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Innovate Your Organization
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The 24/7 Innovation
THOUGHT LEADERSHIP SERIES
Innovate Your Organization
By: Stephen M. Shapiro
undergoes. (The other two waves are structural driven
Two men are hiking through the mountains of Canada
capacity, in which mechanisms are put in place to enable
when they stumble upon a hungry, 600- pound grizzly change, and organic capacity, in which employees begin
bear. Immediately, one of hikers takes off his backpack seeing innovation as integral to their jobs.)
and hiking boots, and proceeds to put on his running
shoes. The other hiker looks at him and says, "What are Ability, Desire, and Environment
you doing? You can't outrun a bear!" The first hiker
responds back, "I know, but I only need to outrun you!" If creating this culture of innovation rests with you, the
And this is so true in the world of business. You need to leader, where should you start? There are three
be fast enough to outrun your competition. When the pace ingredients necessary for a pervasive culture of innovation
of change outside your organization is greater than the to emerge: 1) The ability of the people within the
pace of change within, you will be eaten. Devoured by organization to be innovative, 2) The desire of the people
competitors. Overwhelmed by changing customer to act an in innovative manner, and 3) An environment that
demands. Outpaced by new technologies. enables and empowers innovation.
In today's market, there are so many darn followers trying Most leaders believe that the key problem in their
to steal your thunder! Think about it. It's discouragingly organization is that their people are not innovative enough,
easy for competitors to copy your products, rip off your and that they need to be "fixed." But it is a myth that
business processes, and go after your customer base. creativity is a trait a few select people are "born with"...that
Yes, it seems someone is always nipping at your heels. there are those with "creative personalities" and then there
So what can your company do that's impossible to copy? are the rest of us. We all have the potential to be
innovative. Perhaps not all to the same degree, but we all
The answer is simple. In my new book, 24/7 Innovation: A do have the ability. We were all innovative as children.
Blueprint for Surviving and Thriving in an Age of Change The problem is, creativity is unlearned as we grow up. The
(McGraw-Hill, 2002, ISBN: 0-07-137626-7, $29.95), I tell business world has traditionally favored analytical thinking
you how to create and nurture a company culture based
over the capacity to innovate, and has seen to it that
on innovation. After all, the company that's forever
business schools produce highly trained young men and
reinventing itself doesn't hold still long enough to be women to think along strict parameters. All people are
copied! Therefore, a culture of innovation is the best innovative; they just need help unlearning their uncreative
secret weapon you can have. But where to begin? habits.
Installing a new culture–a process that must be done
carefully and gradually–starts with a single individual, But is the creative ability of employees the most critical
someone at the top who sees an opportunity for ingredient? When I've asked thousands of people across
improvement and runs with it. This stage, called organizations which ingredient they feel is most important
leadership-driven capacity, is the first in a series of three (ability, desire, and environment), no one has ever said
"waves of change" that the innovative company that the ability of their people is the biggest issue. And
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
only 10% of the people say that their people are appropriate to the loose-tight combinations we should
unmotivated or lack passion. The biggest issue is creating strive for in seeking innovative solutions.
the right environment. The fact is, people within
organizations are willing and able to do a good job. It's Connecting the Dots
just that most companies are stuck in outmoded ways of
I find that it is useful to think of an organization as a
thinking. I am always amazed at the high quality of people
collection of dots...or as a colleague of mine calls them,
employed by companies around the world. And I am even
more amazed at how little most companies tap into the "buttons." These dots are ideas, activities, people,
creative potential of these employees. Rigid policies, processes, departments, companies, or industries.
prescriptive processes, political infighting, and fragmented However, it is the interconnections and interdependencies
between the dots where innovation emerges. Innovative
organizations have stifled innovation for too long.
thinking comes from making connections. Connections
Therefore, we need to design organizations that free up
the employees to apply their talents. between boxes. Connections between ideas. Connections
between companies. Or connections between industries.
