Editorial
What is innovation? Although it has many definitions, this quote by the Business Development Bank of Canada encapsulates it well: “Simply put, innovation is about successfully implementing a new idea and creating value for your customers and stakeholders.”
At its core, innovation should have the following components:
- A new idea, big or small, expected to create value for customers and other stakeholders.
- The implementation/execution of that idea to create value for customers and stakeholders.
Without the first, it has no value. With the second, it’s nothing more than an idea.
Innovation is everyone’s responsibility. Anyone has the potential to come up with new ideas to create value and implement them for stakeholders collectively. Limiting it to one area or one group delegitimizes the ideas and innovations of others and leaves organizational potential untapped and unengaged. No company can afford this to happen, especially in a turbulent environment.
However, many obstacles prevent organizations from innovating, including:
- Ignoring and not understanding how the world (the context) has changed, often obliterating past assumptions. Context changes can be caused by economic and geopolitical events at the macro level to business model changes at the competitor level.
- Complacency, the belief that one’s size and success are so strong that they do not have to pay attention to and can ignore possible early warning signals from others, especially minor or emerging competitors. Think about Kodak and Blockbuster.
- Allegiance to the past, believing what makes them successful to date will make them successful in the future. “If it works, why change it” attitude.
- Seeing change as a personal and professional threat that must be contained and removed to preserve one’s power and position.
- Leaders and a culture that punish failure, leading to a reluctance to have challenging discussions and take risks, promote curiosity because it is risky, and take accountability for fear of being blamed.
Is It Better to Play Defense or Offense?
When it comes to innovation, many companies face this conundrum — especially under conditions of accelerating change, frequent and often simultaneous disruptions and widespread uncertainty. When a crisis hits, the first reaction is to hunker down, focus and protect and exploit what you have.
However, only playing defense to avoid losses and minimize risk isn't a strategy for success in the long term. To win, you must play offense. Despite this knowledge, many still try to exploit what they have (or once had), recover what they lost and return to the past. They refuse to recognize there is no going back, and that it's futile — even fatal — to try.
However, exploiting what still works and is relevant that provides value to customers and other stakeholders is essential to surviving, funding the present, and investing in the future. Both exploitation AND innovation are necessary — either is insufficient alone.
This is not a problem to solve, but a paradox to manage and navigate so the company can thrive in the future. When new capabilities are needed, The Five Leadership Superpowers capability framework can provide the answer. Exploring, finding and implementing innovative solutions is the key to success.
Related Article: 5 Key Leadership Capabilities for Success
The 5 Leadership Superpowers
The Superpowers provide the capabilities necessary for organizations and their leaders to thrive in a turbulent future. Each Superpower reflects a tension that must be navigated and managed versus choosing one side or the other.
They are becoming and staying:
- A Present Futurist – Someone who strives to understand the present robustly. They think about, predict and evaluate possible futures, integrating these insights to inform and make decisions about the business and organization.
- An Experienced Learner – Someone who leverages their expertise and past experiences to the extent it is relevant and valuable. They are open to learning, encourage curiosity, and foster a learning-friendly culture and environment.
- A Prepared Risk Taker – Someone who knows that intelligent and measured risk-taking is a part of business, considers interconnections between risks and their aftereffects and integrates these elements to inform decision-making actions. They value improving preparedness to be ready to act, regardless of what the future holds.
- A Strategic Executor – Someone who balances and integrates strategy and execution (operations), knows that one informs and can positively or negatively impact the other, considers longer-term implications when making short-term decisions and makes these decisions in alignment with strategy, even under stress.
- An Accountable Collaborator – Someone who recognizes collaboration across functional and organizational boundaries is necessary to address the complex challenges organizations face, fosters and enables collaboration and enables and encourages teams need to own and be focused on achieving desired outcomes. They are held accountable for these versus activities or outputs.
Related Article: Innovation Can Be Taught. And Measured
How These Superpowers Ignite Innovation
Being a Present Futurist (PF) and Experienced Learner (EL) ignite innovation while being a Prepared Risk Taker (PR), Strategic Executor (SE) and Accountable Collaborator (AC) power and exploit innovations. Optimally, this becomes a continuous cycle.
This is how this works:
Igniting innovation begins with greater knowledge and insights about the current and future environments. WHen developing a robust view of the present, the present futurist considers various perspectives (like those of the customer, employees, distributors, partners and competitors). The PF identifies, evaluates and monitors trends and signals from various sources, using the knowledge gained and resulting insights to spur new ideas and subsequent possible innovations.
Innovation is also spurred by curiosity and a desire to learn, which are key attributes of experienced learners. ELs foster this curiosity by asking questions and encouraging others to do the same. They welcome debate and challenge by providing a psychologically safe environment. They see failure as a source of learning, not something to fear or be punished for. Experimentation and prototyping are encouraged to speed learning and refinement, getting ever closer to value creation.
Powering innovation begins with prepared risk-taking. Prepared risk takers know that risk-taking is necessary to drive growth and is part of all business decisions. However, when placing bets on innovation (whatever the form), they know it is better to place smaller bets, fail fast and learn. By doing so, later bets have a higher probability of success.
Preparedness comes in the form of risk mitigation and backup plans in case things do not go as planned. Exiting specific markets, dropping certain products and ceasing non-value-adding processes help free up resources and funding for innovation. A PR weighs multiple factors before deciding on its bets/investments and manages these collectively as a portfolio. Primary factors assessed include timing and timeframes, size and timing of investments, progress made and continued relevance, risk and impact of loss, and probability and value created from and other benefits of success.
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Strategy execution (implementation) brings innovation to the forefront to create real value for stakeholders, whether that be revenue and profit growth for investors or value to employees. The strategy provides guidance and guardrails for making decisions on innovations, ensuring they align with and support the achievement of the strategy.
Successful innovation requires both collaboration and accountability. Most innovations require collaboration with multiple parties, from ideation to implementation, if they will succeed. Accountability for success (clearly defined in advance and outcome focused) lies collectively with the team. The success of any individual alone only matters if the team is successful at delivering value.
As the exploit–explore cycle continues, the innovation process continues. The Five Leadership Superpowers, working in concert to keep this process going. This makes it more incumbent for the organization to sustain and spread The Five Leadership Superpowers framework throughout the organization. In my next article, I'll explain exactly how you can do this.
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