Three signs that your organisation is killing innovation

Innovation is a word at the tip of almost every CEO’s lips. However, despite the best of intentions, many organisations are killing innovation. There are several issues that these organisations have in common.

 

Leaders don’t walk the talk

While the majority of CEOs and their leadership teams talk about innovation, many unfortunately don’t do anything about it. Resources such as people, time and money continue to be allocated to “business as usual” projects, rather than put towards riskier but potentially highly rewarding innovation projects.

Senior leaders working in organisations that say they value innovation need to look objectively at how they are resourcing it and review whether what they say reflects what they are actually doing.

At this year’s top ranking organisations in the AFR’s Most Innovative Companies list, senior leaders really walked the talk of innovation. Many senior leaders took an active role in supporting their employees’ innovation activities. This support took a number of forms from open door policies through to mentoring innovation projects.

At Mirvac (who debuted at #3 in the 2015 Most Innovative Companies list), all members of the executive leadership team have the KPI of enabling their team to contribute to innovation at Mirvac. The KPI is measured by people providing examples of supporting or enabling their team to achieve innovation objectives.

 

Innovation starts with idea generation

People mistakenly think that innovation starts with an idea. As such, organisations trying to innovate will often start by running lots of blue sky workshops (where any idea is a so-called “good idea”) and where an online suggestion box is launched calling for all staff to submit ideas. However, this is a very damaging approach to innovation as it leads to a lot of ideas that are completely off strategy.

Instead, leaders need to focus their staff’s innovation efforts around solving challenges that actually matter and that are based on what the customer values.

At Australian Unity, senior leaders set “innovation missions” once a year, which are areas where the business deliberately wants to focus its innovation efforts. After identifying these missions, exploratory customer research is conducted into where specifically the greatest opportunity for innovation lies. And only after these stages do employees commence idea generation.

 

Ideas are taken straight to implementation

When a good idea is born, many organisations move straight to implementation – or at best, a large scale pilot. However, this can prove to be a very costly mistake. Organisations need to ensure that rather than moving straight to implementation, a stage called Experimentation needs to come first.

Experimentation involves setting hypotheses as to why an idea will add value to the customer and creating a minimum viable product (MVP) – the most basic version of the idea that will still allow for learnings. Experiments can then be set up to test hypotheses using the MVP and based on the results, iterate or change course accordingly. Experimentation is a very effective way to de-risk innovation. Companies from Google, through to Lendlease, through to Commonwealth Bank all embrace experimentation as a key stage in their innovation process.

Through identifying and rectifying these three innovation killers, leaders can make significant inroads into turning their organisation into one where innovation thrives.

Dr Amantha Imber is the Founder of Inventium (dev.inventium.com.au), Australia’s leading innovation consultancy. Her latest book, The Innovation Formula, tackles the topic of how organisations can create a culture where innovation thrives.

 

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