Innovation and Jazz Focusing on these connections (or "threads") frees an
organization to improve within the guidelines of the simple
Innovation is not random. In fact, it emerges best when structure. As Steve Jobs once said, "Creativity is just
there is a structure to nurture it. Much like jazz in the world having enough dots to connect."
of music. Jazz is heavy on innovation ("improvisation" in
Unfortunately, most companies focus only on the dots,
musical terms). Just as innovation is not random,
improvisation is not random. There is a simple structure to trying to improve only a piece of the organization...often in
jazz, like 12 bar B-flat blues. It has a rhythm, chord overly prescriptive ways. Remember the binders of
progression, and tempo. Businesses need much of the process flows, created during the height of the
reengineering craze? Getting the right environment
same to succeed. Simple structures are needed to foster
involves looking at the business as a portfolio of
innovation to emerge.
capabilities rather than as organizational silos or process-
Rather than operating like a jazz band, many businesses oriented "pipes" of work. Viewing the company this way
are run more akin to classical symphonies. The classical helps untangle the organization and focus on what needs
musician plays a long, elaborate composition written by to be achieved (outcomes) rather than on procedures or
someone else, a composition that leaves little room for how the company is structured.
interpretation. The composer (usually someone who is
The jazz analogy illustrates this point. Jazz is much more
dead) has written elaborate compositions (detailed
than improvisation. It is the result of collaboration among a
workflows), placed them neatly in binders, and expected
the employees (the musicians) to follow them by rote. group; each artist knows the impact of his or her actions
Even if people could follow these compositions, by the on the others. Successful innovation demands
time they learned the score, the music would have to be collaboration in order to avoid optimizing one capability at
the expense of others or of overall performance. Focusing
changed.
on the lines or the interactions, rather than on isolated
Like good jazz, businesses can operate within constraints activities or organization dots provides the flexibility
that resemble "sheet music," allowing for creativity within needed for innovation. Jazz is a social activity, and so are
simple structures. This jazz metaphor seems particularly businesses.
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
Employees have to be trusted to search intelligently for 4. Focus on goals rather than procedures–When
improvements. But they do need guidance, training, and delegating, do managers focus on "what" rather than
the tools to fulfill whatever solutions they come up with. It's "how?" Are clear goals and outcomes provided to
not a straightforward choice between rigid structures and avoid ambiguity? Is there a clear structure for
allowing total anarchy. It's a question of finding the right managing commitments?
balance of structure and freedom.
5. Employ advocates and owners rather than
Diagnosing Your Innovative Potential managers–Do process owners serve as advocates
for innovative thinking throughout the organization?
Achieving this type of organizational flexibility is no easy Are process owners empowered to work across
feat. Over the years, I have identified 21 factors that help relevant functions? Are the process owners chosen
create a powerful environment of innovation. All of these for their communication/management skills rather
are needed in one form or another. Use these questions than their technical skills? Do process owners
as a diagnostic to see how well you are doing within your facilitate rather than dictate?
organization. For each question, ask yourself how well
you are doing today (on a scale from 1 to 10). Then ask 6. Get the right measures and incentives–Are stretch
yourself how well you would like to be doing. Areas with targets used to create a challenge? Are
significant performance gaps may be factors you want to performance-based incentives and team measures
used? Do the measures focus on outcomes rather
concentrate your energies on.
than tasks? Are "fear based" incentives avoided?
1. Surface and challenge assumptions–Are underlying Are performance targets defined concurrently, or in
assumptions/rules surfaced and challenged? Is the advance of the business design? Are measures
organization prepared to break with tradition? Are "balanced?" Are measures holistic? Has their
the root causes of problems identified and impact on other measures been taken into account?
addressed?
7. Use optimistic language–Are employees
2. Invest time and money–Are efforts adequately encouraged to stay open to new possibilities? Is
funded in terms of money and resources? Is time "inclusive" language used? Is gossiping and
allocated for innovative thinking, reflection, and politicking discouraged? Is negative, pessimistic
planning (15% rule)? Does the physical environment language discouraged?
facilitate communication and collaboration?
8. Get the right people in the right roles–Is everyone in
3. Create a networked organization–Is your the organization provided an appropriate challenge?
organization an "alliance-based network of Are people matched with jobs to minimize boredom
capabilities?" Are procedural or technical standards or avoid their being overwhelmed? Do you only keep
used only where informal coordination is ineffective? employees who subscribe to the values of the
Is data shared across the organization? Are non- organization? Are jobs, roles, or tasks rotated to
critical capabilities outsourced? Are performance keep people challenged and growing?
objectives aligned across organizations? Is decision
making pushed to the lowest levels of organization? 9. Provide encouragement–Are efforts of individuals
and teams privately and publicly acknowledged? Are
people shown the result of their efforts?
