Innovation Isn’t Just About New Products

The innovation mindset isn’t just about product innovation.

Some organizations have focused on product innovation for so long they don’t know how to innovate in any other areas. For example, in 2010, Microsoft —one of the world’s best product innovators for the last two decades — launched a social phone called Kin. The product was a complete disaster. Within six weeks of the launch, the entire product group was shut down, and, according to their earnings reports, Microsoft took at least a $240 million write-off.

How could such a great product innovator strike out so fast? In today’s climate, it happens to the best.

Most organizations focus on building short-term product innovation engines. However, most products have little sustainable competitive advantage and never generate a profit; those that do are often quickly copied by the competition, negating any long-term advantage. The result: a significant investment in product development, without a commensurate return on investment.

To achieve sustainable growth, companies must better integrate product innovation with business model, process, and service innovations.

Transforming a company requires a dedicated process for nurturing and commercializing valuable ideas. This type of commitment to innovation — the surest way to achieve meaningful and lasting differentiation — requires a dualistic mindset: the organizational ability to deliver near-term results and also prepare for perpetual results year after year.

Barriers and Risk
Based on our field work with Global 2000 size companies, we have identified five barriers to organizations achieving the dualistic mindset:

1. Absence of a required mindset to harvest and manage great ideas: Sony had the ideas and engineering competence to build the first iPod equivalent, but it couldn’t commercialize those ideas because of its own internal battles.

2. Lack or misalignment of resources available for investment in innovations: In a matrix environment, many organizations compete for the same funds, which leads to duplication of resources and results in inefficiencies and waste. The challenge is not that an organization has insufficient resources to invest in innovation; the challenge, instead, lies in where to most effectively funnel those resources, and how to do it.

3. Human capital assets which are under-utilized and disengaged from an organization’s creative capacity: When organizations become huge, their pace of change and pace of action often slows down. This leads to lack of urgency. Larger organizations with many people focused on execution can be slow to take risks and design new experiments.

4. Broad product and delivery capabilities which dilute focus on emerging and disruptive opportunities: In the financial services industry, since the mid-1980’s the typical company has gone from handful of delivery channels (branches, relationship managers) to 15-20 channels (branches, direct mail, internet, national sales force, affinity marketing, etc.) while expanding its product offerings tenfold. “Anytime, Anywhere” banking has become the price of entry as providers strive to meet the need of large and diverse customer bases.

5. Organizational orthodoxies that hold on to the past and discourage risk-taking: Every organization has organizational memory which can create complacency and prevent forward progress. When memory becomes a way of life, it obstructs innovation and out-of-the-box solution development.

Large organizations have more resources, more talent, and more market reach than the smaller players. But we often see new start-ups coming in, and in due time, dominating an industry. Why does this occur? Because the large-organization leaders have done little to remove the barriers and risks above. They lack clear innovation intent.

Innovation Intent
Innovation intent answers the question, “What will innovation give me that nothing else will?” It clarifies strategic direction for your innovation focus and efforts. It is top management’s directional mandate on how the firm is going to win using innovation, articulated by organizational leaders and the senior executive team (and sometimes the Board).

Innovation intent must be vividly clear for everyone in your organization, especially at the top. The intent must be concise to help drive alignment to business initiatives and must help articulate specific employee behaviors necessary at all levels for an innovation climate to take root. When designed correctly, innovation intent is clearly linked to and driven by the business strategy.

– by Vijay Govindarajan and Jatin Desai

Originally at


Fri 27 Sep 13


Go Ahead: Ask Your Employees If They’re Happy

When was the last time you made the effort to see, really see, what the people you work with are thinking and how they’re feeling about their jobs? With Gallup’s latest State of the American Workplace survey showing that 70% of U.S. employees are not engaged at work, it seems that the majority of managers would greet that question with a blank stare. Those managers are missing key information needed to attract and retain talented staff — not to mention keep them actively engaged in turning out a superior product.

Despite the dismal statistics on workplace engagement, there are many enlightened leaders who do one simple thing: They ask their employees how they feel. When they do so, they receive priceless information that helps them retain their best employees and optimize their productivity.

Daniel Parent, director of field human resources at video game retailer GameStop, is one of those leaders. He knows the power of checking in with his team. He has a recurring appointment on his schedule that says, “Ask employees how happy they are at work and what can I do to make them happier.” Daniel has learned over the years that simply asking those two questions indicates to his group that they have his support. Furthermore, he learns what their real issues are so he can provide them with meaningful direction.

By knowing what motivates his team, he can help boost their performance and their satisfaction on the job. His questioning also serves as an early warning system, allowing him to head off issues before they become intractable problems. Take Jennifer, for example. She so desperately wanted to be a good employee that she struggled in her new role as a working mother. Daniel recalled his conversation with her shortly after she returned to work from her maternity leave as one of the most poignant he’d ever had. When he asked Jennifer how happy she was at work, she confessed that trying to juggle both roles left her feeling like she wasn’t a good person.

