Thursday, 11 October 2007

Requirements for organisational innovation

Gary Hamel provides some great suggestions for increasing the general level of innovation taking place in organisations (mainly supporting Rita Gunther McGrath's perspectives on entrepreneurial leadership presented at the CIPD Conference):

1. Dramatically accelerate the pace of strategic renewal to build a company that is as nimble as change itself (eg Google’s aim to be capable of evolving as fast as the web itself). Avoid:

  • Denial
  • A dearth of new strategic options
  • Allocational rigidities.

2. Make innovation everyone’s job. Avoid:

  • Creative apartheid (“If folks don’t appear to be creative at work, it’s not because they lack imagination, it’s because they lack the opportunity)
  • The drag of old mental models
  • No slack.

3. Create a highly engaging work environment that inspires employees to give their very best. Avoid:

  • Too much hierarchy, too little community
  • Too much exhortation, too little purpose.

Hamel describes a vision of management 2.0 which will enable innovation and may resemble the web, and particularly web 2.0:

  • Everyone has a voice
  • The tools of creativity are widely distributed
  • It’s easy and cheap to experiment
  • Capability counts for more than credentials and titles
  • Commitment is voluntary
  • Power is granted from below
  • Authority is fluid and contingent on value-added
  • The only hierarchies are ‘natural’ hierarchies
  • Communities are self-defining. Individuals are richly empowered with information
  • Just about everything is decentralised
  • Ideas compete on an equal footing
  • It’s easy for buyers and sellers to find each other
  • Resources are free to follow opportunities
  • Decisions are peer-based.

I think this highlights the challenge organisations have in being truly innovative while operating under the traditional management paradigm. Google, Gore and other similarly innovative companies are likely to have a clear competitive advantage for some time to come.