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and leaders Yet when the CEO space to bring tacit
the freedom
to innovate
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working on masking it to market.
tape, he decided not to
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funding, Drew used helps if it can allow them to
hundreds of $99 purchase discover how to leave
orders to develop the
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first 3M tape. It also and resources for
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multi-billion dollar
innovation culture from
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rules, to be able to create
which tens of thousands quick and “dirty” solutions
of products, including Sellotape and Post-it and then develop them into products.
notes, have resulted. 3M’s eleventh commandment is “Thou shalt
This story is a powerful example of some of not kill ideas for new products”, which along
the actions and events necessary for with the advice that leaders “bite their
transformative innovation. In fact, we could have tongues until they bleed” is designed to
chosen a thousand other such cases from ensure that they allow smart people (in other
companies as diverse as Apple, Cemex, words, the kinds of people organisations hire)
Nintendo, Coca-Cola and Google with the same to make mistakes, rather than the leaders
essential shape and substance. making the bigger mistake of stopping them
The common factor is that such stories creating the products that reinvent and
allow us briefly to consider what behaviours reinvigorate the company.
Max McKeownÉhcZl should be encouraged and how coaching can If coaching is paid for by the business it should
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help or hinder such efforts. What can a coach contribute to the business. That means it should
Richard Hanson
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coaching help? facilitating the behaviour that leads to
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www.thetruthabout
insights to keep renewing the organisation – a purpose that earns the right to a competitive
innovation.com coaching helps if it can give them sufficient place in the world.
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The following is an extract from
by Max McKeown
THE TRUTH
ABOUT
INNOVATION
“Find the
creativity inside”
MAX McKEOWN
Innovation rocks. It rolls. It makes the world go round. Our
INTRODUCTION
lifestyles are the result of other people’s efforts to improve
the human condition. They mixed ideas and inventions
together. They worked hard to create the must-have and often taken
for granted stuff that surrounds us.
You have evolution to thank for your opposable thumbs and adorable belly button.
And for your amazing brain, with more connections than stars in the galaxy, that has
allowed millions and now billions of us to examine our world and seek to make it
better. That is innovation and it matters.
Our century’s greatest innovation will be the method of innovation. We are beginning
to understand how to increase our ability to improve together. We are learning how
to move from individual invention to group innovation.
This book shares some of what we have learned about innovation, what it is, how it
happens, and how it can be increased. New insights into how our brains work
collectively provide us with the opportunity to create the equivalent of a bigger brain,
capable of dreaming and working together to make those dreams reality.
Everyone can help. Every kind of intelligence and personality plays a part.
Our need for innovation has shifted power closer to the source of that
power ? Us. We are the future.
You’ve seen the big picture, haven’t you? The typical big company wants TRUTH
big products. They want big ideas. If they’re big shots with big balls then
they place big bets on a big future. No one wants the small project. Or to
be the small project manager. Who wants to do that?
1
References
Snyder, NT, Strategic Innovation: Embedding Innovation as a Core Competency in Your Organization, 2003,
Jossey-Bass Business & Management
Rosenhead, J (Ed.),1992, Rational Analysis For A Problematic World: Problem Structuring Methods for
Complexity, Uncertainty, and Conflict, John Wiley & Sons
Liker, JK, The Toyota Way:14 Management Principles From The World’s Greatest Manufacturer, 2004, McGraw-
Hill
TRUTH
A worker suggests an idea worth millions to her company. Should her
managers keep their promise to give ten percent of the value of the idea
even though it means paying her $1 million? Or should they keep the
money and give her a gesture of appreciation, a gift voucher perhaps, since it’s
2
It seems simple, but it’s amazing how many managers forget that you
have to share to get people’s best work. Don’t expect breakthrough The purpose of
innovations in return for free t-shirts or gift certificates. Recognition
has its place but it doesn’t pay the mortgage. Some managers are sharing rewards
tempted by their inner scrooge when faced with the reality of passing
on the profits. Where the idea is lucrative they may find the prospect
uncomfortable of paying subordinates more than senior staff. Resist
is to encourage
the temptation and the excuses that go with it. more great
If you want more, higher quality ideas then you will have to share
more. People you trust to generate innovations are smart enough to
want fair returns for their contribution. When the path to shared
innovations
rights and rewards is not clear people tend to keep their best ideas
secret or undeveloped. Others will leave to seek rewards from a new employer or by starting up a new compa-
ny. The people you should most want to keep are those most likely to leave if they do not receive their fair-
share. The bold, obsessive, entrepreneurs leave first.
Different kinds of rewards will lead to different kinds of innovation. Short-term bonuses for managers are rarely
a good match to increasing long-term innovation. Short-term financial rewards tend to encourage management
behaviour that is unhelpful to the innovation process. The volume of ideas becomes more important than their
value.
The purpose of sharing rewards is to encourage more great innovations and the behaviour that goes with it.
Good ideas take time and effort. Great innovations demand careful, rigorous, imaginative joining-up of ideas.
Incentives need to motivate the right kind of effort. Each stage in the innovation process should have a clear
rewards mechanism.
