By: Steve Little, Principal, The Disruption Lab: Building the plane while flying… A Short Video
Operators vs. Innovators…oil and water? As a passenger, would you prefer to have a flight crew focused on getting you safely from point A to point B in comfort with no surprises, or would you be impressed by a flight crew innovating on the fly (pun intended)?
Often it seems, operators want innovators to stay out of their operational sand box. Operators are responsible for daily, if not moment-by-moment, deliverables. If the operators fail to deliver, the organization will soon cease to exist. And in some industries, such as air travel or acute health care, operational delivery is truly life-or-death.
An interesting McKinsey study published in April 2015, The Eight Essentials of Innovation, begins with the following statement:
It’s no secret: innovation is difficult for well-established companies. By and large, they are better executors than innovators, and most succeed less through game-changing creativity than by optimizing their existing businesses.
To be sure, organizations that are successful over the long-term, excel in efficient, effective operations. However, operations devoid of innovation over time become irrelevant. Innovation is a key determinant of long-term success.
One of the keys to any successful business is being able to come up with new ideas to keep operations, products and services fresh. The process of bringing those ideas to reality is called innovation. While thinking up new ideas is one step of the process, businesses have a much greater task in trying to turn that into an actual product or service that will benefit customers.
The companies that have done the best over the long haul are those who are the most creative and innovative. These organizations don’t copy what others do; instead, they may use innovative ideas from others as a spring board to come up with a unique application, product, or service for themselves. They tend to distance themselves from the competition rather than compete with them. If they see another company copying what they do, they create something new and better. In other words, they are able to leverage their creativity and their innovative capabilities to attain long-term success.
So operational efficiency and effectiveness are essential AND innovation is essential. Oil and water? It better not be. My colleague, Phil Gibbs, did early research in what is now often referred to as “the ambidextrous organization.” He concludes today that:
The organizational requirements for operations and innovation tend to be at opposite ends of the continuum. Excellence in operations usually includes low uncertainty, predictability and planning, metrics and accountability, high structure, and little tolerance for failure. Innovation, on the other hand, is generally characterized by high uncertainty, hypotheses and experimentation, metrics and learning, little structure, and failure that is quick, inexpensive, and iterative. While improvements can be made in operations, transformative innovation generally requires moving to the edge or outside of operations where a structure, culture and leadership style that champions innovation can flourish. While this has always been true, the pace of change today makes it an imperative for any organization committed to survival and growth.
While there is not a cookie-cutter, checklist answer to optimizing operations AND innovation, there are a few basics.
- Create and encourage a culture of innovation: It is important that the entire organization understand the importance of innovation and how your organization is leveraging innovation to ensure future success. Each employee should know how they can participate in innovation.
- Value the work of the operators: There must be a clear understanding of the current business model and what must be done daily to satisfy your stakeholders (customers, investors, employees, etc.).
- Practice rapid experimentation: The Center for Innovation at the Mayo Clinic emphasizes, Think big. Start small. Move fast. Innovation doesn’t require a bet-the-farm strategy. Quick, inexpensive, non-intrusive experimentation is key to testing the hypotheses and assumptions of your innovative idea.
- Have a process: What is your process for innovation? What tool sets are you equipping your innovators with? Just as your organization has a vocabulary unique to you and to your industry, you need a common language around innovation. Having done a bit of consulting work, I experienced unique vocabularies as I went from client to client. Often the client doesn’t realize their uniqueness. There are phrases with stories behind them that everyone in the company understands, but to the outsider, we often miss or misinterpret the meaning. There are acronyms, company-specific meanings for common words, and short-hand ways of communicating. I NEED THE SECRET DECODER RING. Until your company can speak fluently about your innovation process and language, your initiatives will always face headwinds.
- Make it yours: What works for your company? Don’t introduce some grand innovation structure (at considerable expense and time) before you’ve tested the process yourself. Discover what works in your company, then double-down.
Personally, I prefer not to fly on a plane that’s being built during flight. But to each his own.