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
10. Design for process flexibility–Are overly prescriptive 17. Eliminate administration–Are knowledge workers
processes avoided? Is technology used to enable freed to focus on value-adding activities rather than
innovation rather than prescribe procedures? administration? Is the effective use of critical
resources optimized?
11. Strive for simplicity–Are simple solutions used over
sophisticated ones? Is over-analysis avoided? Is a 18. Create and align context–Is an exciting context
"build it, try it, fix it" approach used when created for employees? Are people made aware of
appropriate? Are overly formulaic approaches the big picture? When selling new ideas internally, is
avoided? "why" addressed before "what" and "how?" Is a
powerful "burning platform" created to stimulate
12. Be consistent and build trust–Does management interest? Do people understand how their work fits in
demonstrate the organization's commitment to the with the overall effort? Are personal passions
success of initiatives and individuals? Does aligned with organizational objectives?
management avoid the frequent changing of goals?
19. Target high-value capabilities–Are capabilities
13. Provide strong leadership–Do leaders demonstrate targeted that create the greatest stakeholder value
their commitment to innovation? Do leaders make
and represent the greatest opportunity for
tough, unpopular decisions (intestinal fortitude)? Are
improvement? Is the most valuable work converted
the leaders inspirational? Do the leaders serve as a into knowledge work? Is a holistic view maintained?
role model for the rest of the organization? Is the organization's capacity to change considered?
14. Use internal markets–Is cross-unit cooperation 20. Focus outside in–Is the organization customer
encouraged through appropriate incentives? Is focused, designing from the outside in? Does the
internal competition used to keep people on their organization stand in the customers' shoes and
toes? Are survival of the fittest/free market models
observe their processes in action? Does the
applied throughout the organization?
organization focus on redesigning customer
processes rather than internal processes? Does the
15. Collect and connect dots–Is knowledge and skills
organization create customer needs rather than just
building encouraged? Are people encouraged to
respond to them? Are various customer segments
explore new disciplines? Do individuals collect and
handled differently? Is the organization "easy to do
combine ideas? Are individuals encouraged to look
business with?"
at work through various "filters?" Does the
organization collect, combine, disseminate, and
21. Revel in differences–Does the organization develop
reward the best ideas? Are individuals encouraged
teams with diverse skills and analytical styles? Does
to challenge norms? Is a standard process used for the organization value contention, debate, and
innovation (diverge then converge)? Are centers of tension? Do managers acknowledge, but avoid
excellence used to build broad-based expertise? punishing, failure? Are conversations structured to
accommodate different analytical styles? Does the
16. Ensure Strategic alignment–Are all initiatives
aligned to the overall strategy? Are all stakeholders organization avoid the lowest common denominator,
analysis paralysis, and "right of infinite appeal?" Are
considered when defining the strategy (stakeholder
new organizations created when a new culture/skill-
wants & needs)?
set is needed?
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
Keeping it Simple key is to avoid deadlocks in debates where creativity is
stifled and progress is not made.
Assessing 21 factors can prove to be a bit overwhelming.
So, to keep things simple, I propose you consider the 2. Educate all employees. Companywide education is
"NOW Just Do IT" model. The "N" in NOW stands for essential before any change program is rolled out, if a
company's capabilities are to be kept running smoothly
need; a burning platform for change is communicated and
throughout the turmoil that such a program inevitably
well understood throughout the organization. The "O" is for
opportunity; you have to be in a business that has a brings about. Most people innately prefer the status quo
chance of succeeding. And the "W" is for will of senior unless and until they are given some sound reason why
management; committed leadership with the "intestinal an alternative is preferable. And remember, education is
as much about mindset as it is about skills. Shape the way
fortitude" to see the change through. And you need all
people see the world, and you will change their actions.
three to be successful.
