Tuesday, June 19, 2012

INNOVATION killers by John J Arent

A few weeks ago, we talked about innovation and the fact that true innovation will lead to success, see my original post  

Today, we will focus on  a couple of reasons that will starve innovation.  These center on the leadership of the organization and can quickly transcend the entire company.

Conservative Leadership ~ Often seen in companies that have experienced some success due to product or service improvements.  There is a general feeling of “not rocking the boat” mentality.  The executive team is afraid to go beyond what has proven successful and often stifles creativity.  Their goals are often maintenance rather than growth.  They play defensively to protect and maintain their business but ultimately someone or something will break through their protective defense.  When this happens, they lose traction, become reactive and often spiral out of control. How many times have you seen the “prevent defense” gets beat when the first 58 minutes they held and then lost in the final two minutes of the game?

Loss of customer focus ~ Top Management has lost touch with front-line employees and the ultimate customers of the organization.  They have become desk jockeys making decisions that worked in the past but may be out of touch with what is truly happening on the front lines.  I’m reminded of an old TV commercial where a decision is made by the CEO that it is now time to get back to their customers who put them on the map and they plan a large-scale “boots on the street” approach.  Often times, losing customer focus comes about when executive management “thinks’ they know what makes customers tick but somehow forget that updates are important.  Once your competition finds a better way to do things, it is much too late for you to recover!  I have seen this first hand in organizations that are "top heavy" in the decision making processes.  This often happens after initial success has allowed early achievers to rise through the ranks.  Once they are executive management, they tend to lose first hand knowledge with what got them there.  

Business Departments operate in a Silo ~ To innovate, departments need to work together to solve issues.  It is through the blending of talents and sharing of expertise that true innovation results.  Many years ago, I happened to work for an organization where our CEO talked about silos and the need to break down any silos that were forming in our company.  This man proved to be a great innovator and helped our organization grow from a very small company with sales south of 100M to an organization that surpassed 2B in just 10 years.  To do this required a team approach and combination of skills from the various departments that were created within the company.  Often a company will try to “force” innovation with a special ops team or small department who will spearhead the drive.  This is the “silo” mentality and has rarely shown to be effective. 

The need to innovate has never been more apparent than in the recent past.  However, early success often  has a way of acting as a roadblock to innovation.  Do not let these 3 things detour your road to excellence!

1 comment:

  1. This is very true. I work for the #1 PBM in the US (120M-150M patients, following recently merger) and its staff and leadership are not open to innovation. This allows for competitors to produce better products that serve more purposes. That also prevents the company from reaching the goals for Federally imposed STAR awards programs. Company likes to count and report, but not analyze of search for better means to evaluate its entire program. Essentially it's workers and managers are taking the easy route without long term goals in mind.