The essential guide to innovating in HR- Building things that don’t scale
If there’s one skill HR professionals have struggled to master for decades, it is the art of innovation. Whether this is for creating a culture where innovation thrives as Steve Jobs did at Apple, designing HR technologies, or rethinking how we serve our customers in the employee lifecycle, there are many opportunities to do better as we lead our organizations towards the future of work and uncertainties like Covid 19.
Peter Drucker- There’s surely nothing quite so useless as doing with great efficiency what should not be done at all.(LS)
How do you go about innovation in your team or organization? When was the last time you ventured into your customer’s world? Do you audit your ‘failed ideas bucket’ to learn from your mistakes? What assumptions are you making daily? Why do most HR ideas fail in customer adoption? How often have you as a staff woken up to a company-wide email from the CEO announcing all the new measures leadership is putting in place starting the new year(that affect you but you had no input?
As employee experience design and data analytics become HR’s top sought-after digital skills for 2025 for the modern workplace, innovation becomes a sure way of putting them into practice and helping spur organizations into new frontiers. And here’s why;
Process is only the foundation upon which a great company culture can develop. But without this foundation, efforts to encourage learning, creativity, and innovation will fall flat- as many disillusioned directors of HR can attest. (pg204)
1. Employee experience & data analytics take top priority for HR leaders
✅️Innovation is both a mindset & a skill. Several innovation theories like design thinking frame creativity in a step-by-step approach. Opportunities in HR to improve all employee(or managers) touchpoints exist. But only the trained eye will be able to maximize them to create remarkable solutions.
✅️It brings us back to what’s at the core of HR and customer development i.e. the human before the resources. People ignore designs that ignore people. Design is a tool to enhance our humanity. In a workplace where everything feels either automated or platonic, you’re guaranteed to stand out as a workplace if you “design for meaning.” As Seth Godin says in his book Linchpin, “Consumers are not loyal to cheap commodities. They crave the unique, the remarkable, and the human.” Good ideas never come from behind a desk.
✅️Most of our HR tools and products are designed poorly, hence the low user adoption. “It is not enough that we build products that function, that are understandable and usable. We also need to build products that bring joy & excitement, pleasure and fun, and yes, beauty to people’s lives.”- Don Norman.
Human centered approach to innovation helps us “Upgrade your user, not your product. Don’t build better cameras — build better photographers.”-Kathy Sierra. Our focus shifts from the process/product to the endless possibilities to enhance our employee’s experience.
✅️Innovation equals financial success. All the top-performing firms like Apple have embedded an innovation culture across ALL their teams. And as the results show, “There are no traffic jams along the extra mile.”- Roger Staubach.
2. Innovation can be managed
As Eric Ries says in his book Lean Startup, entrepreneurship is management. That building a startup is an exercise in institution building; hiring creative employees, coordinating their activities, and creating a company culture that delivers results. That every organization is dedicated to uncovering a new source of value for customers and cares about the impact of its product on those customers. But isn’t innovation messy? Why should we care as HR about failure? As Eric says, “What makes these failures particularly painful is not just the economic damage done to individual employees, companies, and investors; they are also a colossal waste of our civilization’s most precious resource; the time, passion, and skill of its people……..our larger wastes of human effort, which go on every day through such of our acts are blundering, ill-directed or inefficient.” So whether that is in our own HR teams or as custodians of company resources, our mandate is to ensure the proper use of company resources.
Take the employee lifecycle for instance. A HR team can look at various emerging HR tech trends as shown above and agree to innovate on a process e.g employee onboarding. But many questions can arise here as Eric shows;
- Which customer opinion should we listen to if any?
- How should we prioritise across the many features?
- What can be changed safely and what might anger customers?
- What should we work on next?
By managing the process of innovation, it provides us as the team with many benefits including ‘identifying the elements of the plan that are assumptions rather than facts, and figuring out ways to test them.’ And these two key strategies below are how you do it.
