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(Since Culture Eats Strategy for Breakfast anyway) — Let Them Eat Cake!

Originally written May 2011. Revised January 2018.

I am a passionate evangelist for "management innovation." This term was popularized by American management expert Dr. Gary Hamel in his great Harvard Business Review article, "The Why, What, and How of Management Innovation." It refers to an approach to leadership that allows ingenuity efforts to succeed. Once leaders have re-envisioned their own roles (as the "stand-out" leaders in the IBM CEO study did), the journey of "innovation management" can begin. But without this as the starting place, that of management "innovating itself," efforts to foster inventiveness elsewhere in these organizations will likely fail. This is key ingredient #1.

Key ingredient #2 is that leaders need to be clear that creating an innovative organization is a journey one commits to; this is the heart of "kaizen," or continuous improvement. ("What Does 'Innovation' Mean") Isolated incidents of new initiatives (whether this is a process improvement, or a novel product or service) does not an “innovative organization” make. The genius of certain organizations, those that can rightly be called innovative, is that the conditions and processes to do this repeatedly have been standardized. (Langdon Morris, Permanent Innovation and Agile Innovation).

Numerous guidelines are readily available on how to make organizations more innovative. However, having an overarching mental model for the key components and how they relate to one another can be helpful. –The one I came up with happens to very much resemble the form of a two-layer cake!

 

The Bottom Layer: A Solid Foundation:

There are the basic, fundamental structures and processes that are necessary to the stability of any organization. Think of it as the bottom layer of the cake. Vision and missions should be well understood and aligned; legal and fiduciary structures must be in place; clear accountability and communications systems are needed, and so on.

Once in place, this basic foundation requires regular assessment and maintenance in order to ensure ongoing organizational and fiscal health.

This layer must be solidly in place before adding the next, which contains the structures and practices that foster ingenuity. However, even if one's organization is on shaky ground, just as the successes of kaizen clearly demonstrate, integrating some continuous improvement programs among staff may help guide the organization to more solid ground. Regardless of whether an organization is ready to go fully to the next level, smart leaders engage their employees by soliciting their problem-solving and improvement suggestions.

Top Layer: Innovation Processes: 

It is here that the structures and procedures specific to innovation are added and integrated into the organization, such as:

• The continuous collection of and reward for ideas solicited from employees, customers and stakeholders
• Formal vetting processes to determine which ideas to explore and which to shelve
• Rapid-prototyping to test new ideas to ascertain quickly which ones should be developed
• Pipelines for short, medium, and long-term projects, so that the organization has a mixed "portfolio" of experimental initiatives in order to diversify its investment and risk
• Creating “Intra-preneur” programs that reward employees to spend a modest percentage of their time developing viable ideas that may benefit the organization
• The implementation of systems such as Lean and Agile to improve efficiency, effectiveness, speed, collaboration, and learning cycles
• Skunk works (independent "branches") and “Organizations within Organizations,” when the organizational structure or culture is not yet conducive to integrating innovative processes
• Practices that encourage both formal and informal cross-functional collaboration

"Management innovation" practices (see opening paragraph):

• Systems and metrics that reward managers for experimentation and taking some risk, and not just ROI
• Open communications systems that increase transparency, facilitate cross-functional collaboration, and that can push some decision-making downward
• Implementation of formal roles such as "innovation champions" and MBWA (Management by Walking Around) practices

And now, for the final element…

The Icing: Daily Operations Re-thought!!  

The icing or frosting covers and runs through the center of the two-layer cake, just as culture covers and permeates an entire organization. Yes, some people prefer their cake plain, with no icing. But in this model, frosting is not an option!

 

The icing, or culture, is the “special sauce” or "glue" of an organization that will make, or break, any initiative. In this case, innovation efforts.

 

As the saying goes, "Culture eats [even the best] strategy for breakfast."

