Over at InnovatorInside, my new blog, I've put up quite a bit of new content:
I argue that Innovators aren't researchers, so stop the creativity stuff
How things have been going since I left the Civil Service in January
If you're doing innovation inside a corporate, some things a clever person told me
Why making the number is an important skill for an innovator
Why is that noone seems to spot a competitive threat till far too late?
Hope you enjoy!
Over at Innovator Inside, I've written today about the reasons practically all innovation programmes fail, and argued that we need to devolve the whole innovation problem to the edge, not just idea capture. Hope you find it interesting reading.
Back in May last year, I complained about HSBC and its apparent lack of a mobile strategy. My complaints were purely selfish, because I wanted to be able to bank on my iPhone, and couldn’t find a way to do it.
As an HSBC customer, I was jealous that other banks were offering something I couldn’t use.
Well, last week, HSBC released their iPhone app to customers of its direct banking unit First Direct. It is an excellent first step.
The App itself has been getting pretty good reviews on the App Store. Oh, there are a few people who don’t see the point and say so (“The website does more, why bother?”), but generally, everyone seems really pleased. When I checked a minute ago, it had a 4.5 star rating.
I think HSBC have done something that should make them pleased, though. By creating their own application, instead of going the generic route with the same vendor as everyone else has done, HSBC have created a space for themselves to iterate and innovate.
If they’re serious about mobile, that’s going to be a pretty big advantage they have over everyone else.
First Direct say in their press release that:
“…plans for the next generation of mobile banking applications already afoot. In a post on "talking point", first direct's customer forum, the bank… plans to collect online feedback in order to understand which new features are most in demand”
Now, it may not quite be customer co-creation, but this is rather more than anyone else is doing, frankly. And, by owning their mobile technology, First Direct are in a position to actually do something when customers make a suggestion.
The interesting thing to watch unfold in the coming months will be whether the bank pushes its platform advantage in mobile. It will be quite obvious and transparent if they’re doing so: the app will update regularly in the AppStore and we’ll all see every time it does.
Good on them.
There’s another morsel in the press release too:
"We chose to go with the iPhone first because that's where our customers are. Over the last 12 months, the iPhone has grown to become the 6th largest source of visitors to our website and whilst Android is growing rapidly, it's nowhere near the iPhone just yet."
Why is that interesting?
The most recent data I can find on iPhone demographics suggests that owners are richer and older than those on other handsets. It is pretty well accepted there are more Androids selling than iPhones now. And in terms of overall handsets in use, my understanding is they’re neck and neck.
Conclusion? First Direct must be doing more stuff right than just releasing a halfway decent mobile app if it is seeing its online demographic skewing in this interesting way.
Anyway I instantly tried the new First Direct app with my HSBC accounts, hoping it would work. It didn't. I'm guessing it will soon though: there were 303 reviews on App Store this morning: a sign that people want the thing and are passionate about it. I can't imagine the bank will ignore this early success for the rest of its customers.
Dear Senior Executive,
I understand you’ve been given responsibility for innovation. I’ve heard on the grapevine that you’re excited about it, and planning great things. I think it will be thrilling to see what you create.
But I hope you’ll take a few words of advice from someone who has been in the position you’re now in.
Firstly, you’re going to have a hard time convincing anyone that your new responsibilities are important. Oh, everyone will say they think innovation is important, but when the rubber hits the road, they’ll be watching to see if you screw up the line-of-business things you’re responsible for now, not waiting to celebrate your innovation success.
So my first word of advice is to believe in your new responsibilities, even if most of the time you’re the only one who does. Success will come with time, if you let it.
Secondly, everyone will have an opinion on what you’re doing and all those opinions will be as far apart as the Earth and the Moon. There are no right answers if you have to run an innovation effort, but there is a wrong answer. The wrong answer is trying to satisfy everyone who has an opinion on innovation. If you try to do that, you’ll never get anything done. You have to believe in what you believe is right.
