Innovation is hard, but necessary, rewarding, and learnable
Strategic Management and Entrepreneurship Associate Professors Mary Benner and Daniel Forbes study how leaders can build and manage organizations that foster innovation and adapt to change. According to these experts, leaders can develop expertise in innovation and affect change across their organizations.
Read on for key lessons you should know to build a culture of innovation.
Beware the competency trap
Amid a dynamic marketplace, no organization is immune to advances in technology that necessitate innovation. In fact, it’s the firms that are on the cutting edge today that will be obsolete tomorrow. Be careful to avoid the “competency traps” that lead to successful organizations’ demise.
“I’m fascinated by what happens to successful firms when they’re faced with huge changes in their markets. We can look back at failed firms, and ask ‘what happened?’ These companies are full of smart people who see things changing. But something makes it hard to respond to changes in the market. Companies that are particularly good at something are subject to competency traps—their core capabilities become cultural rigidities that stifle innovation,” says Benner.
In explaining this phenomenon, Benner points to examples like Motorola's 2004 Razr release, a line of cell phones that quickly permeated the marketplace. She explains that Motorola banked on the success of the Razr, instead of continuing to innovate in the fast-changing mobile device market, and was later overtaken by its competitors.
Engage the innovation ecosystem
Organizations operate within a regulatory environment, a marketplace, and a society that is constantly changing. Look beyond the confines of your organization for opportunities to innovate.
“Leading a culture of innovation involves paying attention to what’s happening in firms and industries, and what individual people are doing in their firms. Engage with the larger innovation ecosystem—there are things happening on the other side of the world that could be relevant to your organization’s strategy,” says Forbes.
Acknowledge that failure is inevitable
Innovation is risky, and for organizations that reward short-term success, employees have little incentive to implement new ideas. Rather than be dissuaded by failure, leaders make allowances for risks.
“If you’re punished because you fell short of meeting your numbers, but you’re also expected to innovate, you’re going to remain stuck. Innovation is hard because the pressures of being more efficient and improving performance in your current business often crowd out doing new things,” says Benner.
“We need to brace ourselves for the reality that unsuccessful outcomes are going to be frequent in innovation,” says Forbes. “If we make a mistake, it’s the price we pay for learning.”
Get started building your own culture of innovation
Registration is now open for an Executive Education program, led by Benner and Forbes, that delves deeper into how managers can lead innovation, develop new business opportunities, and adapt to a dynamic marketplace.