What many leaders don't understand is that creative thinking is not just a switch that can be turned on upon request, and then off for the remainder. The creative lens is a more fluid way of looking at the world. It is the one that we were all born with — before we began suppressing it around adolescence because our peers thought it too "weird" to think and speak imaginatively. Conformity became the path to fitting in and finding acceptance. To compound this, convergent, inside-the-lines/box thinking is generally reinforced by our public-school systems, religious institutions, and workplaces.

So, it doesn't work to ask employees to "turn on" their best creative thinking at a brainstorming session, but to then spend most of their working hours staying within the lines of the accepted cultural norms and adhering to "how things are done," lest they be reprimanded in some way. This simply produces " cognitive dissonance" — not a safe environment that is conducive to original thinking.

 

It is no coincidence that the most innovative companies have cultures that are anything but staid. They are designed to encourage playful, divergent thinking. (Southwest, Google, Virgin Air, IDEO, etc.) Creative thinking is a core value and encouraged as a norm. Their approach is both clear to see, and effective.

In organizations committed to increasing innovation, teams should be rewarded for coming up with creative approaches to how everything is done, from:

• Recruiting
• On-boarding
• How meetings are run
• The design and delivery of training
• Communications
• How staff is rewarded for pushing through tough deadlines
• Celebrations
• And so on….

Creative, experimental approaches should be encouraged for all daily, "mundane" operations by those who have the inspiration and imagination to re-envision them. Think of it as creativity applied to designing the organizational culture.

 

(There are some great ideas for this in John Putzier's wonderful book, Get Weird: 101 Innovative Ways to Make Your Company a Great Place to Work.)

In closing…

When it comes down to it, most leaders are not prepared to do what is necessary to create innovative organizations. Their comfort zones are generally the top-down approaches to management which, then reinforced by the culture, allows them to retain full control and, they may think, "risk less." However, this system is antithetical to fostering cultures where divergent thinking can thrive. Such organizations may be "doing fine" at present time, but they will not be innovative or as successful as they might have been, and they certainly will be more vulnerable to waning competitiveness going forward.

However, for those who are committed to doing whatever it takes to lead and thrive into the future, the good news is that some great road maps have been created by those who have been part of the many success stories. Creative thinking is contagious. Once the systems that foster innovation are put in place, and the culture is designed to stimulate creativity, permanent innovation becomes possible — with benefits that keep on giving.

Build it, Bake it – And they will come!

I.  Most organizations fail at becoming innovative or diverse, for similar reasons.

Many leaders say they want their companies or agencies to become “more innovative.”  Most of their initiatives will fail because the leaders themselves won’t be willing to make the changes necessary for creating cultures that are conducive to innovation.  (The term “innovation” means much more than breakthroughs in new products and services.  Most often, it relates to the continuous improvements that streamline processes, lower costs, and improve customer satisfaction.)¹

• If the organization is in the public or nonprofit sector, it may limp along while falling short of fully accomplishing its mission and will continually grapple with morale and productivity issues.

• With for profit companies, failures to maximize both efficiency and adaptability in a rapidly changing world often results in financial losses that end in closures or takeovers.(40% of companies in the S&P 500 will fail in next ten years; projections are even higher for small businesses and startups.) ²

Similarly, many leaders talk about “increasing diversity.”  Some are motivated to jump on “the diversity train” in order to improve public relations or because it seems the thing to do.  They may have heard that companies that reflect society’s changing demographics sometimes grow market share.  (Especially through the use of Employee Resource Groups (ERGs).)³  For whatever the rationale, most organizations fall short of significantly increasing diversity across their workforce and within senior management.

Here again, the failure is due to the general unwillingness of most leaders to do what it is required of them to embed the inclusion piece of “Diversity & Inclusion” (D&I) into their cultures.  Human resource departments can recruit for candidates from varying identity groups all day long, but if the work environment is not one in which all employees feel included, meaning that they know their perspectives and input matter, the best and the brightest won’t stay longer than they have to, regardless of their cultural or gender identity groups.  In many “top-down” organizations, a substantial percentage of employees “check out” and do only enough to get by, while counting the days until they can go elsewhere or retire.

