Companies Need All The Innovation They Can Get

In a recent Bloomberg article entitled “Why Companies Need Less Innovation”   Pat Lencioni makes the case that companies should not be asking employees to be innovators.  He goes as far as to say that leaders should not even be open to more ideas from their employees and that only a few people really need to innovative.  He suggests that rank and file employees should not try to innovate but simply “do their jobs and satisfy customers in the most effective and charismatic way possible, but within the bounds of sound business principles.”

Lencioni has a far too limiting view of innovation.  Let’s start with the definition of innovation itself.  While this is widely debated, I always fall back to the simple dictionary definition:

Something new or different introduced

Too many innovation writers, try to complicate a simple concept.  Innovation is simply doing something new.  It doesn’t have to be revolutionary or disruptive to be an innovation, an innovation can simply be a new way of doing something.  PwC is a professional services firm and our goal is to deliver value to our clients.  The goal of our innovation program is to encourage all 30,000 of our people to come to work each day and ask themselves the question, “What can I do differently today to deliver more value to my clients?”  The creation of new or additional client value should be the goal of every corporate innovation program.

The value created can be both large and small. Successful innovation programs usually take a portfolio approach to innovation, which nurture both small incremental innovations as well as more dramatic innovations.  Toyota has taken this approach in developing the “Toyota Way” corporate culture.  Toyota claims that their success is the result of thousands upon thousands of small innovations, most of which were created by employees at all levels of the organization.

Other innovation gurus, along with Lencioni, have suggested that it is not productive to have everyone within an organization focus on innovation.  They site many studies which have found that only 10 or 20% of a random population are really interested or talented enough to come up with new valuable ideas or innovations.  Unfortunately I believe experience has shown that it is not easily possible to pre-determine which 10 or 20% are the right people to ask to innovate.  Lencioni’s suggestion that a firm’s leaders “are the keepers of innovation” defies most people’s experiences.  It is rare that a firm’s leaders are the best innovators; the exact skills which enabled them to climb the corporate ladder probably keep them from being the most creative people.

A secondary benefit of encouraging everyone in an organization to think about innovation is the effect on culture.  In many companies, young people learn that their ideas are neither valued nor appreciated and they quickly stop sharing them.  Innovation programs must strive to unwind this behaviour and attempt to create a “Culture of Ideas.”  A Culture of Ideas is one in which ideas are judged on their potential value, not on the salary or staff level of the person who suggested it.  Corporate executives help make this change by communicating that they are interested in ideas from anywhere in the firm.  Innovation programs must set up mechanisms for collecting, evaluating and implementing appropriate ideas in order for this to work.

Anyone within an organization can come up with an innovation which delivers more value to their clients.  Innovation programs must be designed to encourage and capitalize on everyone.

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About Sheldon Laube

Sheldon Laube advises member firms of the PwC network in the development of innovation strategy. An experienced entrepreneur and corporate technology executive, Sheldon recently retired from PwC after being the Chief Innovation Officer of PricewaterhouseCoopers from 2009 to 2011.
This entry was posted in Culture, Innovation, Organization, Process. Bookmark the permalink.

2 Responses to Companies Need All The Innovation They Can Get

  1. Joao Soares says:

    Hi Sheldon,
    I understand and suport your point of view about Innovation should be everywhere in a company. But I understand the concerns of Pat Lencioni , putting everybody ” thinking”in innovation how it could afect the Process Orientation of the company? How can a large company be competitive if everybody is trying to innovate doing things in a different way. I guess, everybody should think in innovation, but must exist a central point where you define that ” new idea ou new way of doing that” is integrated with the company objectives and with the compliance of all business processes.

    • Sheldon Laube says:

      Joao,

      Good point, but the goal is not to have everyone try to do innovation on their own, but have everyone come up with ideas on how to improve things. You then need a process to review all the ideas and decide (from a business point of view) which ones to more forward.

      Sheldon…

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