February 19, 2019
Do You Really Need an Innovation Culture?
by Paul Carroll
Insurers have caught religion about innovation enough that they’re trying to develop an innovation culture. That’s the good news. The bad news is that many are going about it wrong. They focus on the ephemeral aspects of culture and hope that innovation will eventually bubble to the service. In fact, as odd as it may sound, the innovation generally needs to come first. Only then will the innovation culture follow.
Let me explain.
Many companies engage in what I think of as “innovation tourism.” They go to Silicon Valley and have some meetings, then hope some of the magic will stay with them as they go back home. Maybe they change some things about their office structure, putting in a ping pong table, a fancy espresso machine or something else that’s supposed to symbolize innovation and free people to think outside the box. Maybe companies even go so far as to hold some sort of brainstorming session that lets people toss out innovative ideas (though generally without having a clear idea of what to do after all those ideas are collected). Companies often then talk publicly about their innovation efforts, in the hope that everyone will be a little sharper, that processes will move a little faster, that innovations will arise. In any case, the HR department and senior leadership can check a box that shows they’ve worked to be more innovative.
But inertia is hard to overcome. People will enjoy the brainstorming, and maybe the ping pong table, but they don’t have a clear mandate for how to change their behavior, and they haven’t entirely bought in—they’ve never seen the new approach work. For a book project that eventually fell through, I once spent days in a room with some of the best change management people in the world (certainly, some of the highest-paid) and watched them try to specify how to make a culture more innovative. They eventually decided that they couldn’t make a culture innovative in a quantifiable way. They could just mandate changes in behavior that, over time, would change the culture.
My experience consulting and writing on innovation suggests even a narrower approach. If you’re trying to change the culture of an organization of any size, that’s going to be an expensive undertaking and will take years. But success begets success. An innovative product gets people excited and more inclined to try to do even better next time. Seeing the leaders of an innovative project win bonuses and promotions really gets the saliva flowing. Once you have a string of three or four innovation successes, you’ve gone a long way to changing the culture. Certainly, people will listen when you talk to them about the benefits of innovation and tell them they need to change behaviors.
So, I recommend starting small. Pull together a small team of your sharpest people and get a product into the market that could be a game changer for you. You’ll quickly see the benefits of focusing on innovation, while laying the groundwork for a long-term change in culture.
But keep the ping pong table, if you’ve bought one. I whiled away much of my youth playing ping pong. I recommend it highly.
Have a great week.