What is the common thread to these two “failures to launch”?  — A lack of respect and trust.  The inability to create either innovative or diverse environments both result from deeply entrenched hierarchical approaches to management.  “Hierarchy” is actually the polite or PC (politically correct) term for “elitism.”  Most management in the U.S. is still based on the 19^th century industrial elitist model, which maintains that the smartest people should be running things from “the top,” and employees’ roles are merely to carry out the instructions of the smart big bosses.  Management typically believes their superior capabilities entitle them to be paid considerably superior salaries.  (Sometimes, the organizational benefits of their tenures are irrelevant; thus, the “golden parachutes” even for those who bring financial ruin to their companies.)

“Respect” is an organizational value commonly cited in annual reports and on company plaques, but top-down management approaches neither reflect trust nor respect for rank and file employees.  Given that the “important thinking” is left to those up the food chain, employee voices are generally absent from the table, other than when absolutely necessary (i.e. unions) or for show.  “The mindset is that managers have all the answers and their jobs are to dictate them — not to learn from workers.  These beliefs run very deep in most organizations.” ⁴  As a result, the trust or respect employees might have for senior management is limited, as is their would-be engagement.

II.  What is Missing?  Both Innovation and Inclusion Require Listening, which is tied to Respect and Trust

Although command and control leaders generally assert that departmental “silos” ⁵ are necessary for efficiency, these structures actually serve to control the flow of communications and ideas in order to maintain the power dynamics.  They inevitably slow everything down due to continual bottlenecks.

Continuous improvement requires the input and creative problem solving from workers throughout the organization.  Innovation is generally the result of a diversity of perspectives from numerous people asking questions and looking at issues with fresh eyes.  “Kaizen” is the Japanese word for “improve.”  Through rigorous application of the Kaizen system, each employee at Toyota is expected to submit no less than nine ideas per year on ways to do everything more efficiently.  And thus, Toyota has become known as the most efficient car manufacturer in the world.  (Yorke & Bodek: All You Gotta Do Is Ask)

There is nothing either mysterious or elusive about employee engagement.  ”Carrots” are not required.  Employees invest a considerable amount of their waking hours and their skills into their jobs.  The future and security of their livelihoods are linked to decisions made by management.  And so, it is only natural that they feel a sense of ownership and organizational pride when they are respected enough to be included in important discussions that tie to the success of their companies or agencies.  As the book title above reflects, if you want to engage employees, “All you gotta do is ask.”

III.  Success in both Diversity and Innovation Management Requires Courageous Captains to Venture Beyond “The Known World”

There are countless documented examples of companies becoming highly profitable industry leaders as the result of leadership initiatives that flatten organizational structures and apply Servant Leadership⁶ or other collaborative management models  (i.e. Southwest Air, Toyota, Harley Davidson, Starbucks, Whole Foods, and Virgin Air).  So why does resistance continue to persist within the wider managerial field?  Senior managers generally pride themselves on their rationality.  But where is the logic in ignoring all of the data gathered by innovative organizations and in resisting recommended best practices and the opportunities they present?

2,500 year-old lessons from The Buddha:  When people are not behaving in constructive or rational ways, there are generally strong underlying emotions at work.  There is a Buddhist teaching that I find valuable for “root cause analysis.”  It asserts that all human behaviors result from one of two sources: they are either motivated by fear, or love.  The object of our love can be humanity, learning, trying new things, adventure, creating, making a difference in the world, and so on.  At various times, we have all been animated and driven by this kind of love, which has been at the center of human advancement for millennia.  Love is an expansive and outward energy.  

However, when we turn away from options that positively affirm and help others or that would allow us to grow in new ways, our decisions are fear-based.  Fear causes us to shrink away from others or opportunities and go into “self” protective mode.  It is a contracting energy.  Things such as self-centeredness, deception, and betrayal are manifestations of fear, but fear is the underlying driving emotion.

