate, with senior
leadership ranked highest, said Dighe.
Senior leadership matters
The actions of senior leaders are particularly important when fostering innovation, he said. The ambiguity around innovation as an objective makes a senior
leader’s commitment to the outcome critical.
Authenticity means the world to a workforce, said Dighe.
“People are looking at the senior leaders of the organization to say, ‘Is this thing about innovation really true, or are they just saying it because you’re supposed to say it in today’s economy? Are they spending their time and effort on a continual basis on it, or is it just a buzzword for the day?’”
And employees aren’t only looking at the C-suite, he said. They are also evaluating the actions of their company’s research and development leadership group and senior-level innovation team, seeking active participation in the innovation process, over and above regular attendance in meetings.
Leaders should refrain from limiting the ideation process by using appropriate tones and leadership posture, said Dighe. Whether they realize it or not, senior leaders shape a corporate innovation climate through their actions and words.
Inadvertent signals from the C-suite send strong signals that can foster or kill innovation, he said.
“They say it every day through their words and actions. It’s the difference there that makes all the difference. It’s that subtlety in the messaging we give.”
Ideally, employees want to work for senior leaders who prioritize innovation projects, are open to suggestions for new ways of working, consistently pursue ideas that disrupt the status quo, emphasize the values of learning, and consistently communicate importance of innovation, said Dighe.
Some employers learned this years ago, to their benefit.
India’s Tata, for example, has implemented Innovista — a tactical, companywide exercise performed annually to celebrate and reward innovators and those who “dared to try,” he said.
Founded 15 years ago, the academy award-style event works because it is peer-nominated, externally validated and includes C-level participation. Over time, this climate change helped shift the company’s culture further along the innovation spectrum.
“When we shape the climate over time, we can see the outputs that we’re all after around innovation,” said Dighe.
“Over time, we can shape the culture about how our people want to stay longer and work harder and be more committed to organizations, and ideally will produce the outcomes that we all feel are necessary to solve the biggest challenges.”