“While 77% of Chairs and 72% of CEOs said their organisations were innovative, only 34% of Chairs and 46% of CEOs said that a significant proportion of their revenue was derived from recent innovation. Indeed, while companies saw themselves as innovative, the interviews highlighted several concerns that Australia has not been innovative as a nation.
“Both Chairs and CEOs raised concerns around innovation, such as a lack of scale, low levels of venture capital funding and changes to government tax rules. But what surprised us was the view that lack of innovation may be cultural. There were several references to tall poppy syndrome and cultural cringe around innovation. Many Chairs and CEOs also felt that while Australian companies are good at adapting and may be incremental innovators, they have not generally been breakthrough innovators.”
Now this research is conducted by interviewing the CEOs and chairmen of the Top 200 companies in Australia, but I wonder if their comments are representative of Australians as a whole.
You do hear stories from the US about entrepreneurs who have failed 5, 6, 7 times or even more, and just pick themselves up, dust themselves off and try again.
Yet, I cannot name any Australian entrepreneurs who have the same history. So the question is, do we as a nation have the ticker to accept failure is part of the innovation process, or do we just give up too easily?
Are our business leaders uncomfortable being seen as champions for change? And is this because when we fail we feel there is a lack of support for our endeavours, and that observers are somehow pleased by our failure?
That brings me on to thinking about competitive advantage – imagine a business which really does treat innovation as a core part of their strategy, and is willing to accept that ideas fail.
The key would be to arrange things so that the failures are quick and cheap, so as not to become too much of a drain on the overall resources of the business, but to celebrate the process of “failing quickly and cheaply” and then reinvesting the learnings back into the innovation process.
Against a culture where innovation is not culturally accepted, this could provide a real competitive advantage.
One of the blockers to an innovation culture is the ambiguity and fuzziness which comes with the uncertainty of an innovation culture rather than a culture where the direction and strategy is tried and tested.
And this is a test of leadership: to embrace the ambiguity of innovation. Even if innovation is embraced at the senior levels, however, there can still be a major disparity in comprehending innovation between senior management and the rest of the company.
The result is an “air sandwich” between senior and more junior employees, which comes about because people believe they need a culture that embraces co-participation, but don’t always know how to achieve this.
So how can you set up or develop an innovation culture? Here are some ideas:
• Once the leader of the organisation has embraced innovation as a culture, he or she will need to “walk the talk” – encouraging staff to discuss new ideas and celebrating them when this happens.
• Organising workshops to brainstorm particular issues, such as solving a problem or considering a particular customer need. Workshops can be enriched by bringing in people from a range of areas of the business, for example customer facing, production, warehouse and so on.
• A series of workshops could be a way to signal to the team that the innovation process is valued within the business, as well as establishing a process where business issues or challenges can be examined
• Creating an “innovation zone” where ideas can be logged by anybody in the business and then centrally viewed and considered. Ideas worthy of further consideration can then be “funded” with time or dollars to develop them further. This allows management or the leadership team to manage the flow of innovative ideas and to direct resources to the ones they consider most worthwhile. It also allows them to control the process of “failing quickly and cheaply”
• Using internal social media, where employees are encouraged to share problems and solutions – a crowdsourcing approach to innovation
• Once a business becomes used to this way of working, then some of the above processes can be applied to forums with external stakeholders, such as customers or suppliers.
Change can be confronting and unsettling, but can also bring great excitement and opportunity.
In closing, I’m reminded of the information revolution which resulted from the introduction of information technology. Initially many feared that IT was going to do all of us out of white collar jobs, but that hasn’t happened – at least not yet.
Saying that I am a slave to my mobile and laptop, so perhaps the computers have won by turning the tables on us all!
Contact Kate at khill@deloitte.com.au
