Interesting article from IMD on why small companies have an edge over their large company counterparts in driving innovation. The point I found most interesting is that they point to psychological safety as a necessity to foster a culture of innovation. They define psychological safety as "the assurance that if you have an idea and explore it yet it fails, you wont be fired or penalized for it."
Most organizations understand that it is important to accept failure in innovative cultures. But how do you send a clear message to the organization about what type of failure is acceptable, and what type of failure is not acceptable? No one wants to reward people for not being thorough, screwing up, or being lax. Stating this fact seems obvious, but in practice it can become quite muddy. What do you do if an engineer perfects a new technology that has no relevance in the market? This is what can happen when companies try to encourage failure by creating sandboxes that can be tangibly measured. For example, each group or person gets a budget of $x to spend on exploration, or (as Google famously states) each person has 20% of their time to work on whatever is of interest to them. Yes, a random breakthrough may occur, but these metrics are meaningless if they are not tied to innovation goals.
I believe that the leadership of an organization bears the responsibility of defining the goals for value added innovation. By this I mean that they need to define the business the company is in based on what benefits they provide to the market. When this is very clearly stated, (as is usually the case in a small company) people know what challenges are set out before them. They will then find ways to cut through silos, form groups that consist of people with diverse skills, and be able to tell when one path needs to be abandoned for another that's more promising. These "failures" will be good failures because they won't look or feel like failure at all. The goal will be greater than any one execution which removes the burden of failure from any one task or series of events.
In my opinion, the only real failures happen when leaders do not take on this responsibility. They reorganize to remove silos, give up some money, free up some time, and sit back and wait for magic to happen in a vacuum. If this is what happens in your company, think about what you can do to set market driven innovation goals. Otherwise you risk rewarding real failure.
I am a psychologist, not a business person, but I found this post on a google search for failure and think it is so interesting the notion of creating a safe environment for good failures so that innovation can occur. I write about how parents need to teach their kids how to (and learn themselves) destigmatize or make use of failures because this is ultimately how to succeed– I wonder what would happen if schools and families noted the IMDs recommendation that psychological safety is essential for innovation– I can only imagine what this mindset change would do for our culture.
If you’re interested in looking at my chapter on overcoming failure, losing and disappointment, you can read an excerpt of my book: Freeing Your Child from Negative Thinking: Powerful, Practical Strategies to Build a Lifetime of Resilience, Flexibility and Happiness, at http://www.freeingyourchild.com.
Thanks Tamar! I appreciate your perspective and the thought that innovation truly does start at home! You’re right that if more schools and families had this focus, there would be so much less unlearning to be done in the workplace.
Hi Ellen,
What a great article. I often work with companies to define innovation. We almost always work quickly into the comparison of innovation against invention. Invention being to create something new and innovation to bringing new value for the organization, the customer, the environment, etc…
I was speaking with our mutual friend (and overlapper) Lina today and I was talking about one of the greatest strengths of design-thinking from where I sit – namely the focus on defining the problem.
So many companies want to rush into solutions. To take action.
I have long held that defining the problem is the single most important step. We naturally seek solutions as human beings.
You make a wonderful case for this in this article. Clearly defining the problem in a way that is relevant to the organization and it’s customers (market) is a great case in point.
Sean
Good to hear from you Sean! I like the way you make the distinction between invention and innovation. Works very well.
And yes, it’s one of my holy grails to continue to make the point that the most important first step is to make sure that the right problem has been defined. Otherwise there will be a lot of wasted effort.