3. Use the new orientation to bring managers closer to
Without the will of senior management, you are left with
customers. Often, frontline personnel are quicker to pick
"NO"; no, don't do it. Without opportunity ("O"), you are
left with "NW"; no way to succeed. And without the need up, and less resistant to the idea of this new way of
being understood ("N"), you are left with "OW"; a painful thinking than are a company's managers. The closer a
experience for all within the organization–reminiscent of company gets to its customers, the easier it is for them to
make the journey. The lesson? Companies can speed up
what Jack Welch did at GE when he started out. "Just"
a sluggish start to their transition by nominating a few
stands for justification–a business case for change. "Do",
which means you need doers, not talkers. And finally, "IT" potential champions at the top of the organization and at
stands for information technology. No change today successive levels further down. The designated
stands a chance of making a difference without taking into champions can then be sent out to experience firsthand
some of the problems that face the organization's
consideration the important role of technology. All of these
customers. This results in a bottom-up leadership from
together begin to create the right environment.
those closest to the customers.
Other useful "top tips":
4. Buy expertise that you do not already have in-house. In
1. Encourage a culture of tension. An alliance-based many cases the idea–and the proposed route–of the
network often results in a highly matrixed organization that journey is so strange that organizations do not have the in-
focuses on both capabilities and line responsibilities. At house skills that are needed to make the transition. In
Mölnlycke Health Care, one of Europe©s leading such cases, they need to go out and find help in those
manufacturers and suppliers of single-use products for areas where they have insufficient expertise–for example,
surgical interventions and wound management, capability with the techniques of change management. Most
owners were responsible for identifying improvement importantly, outside help can help you surface and
opportunities, while line managers were trying to run the challenge assumptions that may be invisible to the rest of
business. This caused a great deal of tension within the the organization.
organization. And although tension is often thought of as
undesirable, it was discovered that this debate and 5. Communicate clearly, continuously, and repeatedly. It is
scarcely possible to exaggerate the need for information
discussion unleashed creativity in the organization. Issues,
about the transition to be communicated clearly and
and hence opportunities, surfaced much more quickly. The
regularly throughout the organization. If in doubt,
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
remember the Rule of 50s. The first 50 times you tell About the author
people something, they don't hear you. The second 50 Stephen Shapiro is the author of 24/7 Innovation: A
times you tell them the same thing, they don't believe you.
Blueprint for Surviving and Thriving in an Age of Change
Only during the third 50 times that you tell them do they
(McGraw-Hill, 2002, ISBN: 0-07-137626-7, $29.95) and
begin to listen.
founder of The 24/7 Innovation Group. Previously, he
6. Build in safeguards that prevent the organization from spent 15 years at Accenture. During his last three years,
he was based in London and led the firm's European
taking backward steps. Senior managers who are not
Process Excellence practice. In 1996, he was one of the
close to their customers can stall a transition that is
founders and directors of Accenture's Global Process
already well under way and may even cause it to revert
back. This can sometimes occur because of an Excellence practice. And he was one of the leaders of the
unexpected change of leadership. Incoming managers' firm's reengineering practice from its inception in 1992.
Shapiro has advised many of the world's leading
allegiance to a traditional structure of fragmented
organizations, from BMW WilliamsF1, ABB and UPS to
departments can result in the company regressing to an
Lucent and Xerox. He has also collaborated with other
early stage of maturity. To minimize the risk from such a
changeover, companies should develop several strong thought leaders including Michael Hammer and Peter
leaders on the team so that there is someone to carry on Keen, and is recognized as one of today's most influential
consultants in the area of process and innovation. Articles
the role of champion if (and when) one of the others
by Shapiro have appeared in over two-dozen newspapers
moves on. This removes the risk of the whole exercise
and magazines, and he was recently quoted in The New
being at the mercy of one person's career development.
York Times. For more information, go to
www.24-7Innovation.com.
7. Realize that one size does not fit all. Organizations
should not try to follow any one case study too literally. No
two companies will pass through the transition for the
same reasons or by following the same sequence of
events. Not only does one size not fit all; one size doesn't
even fit two.
Any leader worth his or her salt should be enthusiastic
about creating a culture of innovation. After all, a
company with such a culture naturally rises to the top.
Once innovation becomes a way of life for your company,
people will want to work for you. You will begin to attract
the best and the brightest. And before you know it, your
company will be a leader–not a follower–in the
marketplace.
