Digital transformation is the name of the game for incumbents in almost every industry. Leaders are learning that developing the right technological solutions is only half the battle. Without the right culture and capabilities, an organization will never reap the benefits of those solutions—people will not be willing or able to use tools like IoT and AI, nor take full advantage of end-to-end enterprise platforms. At the heart of building the right culture is the need for a shared sense of purpose among people in the organization.
To explore this idea further, I spoke with Linda A. Hill, a Harvard Business School Professor and the co-author of Collective Genius: The Art and Practice of Leading Innovation. Hill, regarded as a top expert in the field of leadership and innovation, helps leaders understand how to build organizations that can innovate time and again and gain a competitive advantage. At the upcoming Liveworx in Boston on June 19th, Hill, a keynote speaker, will discuss the importance of purpose for organizations that seek to innovate and grow in the future.
What is Innovation?
Hill described that too many companies fall into the trap of defining innovation as synonymous with invention. Many see innovation as something new, often a new technology, ideally one that can be patented. But for Hill, to call something an innovation, it must be both new and useful. It must address some challenge or opportunity aligned with the organization’s purpose and ambition.
How Does Innovation Occur?
Hill has seen companies invest significant time and resources into developing or implementing a new digital platform, only to find out later that few embrace the new technology and take advantage of the associated capabilities. Why? They don’t have the right culture in place.
Innovations are almost always the result of collaborative efforts of people with different expertise and points of view. Therefore, an organization must have a receptive environment – one in which people are willing and able to do the difficult collaborative, discovery-driven work required for innovation—otherwise the new tools go underutilized. As we all know, Hill went on, “Innovations are rarely developed full-blown. They often require iterations, missteps, even failures. Without commitment to a shared purpose, people admit they don’t think it is worth it to take the risk to work in new ways with others—often others who are quite different from themselves—like the new big data analytic experts that have joined their marketing or operations teams.”
Hill believes that leaders play an essential role in creating this receptive environment—a key foundation for innovative work. Hill and her colleagues find rather than defining their role as that of the “visionary”, exceptional leaders of innovation see their primary role as creating a context in which others can co-create the future with them. These leaders do not pretend to be “all-knowing,” but instead encourage employees to come together and use the new technologies to fulfill the organization’s bold ambitions to delight their customers by providing highly differentiated or personalized experiences.
Hill said that people can have difficulty letting go of the myth that innovation is the result of the “lone genius.” They think of a brilliant person who has a sudden “flash of insight.” In fact, Professor Hill’s research shows that innovation is usually a collective process. Organizations that seek to foster routine innovation cannot rely on a few “creative” individuals. Instead, they need to draw out the “slice of genius” in each individual. Innovation is voluntary. No one can be forced to make a contribution or solve a problem. People are willing to do the hard work of innovation when they feel part of a culture engaged in something greater than they could ever achieve alone.
Why Does Purpose Matter for Technology & Innovation?
As Hill described, innovation is a collaborative process—most often among individuals with diverse perspectives and experiences. Getting talented and diverse individuals to work together is not easy, especially because truly creative work is often intellectually and emotionally taxing. But, Hill said, organizations that can innovate routinely have this key ingredient that many organizations do not: Purpose. A compelling purpose is what makes people willing to collaborate, to do the hard work of innovation.
Hill says organizations can define their purpose by answering two questions: 1) Why are we together? 2) Who are we? Organizations that wish to achieve innovation and growth must do more than equip themselves with the required technology infrastructure and solutions. Their leaders must focus on communicating a shared sense of purpose that guides people as they go about their day and make decisions.
When working with organizations, Hill finds that purpose is often misunderstood. Leaders talk of mission statements or strategy. They often focus on what a group does, but not on the why it does what it does. The purpose is more than a goal – it is the reason that the organization exists and the need that it fulfills. Every group, especially in technology, must ask itself: if we disappeared tomorrow, how would the world be different? If your group cannot answer that question, then it might be time to reflect on your purpose and consider how to define it more clearly.
To that end, Professor Hill cited the example of Luca de Meo, the former Chief Marketing Officer for a leading automaker. When De Meo joined the company, innovation was seen as the sole purview of design engineers. This narrow definition of innovation—as something belonging only to the technologists—was slowing the time it took to bring new car designs to market. De Meo knew that the organization needed to be more nimble and that could only happen with breaking down silos—both functional and geographic. The company needed every group engaged in innovative problem-solving together, to include marketing, if they were to be agile and thrive. For sure they needed to build the digital infrastructure and processes to facilitate global collaboration. But without a shared purpose to which all could commit and direct their talents and passions, they would not be willing to create and deliver an innovative brand and unique experience for their customers.
De Meo understood that the first step of their transformation journey was defining a shared purpose—a collective identity that represented the brand. For De Meo and his colleagues, purpose ended up being jointly defined as providing customers with environmentally sustainable mobility options. For a luxury fashion brand, another example cited in Hill’s book, purpose was about delivering products that helped women feel empowered. No matter the form that it takes, purpose is the glue that holds people together in an organization. It is the grease that makes it worth it.
What Values Do Innovative Communities Display?
In addition to purpose, leaders of innovation also instill shared values in their organization. These values shape the organization’s priorities and choices as well as influence individual and collective action. The four values are:
- Bold ambition. Innovative organizations tackle big challenges (address customer’s key pain points or provide unparalleled experiences that delight them) that conventional ideas could not resolve; in fact, their ambitions tend to be bigger than the company’s capabilities. If the ambition is not bold enough, the purpose important enough, why bother trying to innovate. As one leader of an outsourcing company put it, “If you are going to jump, JUMP!”
- Collaboration. Innovative organizations take conscious, proactive steps to ensure diverse people interact, now how to debate, and do decision-making in ways that even opposable ideas can be combined and pursued.
- Learning. Innovative organizations believe a desire to learn enables people to tackle tough problems and benefit from the missteps and mistakes inherent in innovation.
- Responsibility. Team members feel a sense of responsibility to do their best work to contribute to the organization’s shared purpose.
The rapid pace of technological change demands constant innovation and growth. Without building the right culture, however, organizations may find that the digital platforms and technological solutions in which they invest a great deal of time and resources may not succeed. Leaders must focus on creating a compelling sense of purpose within their organizations if they wish to achieve routine innovation – whether in technology or other areas. Technical solutions that are implemented in an organization will thrive when the culture supports people in using those tools to pursue innovations that are compelling and meaningful to themselves and their clients.
If you would like more insights into how to foster innovation and growth in your organization, then join Professor Hill and me at the PTC Liveworx.