by Steve Blue, president and CEO, Miller Ingenuity
In the article title, I’m not referring to a blockbuster hit – instead, I’m referencing Blockbuster, the company that owned the video rental market until it was upended by an innovative competitor, Netflix.
One thing is for certain: If a company isn’t innovating, all of its products or services eventually become commodities… or the company is toppled by the next Netflix.
When that happens, no margin is left to spend on research and development, new product initiatives or anything else that could provide a competitive advantage. Then, customers will start playing a company against the competition, and it’s just a race to the bottom for further price concessions.
By that point, the company is left with reducing costs, overhead or profit – and now is in a death spiral toward that going-out-of-business curve.
So how, exactly, does a company spark new innovation? What’s more, how can it be done at an already established business?
1. Make innovation part of everyone’s job description.
The first line item on every job description should state that a primary duty is to introduce innovative ideas into the company. This goes for job descriptions of all employees – not just a select few. From the plant floor to the executive door, mandate that the entire organization offer ideas to improve products and services.
Innovation must be one of the company’s core values, so much so that it is tied to performance appraisals. Determine a means to best measure innovation in the company, and incentivize innovative thought by making it part of the performance review process. By doing so, not only do employees who innovate receive kudos and raises, but the company also can say goodbye to the ones that don’t. Pretty harsh, isn’t it? However, so is what happened to Blockbuster – and Polaroid – and Woolworths – and the dozens of other industry icons that bit the dust.
2. Invest in innovation.
Contrary to popular belief, everyone is creative. The key is to understand how to unlock that creativity. Train every single employee in the principles of brainstorming and innovation by holding “innovation fairs,” similar to a science fair. Take employees on field trips to highly innovative companies outside of the industry in which the company operates.
3. Provide the time to innovate.
It isn’t always enough to set the expectation to innovate. A company also must provide the time – or at least the parameters – for innovation. To really push the innovation envelope, employees should be encouraged to spend 20 percent of their time innovating and brainstorming new ideas. But, it would be unfair to still expect the team to accomplish the same amount of work in the remaining 80 percent, and in the end, would never work. Bite the bullet and hire more people to cover that 20 percent. Set the expectation that “thinking about things” is just as important as “building things.”
4. Provide the space to innovate.
Asking employees to innovate and brainstorm without providing a space to do it in can squelch creativity. Once the practice of innovation is established, devote a location within the organization where employees can meet regularly and without interruption.
This can be as simple as an empty cube dedicated for innovative practices or as involved as an offsite location where the round-the-clock focus is on innovation. Above all else, make it abundantly clear that these spaces aren’t just for white collar employees, but for all employees. Allotting spaces serves two purposes: it provides an assigned area in which to innovate and it shows employees how serious the company is about the process. Keep in mind there is no magic in this space. The magic is in unlocking the creative genius in every employee. The innovation space only facilitates this. Before the space is built, be sure the above steps have been taken to create the culture and provide people the tools and training to innovate.
5. Celebrate, recognize and reward innovation.
Find ways to celebrate and recognize innovation: It has a way of changing workplace culture for the better and reinforcing positive behaviors. Potential rewards include significant cash awards for innovation, professional photos taken of the team marking the achievement or even taking out a half-page ad in the local newspaper detailing the innovation.
Be creative in how people are recognized. Send innovative employees on hot air balloon rides. Hire a team of skydivers to land in the company parking lot. Hire an airplane skywriter. All of these crazy ideas further the process of getting a team to be more innovative.
6. Fight fear and resistance.
Regardless of how long a company has been around, it’s imperative to keep the creative wheels turning and staying ahead of the innovation curve. The logistics may seem daunting, yet the biggest risk isn’t a technical one – it’s organizational. People fear what they don’t understand, and employees will kill a project they’re afraid of if they aren’t operating in an atmosphere of innovation.
Innovation is no longer an option – it’s a necessity. As a business moves toward more innovative thought, be prepared for pushback. Also, be ready to restructure the organization and even cut people loose, if necessary. Surround new developments with people who believe in innovation. Otherwise, the company will be left with those who’ll do little more than look for flaws.
Steve Blue is president and CEO of Miller Ingenuity and author of the forthcoming book American Manufacturing 2.0: What Went Wrong and How to Make It Right. As a nationally recognized business transformation expert and speaker, Blue has been featured in Forbes, Entrepreneur and The Wall Street Journal. He is founder and contributor to American City Business Journal’s “League of Extraordinary CEOs” series. To learn more about Blue, please visit www.MillerIngenuity.com.