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial Engineers
THOUGHT LEADERSHIP SERIES
Innovate Your Organization
By: Stephen M. Shapiro
undergoes. (The other two waves are structural driven
Two men are hiking through the mountains of Canada
capacity, in which mechanisms are put in place to enable
when they stumble upon a hungry, 600- pound grizzly change, and organic capacity, in which employees begin
bear. Immediately, one of hikers takes off his backpack seeing innovation as integral to their jobs.)
and hiking boots, and proceeds to put on his running
shoes. The other hiker looks at him and says, "What are Ability, Desire, and Environment
you doing? You can't outrun a bear!" The first hiker
responds back, "I know, but I only need to outrun you!" If creating this culture of innovation rests with you, the
And this is so true in the world of business. You need to leader, where should you start? There are three
be fast enough to outrun your competition. When the pace ingredients necessary for a pervasive culture of innovation
of change outside your organization is greater than the to emerge: 1) The ability of the people within the
pace of change within, you will be eaten. Devoured by organization to be innovative, 2) The desire of the people
competitors. Overwhelmed by changing customer to act an in innovative manner, and 3) An environment that
demands. Outpaced by new technologies. enables and empowers innovation.
In today's market, there are so many darn followers trying Most leaders believe that the key problem in their
to steal your thunder! Think about it. It's discouragingly organization is that their people are not innovative enough,
easy for competitors to copy your products, rip off your and that they need to be "fixed." But it is a myth that
business processes, and go after your customer base. creativity is a trait a few select people are "born with"...that
Yes, it seems someone is always nipping at your heels. there are those with "creative personalities" and then there
So what can your company do that's impossible to copy? are the rest of us. We all have the potential to be
innovative. Perhaps not all to the same degree, but we all
The answer is simple. In my new book, 24/7 Innovation: A do have the ability. We were all innovative as children.
Blueprint for Surviving and Thriving in an Age of Change The problem is, creativity is unlearned as we grow up. The
(McGraw-Hill, 2002, ISBN: 0-07-137626-7, $29.95), I tell business world has traditionally favored analytical thinking
you how to create and nurture a company culture based
over the capacity to innovate, and has seen to it that
on innovation. After all, the company that's forever
business schools produce highly trained young men and
reinventing itself doesn't hold still long enough to be women to think along strict parameters. All people are
copied! Therefore, a culture of innovation is the best innovative; they just need help unlearning their uncreative
secret weapon you can have. But where to begin? habits.
Installing a new culture–a process that must be done
carefully and gradually–starts with a single individual, But is the creative ability of employees the most critical
someone at the top who sees an opportunity for ingredient? When I've asked thousands of people across
improvement and runs with it. This stage, called organizations which ingredient they feel is most important
leadership-driven capacity, is the first in a series of three (ability, desire, and environment), no one has ever said
"waves of change" that the innovative company that the ability of their people is the biggest issue. And
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
only 10% of the people say that their people are appropriate to the loose-tight combinations we should
unmotivated or lack passion. The biggest issue is creating strive for in seeking innovative solutions.
the right environment. The fact is, people within
organizations are willing and able to do a good job. It's Connecting the Dots
just that most companies are stuck in outmoded ways of
I find that it is useful to think of an organization as a
thinking. I am always amazed at the high quality of people
collection of dots...or as a colleague of mine calls them,
employed by companies around the world. And I am even
more amazed at how little most companies tap into the "buttons." These dots are ideas, activities, people,
creative potential of these employees. Rigid policies, processes, departments, companies, or industries.
prescriptive processes, political infighting, and fragmented However, it is the interconnections and interdependencies
between the dots where innovation emerges. Innovative
organizations have stifled innovation for too long.
thinking comes from making connections. Connections
Therefore, we need to design organizations that free up
the employees to apply their talents. between boxes. Connections between ideas. Connections
between companies. Or connections between industries.
