North Jefferson News, Gardendale, AL

Business

October 18, 2010

Business AdVise

Innovate or die

COMMENTARY — Jason Krieger, senior consultant for the Gallup Management Journal, writes this week on ideas of creating a culture of innovation. He observes that there have been three main business innovations since the industrial revolution.

The first driver was the supply-and-demand economy. The second occurred in the 1980s and 1990s when companies like Toyota, GE and others used process improvement strategy like Six Sigma and lean manufacturing to drive profitability and growth. In today’s global marketplace, these models no longer offer the competitive advantage that they used to for us.

Today, he writes there is a new major business model that is driving innovation and it is called behavioral economics. Behavioral economics blends the teaching of social psychology (why we act the way we do in given societal norms) and why we buy and sell (economics). Look for more in a future article on this emerging business science, as we explore the science behind business. This is where true innovation is born, and it is unfolding all around us.  

How do you capture true innovation for your own business and corporate culture? To build a culture that fosters innovation, an organization must hire for innovation talent, build teams that are diverse in talent, and fit individuals to the right role to drive success. Once the people have been identified and placed, management must provide the right training and onboarding relative to innovation and should train managers for skills needed to drive innovative talent. Simply put, innovation is not just the nifty idea, but the systematic strategy and strong follow through that moves all effort from good to great.

According to Krieger, in order to execute on this culture of innovation, firms must have six keys in place.

1. Innovation assessment

Contrary to popular belief, organizations can evaluate and select for innovation talent. By studying your best people, you can hire others like them and identify within your current population the role that individuals play in the innovation process.

2. Onboarding and training

When employees join your organization, are you able to provide a scorecard of how they measure up relative to others with regard to the three types of roles in the innovation process? If you are, then when employees enter the business, they should quickly know what innovation role they should play on the different teams they work.

3. Innovation index

When you compare your organization to others, how do you know how it is performing relative to innovation? Do you have an index that is broad in scope (companies, industries and countries) that allows you to compare your progress?

Engaged employees share their ideas more often, generate more ideas and generate better ideas.

4. Customer metrics

Customer feedback is critical to the innovation pipeline. Are you able to identify your best and worst customers and gather feedback from both?  

5. Employee metrics

Employee engagement has been linked to increasing levels of innovation.  Engaged employees share their ideas more often, generate more ideas, and generate better ideas.

6. An innovation scorecard

It has been said that “what gets measured gets done.” All organizations should build an innovation scorecard if they are to track and measure progress.

Innovation is the “new normal” and will be the driver of organic growth. For companies to maximize these efforts, they must shift their focus from R&D to one that embeds innovation throughout the organization, whether the innovation they seek is a new product, process, or business model.

And remember, take care of your customers, or someone else will.  

You can find additional readings on my blog at http://businessadvise4u.blogspot.com. Teresa works for Sanofi-Aventis Pharmaceuticals and supports the Fultondale Chamber of Commerce. The next meeting of the Fultondale Chamber will be held for a luncheon at the Fairfield Inn of Fultondale on Tuesday with Sen. Jeff Sessions speaking on our Washington update and the upcoming legislative agenda. Please join us by calling (205) 337-1629 or email to visemedical@bellsouth.net.

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