Change Management and Cultural Style: Are You Killing Innovation?

Driving innovation is not an accident – very few can emulate Apple, 3M and other magical icons of innovation, though many have tried.

It’s all about the corporate culture. But anyone who has tried “change management” techniques to drive innovation can attest to the fact “culture” is a fuzzy term. The reality of building a change-friendly culture goes beyond a personality or leadership mission statement. It means  embedding cultural characteristics into day-to-day operations such as risk-taking, empowerment, and clarity.

It’s about inspiring people’s innate desire to be part of a mission, not about the mission statement you post on the wall.

Just like effective leaders come in a variety of different personalities, a company culture that supports innovation doesn’t look the same in every organization. Here are three distinctive cultural styles, all which can support innovation.  You may even see all peacefully co-existing within a division or a company.

1) Customer Obsessed

Placing the customer at the center of your strategy means developing collaborative partnerships with key customers or customer segments. This is about building what people need and want, not a “field of dreams.” Proctor and Gamble claims that 35% of its innovation initiatives have critical components that originated outside the company.

This may mean examining or changing a key element of the business model for how, where, and when customers do business with you. Examples: Netflix astonished the video industry with its convenience factor; Starbucks made grocery shopping a more uplifting experience.

Enablers: Networks, alliances, and connections, good utilization of social networking media, employees who are connectors and seek relationship-building.

2) Relentless Excellence

Innovating operations today means developing cross-functional collaborative relationships and skills that help leaders align people across silos and gain multiple points of view to ensure better decisions. It is the foundation on which product and customer innovations take place – and many companies believe they have this well in-hand. This area of innovation is about making room for the really great ideas to take hold. At Gore & Associates (makers of Gore-Tex), people within the company (but not on a product development team) make the call on projects that need to be axed. One of their leaders handed out “Sharp Shooter” trophies to the outside managers who effectively killed a project that a team may never have had the insight or courage to do on their own. One client we worked with, began every year by making all projects start Ground Zero. Who starts every year at ground zero?

Good design principles aren’t just for the product-development group any more. They apply to internal support systems, structures, and operations. Example: Home Depot used innovative methods to re-tool its entrepreneurial culture and make operations more disciplined. That shift resulted in revenue growth from $46 billion to $80 billion in three years; at the same time earnings per share doubled.

Enablers: Crystal clear goals linked to a meaningful mission or purpose, continuous project trimming as well as sound project management, process discipline such as Lean or Six Sigma, employees who are procedural and have an engineering mind.

3) Wildly Innovative

R&D groups are listed as #7 on CEO’s list of “idea sources” inside their companies – clearly a more integrated approach of this function into the organization is needed. Whirlpool has fostered innovation since the late 1990’s through multiple trial-and-errorefforts (this is not a short-term process). This includes asking all 61,000 employees to dream up new ideas and forming an “innovation board” that meets monthly to review new product ideas and pass good ones onto the company’s nine-member executive team.

It’s not just about branding; it’s about renewing or expanding demand for a product by changing the business model or partnering with marketing, sales, distributors, end users, and maybe even competitors.

Apple is the poster-child. So what if the iPad doesn’t take off. It won’t phase them because innovation and risk-taking IS their DNA. You know the “next cool thing” will come from Apple.

Enablers: Cool, fun, employee-friendly work environments that can be artistically expressive (Think Zappos with their themed work spaces resembling Arabian tents or beach scenes), lots of open spaces for collaboration, out-of-the-box thinking tools, employees who are artists at heart.

OK, so what is it in a corporate culture that is like the antidote to innovation, you ask?  Check out this free tool, Corporate Culture Types that Hinder Innovation.