Innovation and Jazz Focusing on these connections (or "threads") frees an
organization to improve within the guidelines of the simple
Innovation is not random. In fact, it emerges best when structure. As Steve Jobs once said, "Creativity is just
there is a structure to nurture it. Much like jazz in the world having enough dots to connect."
of music. Jazz is heavy on innovation ("improvisation" in
Unfortunately, most companies focus only on the dots,
musical terms). Just as innovation is not random,
improvisation is not random. There is a simple structure to trying to improve only a piece of the organization...often in
jazz, like 12 bar B-flat blues. It has a rhythm, chord overly prescriptive ways. Remember the binders of
progression, and tempo. Businesses need much of the process flows, created during the height of the
reengineering craze? Getting the right environment
same to succeed. Simple structures are needed to foster
involves looking at the business as a portfolio of
innovation to emerge.
capabilities rather than as organizational silos or process-
Rather than operating like a jazz band, many businesses oriented "pipes" of work. Viewing the company this way
are run more akin to classical symphonies. The classical helps untangle the organization and focus on what needs
musician plays a long, elaborate composition written by to be achieved (outcomes) rather than on procedures or
someone else, a composition that leaves little room for how the company is structured.
interpretation. The composer (usually someone who is
The jazz analogy illustrates this point. Jazz is much more
dead) has written elaborate compositions (detailed
than improvisation. It is the result of collaboration among a
workflows), placed them neatly in binders, and expected
the employees (the musicians) to follow them by rote. group; each artist knows the impact of his or her actions
Even if people could follow these compositions, by the on the others. Successful innovation demands
time they learned the score, the music would have to be collaboration in order to avoid optimizing one capability at
the expense of others or of overall performance. Focusing
changed.
on the lines or the interactions, rather than on isolated
Like good jazz, businesses can operate within constraints activities or organization dots provides the flexibility
that resemble "sheet music," allowing for creativity within needed for innovation. Jazz is a social activity, and so are
simple structures. This jazz metaphor seems particularly businesses.
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
Employees have to be trusted to search intelligently for 4. Focus on goals rather than procedures–When
improvements. But they do need guidance, training, and delegating, do managers focus on "what" rather than
the tools to fulfill whatever solutions they come up with. It's "how?" Are clear goals and outcomes provided to
not a straightforward choice between rigid structures and avoid ambiguity? Is there a clear structure for
allowing total anarchy. It's a question of finding the right managing commitments?
balance of structure and freedom.
5. Employ advocates and owners rather than
Diagnosing Your Innovative Potential managers–Do process owners serve as advocates
for innovative thinking throughout the organization?
Achieving this type of organizational flexibility is no easy Are process owners empowered to work across
feat. Over the years, I have identified 21 factors that help relevant functions? Are the process owners chosen
create a powerful environment of innovation. All of these for their communication/management skills rather
are needed in one form or another. Use these questions than their technical skills? Do process owners
as a diagnostic to see how well you are doing within your facilitate rather than dictate?
organization. For each question, ask yourself how well
you are doing today (on a scale from 1 to 10). Then ask 6. Get the right measures and incentives–Are stretch
yourself how well you would like to be doing. Areas with targets used to create a challenge? Are
significant performance gaps may be factors you want to performance-based incentives and team measures
used? Do the measures focus on outcomes rather
concentrate your energies on.
than tasks? Are "fear based" incentives avoided?
1. Surface and challenge assumptions–Are underlying Are performance targets defined concurrently, or in
assumptions/rules surfaced and challenged? Is the advance of the business design? Are measures
organization prepared to break with tradition? Are "balanced?" Are measures holistic? Has their
the root causes of problems identified and impact on other measures been taken into account?
addressed?
7. Use optimistic language–Are employees
2. Invest time and money–Are efforts adequately encouraged to stay open to new possibilities? Is
funded in terms of money and resources? Is time "inclusive" language used? Is gossiping and
allocated for innovative thinking, reflection, and politicking discouraged? Is negative, pessimistic
planning (15% rule)? Does the physical environment language discouraged?
facilitate communication and collaboration?
8. Get the right people in the right roles–Is everyone in
3. Create a networked organization–Is your the organization provided an appropriate challenge?
organization an "alliance-based network of Are people matched with jobs to minimize boredom
capabilities?" Are procedural or technical standards or avoid their being overwhelmed? Do you only keep
used only where informal coordination is ineffective? employees who subscribe to the values of the
Is data shared across the organization? Are non- organization? Are jobs, roles, or tasks rotated to
critical capabilities outsourced? Are performance keep people challenged and growing?
objectives aligned across organizations? Is decision
making pushed to the lowest levels of organization? 9. Provide encouragement–Are efforts of individuals
and teams privately and publicly acknowledged? Are
people shown the result of their efforts?
