Approaches to innovation - III
Mar 13 2012, 19:20 | By Infomedia18
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Today, with new technology, changing customer preferences, growing markets, new geographies, and an open market with multiple brands/products, garnering a substantial market share is becoming tough. Pricing alone is no longer the differentiator. Organisations realise that they are addressing an aware customer, and also, that they are one among many who are doing so. Innovation and product differentiation therefore, becomes inevitable, if an organisation has to survive.
In the first article [link] and second article [link] in this series, we saw some of the effective approaches towards successful innovation. In this article we see how to instill innovation within an organisation.
Revisiting the hiring process: An integral part of any work culture is people. Work culture is formed by the people, for the people. The management only plays the role of a facilitator. Therefore, an organisation encouraging an innovative work environment should pay special attention to the hiring process. What kind of people are being hired? Do these people have the skills to take the organisation forward? How are our employees different from that of competitors?
When hiring, the interviewer has to understand the difference between a questioning mind that is seeking answers and a bad attitude. While bad attitude will cloud the climate of innovation, questioning will accelerate the process. Moreover, if a manager hires people he understands, it is likely that the company will never get people better than him/her. Tom Watson Jr, the legendary President of IBM, for instance, was famous for hiring ‘wild ducks’ – people with unconventional ideas and risk-taking ability. There is always a tendency to hire or create clones. Sometimes managers find that the outstanding contributors are among those employees whom they do not like very much.
The industry perspective
Several companies undertake initiatives to promote innovation for the well-being of the organisation as well as the employees. Some of them are mentioned below.
ITC E-Chaupal: One of the single-largest, integrated technological initiatives for rural India by a corporate entity. It empowers the farmer with real-time information, thus enabling better and faster decision-making. E-Chaupal, launched in 2000, today has spread across 9 states and 40,000 villages, and empowered more than 4 million farmers through 6,500 E-Chaupal internet kiosk installations. It has also developed direct marketing channels that have helped reduce multi-level handling and transaction costs, and made logistics more efficient. It helps farmers to order high-quality agricultural inputs for their crops, keep track of the domestic and international agri-markets, prevailing market prices, best practices in farming and weather forecasts, in their local language.
Siemens Automotive: Siemens has a scheme called ‘Ideas Unlimited’, a democratic idea generation process that has elicited 4,000 suggestions from employees in the last year, of which 2,979 ideas have been implemented, saving Siemens approximately $1.44 million. The key to success lies in its simplicity; there is no paper work. The owner of every accepted idea is rewarded. Incentives plans are drawn up for managers and idea to accept and implement ideas.
Tata Motors: Tata Motors’s introduction of the Nano, when viewed from the innovation point of view, becomes a classic case of social innovation. Nano was aimed at changing India’s socio-economic pyramid. Middle and lower middle class families who could only think of travelling by two-wheelers or public transport are now able to afford a four-wheeler with this launch.
Developing lateral leaders: The success of an innovation process lies in the hands of the ‘leadership’ team. While the management can create an environment conducive to innovation, the managers have to lead from the front. It is, therefore, necessary to train and develop leadership that is not just tactical, but lateral as well. As opposed to just following the ‘Action - Result - Improvement’ model, it would help if managers could also include thinking and creativity. There is no doubt that bottom line is the top priority of every manager, and every business needs budget as a barometer to measure success. But budget is not the only strategy to success. Nokia would not have moved from being a wood pulp mill to the world’s leading cellular phone manufacturer by merely budgeting. Similarly, Wipro could not have become one of India’s leading and recognised IT outsourcing companies from its humble beginnings as a vegetable oil manufacturing company with managers who only believed in balancing budgets.
Leadership means taking the business from where it is today to some place new and different. This cannot be achieved, if leaders just worked by the rule book.
Innovation is the only way to stay on top and ahead of competition. Top managements understand this today. However, what was a ‘nice-to-have’ some years ago is a ‘need-to-have’ today. The message that has to be communicated is that need for innovation in an organisation is not just important – it is urgent.
Innovation can also result from trimming the frills; in other words, firms can look at ‘innovation by subtraction’.
Suresh Lulla is the managing director of Qimpro Consultants Pvt Ltd and founder of the BestPrax Club, and chairman of the IMC Quality AwardsCommittee.
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