The Lynchpin of Innovation

Cultural alignment makes creativity possible. There are lots of great case studies on innovators and innovative companies. Some tell the story of ongoing innovative developments and brand extensions of companies like Nike--stretching from the legendary waffle sole to its newer digital business. Others focus on the race to a specific objective, often something that seems impossible, like flying, walking on the moon, or powering the globe without fossil fuels. Still others explore the iconic genius, working tirelessly in his/her garage workshop to bring his/her dreams to life. All the stories are intriguing and start the creative juices flowing. Who hasn't read about an innovative company and thought, how can I apply that to my work? But there's often something missing in articles and keynotes on sexy innovators. Cultural alignment. Cultural alignment is, in my mind, the lynchpin to effective innovation, but it is all too often ignored. Sure, we hear that innovation has to be disciplined and that the process is often messy, resulting in more failures than successes, but disclipline and risk tolerance only occur within the framework of organizational culture. And it extends beyond whether or not an employee is willing to admit without fearing for his job that a project doesn't work as planned. Innovation requires cross-functional teams in which all players have the same goals and do their damndest to achieve them. Communication lines are open. Team members openly communicate failures and obstacles to success and then work together to address the challenges. There will still be more failures than successes and the process will still be messy, but success is more likely to happen when everyone  is pointed in the same direction. Now here's the rub. This kind of alignment doesn't happen as a fluke. It is intentional and led from the top. Jay Rao and Joseph Weintraub, professors at Babson College, have identified six building blocks of an innovative culture.

• Values. Gloria Steinem once said "We can tell our values by looking at our checkbook stubs." The values of a company are not necessarily what is written in an annual report or named in a mission statement. Values are defined by what the leaders do and invest in, and they determine our priorities. Innovative companies invest in professional development and promote creativity.
• Behaviors. Leaders of innovative organizations support innovation through their actions. They discontinue products and services to make room for new and better ones, and cast a vision for the organization, telling vivid stories to help employees envision the future. They also do everything in their power to cut through red tape and find the funds and resources to act on innovative ideas, even when budgets are tight.
• Climate. Contrary to common perception, culture and climate are not synonymous. Culture is the "personality" of an organization, cultivated over time, and includes the values (stated and implied), beliefs, and norms that guide how an organization does business. Climate, on the other hand, is the "mood" of the organization and can change rapidly depending on leadership, recognition, and organizational structure. An innovative climate engages employees and encourages independent thinking and risk taking within a safe environment.
• Resources are the people, systems, and projectsthat foster innovation. Of these, the most important is people. Innovative companies develop champions and mentors to help ensure that ideas are nurtured, screened, and vetted at all levels of the organization.
• Processes. These are the formal steps an organization uses to capture and vet ideas.
• Success. Success can be measured on a number of different fronts, including financial, market share, and how a company is perceived in the marketplace. But success can also be gauged by the level of involvement by employees across the organization, the extension of capabiliities within the organization, and the level of integration of innovation in long-term strategy.

So how are you doing? Rao and Weintraub have developed a Building Blocks of Innovation Assessment to help measure the strength of each of the building blocks. Have staff members from all levels of your credit union complete the survey by rating 54 different elements that make up each building block on a scale of one to five. By averaging the scores for each building block, you have a simple-to-understand innovation scorecard for your organization to level set and then monitor progress. Not surprisingly, many companies perform quite well at tools-oriented elements, providing necessary resources, processes, and measurements, but do not excel on the hard-to-quantify people-oriented elements. They lag in supporting and promoting values, behaviors, and climate needed to support innovation. While no organization will be equally strong in all areas, the most successful innovators monitor the building blocks, and expose and address inconsistencies between thought and action. Cultural alignment is critical to successful innovation. Be intentional. Measure, monitor, and adjust.

Christopher Stevenson is CUES' VP/professional development and innovation. Read other posts from this blog about creativity and innovation: "Creativity Can be Taught," "Limitations Enhance Creativity",and "Creativity: Stroke of Genius or Result of Hard Work?" This September's inaugural Strategic Innovation Institute I is sold out, however, you may still express interest in attending and check out information about Strategic Innovation Institute II. Learn more about the CUES School of Strategic Marketing I and CUES School of Strategic Marketing II, slated for July in Seattle.