Leadership Caffeine: Managing Risk Without Stifling Experimentation

November 8, 2010 By 14 Comments

The art and science of management is much about coping with risk. There are few certain outcomes in business, and that’s particularly true when we factor in the reality that people are darned complex and don’t always act rationally.

More often than not, I see managers and leaders looking at their world through the eyes of “what can go wrong?” and basing their decisions solely on attempting to minimize those identified adverse outcomes. I also see a great number of aberrant behaviors impacting the decision-making processes and risk-taking actions of managers and organizations.

4 Bad Habits that Stifle Experimentation:

1. Fear of being wrong rules the day. In particular, early career leaders lacking the benefit of experience and often left to sink or swim on their own, act conservatively out of fear of making mistakes. While they may be anxious to experiment with people, teams and programs, they often lack a framework for understanding what is acceptable or unacceptable.

2. Managers and leaders struggle to interpret what “new” means and the knee-jerk reaction is to avoid “new” until it’s better understood. Social Media is a prime example of this, as many firms opt to create punitive and restrictive policies versus challenging their employees to find ways to leverage the tools. It wasn’t so long ago that the web was the “new” and many firms carried the same “wait and see” attitude and failed to leverage new and powerful capabilities to improve their businesses and gain an advantage.

3. Risk is managed to perceived political tolerance levels. Politically motivated managers and leaders focus on identifying decisions that fit within the tolerance zone of their superiors. Experimentation is reduced to subjective and politically motivated thought-processes.

4. Fear rules the day. In toxic environments, people strive and struggle to avoid making decisions out of fear of gaining the wrath of someone with a vested stake in his/her people not making decisions. Experimentation in this case is non-existent.

5 Ideas for Leaders to Help Experimentation Flourish:

1. Define, communicate and reinforce risk tolerance levels in all aspects of your business. As a senior leader, you owe this critical context to your team members. If you’re encouraging experimentation and innovation, then you need to create the processes and systems to reasonably evaluate opportunities AND risks and help the team understand choices that are acceptable.  It’s common for me to see firms where there is no context for risk, yet ample lip service for innovation. The lack of context slows or stifles any true experimentation in some cases and simply confuses the situation in others.

2. Cultivate a “what does this mean for us?” opportunity and risk assessment type of thinking with your team members. Teach and encourage big-picture, competitive, customer and other industry scanning habits and challenge people to end all discussions with their own translation of what the opportunity might mean positively or negatively for your firm. Of course, the next discussion is, “What do you suggest that we do?”

3. Build experimentation into professional development plans. A key part of everyone’s development is their ability to cope with increasingly ambiguous circumstances. Move beyond encouraging people to experiment to making it a part of what gets done and what gets measured, and you are actively supporting personal professional development. Of course, ultimately, experimentation needs to provide meaningful outcomes, with a blend of lessons learned through failures and gains from successes.

4. Remember to help your team members cut through the very-real political fog and fud. They don’t have the political capital that you do and it is your job to help them gain it, while knocking down obstacles and cutting through aberrant organizational behaviors.

5. Extend experimentation beyond programs and processes to management tasks, including team development, decision-making processes, developmental activities, job definitions and so forth. We cannot keep solving the increasingly complex problems of our world with yesterday’s management approaches.

The Bottom-Line for Now:

A healthy workplace is one where people are comfortable being uncomfortable, as long as the discomfort is not politically motivated or driven by fear of repercussions. Healthy discomfort comes from pushing the envelope on new approaches, while managing and monitoring risks and learning in the process.  I would much rather have a team of professionals pushing me as the leader to take chances for the right reasons than a team of professionals hiding in their cubicles hoping not to draw my gaze.

Filed Under: Decision-Making, Leadership, Leadership Caffeine, Leading Change, Management Innovation, Performance, Professional Growth Tagged With: , , ,

Innovation is Everyone’s Business

July 28, 2010 By 11 Comments

Fresh ideasTake a poll in your firm on whether people feel responsible for innovation in their jobs or in their departments, and I’ll offer an educated guess on the outcome. Those involved in engineering, design, marketing and product management will feel a strong sense of responsibility to innovate.  For others in supporting or operations-focused roles, the need or ability to innovate will be rated towards the low end of perceived priorities or even capabilities.

That’s a shame.  A good innovator and good innovations are terrible things to waste, regardless of functional role.

This “I” word has been a hot topic for several years now, giving rise to entire shelves of books and legions of consultants, and yet the majority of people that I connect with in organizations from small to large, tend to view innovation as someone else’s job. This view ensures that some of the best ideas and solutions to vexing problems for internal and external customers are left behind in the pursuit of the urgent day-to-day work of many employees.

It’s time to alter organizational and leadership thinking about the concept of innovation and get more leaders and people doing the right things to push out of their transactional modes in search of new ways to create value.

