Traits of Innovative Organization
Innovation is just a tool that companies use to reach their own unique, strategic goals. Jeffrey Baumgartner says it shouldn’t just be a slogan or an end in itself. For an organisation to be truly innovative, it needs to have seven things.
What makes a company new and different? An initiative to encourage new ideas is not enough. It’s not enough to have the word “innovation” in your company’s motto or all over your website. In fact, I would say that focusing on innovation as a goal is bad for innovation. Innovation is just a tool that companies use to reach their own unique, strategic goals. Here are seven things that all innovative companies have in common. How successful is your group?
1. Unique and Relevant Strategy
A truly innovative company probably stands out most by having a strategy that is both unique and useful. We all know what Apple, Facebook, and Google are and what they do. That’s because they make their plans clear and stick to them no matter what. Even if a small, innovative player isn’t known around the world, its leaders, employees, business partners, and customers will all know what its strategy is.
If a business doesn’t have a clear strategy that is also unique, it won’t be innovative. Plain strategies like “to be the best” don’t lead to innovation as well as clearer ones like “to be at the forefront of mobile communications technology,” “to build the safest cars in the world,” or “to deliver anything, anywhere.” If your strategy isn’t clear or doesn’t make your company stand out from the rest, you should fix this as soon as possible.
2. Strategic goals can be reached through innovation.
Innovative companies don’t see innovation as a goal in and of itself. Instead, they see it as a way to reach their strategic goals. Just as a good camera is a necessary tool for a photographer to take professional photos and a saw is a necessary tool for a carpenter, innovation is a necessary tool for companies with a clear vision that want to reach their strategic goals. In fact, if you look at the websites of the most innovative companies in the world, you won’t find a lot of talk about innovation. Instead, they tend to talk about their corporate vision.
3. Leaders are Inventors
Market leadership is the one thing that innovation gives you more than anything else. When businesses use innovation to reach their strategic goals, they always end up on top of their markets. Sadly, this doesn’t always mean that they are the most successful or make the most money. Amazon has always been ahead of the curve, setting many of the rules for online shopping.
Still, it took a few years for the business to start making money. Cord was one of the most innovative car companies in the world. In the 1920s and 1930s, it was one of the first to make cars with front-wheel drive and pop-up headlights, both of which were very new at the time. The company never made much money, though, and it went out of business in 1938. On the other hand, companies like Apple and Google have made a lot of money because they came up with new ideas. In short, people who come up with new ideas are leaders, but not always profitable ones.
4. Innovators Implement
Most companies have a lot of creative, idea-filled employees. Some of these ideas even fit the needs of businesses. But one thing that sets innovators apart from people who want to be innovators is that innovators follow through on their ideas. Companies with less innovation talk more about ideas than they do about putting them to use.
5. You can choose to fail.
We would say that giving employees the freedom and encouragement to fail is the most important part of the business culture of an innovative company. If employees know that failing won’t hurt their careers, they are more likely to take on risky, innovative projects that could be very profitable for their companies. On the other hand, if employees think that working on a project that fails will hurt their careers, they will avoid risk and innovation like the plague.
More importantly, if senior managers reward early failure, employees are much more likely to regularly evaluate projects and kill ones that aren’t working before they cost too much to fix. This frees up money and time for new, creative projects. But in businesses where failure isn’t an option, employees will often keep working on projects that aren’t working, putting more and more resources into them in the hopes that they will eventually work. When it doesn’t, the losses are bigger and people’s reputations get hurt. So, companies that praise failure tend to fail less often than those that try to stop it.
6. Setting for trust
The people who work for Innovative are able to trust each other. Innovation comes with a lot of risks. Ideas that are very creative often sound stupid at first. If employees think they will be laughed at if they share crazy ideas, they won’t. In the same way, employees won’t take part in failed projects if they think they will be punished for doing so. If workers don’t trust each other, they will always be looking over their shoulders.
Employees won’t share ideas if they think their managers will take them and claim them as their own. On the other hand, if employees know they can take reasonable risks without fear, if they know that crazy ideas are welcome, and if they know that their managers will support their ideas and give them credit for them, these employees can be creative, implement ideas, and drive the company’s innovation. In short, people in an organisation are more likely to be creative and come up with new ideas when they trust each other and their organisation.
7. Autonomy
Along with trust, the freedom of both individuals and teams is a key part of innovation. When you give people and groups clear goals and the freedom to find their own ways to reach those goals, you create a good environment for new ideas to grow. But if managers watch over their employees’ shoulders and tell them what to do every step of the way, they shut down the creativity and individual thought that are needed for innovation. Having employees work on their own means that they may make mistakes.
They might choose less effective ways to reach their goals. But at worst, they will learn from their mistakes and inefficiency. At best, they will find better and new ways to reach their goals. Most importantly, if you hire smart, skilled, and creative people and let them solve problems on their own, they will. And by doing so, they may help innovation grow all over the company.