3. Ditching big data for small data
“When the cook tastes the soup, that’s formative assessment; when the customer tastes the soup, that’s summative assessment.”-Paul Black
So you’re a global HR Manager for a global firm like Unilever and want to improve on your employee onboarding process. How do you go about this? Do you sit in a meeting room and craft a new process behind a desk as most bosses do? Do you look at your employee engagement survey & retention numbers and work from that? Do you talk to the team managers who handle the new joiners or the new employees? What touch points will you prioritize? What assumptions are we making? Will a new onboarding software solve all our problems? How will we know if we’ve solved the problem? How will you scale this new solution across the different countries & regions? So why can’t you simply dish out an onboarding survey for your new joiners and go from there?
Jeff Bezos the CEO and Founder of the global shopping giant Amazon shows how he’s learned as a leader to question the metrics and data for decision making. When looking at the firm’s customer complaints data, he went on to make an actual call on their toll line to test the waiting time vs what the metrics said. He acted as a mystery shopper in this instance.
In this article, https://lnkd.in/d3iixg6r HR meets Marketing Part 6: The Case for the Mystery Shopper, I shared 2 reasons why it’s critical to go beyond the data being presented to you;
👀People are biased in their judgment & accounting
👀People LIE
In this other blog post, https://lnkd.in/dz2au_8x How to hire technical talent the right way(Part 1-Sourcing), I shared;
“In conclusion, you’ll notice that most of these techniques are outbound. A trend Dave Ulrich refers to as ‘HR outside in’. The organization is slowly opening up and allowing the world to get in. It also means HR teams need to get out into the world and interact firsthand with their customers. An approach commonly referred to as ‘GET OUT OF THE BUILDING’ by Steve Blank in Lean Manufacturing and involves discarding what you think you know about your customers and ‘genchi genbutsu.’ Genchi Genbutsu is a key concept at Toyota and the Toyota Production System; it means “go and see for yourself.” -Lean Startup book By Eric Ries.
Then he says in the next chapter:
“Numbers tell a compelling story but I always remind entrepreneurs that metrics are people, too. No matter how many intermediaries lie between a company and it’s company and its customers, at the end of the day, customers are breathing, thinking, buying individuals . Their behavior is measurable and changeable.(89)
“First, remember that “Metrics are people, too.” We need to be able to test the data by hand, in the messy real world, by talking to customers. This is the only way to be able to check if the reports contain true facts. Managers need the ability to spot check the data with real customers. It also has a second benefit: systems that provide this level of auditability give managers and entrepreneurs the opportunity to gain insights into why customers are behaving the way the data indicate.” — Pg 147 Lean Startup Book by Eric Ries.
Data is only as good as the people behind it. People also lean on good metrics to dismiss evidence to the contrary. I’ve seen tools like engagement surveys lacking in quality, managers who aren’t in touch with employees lying to senior leadership about HR reports and so on. Data is only one perspective of the picture.
This ‘entrepreneurs’ mindset gives us an opportunity to probe deeper into HR data while also going beyond ‘vanity’ metrics. And here’s how;
✅️Have a beginner's mindset. Be curious. See with new eyes. Even with your 30 years of experience, remember the market is always shifting. Assumptions and bias are the killers of true insights.
✅️Engage with real people!!! Get out of the building and go see for yourself. Merge the offline data with online data. Or as we say Big data PLUS small data. Small data is what you collect from sources like observations and shadowing.
✅️What you measure is as important as the why, how, and when. Invest in the first half of the equation heavily. Are you measuring the right things? What are your motivations?
4. Build things that don’t scale (or don’t?)
“Think one customer at a time and take care of each one the best way you can.”- Gary Comer
Ok so back to Unilever’s onboarding dilemma? We’ve figured out our problem, vision and assumptions, what next? How do we create an exceptional new joiner process for over 1000 new hires per quarter? How do we roll it out? How will we know we’ve succeeded? By building a process that doesn’t scale. At first.
As we see with many successful startups that also started small, “Instead of marketing themselves to millions, they sold themselves to one.” This is because each week they were learning more and more about
- what was required to make their product a success. (customers, market & strategy)
- what attributes customers care about.
