Factors that drive innovation in organisations
In a 2015 survey of the Center for Creative Leadership, 94 percent thought innovation was important and only 14 percent thought their organisations were effective at innovating
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We live in unprecedented times of technology advancements happening at blistering pace, creating endless possibilities for individuals and organisations. The global political and economic environment is also shifting constantly, often moving in unpredictable directions. It seems clear that innovation will be a defining trait of those organisations that thrive over the next few decades. In a 2015 survey of the Center for Creative Leadership, 94 percent thought innovation was important and only 14 percent thought their organisations were effective at innovating.
The research interviewed teams on the front lines of innovation work from various industries to better understand the leadership behaviours that encourage innovation. They identified the critical leadership behaviour exhibited during successful innovation efforts, as well as those that worked against innovation. What does it take to lead innovation? Their findings led to the following 5 characteristics:
1. Leaders that support innovation
2. A culture that supports innovation
3. A formal innovation strategy
4. Budget allocated for innovation
5. A clear direction for their innovation efforts
Innovation is an unpredictable and uncharted territory. Traditional leadership behaviour was developed largely to produce excellence in the relatively predictable context of execution and driving for results. There are several reference points established by now for successful operational leadership like its own history, case studies, competitor's history, and existing data to understand current and past scenarios. Leading innovation, however, is radically different. It is often a new way of looking at the same things.
Ironically, it is not very obvious that leading an innovation team is indeed different from leading an existing successful operation. This is a trap that many innovation efforts and their leaders fall into. If you try adopting the same approach to innovation as is used to lead an ongoing operation, it is likely to fail.
It often requires creating something radically new, instead of just making incremental changes. It demands a different approach to leadership. Defining these differences and helping leaders adopt behaviours, values, attitudes, and techniques that support innovation are essential for any organisation pursuing innovation.
When leading business as usual there are clear goals and a definable path to reach those goals. Of course that clarity does not always ensure success; it does make success more likely. It is also easier to know, as you move down that path, whether you are on track or not. Innovation, however, happens in a unique manner. Many organisations do not appreciate how different innovation is and what the implications are for leadership behaviours.
Let us look at how leadership behaviours differ by function in Traditional Leadership versus Innovation Leadership.
Revenue is already flowing, giving leaders financial information that helps them make decisions. Compared to this, the return on investment from innovation efforts is difficult to forecast accurately.
A path to success is already in place or can be mapped based on past experience and formal expertise. Comparatively, during innovating, the path is still being formulated without knowing exactly where it will lead to or how long it will take to get there.
Leaders usually have experience and knowledge related to the problems and issues that may arise. During new innovation, novel challenges arise that no one may have dealt with before.
Innovation is about the new, the unknown and unchartered value, products or services. Working to lead this unique proposition highlights the emotional stakes and amplifies the daily fluctuations that innovation teams experience. Here is how is makes it interesting.
All leadership jobs are challenging in the modern corporate environment, but innovation leaders and their teams face greater emotional stress because there is no clear map of success for them. Persistence and success requires more risk taking and greater emotional tenacity. Leaders, then, must find ways to guide and support innovation managers through this fraught organisational environment.