First, A Working Definition of Innovation for All of Us:

In interviewing individuals inside of a number of small and large firms that have successfully fostered cultures where innovation is viewed as everyone’s business, the definition that emerged was:

Innovation is solving vexing problems in unique and reproducible ways

While the continuous improvement group might be quick to claim some of that real estate, the intent of the “innovators” offering up that definition was to look beyond incremental operational improvements to solving significant problems that adversely impacted an internal or external customer group.

The adoption of the definition helped create awareness that everyone was responsible for recognizing upstream or downstream problems and pulling together the people and resources to find solutions.  Solutions include process changes, technology adoption, new products and new approaches.

7 Suggestions for Jump-Starting an Innovation Focused Culture:

1. Challenge leadership to stand-up and own this one. Leaders at all levels own the responsibility for fostering an atmosphere or working environment that encourages innovation in all corners of an organization. While there’s no simple formula for building a successful innovation culture, it starts with the simple, but significant leap of faith for leaders to say, “Yes, we want all of our people thinking beyond tasks and looking for problems to solve and new ways to better serve their customers.”

2. Promote situations that jump-start the right thinking. People don’t innovate on command, so, it’s imperative that leaders and managers create situations where typically transaction-focused individuals can step back and look at the bigger picture of their work.  Choose simple but important questions and conduct ideation sessions around the topic, such as:

  • What gets in the way of serving our (internal/external) customers?
  • What in our working environment frustrates you?
  • What are our customers telling you that they wish we could do for them?
  • If you could fix one thing about how we do our work, what would that be?

3. Create an outside-in view. Move beyond the functional four walls and invite customers in your value chain to sit down and share their insights, observations and needs.  An example might be the order-processing group engaging with sales, shipping and manufacturing to gain a better understanding of how things flow and where the opportunities are to change and improve.

4. Go beyond process and promote innovation as a way to compete.  The most innovative teams that I’ve worked around include a few marketing communications groups and professionals that found ways to out-promote, out-maneuver and out-perform much better heeled competitors, while operating on a shoestring budget.  The push to innovate, adopt new technologies and to put a spin on traditional activities to shake up the customers was a core part of this organization’s success.

5. Celebrate innovation victories. It’s fun and easy to celebrate the blockbuster new products, but the type of innovation we’re describing is much less visible to the outside world.  People are people, and the recognition that their work is making a difference in someone’s job or life reinforces positive innovation behaviors.  Don’t skimp on the opportunity to celebrate.

6. Incorporate innovation activities and challenges into professional development activities.  Making this part of the PD plan reinforces the cultural imperative to innovate.

7. More work for leadership.  Once started, the innovation machine needs care and attention.  Your role transitions from getting things going to providing on-going support and enabling capabilities.  You need to challenge yourself to step-up and recognize the need to both channel the innovation as well as to let it run on occasion.  And remember, your job is to knock down barriers.

The Bottom-Line for Now:

Critics of this proliferation of innovation thinking typically suggest that too much distracts from the business of execution.  And while I’ll agree that a culture of the “undisciplined pursuit of more,” is a problem, it’s up to leadership to ensure that the intent and approach here stays true to the mission of getting more people focused on solving the right problems for the right customers. Difficult, but not impossible, and well worth the investment in leadership capital.

Filed Under: Leadership, Leading Change, Management Innovation, Performance, Professional Growth Tagged With: , ,

Innovation is for Everyone

June 22, 2010 By Leave a Comment

Fresh ideas sign in the skyInnovation isn’t just the domain of engineers, designers and other creative product types and functions inside organizations.  Everyone and every function has the opportunity to innovate in pursuit of serving internal or external customers, improving business processes and helping the firm achieve strategic objectives.

It’s too bad that many of us don’t recognize our innovation obligation and opportunity.

People focus on the all-new, all-new product and technology innovations that make our news headlines.  This discontinuous innovation while exciting and big and sometimes transformational, is actually quite rare.  Most innovation is continuous in nature…more incremental than of the all new variety.

My working definition of innovation is: “solving vexing problems in unique and reproducible ways.” While I have no doubt that there may be better and even shorter definitions, mine opens up the innovation frontier to the broad range of “problems” inside and outside of organizations.  My only catch is that the solution be both unique and reproducible.

Jump-starting your innovation thinking can be as simple as brainstorming with your colleagues on the headaches, time and cost wasters and bottlenecks that affect your customers and impede goal achievement.  Pick one, apply my definition and solve.

Rinse and repeat.  Happy innovating!

Filed Under: Uncategorized Tagged With: , ,

What If? Why Not? And Other Incredible Business Adventures

June 16, 2010 By 4 Comments

While we celebrate companies that pursue and succeed in radically changing the rules of the game, let’s face it, most organizations run on inertia.

For every company that redefines their little part of the world and changes our culture just a bit, there are plenty of firms that run on autopilot until the fuel runs out and the plane needs to be ditched in the ocean. The forces of globalization and digitization create storms and headwinds for some that are just too strong to overcome.

