Innovating from inside out: how smart workforces lead the digital revolution

digital-revolution
Companies like Facebook embrace digital change from within, Hay Group argues. Photo: SIPA/REX Shutterstock

How organisations embrace technology and new processes internally can make them more innovative from a customer perspective. This is a concept that Hay Group calls “innovation acumen”. Cath Everett finds out more.

If organisations want to be considered innovative, how they use new technologies and adopt creative processes is all important.

Experts argue that, once internal innovation has been unleashed, it spreads and makes itself felt externally in terms of the creation of new products, services and even breaking into new markets.

Effective use of emerging technologies will be a key enabler and differentiator.” – Ben Hubbard, Hay Group

Ben Hubbard, a consultant at management consulting firm Hay Group calls this “innovation acumen”.

He explains: “As Silicon Valley continues to produce corporate giants to lead the digital revolution – Google, Facebook, Amazon and the like – innovation acumen will surely become a basic survival need in a rapidly changing global economic landscape.

“The effective use of emerging technologies will be a key enabler – and differentiator – in the pursuit of a more creative and smarter workforce,” he says.

The tools to create this smarter workforce comprise cloud and mobile computing, social networks and analytics as they have “the power to foster greater collaboration and inter-connectedness across the modern enterprise”, Hubbard adds.

“This is a new world where research and development, IT, marketing and HR converge to create work environments that equip and empower their people to be key contributors in the innovation cycle.”

But such innovation does not happen by chance. In order to allow it to blossom, organisations need to put in place a suitable culture, leadership style and performance management agenda.

Keys to innovation

Hay Group carries out an annual study with US magazine Fortune to rank the world’s most admired companies, and this study reveals that top innovators such as Apple and Google are much better than their peers at using new technology and creative approaches to improve efficiency internally.

“Internal innovation is the first ‘shift’; what becomes valued is the execution of new ideas. By pushing through an agenda of internal innovation, these companies have altered the horizons of what’s possible for the business as a whole,” explains Hubbard.

But while a vision is important to identify where the organisation should pursue new ideas and approaches, it is also necessary for leaders to sell them to employees in order to encourage concrete action.

Hay’s research also reveals the types of characteristics effective leaders in these organisations would exhibit, including:

  • highly visionary;
  • providing direction and purpose;
  • able to develop shared interests across and within teams; and
  • coaching team members effectively.

Importantly, they also:

  • gave individuals the authority to take risks;
  • ensured a minimum of bureaucracy to ensure that new ideas could survive; and
  • purposely did not kill off innovation projects too soon as part of an attitude of tolerance for failure, preferring instead to focus on potential new learnings.

Finally, the most innovative companies were also found to be better at execution than their peers, demonstrating a variety of key characteristics in this regard.

According to Hay Group, it:

  • had clear processes for selecting the right ideas, which included taking decisions at the appropriate level within the organisation and being able to determine suitable levels of investment in those ideas;
  • empowered staff to assess risks and likely business gain in order to ensure that ideas had a good chance of becoming commercial propositions;
  • made sure that there were adequate capabilities in-house to take on new projects; and
  • ensured that they have the right talent in the organisation by recruiting, assessing and progressing suitable individuals who were able to lead, foster and maintain social networks, show commercial nous, have a positive attitude and possess the courage of their convictions.

HR’s role in building this environment is a central one, concludes Hubbard, whether that is fostering collaboration or ensuring that the right performance management systems are in place.

“HR leaders have a crucial role to play in helping organisations foster the conditions in which new ideas and innovation can flourish,” he claims.

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