The ongoing entrenchment of command and control management that flies in the face of potential benefits for our workforces, organizations, missions, and society, is due to leaders’ fears.  The fear may be of not having full control of outcomes as processes become more collaborative or experimental, or uncertainty of one’s role as leader when information becomes more transparent and solutions emerge from across the organization.  Or there may be trepidation of working with employees or colleagues whose ethnic, religious, or gender identities differ from one’s own and of saying anything that displays a lack of awareness.  It is sad that there is so much truth to the saying, “Better the devil you know, than the devil you don’t.”  Initiatives to create more inclusion are often sabotaged by managers who find themselves outside of their comfort zones, because one foot never leaves the old, known turf.  Without 100% commitment on their parts, there are too many mixed signals.  Incremental approaches to the necessary management and organizational culture changes generally fail.

It is not that the leaders of innovative and inclusive organizations have never experienced any trepidation in democratizing their organizations.  Most humans go through some amount of self-doubt when venturing onto unfamiliar ground and sensing the loss of full control.  As has been said, courage is not the absence of fear, but rather learning to face one’s fears and insecurities, and forging ahead despite them.  These leaders recognize and value the opportunities that increased diversity, inclusion, collaboration, and agility present to their organizations, and then push beyond their own fears, learning to navigate through increased ambiguity,⁷ and embracing the collective magic their teams create.

Leaders Eat Last:  Unfortunately, most MBA programs spend far more time teaching students to correctly interpret balance sheets than to substantively explore the role of character, integrity, and courage in leadership.  Regardless of one’s political persuasions, many of us would agree that integrity is in increasingly short supply among our political and corporate leaders.  Our captains of industry and the public sphere would benefit from the training that our captains of the military receive.  In his book, Leaders Eat Last, leadership consultant Simon Sinek shares some of the valuable lessons he gleaned from interviews with admired leaders from both the military and other fields. 

As Sinek explains, standout leaders create "Circles of Safety” that foster trust and cooperation throughout their organizations.  Good leaders earn respect, not through their rank or prestige, but through the respect they demonstrate towards those within their charge.  These leaders know that respect is not an abstract concept, but is known through its actions.  Taking their responsibilities for their teams seriously, they insure they have the tools they need to do their best work, listen to their input for operational improvements, provide them with opportunities to develop and lead, and are open to learning from them.  The respect exhibited from the leadership for those in the ranks increases success throughout the entire organization.

IV.  In closing: Choosing Respect and Trust, and Following Through

In order to help their organizations to gain the benefits of diversity and innovation, organizational leaders need to start by making a basic choice: hierarchy or inclusion. 

They then must commit and follow through with the path they have chosen.

Many managers are not ready to lose the comfort of top-down approaches to running their organizations and to support broader participation and input from their employees.  And that is certainly their choice to make.  Institutions have succeeded for decades and centuries using top-down approaches.  – However, the cost to maintain a higher level of predictability is that other possibilities and agility are lost.  There may come a time that such organizations will lose capacity and/or be forced to close their doors for failure to adapt.  The managers of these organizations should simply recognize that the benefits of diversity and innovation that they say they want will remain out of reach.

There are other leaders whose desire for the benefits that increased diversity, inclusion, and innovation can bring is greater than their fear of change and uncertainty.  They are willing to make the necessary adaptations within themselves, and then to the structures and cultures of their companies or agencies.  Fortunately, they will have at their disposal numerous roadmaps left behind by those who co-led their organizations to new levels of success based on the basic principles of mutual R-E-S-P-E-C-T.  These principles are the DNA, the thread that binds leaders with employees, teams, and potential with a thriving future.  

Sing it – Aretha! 