From Apple and Best Buy to Netflix, Starbucks, Zappos and Zipcar, there are firms and leaders that produce cultures and armies of people that thrive on redefining the rules in their own vision and along the way, they change our lives, habits, vocabulary and our view on the world.

These firms have dared to ask, What If? and Why Not?, and then they had the audacity to move forward and change the rules.

For the rest, there’s frustration, shock and amazement as their business models disappear. The CEO of Blockbuster describing how he likes how his moribund firm matches up with the competition is shocking, laughable and sad all at the same time.  His $36 million or so in market capitalization versus the billion-plus of his disruptive competitor is all of the scoreboard that any of us need to see to know that there is no match.

I hear frequently from managers and owners about how their firms can no longer make money in their traditional businesses. In some cases, since they don’t know what to do, they’ve settled on trying to just lose less money. That’s equivalent to allowing yourself to bleed out slowly.  The outcome is still the same, but the pain lasts a lot longer.

When I ask why they aren’t rethinking their businesses…whom they serve, what problems they are capable of solving and how they can position themselves in arenas where there are profits to be cultivated, the answers are shoulder shrugs mixed with looks of resignation and acceptance.  If looks could talk, theirs would say, “Who is John Galt?”

I’ve noticed that no one in these firms is asking What If? and Why Not? Instead, they are filled with leaders and managers doggedly defending the status quo as if their lives hung on perpetuating what they know.  Ironically, their business lives hang on what they don’t know but should be seeking.

The Bottom-Line for Now:

There’s no silver bullet, quick fix or sure-fire method to rethink and reinvent a business.  In fact, many cannot be reinvented and the highest and best use of capital may well be to fold.

For some however, there’s a process that combines the speculative questions of What If? and Why Not? with the courage to ask and answer How Can We? and then to say, Let’s Try It!

If your plane is running low on fuel and the storm clouds look ominous, it may be too late.  But before you decide to pull the ripcord and let the business plummet into the abyss, try asking and answering some simple but profoundly tough questions.

Filed Under: Crisis Leadership, Leadership, Leading Change, Strategy Tagged With: , , ,

Apply Distance and Anonymity to Improve Idea Generation

May 21, 2010 By 3 Comments

ideasThe default approach in most organizations and on most teams for idea generation is to conduct a brainstorming meeting.

You know the drill.  A meeting notice is sent out, and everyone assembles at the appointed time, prepared to “ideate.”  The moderator reminds everyone of the rules…no criticism, build on ideas of others, wild ideas are encouraged and so forth.  The issue is framed, a scribe, timekeeper and possibly a rules enforcer are identified and away you go.  Somewhere.

While there are some obvious potential social benefits from this type of team gathering and work, there’s no formal evidence that traditional group brainstorming is any more effective than other group or individual techniques for generating either more ideas and/or higher quality ideas.  In fact, there’s a hefty body of evidence that the dynamics in the live group setting may well contribute to stifling creativity or directing conversations down paths that are less than ideal for the issue at hand.

Researchers have long observed social issues, including distraction, social loafing (the tendency of some members of a group to work less due to the group), production blocking and evaluation apprehension as factors that impact both the quantity and quality of idea generation in brainstorming sessions. If you’ve participated in more than a few of these meetings, you’ve definitely observed all of these in action at some point.

An interesting and potentially beneficial approach is to add a step into the process that encourages individual brainstorming and that offers a degree of anonymity.

Add a Step or Two to Improve Idea Generation:

As the facilitator, you frame out the brainstorming question/issue and allow people working on their own to generate and then return to you a list of ideas.  You roll-up the ideas (without attribution) and return the compiled list to the individuals with instructions to clarify (add more detail), build-on and even potentially to sort the ideas into different buckets.

At some point, the group assembles face-to-face, with the ideas and content generated thus far visible to all.  The facilitator helps the group work through additional discussions and add-ons, as well as evaluation and prioritization.

The delayed face-to-face work doesn’t completely eliminate the opportunity for the social problems identified above, but it does potentially allow everyone to move further through the process before these biases or opportunities for derailment enter the picture.  The hoped-for outcome is that people focus more on generating, clarifying and extending ideas without concern for source or agenda, versus the purely live format.

There are of course a variety of additional approaches and techniques ranging from the structured and anonymity focused Delphi technique to brain writing and others that can help mix things up as you search for a better flow of quality ideas.  The suggestion above is one simple, easy to implement twist to your current brainstorming approach.

The Bottom-Line for Now:

In a world where gaining an edge is increasingly a function of responding to or anticipating customers needs in unique ways, creativity is priceless.  The topic is also nearly endless, involving issues of culture, leadership, input sources and group-make up, voice of customer, lateral or divergent and convergent thinking, and of course, human psychology.

Regardless of the complexity or the nearly infinite opportunities for inspiration and idea generation, try breaking away from the formulaic approach to brainstorming that is so widely and frequently used.  The results might surprise you.

Filed Under: "To Do" List, Leading Change Tagged With: , , ,
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