This is my second piece of advice: you are senior, and you are responsible. You aren’t going to make anyone happy with innovation no matter what you do. Every time you try something new there will be winners and losers. So take my advice, and start new stuff regardless. If you wait for consensus, you’ll never be able to start anything at all.
Finally, you may be senior and empowered to make decisions, but the fact is you won’t be the one implementing them. You don’t have time, and anyway implementation will probably require lots of specialized skills besides your own.
Though you’re in charge, there are lots of less senior people who can do things to stop innovation. They will never deliberately disobey and obstruct, but they will certainly go-slow if they don’t like or don’t understand what you’re doing. Change in any form is very frightening to those who aren’t making the decisions.
So my final piece of advice is this. You need to build your innovation effort from the bottom up as well as from the top down. The little people at the front line are just as important as the ones in the center who make the decisions. It is the front line and their managers, after all, who will be affected by anything you do. If they love your innovation effort, they will make sure you succeed. If they don’t, you will certainly fail.
My best wishes for your future success.
Sadly, I have heard today another innovation effort I’ve been following has died aborning. They got so close, too.
Well, maybe not died, but “put on hold”, which is the usual line you get from senior execs who haven’t quite been able to take the leap of faith that’s needed to execute an innovation effort.
There’s been a lot of this, lately. I think organisations in recovery lose their will to innovate as their bottom lines recover. As I’ve said before, really game-changing innovation happens only when there’s a some kind of stress that upsets the status quo. The rest of the time, most firms are satisfied to have incrementalism, which they can get from Lean or Six Sigma as easily as they can from innovation efforts.
Innovation takes a leap of faith.
You have to believe that if you don’t innovate you’ll be out of business.
You have to believe that if do, you’ll reach new levels of success.
And you need to believe this despite the fact that everything’s working fine right now.
Some religions ask you to believe in less and give you more evidence.
We may be heading for an innovation economy, but rationalists will never make business decisions based on faith. Oh, some visionaries have done, but the majority are innovation atheists.
The next few years are going to be tough for the innovation community, because mushy case studies and anecdotal successes are never going to convince rationalists that what’s going on is valuable. Especially when everything is getting back on an even keel without the leap of faith.
We need hard evidence. If you invest this, you’re going to get that. And its worked in a predictable way in these situations.
We need accountants running the innovation process. I know the horror that the creatives reading this will feel, but the discipline of innovation is not a creative process. It’s about running the numbers, about a business capability that needs to be measured and reported on like any other.
Its time for innovators to get boring. Even better, for them to become accountants.
If there’s one thing I’ve noticed working for Government*, it is there’s an endemic promotions culture here, far worse than anything I’ve seen anywhere else.
A promotions culture is what you get when the main objective of everything you do at work is to get to the next grade level. For some people, that’s a financial incentive more than anything else. Others want that promotion for the status and power that goes with it. A few, very few, want to be at the next level so they have an opportunity to make a bigger difference.
A sign of a promotions culture is everyone talks about the “career limiting move”.
I don’t believe in career limiting moves, though of course if it is evident that someone isn’t ready or capable of the next role, that’s something else. I mean, you have to prove that you’re ready for the next role if you want to get the next role.
Proving you’re ready requires a little bit of risk taking. In healthy corporate cultures, that’s behavior which is rewarded.
Not so in a promotion culture.
In a promotion culture, you are rewarded for being as similar as possible to the group of people who decide your next promotion. It is human nature to like those who are similar to us, so pretending to be as similar to your boss as possible is sensible.
In a promotion culture, you are rewarded for showing that you steer a steady course, one that doesn’t rock the boat. It is human nature for bosses to like it when their lives are easy, so promoting those that make it so is an easy decision.
And in a promotion culture, longevity of service, dedication to the organization as it is today, and conformance to all corporate norms is behavior that’s rewarded. A maverick might destabilize the steady progression of everyone else, so being the same as everyone else is the behavior that’s wanted.
