Tool 17. BUILDING A CULTURE OF INNOVATION

About This Tool

Business and thought leaders agree - innovation is vital to succeeding in today's economy. Customers continue to have unstated and unmet needs. Competitors are too afraid to spend their way out of the commodity trap. Bankers aren't sure where to invest. Employees and recruits are looking for something exciting that they can engage and be part of. There has never been a worse time for business as usual, and there's never been a greater need for innovation.

Those leaders also agree that there aren't very many organizations out there that do innovation really well. But there are some. In fact, these highly successful firms will get up to 1/3 of their annual revenues from new products and services, and are known to launch from 20-30 new products each year. But innovation in these companies goes well beyond product development. It goes beyond the responsibilities of a particular department. For them, innovation is a mindset. It's an integral part of their corporate fiber, their culture. It's something that must be inculcated across the entire organization and at all levels. But how? This tool was developed by reviewing some of the best practices in some of today's most innovative companies. Companies who didn't leave it to chance. They made innovation a part of their everyday organizational life.

Using This Tool

Before Using This Tool, it'll help to understand the relationship between creativity and innovation. Creativity is usually referred to as thinking, while innovation is implementing that thinking. Said another way, creativity is about an original thought or idea, whereas innovation is applying an existing thought/idea in a new way. Arguably, there are very few original ideas any more, but there are numerous and significant innovations each year. This tool focuses on the steps needed to create a culture of innovation. It's based on the premise that innovation is, and must be, the responsibility of every employee.

The tool is divided into four areas: Leadership & Culture, Process, Structure, and People. The four areas are very inter-related and may overlap somewhat. Within each area are key steps or factors that need to exist for an effective innovation strategy. Few organizations can answer "yes" to every factor, but the more yes answers, the more effective that firm's capability is going to be. The tool can be used as a planning model, an assessment tool or a general discussion guide. It can also be combined with the other tools in this module to develop a broader organizational capability assessment or framework.

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