The document discusses fostering innovation through organizational culture change. It emphasizes that leadership plays a critical role in culture and that senior leaders often resist change unconsciously. It also highlights that experimentation, trusting relationships, and ideation are important aspects of an innovative culture. The document provides frameworks for assessing trust behaviors and lists several actions organizations can take to support innovation, such as establishing an innovation strategy and rewarding experimentation.

1. Copyright © 2010 John Wiley & Sons, Inc. 15-1

2.  Improve top line, bottom line or market share
 Strengthen balance sheet
 Strengthen brand/reputation
 Increase workforce retention (incent stakeholders)
 Enhance community engagement
 Improve environmental performance
 Attract investors/acquirers
"Discovery consists of seeing what everybody has seen and thinking what nobody
has thought.” — Albert von Szent-Gyorgy

3. Joseph Schumpter (1936)
 Introduction of a new good, or a
new quality of good
 Introduction of a new method of
production - need not include new
technologies)
 The opening of a new market
 The securing of a new source of
supply
 The creation of a new organization
Innovator’s Alliance (2012)
 Exploring and adopting new
methods of creating value
 Generating new ideas
 Conducting R&D to develop
new products
 Continuous improvement in
all functional areas
 Finding new ways to deliver
products and services
"Creativity is thinking up new things. Innovation is doing new things."
- Theodore Levitt

4. "It isn't the incompetent who destroy an organization. The
incompetent never get in a position to destroy it. It is those
who achieved something and want to rest upon their
achievements who are forever clogging things up.”
— F. M. Young
"The difficulty lies not so much in developing new ideas as
in escaping from old ones.” — John Maynard Keynes
Copyright © 2010 John Wiley & Sons, Inc. 15-4

5. "Innovation is fostered by information gathered from
new connections; from insights gained by journeys into
other disciplines or places; from active, collegial
networks and fluid, open boundaries. Innovation arises
from ongoing circles of exchange, where information is
not just accumulated or stored, but created. Knowledge
is generated anew from connections that weren't there
before.” — Margaret J. Wheatley
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6. Rewards and Recognition:
• Performance metrics associated with collaboration
• Reward action, and risk taking
• Recognize sharing of idea / provide feedback on idea
• Showcase success stories of collaboration
Flexible Learning and Development Practices:
• Encourage learning from mistakes
• Allow unstructured time for self-study or learning
• Formal program for peer training
Supportive Organizational Practices:
• Encourage cross-functional teams
• Establish ground rules for collaboration
• Openness to input from external experts 15-6

7. Lack of Reciprocity:
• Stealing other people’s ideas
• Focusing only on self needs and not helping others
Restrictive Organizational Practices:
• Hierarchical structure that restricts interactions I
• Lack of clarity between functions
• Lack of shared objectives
Financial and Legal Constraints:
• Lack of technologies to allow distance collaboration
• Fear of IP loss leads to excess legal hurdles
Judgment:
• When people judge ideas prematurely
• Judge people for posting questions 15-7

8. Changing the way people behave and make
decisions
Behaviors are influenced by the individual, team
and corporate culture
• What gets rewarded and what gets punished
• What gets noticed and what is ignored
• What requires permission, where forgiveness is asked
Challenge is changing the balance
• What will be the effect, and what are the unintended
side-effects
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"The things we fear most in organizations - fluctuations, disturbances, imbalances,
are the primary sources of creativity." — Margaret J. Wheatley

9. “Leaders have a disproportionately large effect on the
cultures of organisations and systems. By their
behaviours, leaders create the conditions that either
hinder or aid innovation.”
- Maher, Plsek, Price, Mugglestone
“Senior leaders often have an
emotional investment in the status quo
without even realising it”
- Gary Hamel

10. 1. There is a natural tendency for organizations to keep
doing what they’re doing and resist changes. In the
absence of a force, they will continue to do what
they’ve always done.
2. Larger organizations require more force to change
what they are doing than smaller organizations.
3. For every force there is a reaction force that is equal in
size, but opposite in direction. When someone exerts a
force on an organization, he or she gets pushed
back in the opposite direction equally hard.
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11. Resources
Financial
Technology
People
External
Business Information
Quality Management
Project Management
Decision Support
Processes
Leadership
Incentives
Communications
Risk Tolerance
Culture
Strategy
Product Leadership
Customer Intimacy
Oper. Excellence
Disruptive Offerings

12. Product Leadership
Customer Intimacy
Operational Excellence
Disruptive Offerings

13. Financial
Technology
People
External partnerships

14. Business Information
Quality Management
Project Management
Decision Support

15. Business Information
Quality Management
Project Management
Decision Support

16. Leadership
Incentives
Communications
Risk Tolerance

17. We are going to focus on three aspects;
 Experimentation, and lean decision-making
 Trusting versus controlling
 Ideation

18. “Do not be afraid of day-to-day failures — learn from
them. (As they say at Google, “don’t run from failure —
fail often, fail quickly, and learn). Cherish your history,
both the successes and mistakes. All of these behaviors
are the way to get better at programming. If you don’t
follow them, you’re cheating your own personal
development.”
- Ben Collins-Sussman (Subversion, code.google.com)
"The essential part of creativity is not being afraid to fail."
— Edwin H. Land

19. • Develop an innovative idea you would like to consider
• Create a hypothesis that is testable (i.e. there is demand fo
a recycled version at a premium price)
• Determine the cheapest, fastest and simplest experiment
you could undertake to support (or disprove) hypothesis
• Complete the experiment and gather the results
• Interpret the results, see if your hypothesis was confirmed
and move to next steps

20. • Most organizations started based on trust
• Over time rules (controls) introduced to ensure conformity
minimize risk and the likelihood of errors
• These rules had unintended side effects; can be outdated
• Challenge is to remove controls without damage
• Looking at trust behaviors a useful framework
• Four dimensions types of trust behaviors
“Organizations, by their very nature are designed to promote order and
routine. They are inhospitable environments for innovation” Ted Levitt

21. Trusting:
• Disclosing
• Reliance
• Receptiveness
Capability:
• Competence
• Experience
• Judgment
Trustworthiness:
• Consistency
• Benevolence
• Alignment
Communication:
• Accuracy
• Explanation
• Openness

22.  Clear understanding of why innovation is important
 Innovation strategy is clear and well communicated
 Method/process for collecting and evaluating ideas
 There is the requisite support for innovation
 Leadership support
 Alignment of incentives
 Allocation of necessary resources
 Open decision support system
 Make and implement decisions in a timely manner
"A new idea is delicate. It can be killed by a sneer or a yawn; it can be
stabbed to death by a quip and worried to death by a frown on the right
man’s brow." — Charles Brower

23. 1. Change starts at the top
2. Innovation need shared throughout organization
3. Innovation strategy and direction developed
4. Resources made available
5. Procedures changed
6. Improved management of innovation process
7. Incentives and recognition modified
8. Experimentation embraced
9. Communication increased (internal and
external)
10. Results (and benefits) quantified

24.  Experimentation is critical decision-making tool
 Success rewarded, failure is a learning
opportunity
 New projects viewed as an innovation portfolio
 Cross functional teams; weak ties innovation
become critical source of innovation
 Active communication and engagement,
internally and externally

25. Identified challenges of changing the culture, especially
critical role of leadership.
Changing culture requires some changes in what you do
(both by example and through explanation).
We will make available tools to identify your “innovation
quotient” and trust behaviors
Working these with your team starts the journey, although
you may want external help
Hopefully, you can share some of the issues with other
Innovators Alliance chapter members
Thank you
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