The Innovation Disconnect

By: Paul Sloane

CEOs talk enthusiastically about the need for innovation. Workers at the front line can see the needs and opportunities for fresh ideas. But somehow nothing happens. Ideas do not get implemented. Innovation grinds to a halt. This is the innovation disconnect and it has to be tackled head on.

I recently ran an innovation training workshop for a global pharmaceutical company.   The participants were all high-potential junior executives.  One of the exercises produced some novel and feasible ideas that could possibly lead to a significant increase in sales.  ‘What should we do with these ideas now?’  I asked.   Nobody said a word.  One or two people shook their heads.  ‘What is the chance of any of these ideas being implemented?’ was my next question.  ‘Zero’ was the reply from one delegate.  On the wall was the corporate mission statement which included the word innovation.

‘If the CEO of the whole group were here and I asked him whether innovation was important what would he say?’ I asked.  ‘He would say it was essential,’ one person said – and others agreed.  So what is going on here?  There is a huge disconnect.

We discussed the issue and what came out was a sorry tale of corporate misalignment.  The experience of the delegates was completely at odds with executive statements about innovation and entrepreneurship.  The corporate leaders made grand statements about the need for agility and innovation but their actions belied their words.

Recently the company had run a major creativity exercise to generate and evaluate ideas to boost health care product adoption.  It had resulted in hundreds of ideas from which ten promising proposals had been short-listed as winners.  The people who submitted these ideas all won prizes.  However, none of the ideas was implemented.  What is more, although the leaders called for more innovation, their actions resulted in more rules, procedures and compliance that made approval of new ideas even more complex and difficult than before.  Where innovations had occurred, often in some of the smaller country subsidiaries, they had had to overcome serious opposition from central staff units who wanted conformity and not diversity of approach.  Furthermore the successful innovations had not been broadcast to other subsidiaries nor replicated in them.  The company was compliant, centralized, risk averse and potentially headed for obsolescence.

People do not believe what leaders say.  They believe what leaders do.  Actions speak louder than words.   If the CEO says that innovation is important but she penalizes risk-taking and rewards conformity then the message is clear – keep your head down and don’t rock the boat.  It is not enough to talk the talk – the leadership team must walk the walk.  Fine speeches and grandiose mission statements about innovation and creativity don’t cut it.  Actions have to deliver on the promises.

The innovation disconnect occurs when corporate statements and employee experiences are inconsistent.  People become disillusioned and cynical.  Why bother submitting ideas when there is no chance of them being evaluated or approved?  The people at the top want innovation and the people at the bottom have lots of ideas for improvement but somewhere in the middle there is a jungle of approval complexity and caution that inhibits change.  In his book, Managing Change, John Kotter identifies intermediate supervisors as one of the major obstacles to successful change.  The people in the middle are committed and busy so they follow the rules and turn down suggestions that disrupt the operation.

What is needed to bridge the innovation disconnect is actions that reinforce the words.  Leaders must demonstrate that innovation and risk-taking are desirable and rewarded.   They must implement some of the best suggestions and publicize successful results.   They must reach across the organization to empower and encourage people at lower levels to prototype new ideas.  They must allow some failures in the pursuit of experiment and innovation.  They must encourage sharing of innovative experiences (both successful and unsuccessful) in the cause of learning.  Of course compliance, quality standards and regulation must be observed but they have to be kept in balance.   The leaders must constantly strive to overcome the systemic inertia and the complexity of approval processes that naturally occur in larger organizations.  They must fight the innovation disconnect with actions not words.

By Paul Sloane