The corporate landscape is littered with buzzwords. One of the hottest? Innovation.
Like so many buzzwords, innovation can seem promising on the outside yet ultimately hollow in the middle. So how can you transform the theory of innovation into a strategic business advantage? Five speakers from CPA Congress 2014 share their tactics.
Focus on the future
As a successful entrepreneur, Cheryl Yeoh is in a good position to talk about innovation.
In 2012, Yeoh launched ReClip.It, a personalised shopping list app that helps people save money by matching their list items with digital coupons. A year later, she sold the business to WalmartLabs, a unit of Walmart Global e-Commerce that is dedicated to innovation.
Returning to Malaysia after 12 years in the US, Yeoh is now using her entrepreneurial nous to help other innovators in her home country.
“No idea is too small to be voiced, and management takes heed and listens.” – Cheryl Yeoh, MaGIC
As CEO of MaGIC (Malaysian Global Innovation & Creativity Centre), Yeoh aims to transform Malaysia into the regional start-up capital.
“Next year we want 75 start-ups to come to MaGIC to work out of the space for a minimum of five months. We want entrepreneurs from the whole of South-East Asia to apply to come to this accelerator program.”
Yeoh says companies that focus on the future are natural innovators.
“Innovation is about thinking ahead. As a business, you have your shareholder interests to fulfil and a lot of the time that means quarterly profits and very short-time goals,” she says.
“So while you have to do that, you also have to look at the future to see how you can grow your company or protect your position if you’re already a market leader. Think about the Kodak moment – digital photography replaced film and now smartphones are killing off digital cameras.”
Yeoh adds that innovation must be regarded among the key business strategies.
“WalmartLabs is a prime example of how to keep up with technology,” she says.
“Walmart carved out a department to allow a group of entrepreneurial employees to work on experiments and new products,” she says.
“Management treats it as a core strategy of the business. No idea is too small to be voiced and management takes heed and listens.”
Have discipline – and curiosity
Managing partner, Innosight
While many may see creativity and chaos as close allies, Scott Anthony believes the opposite to be true. The Singapore-based managing partner of management consultancy Innosight, says creativity and constraint are much better friends.
“The right sort of boundaries and oversights can be a great spur to innovation, but you have to manage that balance really carefully because too much of it can kill innovation as well.”
Anthony says that for companies to unlock innovation, they must view it as a science experiment and apply the same rules. There must be a hypothesis, an objective, a prediction and an experiment with results that can be measured.
“Leaders need the discipline to have people do this before they conduct experiments,” he adds.
“And they need to measure them not by whether the experiment had positive results but whether they actually followed the discipline of experimentation. It sounds simple enough, but there are very different sets of rules and engagement models for leaders that run counter to what many of them have been taught.”
Anthony, who has advised senior leaders in companies such as Procter & Gamble, Johnson & Johnson and SingTel, says it’s not easy for companies to build innovation into their DNA.
“The honest truth is that most organisations that have been around for any length of time have developed an ability to operate a proven business model with discipline and excellence. That’s a really good thing but sometimes it can stand in the way of how innovation really works, where there’s experimentation, exploration, fits and starts and imperfections.”
Anthony boils company innovation down to one word: curiosity.
“It means that they have a desire to understand the human beings who are their customers, not as facts and figures but as real human beings. They must like to experiment, even if they don’t know the kind of commercial result they’re going to get, but sometimes just to learn. They’re willing to try things in the marketplace and finally they plant themselves at intersections – they regularly bring in voices from the outside, they interact with as many different people as possible because they know that true breakthrough ideas happen when you get different skills and mindsets colliding.”
Be open to failure
Director, deals innovation, PwC
It sounds ironic, but Lynette Nixon, director of deals innovation at PricewaterhouseCoopers (PwC) in Sydney, says many company innovation programs fail due to their fear of doing just that – failing.
“Business success historically is measured by trying to protect ourselves from errors and trying to protect what we already have,” she says.
“That’s a short-term mindset. In an innovation world you need to balance that with generating insights and taking measured risks, so the concept of failure, for example, is very much part of an innovative culture. Have a go. Test it. Refine it. If that doesn’t work, start again.”