Paying people for submitting suggestions, or introducing prize draws that reward some of those who put for-
ward ideas, may generate more suggestions but will not encourage better ideas. The only reward for the act of
submitting an idea should be recognition for having participated along with access to support, knowledge and
training that can help the individual take the next steps to develop the idea.
Lessons and knowledge gained from attempts to implement an innovation deserve rewards. One pharmaceuti-
cal company now gives stock options to those brave enough to conclude that their own research projects will
ultimately fail. It does this to encourage fast learning rather than back-covering, defensiveness.
You can also try rewarding people by promoting them to the most senior levels based on the impact of ideas.
It works for 3M, the post-it people, who also elevate those who have taken personal risks to sell and imple-
ment their ideas.This approach has a number of strengths. The hierarchy becomes not only a meritocracy of
past results but also a meritocracy of future growth. This is motivational to other innovation-minded individu-
als and ensures that the leadership team includes an innovation perspective.
Sharing is mirrored behaviour. We share most with those who share with us. Sharing is risky. Sharing new
ideas is a gamble: Will the idea be laughed at? Will time spent developing the idea be wasted? Will credit for
the idea be taken? Will the idea be stolen? Or ruined? The risks are so high that most people need to know
that the upsides of sharing are considerable and that the process for sharing can be trusted before they will
actively look for ideas that go beyond their job descriptions and pay grade.
Money is not the only motivation for sharing and developing ideas. Sharing the benefits that come from an TRUTH
idea does not only mean financial benefits. You can share glory, the thrill of creation, the satisfaction of
achievement, and the respect of colleagues. They are not directly paying the mortgage either but they are
attractive to many people as long as they are real and first-hand. 2
It’s tempting not to share benefits especially for the super-ambitious who often minimise the
References
Capek, PG, Frank, SP, Gerdt, S, & Shields, 2005, DA history of IBM’s open-source involvement and
strategy, IBM Systems Journal, Volume 44, Number 2
Gerstner, L, 2003, Who Says Elephants Can't Dance?: How I Turned Around IBM, HarperCollins
Stewart, JB, Disney War, 2005, Simon & Schuster
Yadav, MS, Prabhu, JC, Chandy, RK, Managing The Future: CEO Attention and Innovation Outcomes,
Journal of Marketing, Vol. 71 (October 2007), 84-101
A few years ago, Proctor and Gamble’s CEO, set a goal to find 50 percent TRUTH
of its innovations outside the company. His decision has boosted growth,
and doubled its billion dollar brands and share price. Should you limit
yourself to the talent inside your company? Could you get a bigger brain with the
4
windows. Apple didn’t invent MP3 players. Hoover didn’t invent vacuum cleaners. Amazon didn’t
invent online shopping. Sony didn’t invent games consoles, video recorders, or portable cassette
player. They brought together outside inventions into innovations that people wanted to buy. 4
References
Huston, L, & Sakkab, N, 2006, “Connect and Develop: Inside Procter & Gamble's New Model for
Innovation,” Harvard Business Review, Vol. 84, No. 3, March 2006.
Hughes, Thomas P. 1977. Edison's method. In Technology at the Turning Point, edited by W. B. Pickett.
San Francisco: San Francisco Press Inc., 5-22
Owen, D, Copies in Seconds: How a Lone Inventor and an Unknown Company Created the Biggest
Communication Breakthrough Since Gutenberg - Chester Carlson and the Birth of the Xerox (New
York: Simon and Schuster, 2004)
Madonna is the queen of re-invention. She has sold over 200 million singles making TRUTH
her the most successful female artist of all time. How has she managed to thrive over
two decades while others around her have faded away? What can you learn from her
approach to innovation? 5
The same stuff happens with organisations and with our individual careers. Success, particularly big
success, makes us think that we have the answers. People just keep doing the thing that has brought
them success in the past. We even hire people who fit into our established way of doing things. It
reduces the range of variation, in the genotype of the firm and the phenotype of its members, in the
service of efficiency. In other words, we endanger future success by betting on the habits of past suc-
cess.
Lacking either the time or the humility to consider other options, companies naturally lose their com-
petitive position when the market shifts from beneath it. Structural inertia kills the future of a firm just
as surely as three-chord monotony will eventually bring about the demise of a band.
Being very good or even better is not enough. You need to become the hub of new things that are as
popular as the old things were. Sure it's a risk ? the socalled 'liability of newness', but then so is stay-
ing the same. You can reduce the risk by understanding how the reinvention queens and kings keep
all virgin fresh while building on past success.
Madonna does not work alone. Her reinventions come about by listening to those who are listening TRUTH
to music trends and being credible enough to attract producers who are producing the latest thing.
She has the reputation of being good for other people's careers - not just her own.
Nintendo is a king of reinvention. It began in 1889 producing handmade playing cards. It experiment-
5
References
Odum, EP, 1959, Fundamentals of Ecology, Second edition, Philadelphia and London: W. B. Saunders
Co
Sheff, D, 1999, Game over: How Nintendo Conquered the World, Cyberactive Media Group