Two Innovation Killers

Organizations over-focus on managing the present—increasing efficiencies—and they think they are doing strategy. ~Vijay Govindarajan

Over the years, I have had individuals argue during discussions about strategic planning that “getting better” is strategic. Getting better, making improvements is absolutely something that needs to happen in organizations and it certainly should be encouraged. However, I still believe “getting better” isn’t strategy.

Several years ago I heard Vijay Govindarijan speak about The Innovation Challenge. This week his presentation came to mind as I was working on a project in health care. I reviewed his presentation once again and still believe his premise that strategy is innovation.

VG (as he’s called) says that organizations spend time and resources in three boxes. If there is an over-focus on Box 1, innovation may never occur.

Box 1: Managing the present = efficiency

Box 2: Selectively forgetting the past = what you will abandon

Box 3: Creating the future = innovation

Therefore, strategy is answering the question: How do we create the future while managing the present?

I think this is why so many strategic plans fail. The plans weren’t strategic in the first place. In other words, they focused on managing the present, got more efficient, but nothing new emerged. Or, they got frustrated by the enormous challenge of creating the future while managing the present, and essentially gave up.

VG maintains that you can’t create strategy in your dominant logic. Your dominant logic (performance engine) is the kind of people you hire, the kind of processes you have, the performance measures you monitor, etc. All of this is needed for continued operational execution (i.e., efficiency), but it is also a barrier to innovation, or strategy.

How do you simultaneously do innovation and efficiency? That’s strategic planning. And, that’s hard.

According to VG, there are two common innovation killers.

  • To assume that innovation can happen inside the dominant logic (your current performance engine).
  • The innovation team and plan is not constituted correctly. It has to be a separate team and plan with different responsibilities. In other words, not the operational team. You may need to recruit people from outside of your organization because you are building new capabilities and selectively forgetting some of what’s worked in the past.

There’s far more to unpack around this topic. But if your strategic planning isn’t going anywhere, maybe part of the reason is because the very same team is trying to both manage the present (operational efficiency) and create innovation (strategy).  Step 1: Start your strategic planning by building a dedicated team to create the future and function without the restrictions of your current dominant logic.

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If you faced Goliath, would you feel fear or possibility?

When Goliath came against the Israelites, the soldiers all thought, “He’s so big we can never kill him.”  But David looked at the same giant and thought, “He’s so big, I can’t miss him.”  ~Dale Turner

It’s all in the eyes of the beholder. Our emotions or how we feel about a given situation is significantly affected by the meaning we give to what we experience. And the meaning we give to any experience is shaped by the lens or filter through which we perceive it. David was clearly viewing Goliath through a different lens or filter than the other soldiers. While they felt fear, David felt possibility.

That means if we can change the way we look at something, by reframing it, we change the meaning and in turn, change the emotion attached to it. Reframing isn’t always easy, but I do believe it comes more easily with practice. It might be helpful to first remind ourselves that our perspective on a given situation is exactly that, ours. There are always many ways to view the very same situation.

Here are a few questions you could ask yourself to reframe your perspective on a given situation.

  • If you were feeling resourceful and generous, how might you look at this situation?
  • What’s missing here, that once it is included will make this situation flow?
  • What if the opposite were true; what would that look like?
  • Put yourself in the shoes of the other person, what do you think is their perspective?
  • What would it look like if you were empathetic instead of irritated, frustrated, or angry?
  • Imagine yourself in a week, a month, a year in the future – how much do you care about winning this one argument?

An example frequently used to illustrate the art of reframing is Thomas Edison. He made somewhere around 10,000 attempts to invent the incandescent light bulb. Others would scold him for failing over and over and would ask when he was going to stop trying. It is said that he replied with, “I didn’t fail, I just figured out another way not to invent the light bulb.” He reframed failure as a process of gaining more knowledge that would get him one step closer to realizing his vision. Reframing made Edison feel empowered so he continued.

Another of history’s great minds, Albert Einstein said, “You cannot solve a problem from the same consciousness that created it. You must learn to see the world anew.”

We all have moments where we become stuck or find ourselves at an impasse of some sort. We can continue to hold on to our same view or perspective with stubborn determination, or we can explore other perspectives and reframe our thinking to get unstuck.

As leaders, we must be willing to continually see the world anew, to replace fear with possibility.

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This is the slowest pace of change for the rest of your life.

This is the slowest pace of change for the rest of your life. ~Greg Dickason from CoreLogic

Greg Dickason wrote both an attention-grabbing and accurate headline. Global Risks 2018 (an annual report published by the World Economic Forum) stated that the pace of technological and social change is “testing the absorptive capacities of institutions, communities, and individuals.”

Like it or not, our “absorptive capacities” will be tested for the rest of our lives, as well as the lives of our organizations. I discovered an HBR article back from 1997 entitled Changing the Way We Change by Richard Pascale, Mark Millemann, and Linda Gioja. While the article was written 20+ years ago, I believe their conclusions about the vital signs of organizational health to withstand change (i.e., absorptive capacities) still hold true today.

Here are four vital signs to test your organization’s “absorptive capacity,” your ability to thrive in the midst of change, with some of my added commentary.

