How to Create a Culture of Innovation

The following is an excerpt of a blog post reprinted with permission from AchieveIt.

Over the last few weeks, we have been discussing a typical company's progression from a culture of collaboration to an accountable culture to a culture of execution. Once an organization reaches this latter stage, it naturally progresses to a culture of innovation.

Why?

If you have a true culture of execution, strategy is driven down to the front lines, and every employee in your organization is engaged in some small way in executing your strategic plan. Even though front-line staff have no direct responsibility for strategy execution, if they understand the strategy and are able to internalize the execution of the strategy through their job roles and functions, then execution is accelerated and heightened. In fact, execution occurs automatically and is somewhat invisible.

When employees operate at this level, they are better able to identify not only weaknesses that impede the success of the plan, but also opportunities that can far surpass the plan itself. If customer service is your company's core value proposition and the strategy around customer service is understood and executed by all, it will give rise to innovative ideas on how to improve customer service. Front-line staff always see the world differently than management, which is expected, as they are, after all, on the front lines. They are positioned to see the immediate effects of customer service strategy implementation and develop new ways to improve customer service even more. Because of their unique first-hand perspectives, their ability to develop new strategies to take customer service to ever-greater heights far outstrips that of management.

The secret, though, is unlocking their innovative potential. Unless you are able to tap into their first-hand experience, innovation will be lost. So how do you do this? At AchieveIt, we put having a culture of innovation to the forefront through a number of initiatives. For instance, we host a monthly book club for all Team Members that is designed to foster creative thinking. We read a book every month and then discuss it in a structured forum, always asking how we can apply the concepts in the book to our own company. We designate every Friday as Execution Friday, where we kick off the day with an Ideation Session. The cost of admission to this two-hour event is to bring one innovative idea that can help our company execute smarter, faster and better. We make quick decisions about what ideas we will put into action and begin working on implementing those ideas that same day. In this way, we can see innovation in action.

That's not all. We regularly source inspiring videos (see TED.com for a library of videos that will WOW! you that we share we our staff and discuss their implications. We also award a weekly cannonball to the Team Member who excelled at innovation and execution over the previous week. This Team Member has to then photograph the cannonball in some innovative way and share it with the team at the next Ideation Session. This in itself has become an act of creativity, as every Team Member tries to outdo previous cannonball winners.

These are just some ideas to get you started toward creating a culture of innovation. Alex Lattin, a principal at the strategy firm Strategos, offers five more:

1. Give people the tools and skills they need to participate. Becoming more innovative doesn't mean finding the "natural innovators" inside the company and pinning your hopes on them. Innovation can be taught. Leaders must act intentionally and proactively to build new skills throughout their teams of employees.

Your employees need to develop new perspectives about your customers, market and company. This requires skills to identify and challenge industry orthodoxies, extract unmet and unarticulated customer needs, envision industry and market changes and understand the company's core competences. Employees must also learn how to do structured idea generation, turn ideas into business concepts and define low-cost learning experiments.

2. Focus innovation on issues of importance. Front-line employees are not likely to be motivated by financial targets (such as grow revenue by 20 percent). But they will be motivated by ambitious strategic goals that inspire the employee as a person, as well as a contributor to the company.

3. Connect the pools of innovation. Innovating isn't a solitary activity — it's a collaborative activity and should be managed as such. Take a hint from the successful open-source movement. Connected innovation is successful in part because of the emotional rewards and reputational equity that it provides. Who doesn't want to be seen by their peers as the leader of a successful innovation? In addition to the emotional rewards, ideas just get better as more people hear about them and build on them.

4. Keep the enthusiasm flowing. Nothing is more de-motivating to would-be innovators than a mysterious "black box" process.  Keep the process simple, clear and transparent. Let innovators know who has the decision rights for moving ideas forward and clearly provide the decision criteria that are being used. Strive to keep politics out of the process. Once the flow of ideas begins to wane, start a new campaign. And don't discount the benefits of public recognition for innovators.

5. Use all levers at your disposal. Front-line innovation is a systemic challenge that requires a systemic solution. If you want your employees to act more innovatively, you'll also have to work hard at creating the right combination of leadership, culture, organization structure, incentive system and key process changes that embolden experimentation and motivate people to achieve new results.

Companies that are truly serious about creating a culture of innovation know that fresh insights and ideas arise throughout their workforce when they are willing to create the structure and rewards to allow those ideas to succeed.

More Articles on AchieveIt:

Creating a Culture of Innovation
5 Tips for Creating a Culture of Execution

Developing a Culture of Execution

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