Nixon says poor leadership is another impediment to a creative culture.
“Too many leaders delegate rather than lead. Innovation is about changing the way you do things, and that needs to come from the top,” she says.
“Leaders are also focused on the short term, but innovation takes a while to pay off and the lack of patience means it doesn’t get the traction it really deserves.”
The best innovation programs have a clear purpose and a solid foundation.
“You need to build the belief in your people that what you are doing around innovation is important. You must give people the skills and tools that they need to be successful with innovation, and you need to create an environment that consistently reinforces positive messages that innovation is part of your future.”
Nixon adds that companies must create a framework that enables people to contribute creative ideas.
“I’m confused why CEOs seem to be OK with only using half of their people’s talent,” she says.
“They are very focused on rational business process but few organisations are encouraging random and inquisitive kinds of thinking to tap into the right brain of people. Don’t you find that odd?”
National manager – unified communications and collaboration, Telstra
For Dave Carden, national manager – unified communications and collaboration at Telstra, innovation is more than just generating ideas. “It’s about being able to act upon the idea in a quick and efficient manner, to the point where you can take a concept from idea to execution quickly and efficiently,” he says. “The results don’t have to be revolutionary to be innovative, however they do need to make things better than they were before; be that a better product, service or process.”
With almost 30 years’ experience in the ICT industry, Carden’s current role at Telstra is focused on helping organisations achieve their business productivity goals through the use of collaboration technologies. He says collaboration – with co-workers, external partners and clients – plays a key role in facilitating innovation. In fact Carden has a motto: Collaborate to innovate.
“Collaboration is about getting the right skills working together in a cohesive manner to achieve a common goal,” he says. “
When done effectively, collaboration can accelerate the innovation process by tapping into a wider pool of ideas, experience, skill sets and energy. The result is an original idea that’s improved upon as the collaborative effect generates and drives new iterations of the idea, until you achieve the desired result.”
Carden says collaboration is an essential expression of a Telstra core value – making the complex simple.
“Our industry is so dynamic it’s virtually impossible for an individual to take an idea to execution without collaborating.”
Telstra fosters collaboration through its Innovation Hub, where ideas can be generated and shared. Participants can earn Innovation Dollars for doing important work and invest them in ideas they’d like to support.
Carden believes collaboration can spur creativity.
“It’s the fuel that drives the innovation engine. Without a creative attitude combined with a clear vision, achieving any innovation objective will be virtually impossible.”
'It's about freeing up creativity.' Danny Davis, Vandis
Practise good governance
Principal, Vandis Advisory
Danny Davis, principal of Melbourne-based innovation and management consultancy Vandis Advisory, believes companies don’t suffer from a lack of ideas. They suffer from an inability to address and identify the right ones in a volatile environment. The remedy, says Vandis, can be found in a framework he calls “innovation aware governance”.
Just as financial systems are clearly governed, Vandis says the same should apply to innovation.
“Finance practices are governance practices. It flows down through the whole organisation and impacts behaviour at every level. And if you are going to achieve the goals of motivating and engaging staff on strategic thinking and the future of the organisation in the fast-moving, volatile world, you need to be able to do the same thing. You need to be able to consistently show them what is required, how to measure up their ideas and how to act on their ideas.”
Davis says innovation-aware governance allows both directors and executives to exert strategic control over the organisation.
“It's about freeing up creativity with appropriate risk management control and disciplines.” – Danny Davis, Vandis Advisory
“It allows them to apply resources and measure progress and answer the fundamental question – are we appropriately invested in our own future? Innovation-aware governance makes sure they can actually see this within the uncertain environment that surrounds innovation. At the moment, they have no instrument to see that.”
Davis says innovation is often something that happens on the side. A governance framework gives it greater visibility. “It’s about freeing up creativity with appropriate risk management control and disciplines. Governance practices are not sufficient to deal with the level of change and volatility that’s out there, so companies need to enhance them to create competitive advantage.”
This article is from the December 2014 issue of INTHEBLACK