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
10. Design for process flexibility–Are overly prescriptive 17. Eliminate administration–Are knowledge workers
processes avoided? Is technology used to enable freed to focus on value-adding activities rather than
innovation rather than prescribe procedures? administration? Is the effective use of critical
resources optimized?
11. Strive for simplicity–Are simple solutions used over
sophisticated ones? Is over-analysis avoided? Is a 18. Create and align context–Is an exciting context
"build it, try it, fix it" approach used when created for employees? Are people made aware of
appropriate? Are overly formulaic approaches the big picture? When selling new ideas internally, is
avoided? "why" addressed before "what" and "how?" Is a
powerful "burning platform" created to stimulate
12. Be consistent and build trust–Does management interest? Do people understand how their work fits in
demonstrate the organization's commitment to the with the overall effort? Are personal passions
success of initiatives and individuals? Does aligned with organizational objectives?
management avoid the frequent changing of goals?
19. Target high-value capabilities–Are capabilities
13. Provide strong leadership–Do leaders demonstrate targeted that create the greatest stakeholder value
their commitment to innovation? Do leaders make
and represent the greatest opportunity for
tough, unpopular decisions (intestinal fortitude)? Are
improvement? Is the most valuable work converted
the leaders inspirational? Do the leaders serve as a into knowledge work? Is a holistic view maintained?
role model for the rest of the organization? Is the organization's capacity to change considered?
14. Use internal markets–Is cross-unit cooperation 20. Focus outside in–Is the organization customer
encouraged through appropriate incentives? Is focused, designing from the outside in? Does the
internal competition used to keep people on their organization stand in the customers' shoes and
toes? Are survival of the fittest/free market models
observe their processes in action? Does the
applied throughout the organization?
organization focus on redesigning customer
processes rather than internal processes? Does the
15. Collect and connect dots–Is knowledge and skills
organization create customer needs rather than just
building encouraged? Are people encouraged to
respond to them? Are various customer segments
explore new disciplines? Do individuals collect and
handled differently? Is the organization "easy to do
combine ideas? Are individuals encouraged to look
business with?"
at work through various "filters?" Does the
organization collect, combine, disseminate, and
21. Revel in differences–Does the organization develop
reward the best ideas? Are individuals encouraged
teams with diverse skills and analytical styles? Does
to challenge norms? Is a standard process used for the organization value contention, debate, and
innovation (diverge then converge)? Are centers of tension? Do managers acknowledge, but avoid
excellence used to build broad-based expertise? punishing, failure? Are conversations structured to
accommodate different analytical styles? Does the
16. Ensure Strategic alignment–Are all initiatives
aligned to the overall strategy? Are all stakeholders organization avoid the lowest common denominator,
analysis paralysis, and "right of infinite appeal?" Are
considered when defining the strategy (stakeholder
new organizations created when a new culture/skill-
wants & needs)?
set is needed?
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
Keeping it Simple key is to avoid deadlocks in debates where creativity is
stifled and progress is not made.
Assessing 21 factors can prove to be a bit overwhelming.
So, to keep things simple, I propose you consider the 2. Educate all employees. Companywide education is
"NOW Just Do IT" model. The "N" in NOW stands for essential before any change program is rolled out, if a
company's capabilities are to be kept running smoothly
need; a burning platform for change is communicated and
throughout the turmoil that such a program inevitably
well understood throughout the organization. The "O" is for
opportunity; you have to be in a business that has a brings about. Most people innately prefer the status quo
chance of succeeding. And the "W" is for will of senior unless and until they are given some sound reason why
management; committed leadership with the "intestinal an alternative is preferable. And remember, education is
as much about mindset as it is about skills. Shape the way
fortitude" to see the change through. And you need all
people see the world, and you will change their actions.
three to be successful.