Power. Authors Pascale, Millemann and Gioja ask “Do employees really believe that they can affect organizational performance? Do they believe they have the power to make things happen?” This seems obvious, after all, if employees don’t believe that their efforts can make a difference in the bigger picture then quite frankly, why should they change what they are doing, how they are doing it, or their attitude towards it? Yet, I see this first vital sign frequently overlooked.

Identity. Pascale, et al, ask “Do individual employees identify narrowly with their profession (i.e., engineers), their working team, their functional unit, or do they identify with the organization as a whole?” That dreaded word: silos. Too many silos throughout an organization make it much more difficult to shift gears, head in a new direction, or introduce any kind of change. The more employees can identify with the organization as whole, the greater the organization’s overall health and adaptability.

Conflict. How is conflict handled? Are conflicts avoided, swept under the rug? Or, is conflict confronted and resolved? Is there a shared understanding for the process of how conflict is handled? Healthy conflict is a good thing. It’s a necessity to effectively manage change.

Learning. The idea of organizational learning has been around for decades, yet I still find leaders who equate organizational learning with having a tuition reimbursement program. Organizational learning is how the organization deals with new ideas, how those ideas are tested, when things don’t work as expected how the organization responds?

This is the slowest pace of change for the rest of your life. How is your organization using power, identity, conflict, and learning, to more effectively maneuver through the changes that will most certainly “test your absorptive capacities”?

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The single most powerful weapon in a leader’s arsenal…

Stories constitute the single most powerful weapon in a leader’s arsenal. ~Dr. Howard Gardner

A leader presents the business case for the organization’s move in a new direction. It’s filled with data and sound logic. Then they ask the people in the organization to join in the move toward the new direction, after all, it’s only logical. Instead of resounding applause, the leader is met with skepticism, challenging questions, uncertainty, and apprehension. Sound familiar?

The leader failed to recognize what organizational theorist Chris Argyris coined as the Ladder of Inference. Imagine a ladder…at the bottom of the ladder is all the observable data (all that logic the leader presented in his business case); one rung up is the data I select; then next the stories I tell myself based on my selected data; followed by my assumptions inferred from my stories; which leads me to my conclusions, next come my beliefs based on my conclusions; and finally, the action I take based on my beliefs. Author M. J. Ryan says, “The higher up the ladder you are, the more rigid is your thinking—and the more unsafe you are because you are farthest away from the facts.”

A quote I use frequently in organizational consulting is “every gap in communication is filled with imagination.” It describes the dangerous assumption made by too many leaders. Once they’ve laid out a logical course, they stop. They believe that everyone else in the organization will select the same data, tell themselves the same stories and make the same assumptions, draw similar conclusions, form beliefs that align with theirs and then take action just as they [the leader] had envisioned.

As Argyris’ model highlights, the actions we take are a far cry from the observable data. What’s a leader to do?

I believe that leaders need to carefully climb up with ladder with their people.

First, don’t overwhelm them with data, select the data that is most meaningful. Then, tell them a story. Provide a narrative they can reference throughout the change process. Tell them what assumptions you are making within your narrative/story, how you’ve drawn your conclusions, what you believe, and then finally what action the organization will take. Far too many leaders jump up the ladder from observable data/facts to taking action and assume that everyone in the organization is both comfortable and capable of making the same leap into the future.

Change is hard. Travel the change journey along with your people. Begin by telling a story.

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People don’t resist change. They resist being changed!

People don’t resist change. They resist being changed! ~Peter Senge

Author John P. Kotter begins Leading Change with this statement: “The single most important message in this book is very simple. People change what they do less because they are given analysis that shifts their thinking than because they are shown a truth that influences their feelings.”

To get us all on the same page, the definition of change management is “The discipline that guides how we prepare, equip, and support individuals to successfully adopt change in order to drive organizational success and outcomes (Prosci.com).” In my own words, change management is about helping people emotionally and psychologically adopt change. Or, recognizing that we change more because of how we feel, not as much because of what we think.

A year ago, I spent a day observing a leadership team of a global organization go through change management training. The day was filled with models like the change reaction curve (our emotional response to change), detailed processes how to influence change of both individual and collective behavior, and all the various roles necessary to influence change. Closing out the day with how to create metaphors to communicate a truth to influence how others feel about change.

(Sigh!) After all of that focus on how to help people feel their way through change, there were still leaders in this group at the end of the day saying, “I think we need to talk more about the ‘business case’ (analysis) for implementing change.” Argh! Really?! At least that’s what I was thinking in the back of the room.

When faced with a decision, how we feel about something many times (if not most of the time) determines our final choice. Think about the last time you made a big decision (bought a home, moved to a new city, quit your job, etc.). When you made that final decision, did you say to yourself, or to someone else, “this just feels like the right choice”? The data and analysis will frequently narrow the choices, but at the end of the day, we choose to change, or not, by how we feel about it.

I believe that leaders are frequently promoted because they are skilled at making analytical decisions. But, those decisions can’t be effectively implemented if others aren’t following. And others will follow, or not, based upon how they feel about what’s being proposed. The process to garner support and followers (AKA: change management) is quite different from the process to make the analytical, strategic, or technical changes (AKA: project management). If you want to bring people with you, they have to feel it.

Is your organization currently going through a change? What are you showing them to influence their feelings about the change?  “It is not the strongest or the most intelligent who will survive but those who can best manage change.” ~Charles Darwin

 

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