Innovation Leadership; into the wilderness or into the future?


Innovation Leadership

In my recent article looking at why innovation transformations fail I called out innovation leadership (or lack of) as one of the prime causes of failure. And OK it’s not that hard to see why. After all, if CEOs and senior leaders are merrily setting off, compass-less, into the innovation wilderness then there isn’t much hope for the rest of the organisation. So where are CEOs and senior leaders going astray?

Strategy

Let’s start with strategy. The latest reports and surveys around innovation at executive level show us that 54% of executives still admit they struggle to align innovation strategy with business strategy. [1] And perhaps that struggle is the key to the solution. If you see innovation as something separate, if it’s ‘A-N-Other thing’, or something which might run on a separate track to the organisations’ main strategy then you’re never going to be able to balance the synergy across strategy, leadership and culture that innovation requires. Innovation has to be understood better and seen as an ‘outcome’ not a ‘thing’ that you are, do or have and so has to be seen as intrinsic to the overall strategy if you are to successfully align people and processes with outcomes that are labelled innovative.

So why then when 100% of executives see innovation as important or very important to the future survival of their organisation [2] do just 28% of executives say their company is innovating successfully to drive growth and increase revenue [3]. What is going wrong at the strategy level? Why have leaders been so slow to kill off ‘innovation theatre’ in favour of innovation-led strategies? Something, if you follow Alex Osterwalder’s work he believes is starting to shift, in that companies are now moving beyond innovation theatre and are beginning to look at innovation strategically rather than just being an ad lib service. In fact, in a recent interview ‘Being A Corporate Entrepreneur: The Good, The Bad And The Promising’ Alex discusses this very point with Yvette Miller from Columbia Business School. [5]

Leadership Perceptions

 Perhaps some of this problem is actually down to perception. The latest stats suggest that 71% of leaders see themselves as acting as role models in leading innovation [6]. And undoubtedly in some cases this is true but there is something wrong when just 41% of managers agree with the leadership perceptions. The polarisation is the issue and demonstrates huge voids/misalignment inside many organisations. And this perception gap is heightened within the same survey which also revealed that whilst 72% of leaders in innovation front runners are seen as acting as role models for change, this falls to 20% in innovation followers and just 1% in innovation slow movers.

Small wonder therefore that in a raft of surveys, leaders and leadership actions are seen as significant barriers to driving innovation in large, complex global organisations.

Flexibility

Developing genuinely innovative solutions requires an element of flexibility i.e. you have to be open to experimentation, to learning from mistakes and to flexing the business model to optimise results. So why in 82% of performance management evaluations is uniformity valued over creativity? And why do 40% of UK leaders seemingly reject disruptive ideas in case they fail? [3]

In a recent article for Forbes, ‘Why Large Companies Continue To Struggle With Innovation’ [4] Tendayi Viki argues that one of the main reasons for this is that ‘there’s something seductive about success’!

Tendayi says, and I completely agree with him, that “success lures people into doing the same things that made them successful in the past”. He also states that he thinks that it’s incredibly difficult for leaders in organisations that have been successful for some time and are still successful today, to imagine a future where that success might stop. That makes it difficult for the majority of CEOs and leaders to ‘shape the future’ as they are hard-wired to continue exploiting today.

Small wonder then that leadership outlook and the culture which leadership teams create seem to be widely recognised as innovation barriers.

Inclusivity & collaboration

I could equally have called this section diversity and inclusion, or leadership outlook. Building innovation capability is way more successful when you draw in influences from a wide range of sources. As I commented in my earlier article this means not only hiring for innovation but also empowering and being open to development strategies which help people to build the skills necessary for innovation and more importantly, thinking bigger in order to shape the future.

But operating a closed environment will never deliver an organisations true potential. Leaders have to allow their organisations to proactively look outside and to be open to working collaboratively with a wide range of people and organisations. Yet whilst 65% of leaders believe their organisation has a culture of openness to the outside world just 34% of employees agree. [6] And there is a similar gap when it comes to perceptions of collaboration inside the organisation.

Conclusion

When it comes to ‘innovation transformation’ it is all too tempting to do lots of stuff all at once. But unless your actions are in line with a cohesive and strategic plan, unless the CEO, board and leadership team are open to collaboration and flexibility then the chances are that you are heading towards the ‘innovation wilderness’ in which snares and traps abound. Building innovation capability, a culture where innovation is a natural by-product of a future-focussed organisation starts with understanding strategy and then with leaders being equipped to deliver on that very different strategic direction, trajectory and pace.

Having said all that, I genuinely feel for leaders in large, complex organisations where innovation is thrown down as a ‘delivery’ challenge. Why, because when I speak to senior leaders either in client organisations or as a speaker at international conferences, one of the questions I always ask is this.

How much money has been spent on your leadership development over the course of your careers? How many modules, courses and executive education programmes have you been sent on and how many hours of ‘learning’ does that add up to? Now, of all those hours, days, weeks of development, how many have focussed on leading for tomorrow, on building the mindset, behaviours, habits, curiosity and creativity required for shaping the future? It’s always somewhat of a rhetorical question as I’ve taught innovation strategy, leadership and culture at several of the world’s top business schools over the years so have spent hundreds of hours with the very people whom I ask this question.

The core challenge is that we’re still not adequately preparing or equipping, in a timely manner, our leaders and future leaders for the world we now find ourselves operating in. We live in a fast-paced, non-linear world, yet we expect our leaders to deliver amazing results with yesterdays slow-paced, linear skills.

Operating in a VUCA (Volatile, Uncertain, Complex, Ambiguous) world can be perceived as a huge barrier to progress if you let it. So, we must equip leaders to reframe VUCA into something that drives them not inhibits them. I think the new mantra and leadership definition for VUCA should be Visionary, Unbounded, Creative and Ambitious.

So, if you’re a CEO or a senior leader, how will you start to shape the future?

[1] https://www.pwc.com/us/en/advisory-services/innovation-benchmark-findings.html
[2] https://www.clustre.net/clustre-innovation-survey-executive-summary/
[3] https://www.cambridgenetwork.co.uk/news/pa-consulting-group-launches-latest-global-innovation-survey9316/
[4] https://www.forbes.com/sites/tendayiviki/2018/11/04/why-large-companies-continue-to-struggle-with-innovation/amp/
[5] https://strategyzer.us2.list-manage.com/track/click?u=a03a2a576ad72cd8546455984&id=c1bc763923&e=f7ea7ed2da
[6] https://www.capgemini.com/consulting/resources/the-digital-culture-challenge/

This article was written by Cris Beswick for The Future Shapers and previously posted on 11/12/2018.

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