3. Use the new orientation to bring managers closer to
Without the will of senior management, you are left with
customers. Often, frontline personnel are quicker to pick
"NO"; no, don't do it. Without opportunity ("O"), you are
left with "NW"; no way to succeed. And without the need up, and less resistant to the idea of this new way of
being understood ("N"), you are left with "OW"; a painful thinking than are a company's managers. The closer a
experience for all within the organization–reminiscent of company gets to its customers, the easier it is for them to
make the journey. The lesson? Companies can speed up
what Jack Welch did at GE when he started out. "Just"
a sluggish start to their transition by nominating a few
stands for justification–a business case for change. "Do",
which means you need doers, not talkers. And finally, "IT" potential champions at the top of the organization and at
stands for information technology. No change today successive levels further down. The designated
stands a chance of making a difference without taking into champions can then be sent out to experience firsthand
some of the problems that face the organization's
consideration the important role of technology. All of these
customers. This results in a bottom-up leadership from
together begin to create the right environment.
those closest to the customers.
Other useful "top tips":
4. Buy expertise that you do not already have in-house. In
1. Encourage a culture of tension. An alliance-based many cases the idea–and the proposed route–of the
network often results in a highly matrixed organization that journey is so strange that organizations do not have the in-
focuses on both capabilities and line responsibilities. At house skills that are needed to make the transition. In
Mölnlycke Health Care, one of Europe©s leading such cases, they need to go out and find help in those
manufacturers and suppliers of single-use products for areas where they have insufficient expertise–for example,
surgical interventions and wound management, capability with the techniques of change management. Most
owners were responsible for identifying improvement importantly, outside help can help you surface and
opportunities, while line managers were trying to run the challenge assumptions that may be invisible to the rest of
business. This caused a great deal of tension within the the organization.
organization. And although tension is often thought of as
undesirable, it was discovered that this debate and 5. Communicate clearly, continuously, and repeatedly. It is
scarcely possible to exaggerate the need for information
discussion unleashed creativity in the organization. Issues,
about the transition to be communicated clearly and
and hence opportunities, surfaced much more quickly. The
regularly throughout the organization. If in doubt,
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial EngineersThe 24/7 Innovation
THOUGHT LEADERSHIP SERIES
remember the Rule of 50s. The first 50 times you tell About the author
people something, they don't hear you. The second 50 Stephen Shapiro is the author of 24/7 Innovation: A
times you tell them the same thing, they don't believe you.
Blueprint for Surviving and Thriving in an Age of Change
Only during the third 50 times that you tell them do they
(McGraw-Hill, 2002, ISBN: 0-07-137626-7, $29.95) and
begin to listen.
founder of The 24/7 Innovation Group. Previously, he
6. Build in safeguards that prevent the organization from spent 15 years at Accenture. During his last three years,
he was based in London and led the firm's European
taking backward steps. Senior managers who are not
Process Excellence practice. In 1996, he was one of the
close to their customers can stall a transition that is
founders and directors of Accenture's Global Process
already well under way and may even cause it to revert
back. This can sometimes occur because of an Excellence practice. And he was one of the leaders of the
unexpected change of leadership. Incoming managers' firm's reengineering practice from its inception in 1992.
Shapiro has advised many of the world's leading
allegiance to a traditional structure of fragmented
organizations, from BMW WilliamsF1, ABB and UPS to
departments can result in the company regressing to an
Lucent and Xerox. He has also collaborated with other
early stage of maturity. To minimize the risk from such a
changeover, companies should develop several strong thought leaders including Michael Hammer and Peter
leaders on the team so that there is someone to carry on Keen, and is recognized as one of today's most influential
consultants in the area of process and innovation. Articles
the role of champion if (and when) one of the others
by Shapiro have appeared in over two-dozen newspapers
moves on. This removes the risk of the whole exercise
and magazines, and he was recently quoted in The New
being at the mercy of one person's career development.
York Times. For more information, go to
www.24-7Innovation.com.
7. Realize that one size does not fit all. Organizations
should not try to follow any one case study too literally. No
two companies will pass through the transition for the
same reasons or by following the same sequence of
events. Not only does one size not fit all; one size doesn't
even fit two.
Any leader worth his or her salt should be enthusiastic
about creating a culture of innovation. After all, a
company with such a culture naturally rises to the top.
Once innovation becomes a way of life for your company,
people will want to work for you. You will begin to attract
the best and the brightest. And before you know it, your
company will be a leader–not a follower–in the
marketplace.
The 24/7 Innovation Group 2002. All Rights Reserved.
Published in the November/December 2002 issue of Industrial Management, the official magazine of the Institute of Industrial Engineers
