Por y para profesionales del Derecho

Portal jurídico de Aranzadi, por y para profesionales del Derecho

25/03/2023. 21:31:47


Por y para profesionales del Derecho

Crisis and innovation

CEO y Presidente de Infotrac, Inc.

vasos de metal con una luz dentro

The Need for Innovation

Ernst & Young's London news release of June 15, 2009 gives us a picture of how the global recession has impacted the business community. Based on the study of executives at 570 leading global companies, the report states that the global recession has permanently changed the rules of the game for companies worldwide and that 88% of companies are now reporting that their operating model has been altered by recession.

From our perspective, the economic crisis can actually have a positive effect as it forces a re-examination in long-standing assumptions – and could trigger a new wave of innovation. Many business leaders are engaging in profound rethinking in order to figure out new strategies to help their companies deal with the new rules of engagement, new bases for competition, and new patterns of consumption. As the environment has changed so dramatically, it is clear that new and innovative thinking will now be key to success. But, how can we encourage and sustain innovation in our organizations?

The Process of Innovation

While it is impossible to describe the exact process that produces innovation, the characteristics that make up the creative process are known. From our observations, the creativity of the mind is enhanced when it focuses on a need or a problem. The greater the depth of understanding of the problem, the greater is the probability of a creative solution emerging. Once the problem is imprinted in the mind, whether or not one is consciously aware, the mind keeps working on it until a solution emerges. The solution could come from associating an insight from an external source or from past experience. The insight could be an idea received from a co-worker, or triggered by an event, or a sudden realization of a natural law or a social principle. Often, the insight is in the form of a pattern one has previously observed or a pattern that emerges when a new idea is added to one's frame of reference.  It is impossible to predict when the moment of creativity will come or what exact sequence of events would produce it. Yet, when it happens, we know that innovation has occurred. It is a thrilling moment and the idea is born. Many of the past great discoveries have resulted from just such a process.

Fostering Innovation

Can innovation be fostered in an organization? Can we expedite the process? Several excellent companies have made progress in this area. One example is Cisco Systems, as reported in the September 2009 issue of the Harvard Business Review in the article, Inside Cisco's Search for the Next Big Idea, by Guido Jouret. Cisco Systems embarked in 2007 on a project to find the Next Big Idea that would leverage its leadership position in Internet technology. Cisco engaged 2500 innovators in 104 countries. The project resulted in 1,200 distinct ideas that were then narrowed down to 40. Cisco encouraged innovators to join forces while rewarding those who won the I-Prize. The interesting conclusion was that despite the competition for the prize, 70% of the final 40 ideas belonged to innovators that joined forces. Cisco's experience shows a correlation between collaboration and innovation.

Culture of Innovation

Beyond collaboration, several other characteristics are necessary to establish a culture of innovation. They include motivation, openness, freedom from fear, and the attitude of learning. Motivation can have an impact on creativity as discussed in Creativity Theories and Themes, by Mark Runco. He states that reinforcement or encouragement motivates a person to be creative. However, it is intrinsic not extrinsic motivation that really causes creativity. Hence, inner motivation is what we want to increase, and the important drivers of inner motivation are involvement and empowerment.

Empowerment goes beyond telling someone that he or she now has power to do something. It is effective when a person assumes responsibility and accountability for specific tasks and has the requisite freedom to act. True empowerment isn't something bestowed on someone else – it is rather self-bestowed by individuals assuming ownership themselves. An organizational culture that fosters inner motivation has empowerment at its core. 

Other characteristics of a culture of innovation are openness, freedom from fear, and learning. A person is open when his mind is free to accept uncensored input. In order to establish a culture of innovation, people should be allowed to express ideas freely even if those ideas challenge sacred assumptions. Related to openness is freedom from fear – not only in expressing ones views but also from making mistakes. Mistakes should be tolerated and even encouraged as long as they result in learning. Openness increases learning and the posture of learning encourages openness. In a true learning mode success and failure become outdated concepts. What really matters is the learning that takes place – learning about what worked and what needs to change.

Establishing a Culture of Innovation

How can an environment of innovation be fostered and established? Many organizations have become more successful at establishing such a culture as their future existence depends on it. We support the initiative of these organizations and wish to offer an additional practical model for establishing such a culture based on our book Total Alignment.  

The Alignment Process as described in this book, together with the twin cascading processes of Team Review and Vertical Review, manifest the characteristics of a culture of innovation. The alignment process establishes empowerment and ownership and gives each individual a sense of purpose and unique mission – a sense of mission that fosters intrinsic motivation. 

The team review process fosters openness, brainstorming and collaboration on specific needs or problems. Team review is upward focused in the sense that members of a natural team are focused on the needs at one level higher than their own.  This focus replaces the defensiveness so often experienced in teams, with genuine participation and collaboration.

The vertical review process, on the other hand, is downward focused and allows each individual to spend the necessary time, one on one, with his or her boss. Through this process, each individual receives genuine coaching and input. When the vertical review conversation is conducted in a supportive and encouraging manner, the collaboration between the two participants releases energies conducive to creativity.

At the heart of both the team review and vertical review processes is the learning model of consultation, action, and reflection. This model, introduced and field tested in the worldwide Bahá'í community, establishes a culture of openness and learning. The model begins with consultation to identify and explore solutions to issues. The second step is action to implement the plan that emerged from consultation. Finally reflection will ensure that learning takes place from the process.  This model discourages action without consultation, or consultation without action or action without review and reflection. 

Crisis and Innovation

The economic crisis has permanently changed the rules of the game for many businesses across the globe. These businesses are finding it increasingly difficult to survive and thrive without innovation. We believe that innovation can be the byproduct of a culture of creativity that should be introduced into the organization by design. It is a culture of openness and  reedom to make mistakes and is characterized by empowerment, collaboration, and learning.  Companies that are able to successfully introduce these characteristics through the many layers of their organizations will reap the benefits of increased creative thinking resulting in innovative solutions at all levels and by many individuals.

The new management model, introduced in our book Total Alignment with its unique characteristics of individual accountability and cascading team reviews and vertical reviews, serves as a candidate for releasing creativity and promoting innovation throughout the organization.

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