You’ll all know where I’m going with this. Promotions cultures destroy any organizational capability to innovate, because they act to petrify the present status quo.
What can you do if you’re stuck in a promotions culture?
The best advice, I think, is find someone who’s senior who didn’t get senior by virtue of the promotions culture. They’ll have a different perspective on things than everyone else, and be willing to take a few more risks.
I consider myself lucky that my boss is in that category. He came into the Department from the outside, and has allowed me the liberty to do things I really doubt few others get.
If you aren’t lucky enough to be in that position though, what else can you do?
I think the choice is really very simple. You are either on the promotions bandwagon, or you’re off it.
In the former case, you should accept that you aren’t able to make any meaningful change, or take risks, or create a better future. Those things are incompatible with getting promoted.
If you’re off the promotions bandwagon, on the other hand, you can do all those things with impunity. You won’t be rewarded for doing so, of course, since rewards are reserved for those on the bandwagon. But you’ll have the chance to make a really significant difference.
Since I’ve joined the Government, promotions have become much harder to get by virtue of the fact that the resources available are being scaled back. And guess what? There’s lots more risk taking and innovative behavior going on. People are being far less conformant. They’re recognizing the old rewards system is changing.
Isn’t that an interesting outcome from public sector austerity?
* I feel I must point out, for any hacks who decide to hatchet me for having a blog daring to comment, that these pages are a private effort not reflecting the views of the Department, or any present or future employer. Yes, I sometimes sail deliberately close to the wind, but I do it with intent, ‘cause sometimes the best way to drive change is talk about it openly. And in case this post isn’t evidence enough, I want you all to know I opted out of the promotions culture on about, um, day 2. Follow #welovebaskers on Twitter.
I think it is time we considered taking radical steps.
The problem, you see, is that even though everyone says innovation is important, that it’ll be the driver of all future competitive advantage, and those organisations that fail to innovate will die, no one really believes it. Or at least, they don’t believe it in their hearts, even if they accept it with their brains.
Their hearts are wedded to business as usual, and with good reason. That’s what pays the bills. Or keeps the lights on, if you happen to be a support organsiation of some kind.
I went to visit an organization in Madrid yesterday* one of the few examples of a company I can find that’s actually had it’s corporate heart won over as well as its mind. For them, business as usual is innovation. Everything they do is directed towards it. Everyone pulls in the same direction, even at the frontline. And they’re reaping big, big rewards, even thinking of expanding internationally.
I’m not telling you who it is, but, I will say this: incredibly, it’s a bank.
Before they had their change of heart, they were an organization in crisis and had little choice but to try something new.
Most organisations aren’t in crisis, so there’s not much chance they’ll be forced to try doing different. Even in the banking system which was in crisis, it wasn’t a big enough crisis to cause much to change. A pity really. I say that knowing the incredible economic pain an even worse collapse would have caused.
But we’re talking about safeguarding the future here, not protecting the past.
Anyway, as I said, I think it is time to take radical steps. We have to convince people’s hearts as well as their minds that doing everything differently is the new business as usual. Since everything else we’ve tried has failed to do that, maybe its time we engineered a crisis.
I think the step we should take is this: lets reboot business as usual.
What I mean by that is deny business-as-usual resources, take away the crutches that make it work in its ok-is-good-enough way, and force it into change. Deliberately goad it into finding ways to survive. Continually test it, knowing that the price of failure is game-over.
There’s been years of this in IT organsiations, of course. The constant drive to cut costs, to do more with less. To perform or be out-sourced. The technology driven productivity gains that many organsiations have enjoyed have been a result of this drive. But do you, for one moment, imagine that left to itself and without an externally imposed drive to cut costs and do more with less, IT would have done any of this?
No matter how well-meaning the people involved, I just can’t see it. When you are flush with resources, you sit back and enjoy using them.
On the other hand, my observation is people, when faced with a crisis, almost always find extraordinary ways to do great things. They shine in a way that few do when there’s no critical imperative driving them forward. They may not be comfortable, but they are amazing.
So I think we need to reboot business-as-usual in order to win the hearts as well as minds to the cause of innovation. Do the reboot gradually, but do it deliberately. Take away one crutch at a time until everything is on the brink of collapse.
Except I bet it won’t collapse. Something new and amazing will emerge instead.
Such a reboot, of course, requires a leap of faith. And that requires very enlightened management, management willing to gamble because they believe rather than know.
But as an innovator I know this: business-as-usual is the new enemy of economic growth. Not everything done the old way is bad, but when you add everything done the old way together, what you have is rotten to the core.
* For Daily Mail hacks, and any in the general public who might be incensed that I’d dare to travel internationally to visit someone for innovation work, I want you to know that I’ve taken annual leave today. And that my travel expenses are being met by the company I’m visiting. Follow #welovebaskers on Twitter.
Everyone knows sooner or later some upstart is going to come along with something that disrupts your business. And everyone knows that the chances of executing a "disrupt yourself" strategy to avoid the upstart it is practically impossible, because you have all these incumbent people hell bent on preserving what's working now. That's the innovators' dilemma.
But there's another innovator's dilemma and it is this:
Faced with a disruptor, should you jump ship or persevere where you are, trying to save the future?
The qustion really boils down to something pretty basic: do you have the guts to wreck the present business to save the future when almost everyone has failed before you?
Saving the future is the real mission of the corporate innovator.
Saving the future means standing up to the most powerful people in a organisation and letting them know they're part of the problem.
Because there is very significant personal risk in doing this, very few innovators rise to the saving-the-future challenge.
And, as a result, almost all organisations face the original innovators dilemma eventually.
Practically none survive it.
Hat tip to Stefan Lindegard who quotes David Nordfors post speaking to the challenges of the corporate innovator:
“When someone tries to innovate within a traditional organization,
few will understand what he/she is doing,
but everybody will understand who is a trouble-maker.
After the innovation has been embraced by the organization,
few will remember who started it,
but everybody will remember who was a trouble-maker.
This is the dilemma encountered by many intrapreneurs -
they risk punishment for success.”
If you accept the above - and it's really hard not to if you've ever tried to drive innovation in a large organisation - it is possible to conclude that if noone remembers you as a troublemaker, then you haven't been innovating.
And what follows is innovators will rarely, if ever, fit well with a traditional performance management system.
I have to be honest with you and admit I've sat in performance review meetings and lowballed troublemakers. The reason? The trouble they caused wasn't actually helping me, regardless of whether it was helping someone else. The problem perhaps, is that the benefit coming from the trouble-maker isn't often visible. There is such a thing, after all, as a troublemaker who is just a troublemaker.
Anyway, as a result, the innovator-troublemaker is pretty likely to miss out on promotions, financial rewards, and other forms of internal recognition. I have, often. My own experience tells me its nothing unusual for innovators, in fact, to be more recognised outside their organisations than inside for the work they do.
This seems to be true regardless of how much support the innovator has from executive management. It is a direct result of the skew performance management systems have to rewarding those behaviours that keep a business running today.
If there is an answer, I think it must be that performance management systems need to be realigned to reinforce behaviours that keep the business runnning tomorrow. Not today. Today can take care of itself.
That's a leap of faith, of course, and one I think few managers, especially in command-and-control organisations will be comfortable with. Experience - probably an oxymoron with the rate of change in workplaces today - tells them they need to metricate and manage everything, and tomorrow is far, far too far away.
Kate Bennet has written an excellent post on her experiences working in our innovation team. She brings out 11 points - all of which hit the mark - on how to make an innovation function work in a large organisation. Its excellent, so go and have a look.
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