As discussed in previous posts, it is commonly held that there is creative genius in each of us.  But, along with our innate curiosity (creativity’s inextricable partner) most of us found our creativity repressed by the tender age of thirteen by the pressure to “fit in,” not be seen as “weird,” [i] not ask too many questions, and as we got older, to go by “The Rules,” and do as we’re told if we want to succeed.   I wholeheartedly agree with Langdon Morris of InnovationLabs who wrote that “It may only take only the right mix of context, curiosity, support, and environment for it come abundantly forth.” [ii]

And so, smart managers understand that good ideas come from everywhere in organizations.  “Hence, the average Toyota worker, including those on the assembly lines, is said to contribute on average more than one hundred ideas each year.”  Despite some of its recent troubles (and current tragedies in its homeland), Toyota is universally recognized as the most efficient auto manufacturer on the planet.[iii]

Gathering and Channeling the Collective Genius:

Referring back to the top layer of the cake as described in “Let Them Eat Cake!” a couple of posts ago, below are some suggestions I have found for creating an entrepreneurial environment throughout the organization, as recommended by the innovation leaders surveyed in the 2010 IBM CEO report. [iv]

 

Create and Communicate a Shared Vision of What Innovation Looks Like in Your Organization:

    Use cross-departmental input to create a shared language and lexicon.  (Jorge Barba) [v]
    Go beyond the mission and vision to make innovation the responsibility of each and every employee (“50 Ways…”) [vi]
    Involve as many people as you can at the beginning to get upfront buy-in.  (“50 Ways…) 

 

Co-create A Vision for Innovation with Everyone in Your Organization:

Help employees to present their ideas and make their cases:

• Establish an Entrepreneurial Environment: Ideas come from everywhere. Give every “intrepreneur’s” idea an objective hearing. Provide management support in building the business case* in presenting the idea. (“10 Crucial Elements…,” Jim Miller) [vii]

* I discussed this point in my 2/12/11 post on "A Shared Failure to Communicate". 

• Ask employees what gets in the way of their ability to offer contribute creative solutions and innovation, and work to remove those blocks.   

Create Efficient Systems for Collecting Ideas:

• Create formal opportunities for offering ideas: Intranet repositories using an idea 
  management software, internal conferences, etc.  (“10 Crucial Elements of Building an Innovative Company,” Jim Miller & “”50 Ideas…, “)

Embrace the Numbers Game:

• “…Harness everyone’s creativity by involving them in the ideation process; generate lots of ideas, for only a few winners will result, and then broadening your view of innovation to not just technological, products, or services, but also innovate the business model.” (Jorge Barba)
• Have a number of ideas in the works. Short and long-term, incremental, and discontinuous.
•  “The main difference between companies who succeed at innovation and those who don’t isn’t their rate of success – it’s the fact that successful companies have a LOT of ideas, pilots, and product innovations in the pipeline.” (“50 Ways…”)

Create Efficient Systems for Low-Cost, Rapid Prototyping:

• “Fail often to succeed sooner.”  Tom Kelley, GM IDEO.
• Prototype using videos and models or other quick and cheap methods early on to visualize which projects to further develop and which to discard. (“Get Creative,” Bloomberg Businessweek [viii] and “50 Ways…”)

Support Cross-departmental Collaboration:

• Reroute reporting lines and create physical spaces for collaboration. …collaboration requires more than lip-service to breaking down silos… team up people from across the org chart. 
• ‘You have to…get down into the plumbing of the organization and align the nervous system of the company.” (J. Andrew, BCG) [ix]
• Provide “Skunkwork” spaces with visual tools like white boards everywhere, even on ceilings and floors. (“50 Ways…”)
  • Encourage informal, cross-functional networking and exchange of ideas through shared space, social activities, etc.  (“10 Crucial Elements…,” Jim Miller)

 

A nd … Let Go!