- test the riskiest assumptions first
- fail fast(and small!), be able to change direction quickly, get faster feedback
- quality problems can be identified much sooner
- save tremendous amounts of time in the long run by eliminating work that doesn't matter to customers
So how do we apply this “small batch, lean thinking, continuous deployment approach” to our onboarding refresh? Instead of delivering all the new features at once at the end, we produce a finished product every few days. Instead of trying to improve the experience for the 1000 new hires, can we start with one batch in one location and build on that? Instead of sending out a blanket survey to 1000, can we interact with 1–5 new joiners and gather insights? Can you force yourself to think big but start small? Paul Graham in his infamous 2013 article Do Things that Don’t Scale, shares some examples from startups on how to achieve this. Airbnb founders for instance started out by renting out several close spots and engaging with those hosts first hand. Now a billion dollar business, they attribute their success to those early customers who helped them gain new insights into the short term accomodation problem they were trying to solve and what mattered most. And as they grew the business gradually, they continue to unveil new product features & improvements with every new learning.
The ability to learn faster from customers is the essential competitive advantage that startups must possess.
The startup way- People, culture, process, accountability
This is the hardest part of the process because it calls for a mindset shift. As an HR leader with years of experience, you’ll be forced to see the common with new eyes. Or Vuja De as we call it i.e. seeing the common for the first time, just like an anthropologist. We are forced to maintain a spirit of curiosity, not judging, testing out the human aspects of the idea and not just the technical, all while keeping an eye out for common biases such as the Fundamental attribution error where we overestimate personality over context. If it's an onboarding software, do all our employees have the same technical capabilities? If we’re gifting on Day One, is this perceived normal or acceptable across all cultures? What about the role of gender in highlighting the differences in benefits perception? We therefore stop blanketing all our users in one bucket and instead become curious to learn about their abilities, goals, fears and contexts.
We’re also called to have a childlike belief in experimentation and failure. A must in innovation. There are no bad ideas. And every idea must be tested.
Nobel Laureate Richard Feynman- “It doesn’t matter how beautiful your theory is, it doesn’t matter how smart you are. If it doesn’t agree with experiements, it’s wrong.
Innovation is a process that can be managed, tested, and replicated. As Toyota, Apple, Coca-cola or Nike have shown in decades, you can build the most advanced learning organization in the world. The kind of learning culture that surpasses decades.
By focusing on functional efficiency, we lose sight of the real goal of innovation:to learn that which is currently unknown. As Deming taught, what matters is not setting quantitative goals but fixing the method by which those goals are attained. And to achieve better results systematically by changing our beliefs about how innovation happens.-LS
5. Nail it before you scale it
"Build things that don’t scale" is a phrase commonly used in the startup space. Unfortunately it's one we don't hear often in our more established companies. In HR in particular, this concept is extremely IMPORTANT since we're the change agents as our companies and teams go through transitions like a global pandemic to mergers and acquisitions.
From talent acquisition to workforce planning to HR software, we're called upon to be SMART with our decisions as we guide the workforce forward. Building things with the future in mind allows us to mitigate future risk. I've witnessed HR leaders pick software or solutions for a max 100 staff not acknowledging future growth plans for the firm. Most of us also wing processes like recruiting, performance management or L&D without having proper SCALABLE structures, technologies, skills & long term strategies in place that can enable us to adjust with any bigger or changing demands eg geographic expansion. The lean process allows us to scale what is working only and reduce future failures.
Companies struggle with transitions and workforce demands partly because we fail in HR to consider the future while making decisions today. While choosing our processes, people, procedures, plans and products this year, let's remember that the wise man is the one who prepares for tomorrow today. Embedding agility & small batch approach into our innovation culture allows us to quickly make changes and adjustments as needed in the business. Sometimes startups have better success rates with new ideas because of their small size as we highlighted here. However this all boils down to leadership, culture and talent.
"So as organizations grow in scale, the result, as many of us feel intuitively, is the concomitant loss of creativity, flexibility, curiousity, and humanity. Mega scale organizations are not, generally speaking, very nice places to work at, shop at, or do business with, are they? That is why they are always fighting their very own inertia. Like any kind of bloated empire, they end up ridden with politics, run by fiat, sclerotic, ossified, serving only their own purposes." — eand.co
As we go into a new era of employee experience and the future of work with this modern workforce & technologies, it is our responsibility to spearhead change and innovation in our teams and companies by building these capabilities and then some. However, building this startup culture may not be easy. Here I offer some insights from Apple’s Steve Jobs on how to build a solid culture.
For more Lean Startup lessons, check out my earlier articles here and here.
