• Investment
  • 23 July 2018

Mindset shifts to allow innovation to flow

Recogintions

In my earlier article, I wrote about innovation and why it is becoming more urgent for companies to start thinking about how to encourage an innovative culture among its employees.

In this article, I will focus on the mindsets that need to change in order for innovation to take root within an organisation.

To put things in context, we conducted a two-day leadership forum recently for about 200 Bank of Singapore employees, including senior and middle management. We wanted to see how we, as an organisation, could become more innovative.

Throughout the course, which was conducted by INSEAD Professor Nathan Furr, an expert on strategy and innovation, it was clear that in order to build an innovative company, our traditional ways of thinking and management needed to change.

Here are some ways we can try to re-mould our way of thinking.

Blue vs Red management styles

Red is the more traditional style of management. Some characteristics are flawless planning, anxiety to avoid failure, rigorous analysis of a new idea and so on.

Blue, on the other hand, is more of the entrepreneurial style of management. This is where there is a lot of trial and error and a willingness to fail fast and learn fast.

One fundamental difference between the two is that those who are red tend to focus more on thinking and analysis; while blue managers are more into doing, testing, experimenting.

It is important to note, though, that being blue does not necessarily mean you take a laissez faire attitude towards ideas. Some may mistake it for a do-whatever-you-want attitude. On the contrary, a blue person must be very disciplined, have a proper process to try out ideas and know when to switch direction based on the results of the tests.

When we took an informal poll among those attending the forum on the redness and blueness of our organisation, an overwhelming six out of seven voted red.

The poll result did not surprise me nor most people in the room.

What’s important is that after recognising that we’re largely red as an organisation, how do we then move towards becoming more blue?

How do we find a common ground between red and blue and strike the right balance?

To switch suddenly from mostly red to become mostly blue, to me, would not only be unrealistic, but also bad for the company.

This shift would take time – but if we keep reminding each other of the need to be more conscious of the blue way of thinking, we may all get there one day.

Failure vs Learning

Many traditional companies assiduously try to avoid failure.

They see failure as a bad thing and that mentality trickles down to employees fearing failure as well, believing it would be a stain on their appraisal, which then has repercussions on their promotion prospect and annual bonuses.

But failure should not be seen negatively. It is not a bad thing.

Failures should be seen as lessons instead, where we gain insights into why something did not work and how to avoid such mistakes the next time.

In fact, the worst kind of failure is when we get so hung up over our failings that we do not bother learning from them.

In fact, there usually is a spectrum of failure which ranges from deviance (where the employee deliberately violates the rules) to a problem in the processes or the fact that the task is at a very exploratory stage.

In the first extreme, disciplinary action must be taken, but in the other two examples, we should recognise that such failure is part and parcel of the learning process.

In our organisation, we have embarked on several projects over the years. While some have flopped, others have turned out better than expected.

We can learn a lot from what worked as well as what did not.

It may surprise some to know that a recent Harvard study found that half of all start-ups fail within five years. And the failure rate goes up to 70% over 10 years.

If we do not have a willingness to fail, we’ll always find ourselves holding back. And this never produced an innovative idea.

Rather than focus on outcomes, let’s all try to be "Chief Experimenters", where we give our employees time, space and resources to experiment and try out new ideas.

Be a Venture Capitalist vs Be a Manager

A Venture Capitalist (VC) invests in many companies. They have their fingers in so many pies not because they think every one is going to be successful.

Instead, they are hoping for that ONE gem of a business that would make them so much that they can ignore the failings of the other nine in their stable.

A manager, on the other hand, is more focused on ensuring EVERY project he takes on ends up a success. If he is not convinced the project will work well, he would not go ahead with it.

Traditional managers see their role in new projects as one of oversight, where they monitor results of the ongoing project and decide to proceed or not.

VCs, on the other hand, see their role as one of assistance, where they guide the project along and see how they can better “make the lights turn green” for those working on the project to produce the results they want.

In short, they are there to facilitate the project, to see how far we can push the experimentations. They are not there to see when to pull the plug on it.

Agility vs Rootedness

Are we the kind who jump only when we can see the shore? Or jump even though we have no idea which direction the shore is?

Either option may not be wise as the first makes you too cautious (by the time you see the shore, you may have starved) while the other virtually assures you drown (your random choice may mean you end up swimming away from shore).

How about learning to stand on one foot and use the other to test out where land is? If our testing foot does not feel solid ground to the right, let’s pivot to test out the left side. If there’s still nothing to the left, try your front and maybe your back too.

This stance is like a basketball player who has to keep one foot grounded while the other foot can be used to swivel their body from one direction to another to find an opening to attack the opposition.

The pivoting basketballer closely resembles innovativeness – always have one foot planted but be nimble and agile enough to change course when what we have been trying out is not working.

Groom Innovators vs Groom Innovative Ideas

Some companies set out on their journey towards becoming more innovative by focusing on generating ideas and innovations.

But this is counter intuitive in a way because without the right training and tools, most employees find it hard to change their traditional mindsets.

Rather, we should focus on creating innovators by giving them the right training and then creating the right environment for them to thrive.

When we create lifetime innovators, the innovations will eventually flow.

*This is the second in a series of articles on innovation. In the next article, Bahren will discuss how to create an environment at work where innovation can thrive.

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