There are two abstract concepts that innovators in large companies tend to invoke when describing their challenges. The first concept is mindset. Innovators state that what would help them succeed is a mindset change among their colleagues. The second concept is culture. Innovators also state that what would help them succeed is a better culture within their company.
The problem with invoking such abstract concepts is that they are not really helpful for driving specific actions. Let’s take culture as an example. Corporate leaders often describe their culture using abstract platitudes such as integrity, respect and trust. In a recent Harvard Business Review article, Erin Meyer argues that it is difficult to shape employee behavior when culture is described using such abstract positives.
What really shapes a company culture are the decisions people make when they are faced with dilemmas. According to Meyer, if leaders want their desired culture to come alive they have to debate and articulate it using dilemmas. She argues that companies should identify the dilemmas their employees routinely face and then make clearhow these should be resolved.
The Innovator’s Dilemmas
How does this idea apply to innovation culture? It is definitely the case that innovators routinely face a number of dilemmas as they try to navigate their ideas through corporate structures and processes. If leaders desire a culture that drives innovation, they have to address these dilemmas in a clear way. Below are three examples of dilemmas that innovators typically face and some options of how they might resolve them.
Dilemma 1: As a leadership team, we are trying to make decisions about where to focus our budgets, resources and time. Our challenge is how to balance our investments and the time horizon for returns. We can invest in our core business and make money now. The other choice is to bet on future facing ideas with uncertain returns that can only be realized after a few years.
The easy choice here is investing in the core business. When we have a chance to grow our existing business with more or less guaranteed returns, this seems like a decision that makes itself. However, if we resolve this dilemma by consistently choosing the core business, we risk becoming irrelevant as a company.
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The better choice is to have a balanced portfolio of investments where a large portion of our resources still goes to the core business, but we allocate some resources to exploring the future. A good cultural practice is to make explicit what this balance is going to be in percentage terms and use that to drive the right employee behavior.
Dilemma 2: We are an innovation team that would like to test a new business idea with our existing customers. However, getting access to customers in our business requires that we jump through some difficult hoops. First, we have to get our test materials describing the new idea approved by Legal and Compliance. After this, we then need to get the approval from the Sales Director to contact customers.
The easy choice is to figure out a way to access customers without going through all the trouble of working with key functions. In one company, a team simply set up a landing page inviting customers to share their views via a survey link. Instead of clicking the link, some customers got in touch with their contacts in sales to ask about the exciting new product. The sales teams were unaware of the landing page and were very unhappy with the innovation team that set it up.
The better choice is to build a bridge between innovation teams and key functions. Rather than avoiding each other, we can set up agreements on how to work together in advance. There is no need to wait until the exact moment we need approval to engage customers. A good cultural practice is to set up explicit processes with our key functions on how they can support innovation teams.
Dilemma 3: We are an innovation that has been working on a business idea for three years. Our idea has been touted as a lighthouse project by the CEO and has received a lot of resources and funding. However, everyone in our team knows that there are no customers that are interested in this business idea. In other words, our idea is failing. We are now contemplating what we should communicate to our leaders.
The easy choice is to keep working on the idea, launch the product and hope for the best. Admitting failure could be career suicide in our company. This is particularly the case for public failures on lighthouse projects. The moral dilemma is that we will keep using company resources to launch a product or service that nobody wants.
The better choice is to show leaders the evidence from customers in a very clear and honest way. This allows leaders to make informed decisions about what to do next. A good cultural practice is to avoid calling any innovation project a lighthouse project. Furthermore, leaders have to make explicit that it is okay to fail. Publicly rewarding and celebrating these failures as learnings will encourage more employees to do the right thing with their own innovation projects.
Conclusion
When employees are faced with difficult situations, they need cultural reference points to guide their behavior. Invoking abstract platitudes such as integrity, respect and trust will not really help employees make decisions. What would be helpful is making explicit the dilemmas that employees face and then building explicit processes that guide employees to make the right decisions that are aligned with our desired culture.