Getting permission from her boss to spend time with her new baby was what made the difference for Jennifer. She and Daniel worked out an arrangement that met both of their needs. By communicating regularly, Daniel was able to reassure Jennifer that she was meeting all of his expectations and then some. That allowed her to turn her full attention to her child outside of work and really enjoy their time together. “I would never have known this was bothering her if I didn’t ask,” he says.

Daniel also recounts another instance in which an employee put what she perceived to be the needs of the company above her personal well-being. Heading into a meeting, she told him that she had a dentist appointment and would have to leave promptly at 4 when the meeting ended. At 4:10, the meeting was still in high gear with no sign of ending soon. Daniel leaned over to his colleague and whispered that she’d better leave in order to make her appointment. With a grateful smile, she slipped out and took care of her teeth.

Daniel points out that people don’t work for a company, they work for their boss. He has had employees tell him that they stay at GameStop because of him. “These are talented people who could easily get another, better-paying job elsewhere.” The small investment of time he makes in asking his employees how happy they are has paid off many times over when he considers what it would cost to replace any member of his team.

Assuming your team is made up of high-performing, highly motivated individuals whom you want to retain, here’s an action plan for monitoring and improving their engagement:

  • Put a recurring appointment — monthly or quarterly — on your calendar and ask your employees whether they are happy at work and what you can do to make them happier. Don’t wait for the annual review to have this conversation.
  • Maintain open lines of communication so that you can offer support and address issues before they become full-blown problems.
  • Help all team members manage their professional obligations so they can meet their personal needs, allowing them to be present and focused on their work when they are in the office.
  • Keep on questioning. Don’t assume that you have all the information you need if you’ve asked people once whether they’re happy. Circumstances inside and outside of the workplace change over time, and feelings can evolve accordingly.

Remember, relationships are built on a series of little moments that create big impact over time. Sending someone gratefully off to the dentist is not an earth-shattering event on its own. But it is an affirmation that someone’s personal needs are important and to be honored. Taken as a whole, many small actions can strengthen someone’s foundation or they can tear them down. The Gallup survey suggests that there is more erosion than building of the human spirit happening in the American workplace. Be someone who builds others up rather than tears them down. Little things matter in a big way.As Daniel says, checking in with his employees like this is all about retention. By communicating regularly with his employees, he knows what motivates them and the challenges they need to overcome in order to do their best work. This knowledge helps him reward his most talented team members in ways that are meaningful to them, which can change over time, depending on what is happening in both their personal and professional lives. Daniel’s efforts have been rewarded in the form of a highly engaged, productive and, yes, happy team of employees.

– by Allison Rimm

Originally at



Fri 20 Sep 13

How to Win Loyalty From Other People


If you aspire to be successful as an entrepreneur, manager, business owner, or any kind of leader, others must feel loyal to you. Although money is often seen as a prime motivator, ultimately the bonds that hold an enterprise together are psychological. Important data gathered by the indicate that loyalty is one of the top three things that make workers feel satisfied.

Loyalty balances self-interest. It is the willingness to look out for “us” and not just “me.” It’s no secret that the bond of loyalty has frayed at a time of layoffs and the loss of pensions and benefits in the economy. A public image has been built of opposition between management and labor – there is nothing new here – where the advantage has shifted overwhelmingly to management. As long as profits continue to roll in, loyalty is ignored. The assumption is that workers are too desperate for a job to complain or protest.

You have a choice to make in the face of this sad situation. Are you going to join the trend and forget loyalty or are you going to try and rebuild it? The question doesn’t apply simply to managers. Companies develop an atmosphere and a culture. No one works in a vacuum, and your attitude affects the environment you work in, no matter where you fit into the overall scheme.

If you choose to help rebuild loyalty, here are some suggestions:

1. Abstain from disloyalty, which shows up in small but telling ways. Office gossip, back-biting, and spreading rumors show disloyalty, because they degrade the sense of bonding and cooperation.

2. Work on bonding and cooperation. Be sympathetic and open to the people you work with. Support projects that are good for everyone, even if you don’t gain immediate material rewards.

3. Honor the difference between rivals and competitors. The fact that you are competing against others at work doesn’t make them your rivals. Rivalry is hostile; it implies that only one person can win. Competition raises the bar for everyone, so that the whole team can win.

4. Pay attention to personal details. Loyalty runs deep when a person feels cared for and understood. Be alert to these needs. Make an effort to include everyone. When ideas and suggestions are being discussed, make it clear that every suggestion is welcome. If someone’s pet idea is rejected, take time to go to them afterwards and listen respectfully to
what lies behind the idea.

5. Share your success. Include your team in the praise and appreciation that comes your way. If possible, make a tangible gesture, as appropriate – throw a party, or other form of celebration, offer bonuses, present a gift as a token of recognition.

6. Don’t keep secrets. As much as possible, make the decision-making process transparent. Open up financial details.
In the economic downturn of 2008, some small businesses shared their finances with their workers and thereby won real loyalty. Seeing that the company was strapped, the workers felt an incentive to be part of the solution. This is just one way to close the gap that makes management and workers adversaries, a stance that severely erodes loyalty.

7. Remind yourself every day that there is no “I” without “we.” This allows you to be humble in your successes and
provides a community to get through crises.

– by Deepak Chopra

Originally at