One of the hottest topics in business is innovation. The days when you can be successful and support organizational growth through efficiency and productivity are long gone.
Business leaders have often tried to generate more innovation in their organizations by hiring creative people and giving them resources to develop new ideas. AT&T had its Bell Labs and Xerox had PARC. While successful to some extent, especially in new discoveries, these units often fell short of the true innovations that were helping their parent companies. Even today, most organizations find their way through innovation.
One of the main reasons is the difference between creativity and innovation. Most executives confuse these two concepts. Here’s the basic difference: Creativity is focused on generating new ideas that are new and unique. The graphical user interface for computers – developed by Xerox PARC – and the mouse were new ideas. On the other hand, innovation puts these creative ideas into practice. So, Apple, under the leadership of Steve Jobs, managed to put the creative ideas of the graphical interface and the mouse into practice by creating the Macintosh computer.
Success and failure
Why is it so difficult to innovate? The reason lies in the inherent duality that exists with the concept of innovation.
The first duality of innovation is the notion of success and failure. As a nation, we seem to be obsessed with success. This goes hand in hand with our âcult of the victorsâ. There is a saying that goes “no one remembers a second finisher”, and the winners are celebrated as heroes. Watch how Tom Brady was celebrated as he led his team to this year’s Super Bowl victory. In fact, if you watch sporting events, most forces produce a winner. Some use sudden death playoffs to determine the winner, and for other sports, play continues until the winner is identified (golf, for example). What’s wrong with the idea that there are co-champions? Is it sacrilege to have more than one winner?
Failure carries a negative stigma in our culture. Experimentation carries a risk in that you don’t know if you are going to be successful. Rather than seeing failures as finished results, see them as part of the process. Thomas Edison is said to have said: âI have not failed. I just found 10,000 ways that won’t work âandâ A lot of life’s failures are people not realizing how close they were to success when they gave up. Both statements make perfect sense. In other words, a failure is not a static result but part of the process. If you can learn from failures and move forward with new ways of doing things, eventually you will achieve a positive outcome.
We often talk about being “results oriented or focused”, but if the example above is any indication, you don’t want individuals to just focus on results. Rather than focusing on results, we should focus on the process by which we can engage in experimentation leading to innovation.
Consider a scenario where a risk-reward relationship provides a completely different picture for an individual versus a collective. If you have a project that offers 300% ROI on success, but also 100% negative ROI on failure and the odds of success are equal (50%), you may not want not be taking the risk because you could end up losing 100% of your investment half the time. In fact, if the alternative project gives you a 10% return but no loss with 90% certainty, you are more likely, as an individual, to take on the second project rather than the first. Considering the negative stigma associated with failures, it’s easy to see why many managers would pursue the safe project rather than the risky project: “I got a good 10% return” or “at least there is. no loss of investment â. However, for the whole organization, it would be so much more beneficial for managers to pursue the risky option (100% return instead of 9% return). If your organization creates a culture of innovation where there is a risk-free, experimentation-driven environment, then more of your managers would want to pursue the risky option.
The second duality lies in learning and performance. Often times, the notion of “results-oriented” encourages us to be “performance-oriented” rather than “learning-oriented”. Organizations are always focused on maximizing performance, but often such an emphasis on performance delays learning. By nature, learning is not efficient. Imagine a time when you were trying to learn something new. You don’t know or master it, so you will be slower and as a result your productivity will suffer.
If you are an aspiring Olympic gold medalist, the last thing you would do when engaged in your final competition at the Olympics would be tell yourself that you will be engaging in experimentation and trying something that you don’t. not tried before just to see. If you can do it. Instead, you remind yourself that you’ve done this routine a thousand times and would like to repeat your best performance. So here the athlete wants to focus on performance. However, innovation requires you to try something new and different, so an excessive focus on performance delays learning and reduces risk-taking and experimentation.
The third duality of innovation is disruption and chaos versus stability and order. As human beings, we strive to maintain our order. Our brains are designed to make sense of chaos and to seek order to reduce uncertainty. The level of stress generated by uncertainty is enormous. Our brains are designed to avoid using excess energy for anything other than our own survival from the earliest days of human history. Thus, our instincts are driven to prefer routines to non-routines and order and certainty over disorder and uncertainty.
In many organizations, the budgeting and planning process is performed every year to bring order and minimal disruption to the functioning of the organization. This was the aim and purpose of the management system organizations created to maintain stability and order. Unfortunately, such systems hamper our ability to innovate, as innovation often disrupts the system. Innovation takes us away from our routines and orderly existence to lead us to a more non-routine and chaotic existence.
The ultimate question we must ask ourselves is: where to draw the line? Do we focus on performance rather than learning, results over process and order over chaos? There is a need for structure and control so that an organization can function as a collective. The types of behavior that might lead to more innovation – risk taking and experimentation – create more feelings of uncertainty and sometimes chaos. As you can see, these are all related concepts of duality that seem to facilitate or interfere with innovation. What is needed is that we recognize such a duality, which can be paradoxical, and figure out how to create the best balance or the best balance between these two extremes.
There are several ways for organizations to resolve these dualities. For successes and failures, organizations can evolve towards a collective reward rather than an individual reward. Additionally, organizations can also reward not results but processes – in other words, rewarding people for experimentation and learning. Encourage employees to see not only their own situation but also the bigger picture and consider how collective action could benefit the organization as a whole rather than individual action that would benefit the individual. In addition, the leaders of the organization should try to align their organizational goals with individual goals so that they can pursue organizational goals while empowering their employees.
The standard for organizations can be set to disrupt and challenge the status quo rather than focusing on compliance and stability. Promote self-inflicted constructive or positive disruptions, which means you need to generate internal impulses to make changes rather than forcing them to be altered due to external factors. To challenge the status quo, you have to keep asking “why” and “why not” when people say “we have already tried” or “this won’t work here”. As stated earlier, organizations should focus on learning and experimentation rather than just performance. Organizations need to encourage people to become familiar with uncertainties and ambiguities. In short, disturbances are part of the norm.
If innovating was easy, then every organization would innovate. What makes innovation difficult are the intrinsic dualities that I have described. The test of whether organizations will move towards creating a culture of innovation depends on how they optimally resolve three dualities. If the organization moves towards rewarding experimentation and risk-taking, encouraging performance-based learning and fostering disruption of order and control, more innovation will result. On the other hand, if these dualities are resolved unfavorably, it could mean the end of innovation in the organization.
Kenneth Rhee is the Dean of the School of Business and Leadership at Nazareth College.