The 3 Pillars of Breakthrough Innovation
The content discussed in this 2-part article was presented at Coca-Cola Amatil (CCA) head office in Auckland in conjunction with the 2017 Sir Peter Blake Trust Leadership Week in New Zealand. The first part is The Slow Lane of Innovation.
Previously, we discussed the two types of innovation using the analogy of a 2-lane freeway. We highlighted that breakthrough innovation on the slow lane is few and far between. A big part of this, I would argue, is due to a misunderstanding of what it takes to innovate beyond incremental. From the lessons that I have gathered over the years, the one thing that is clear to me is that breakthrough innovation does not just happen. It requires deliberate, focused effort to guide discovery and ideation, mechanisms to sustain the process, and so on. And by focused, we do not mean putting a bunch of individuals into a working group and mandate them to innovate radically on your ideas.
From my experience, in order to foster breakthrough innovation, companies need to place more emphasis on the three critical support pillars, namely, (1) the right mix of people and getting the best out of everyone, (2) systematic approach and thought process, and (3) formal structures and the right level of support from management. We will cover these three pillars in this blog post.
The right mix of people and getting the best out of everyone
The first pillar is all about the people and it should not come as a surprise. There are three points that I would like to raise here. The first is the mix of people and the importance of getting the right representation across subject matter expertise, experience and personality type dimensions. I have found that involving people with the relevant expertise helps bring to the table views of best practice and cutting-edge work across the industry. As for people with the experience, their inputs prevent wheels from being reinvented or the same mistakes from being repeated.
The challenge here is getting the mix right, and more importantly, keeping favouritism and biases in check. For example, do not place too much emphasis on experience to the point of dismissing ideas very quickly simply because someone close to you has ‘attempted’ them before, without first appreciating the circumstances behind those attempts. Similarly, having someone in the mix who lacks the experience (but has the necessary subject matter expertise) can sometimes be helpful to inject left field ideas.
The second point is, leaders need to play an active role in helping individuals work better together and getting the best out of individuals in a group setting. The different personality types aside, humans have the tendency to want to manage a certain impression with peers and managers. For example, we often resolve to not ask questions, offer ideas or admit mistakes to avoid being perceived as ignorant, intrusive or incompetent. Facilitation and moderation techniques should be used in brainstorming sessions, for example, to ensure that people of different backgrounds and personality types get to contribute ideas and have healthy debates.
In the same vein, creating a psychologically safe work environment is critical. My experience tells me that the leaders set the tone in this regard by being transparent and open to acknowledging ones’ fallibility. In other words, leaders need to model the behaviour of admitting their own mistakes and genuinely look for ways to improve and learn. A practice which I find useful is to frame the work, especially in the ideation phase as a learning problem to create the rationale for individuals to speak up.
The third point is about rank and their influence on the merits of ideas. The level of scrutiny on an idea and the subsequent traction that it may gain should not in any way be dictated by the rank or the pay scale of the person who came up with it. It sets the wrong precedence and can discourage contributions, as individuals will question the point of doing so when HiPPO runs the team or the company.
Systematic approach and thought process
The second pillar is the approach and process to thinking. Typically the techniques that one uses to tease out the areas for incremental improvement in existing products are less effective for breakthrough innovation. For example, we often look at customer data and figure out the demographics. Based on that, tweaks are made to the products to better suit certain age group, gender, etc. Another common approach is to analyse feedback from customers about our products being slow, expensive, not keeping up with time, etc, and we make adjustments to the products accordingly. For a lot of these techniques, there is a fundamental problem, which is best summarised by the quote from Henry Ford, “If I had asked people what they wanted, they would have said faster horses“. A different sort of approach is required to shake up thinking.
The first learning is that, breakthrough thinking can benefit from having clarity of vision or purpose of a business, beyond just making more money. The vision or purpose transcends individual products or business models. To illustrate, for SEEK, the purpose as a business is to help people lead productive, fulfilling working lives and organisations succeed. This nirvana state ensures we focus on helping people lead better working lives during our innovation endeavours. Thinking about the purpose or the vision also provides the opportunity to take a step back and look at people as humans, instead of customers, consumers or worse, just numbers. We want to help them with what they want to attain in various aspects of their lives.
Another learning is that there are frameworks and methodologies out there that are useful for ideation and iterative idea refinement. The first one is jobs-to-be-done. This framework looks at the motivation of the people who hire certain products. We like to think that it should be obvious for many products. For instance, the rather unassuming purchase of a McDonald’s milkshake. What can the consumers possibly want to accomplish by hiring milkshakes? How complicated can the circumstances be? This brings us to the often cited example of jobs-to-be-done. If we were to adopt the usual incremental improvement mindset, we would be making the milkshakes tastier, cheaper, larger, with a greater variety of flavours, etc. However, through jobs-to-be-done, it was found that the people who purchase the milkshakes do it on the way to work and have only one hand free with professional work attire on which they want to keep immaculate. In this scenario, the consumers hired the milkshakes to keep hunger at bay until lunch and to keep themselves entertained during a long boring commute. These insights provide opportunities to improve existing, or create new products to better tap into the motivations of the users or consumers.
Thinking-inside-the-box is another approach which I have found useful. It works off the fact that most people are not very good at abstract, unconstrained thinking. I am pretty certain we have all been through scenarios such as this, where a group of people were given some sticky notes and pens and were told to think outside the box. The ideas from these sessions, more often than not, are far from breakthrough or worse, have little potential to add value. Instead, the thinking-inside-the-box approach does not require people to focus more intently inside the usual box nor to think outside of it. By having the facilitators or leaders asking the right questions to set the right constraints, this approach gives people a new box to think inside. Another methodology is design thinking, which takes a more human-centric, empathy driven approach to ill-defined problems.
It is worth noting that some of the outcomes from these frameworks can sometimes lend themselves to small, quick, incremental improvements. However, if the findings show that existing products are way off the mark in terms of solving what the people need solving, these frameworks provide a great starting point for breakthrough innovation.
Formal structure and the right level of support from management
The third pillar is about nurturing and sustaining the right kind of thinking and breakthrough innovation during and beyond ideation. This third pillar is crucial to bring ideas to life and to iterate and refine, as “spotting something and doing something about it are very different things“. The first learning is about the mindset of people at management level and their appreciation of the nature of breakthrough innovation and the effort required. From my experience, the willingness to see values in uncertainties and absurdity is often the first hurdle. This can be a big ask for many at management level as they have been conditioned as part of their roles to reduce risk and maximise return in the shortest time. Moreover, as humans, when faced with two options — one that is more straightforward and yields more immediate results versus the other that has more risks and takes longer for return on investment (if any) — we tend to lean towards the first. The issue with breakthrough innovation is the latter. By simply being conscious that long shots matter, being willing to accept well thought-through risks and to carve out space for those risks is an important first step.
The second learning is the importance of coming up with ways to progress innovation beyond the ideation stage. This often involves structuring and sustaining groups of people so that the ideas that are produced can be tested, refined and hopefully productized. In other words, environments have to be created that are conducive to undertakings where patience and discipline are necessary. I have seen in the past that funding and support models following the incubator, accelerator or venture capital approach can be quite effective.
The third learning is once things are in place in terms of having the right mix of people and team dynamics, fostering the appropriate thinking approaches and the necessary investment and support, management has to refrain from micro-managing. It is inappropriate on many levels in the context of breakthrough innovation. It sends the wrong signal about the role of management beyond guidance and governance. Over the years, I have come across cases of managers involving themselves in the wrong way in the innovation context, often by forcing the ‘how’ and the ‘what’ onto a team instead of inspiring them with the ‘why’ and the ‘where to’. In those scenarios, people will always question the point of hiring the best and the brightest if management is going to tell them what to do and how to do it.
Note: The content discussed in this 2-part blog post was presented at Coca-Cola Amatil (CCA) New Zealand in Auckland in conjunction with the 2017 Sir Peter Blake Trust Leadership Week in New Zealand. The first part is The Slow Lane of Innovation.