• “Innovation requires no fixed rules or templates – only guiding principles.  Creating a more innovative culture is an organic and creative act… Don’t make your innovation processes so rigid that they get in the way of informal and spontaneous innovation efforts.”  (“50 Ways…”) 

 

 

I’ve only scratched the surface here regarding employee partnership in innovation.  Please, share your ideas, experiences, and success stories!

 

• Adapting to Change & overcoming Fear
• Ambiguity and embracing the Unknown
• Apple and/or Steve Jobs
• Business Reports: 2010 IBM CEO & 2010 BCG
• Changing Cultures to become Innovative
• Collaboration vs. Silos
• Continuous Improvement or Process Improvement
• Creative Arts & Innovation
• Creative Genius among Staff
• Creative Problem Solving
• Creative Thinking Practices & Exercises
• Creativity/Innovation
• Critical Thinking
• Curiosity & Asking Questions
• Divergent vs. Convergent thinking
• Employee Engagement
• Fun and innovation
• Hierarchy vs. Innovation
• How to Think Like Leonardo da Vinci
• Innovation & the Economy
• Innovation in Government
• Innovation in History
• Integrity; Following own drummer
• Langdon Morris
• Leadership & Management Best Practices
• Learning from Mistakes
• Lifelong Learning and innovation
• Mentoring and innovation
• Model Innovative Organizations
• Podcasts on innovation
• Processes and Structures for Innovation
• Redefining Innovation
• Scenario Planning
• Six Sigma and LEAN vs. innovation
• Social Change and Innovation
• Spirituality in Workplace and innovation
• Trust and Respect in Engagement and Innovation
• Types of Innovation
• Weirdness and Creativity
• What-iffing
• Whole Brain Thinking
• YouTube Videos

Select Here to See More (Since Culture Eats Strategy for Breakfast anyway) — Let Them Eat Cake! What do Innovative Work Cultures and Inclusive Work Cultures Have in Common? –R-E-S-P-E-C-T The Contenders for “Innovator-in-Chief”: Obama v Romney The Obama Administration & Innovation Innovation is a Banquet! –So Why Are So Many Leaders Starving to Death?! Breaking Creative & Innovative Thinking Out of Their Boxes Through Creative Problem-Solving Giving Thanks to the Original Innovators of The Americas Steve Jobs: Thank you, Dreamer Extraordinaire Kowabunga! Moving Notice & Repost: Got Ideas? Collaborators & YOUR creative brilliance sought for Kowabunga! A Creative Look at Employee Engagement by Explania Get Smart — Like Einstein! “Namaste” – Truly seeing and honoring our colleagues What Does “Innovation” Mean? Many Things. What Role Does Leadership Play in Innovation? — Every Great Show Needs Great Directors & Producers! More YouTube Brilliance & Inspiration! Leader as Conductor: Orchestrating the Creative Genius Throughout the Organization Yankee Democracy at Work… The “Ingenuity” Lies Within the Ranks Why Do Creative Thinking and Innovation Matter? — Seen Any Good Disaster Movies Lately? Fear of the Unknown? Looking More Closely at How and Why We Believe as We Do Trial & Error or Tried & “True”? …Or, a Matter of Balance? Our Wonderful Imaginations… So Close At Hand A Key to Creativity? “Entertain Thyself!” Part 2 of Podcast Interview with Jennifer Blaine Actress Jennifer Blaine & “Dr. Amir” Share Tips for Stimulating Creative Thinking, Podcast Part I CORRECTION: Curiosity Did NOT Kill the Cat! Fear Not Ideas Some Great Short YouTube Videos on Creativity & Innovation! Leonardo da Vinci’s CV: How to Think Like Leonardo da Vinci: Seven Steps to Genius Every Day Dance, Sing, and Shout for Joy Like an Egyptian! Creativity and a Shared Failure to Communicate Asking the Right Questions Critical Thinking “versus” Creative Thinking?! “Surf’s Up!” for Organizational Creativity — It’s Sink or Swim! “In a Nutshell” Notes on IBM’s 2010 Global CEO Survey: