How Should Your Company Pursue and Achieve Innovation?

This past April, Michael Parent published a book entitled The Lean Innovation Cycle: A Multi-Disciplinary Framework for Designing Value with Lean and Human-Centered Design, which addresses what many companies are facing regarding pursuing innovation. His book addresses these concerns by introducing a new multidisciplinary framework for both thinking about and pursuing innovation. By taking key concepts from the quality management practices of Lean and Six Sigma, the framework augments these tools and disciplines by incorporating other problem-solving and design techniques, including Human-Centered Design. The result is a view of innovation that many business leaders will find fits nicely into their existing paradigm of strategy and operational discipline.

When I recently spoke with Michael, I asked him: “How should companies pursue and achieve innovation now?” Here is his complete answer:

Innovation seems to be on the tips of everyone’s tongues. Search social media and you’ll find an ethos of innovation behind every post. But the popularity of innovation and entrepreneurial thinking on social media has done damage to how businesses and industry incumbents should think about and pursue innovation. Especially in a world buffeted by global disruptions – chip shortages, inflation, supply chain issues, pandemics – just to name a few, companies need to have a greater understanding of what role innovation plays in their business and the different ways they adapt to a dynamic organizational landscape.

Regarding innovation, the biggest opportunities for businesses are to pursue an innovative approach styled after the principles of Quality Management. Organizations can mitigate their risks of disruption by holistically evaluating their existing processes, and shoring up gaps that put them in jeopardy. It might not be sexy, but improving supply chain reliability, capability, and in-process quality has enumerable benefits for most businesses, from increasing profit margin, to reducing expenses, to driving towards operational consistency across their entire value chain.

Equally important is how businesses should avoid pursuing innovation. Generally speaking, if you’re anything but a new start-up business, you should stay away from grandiose ideas of disruptive innovation and industry-altering advancements. These promise exceedingly high profits and growth but fail to materialize due to excruciatingly low chances of success, high resource demands, and even internal organizational disruption to the existing business.

A business incumbent has already been successful in their industry. Rather than abandoning the history and tradition of the firm through radical, disruptive innovation, a business ought to re-evaluate its existing value propositions through the lens of a fresh perspective. Amidst global disruptions that have mainly affected business operations (and left the products and marketing themselves untouched) the principles of quality management, Lean, and Six Sigma is an excellent framework to begin this endeavor.

What do you think of Michael’s perspective? What role does innovation play in your company? How is your company pursuing innovation? What have been the pitfalls?


Why is the Failure Rate of IT and Change Management Projects So High?

 A few weeks ago, I had the chance to me with Scott R. Coplan in New York City and discuss the release of his new book, The Integrator: A Change Management Framework for Achieving Agile IT Project Success. This book defines change management as the single overarching methodology integrating Agile IT and project management. It does this because all projects are about change – significant organizational and personal change. The people involved – their participation in and understanding and support of these changes – ultimately determine IT projects success or failure. In fact, while all IT projects are about change, successful projects change human behavior.

During our conversation, I ask Scott, "Why is the failure rate of IT and change management projects so high?" Here is his complete answer:

There’s only one reason projects fail — leadership. You know who I’m talking about. Most of us have worked for that problematic project leader. 

Everything stems from a project’s leadership. They are the principal players or sponsors responsible for guiding each participant in completing the project successfully or failing miserably. 

A successful project requires a chain of sponsorship, including authorizing and reinforcing leaders. Authorizing sponsors have the power to approve, fund, and allocate resources to achieve a project supporting the organization’s clearly defined purpose. Reinforcing sponsors uphold, strengthen, and execute the project on behalf of the authorizing sponsor. 

The pervasiveness of project sponsorship problems stems from one fact. Just because an individual holds a leadership position doesn’t mean they know how to lead. They need guidance. 

In these instances, the problematic sponsor’s boss or a change agent must start by working with that struggling project leader. While having a meeting about their inadequacies is never easy, it is necessary. 

Most problematic leaders feel inhibited in a sponsorship evaluation meeting with their boss. As a change agent of 45+ years, I’ve conducted hundreds of meetings as the boss’s proxy.

This requires preparation before the meeting, including clarity about what the problematic sponsor must do, described in safe language. It’s typical for a sponsor to have little idea of what sponsorship means. I always start by taking time to listen and understand the problematic sponsor’s viewpoint, particularly about their role and what fulfills them in performing it. That sponsor’s input and my response may help them grasp the importance of their role and improve their performance. 

I’ve encountered sponsors that still don’t understand their role, requiring other options, like routinely assessing the sponsor’s performance and providing feedback. At times, I’ve recommended guidance from an effective peer in the problematic sponsor’s development process.

In severe cases, I’ve recommended replacing the sponsor. Their departure offers an opportunity for me to help the organization’s leadership find a suitable replacement. This is an individual who starts by engaging with their direct reports, establishing a shared purpose defined by enterprise-wide collaboration, followed by aligning their beliefs and abilities with that purpose. 

What do you think of Scott's perspective? Have your IT and change management projects been successful? Have there been leadership issues?


The Six Fears that Impede Corporate Innovation

New business innovation isn’t working in most large corporations. This is true even though we have made great progress over the past two decades in understanding the mechanics and dynamics of radical innovation. We have got the methodologies for creating the businesses right, but our organizations still seem to snatch defeat from the jaws of victory.

Why is this? New business creation is thriving in the startup sector, often disrupting incumbents, so the problem is not a lack of opportunity. What is going on? 

I recently spoke with James Euchner, whose recently published book -- Lean Startup in Large Organizations: Overcoming Resistance to Innovation -- addresses such questions. During our conversation, I asked him about the sources of resistance and their connection to Lean Startup. Here is his complete answer:

Any new venture confronts uncertainty: uncertainty in customer demand, uncertainty in the timing of the market, uncertainty about new channels or new business models or emerging technologies. Corporations have gotten better and better at managing these types of risk. The Lean Startup movement has done much to help with this.

It is ironic, but the very methods that have led to success in creating product/market fit have interfered with venture/corporate fit. There are, in fact, six fears that Lean Startup awakens inside the corporation that impede innovation.

The first is the fear of chaos: the concern that the iterative and experimental approaches of the Lean Startup will lead to an unmanaged innovation process. An Innovation Stage-Gate helps to contain the chaos. 

The second is the fear that the innovation process will lead to disruption of ongoing operations. Every corporation has established norms that define “how we do things around here.” New business innovation naturally challenges some of these norms. This disruption needs to be acknowledged and explicitly managed for a new venture to succeed.

The third fear is the fear that the lean innovation process will lead the company into opportunities that the company just can’t exploit. Worse, the new directions may even undermine the identity of the firm. A company needs to innovate within clearly defined opportunity spaces to counter this fear.

The fourth fear is that the new business will succeed by cannibalizing the core: the new business will appear to drive revenue and profit, but only at the expense of the financials of the ongoing business. To counter this fear, companies need to explicitly model not only the economics of the business but the impact of the new company on the core business. Sometimes, cannibalization is necessary to the ultimate growth of the firm.

I believe that the fifth fear is the cause of the failure of more new ventures in corporate settings than any other. This is the fear that the investment in the new business will drain resources from the core. It causes the core business to react in ways that smother the new business. Countering this fear often requires separating the new company from the mother ship, at least during incubation. 

Finally, executives often fear making a career-limiting blunder when investing in a new venture. After all, the new venture, by definition, moves into spaces that are less well-understood by executives in the company. To counter this fear, companies need to develop ambidextrous leaders – those who can both execute and innovate. A key requirement is for the executives to spend time in the new ecosystems. 

What has your experience been with new business innovation? What are your thoughts on Jim Euchner’s suggestions for inoculating companies against these corporate antibodies? 


Can Six Sigma Help Improve HR Processes?

In 2021, prolific author Daniel T. Bloom published the second edition of his book entitled Achieving HR Excellence through Six Sigma, which describes exactly what excellence in human resources (HR) means and outlines dozens of proven approaches as well as a hierarchy of the exact steps required to achieve it. It illustrates the Six Sigma methodology from the creation of a project to its successful completion. At each stage, it describes the specific tools currently available and provides examples of organizations that have used Six Sigma within HR to improve their organizations. 

When I spoke with Daniel this past month, I asked him: "How does Six Sigma actually help improve HR processes?" Here is his complete answer:

The Human Capital Management field today is faced with a dilemma. It is a dilemma that will determine whether there is a human Capital Management field going forward. 

Too many of my colleagues are stuck in a transactional field which means that they see their role as that of the organizational fireman. There to purely put out fires. However, there is another view that Six Sigma encourages and that is the role of being the organizational thinker.

Consider the reactions from two HR professionals who have seen the Six-Sigma approach and have had phenomenal results. The HR Manager of an electronics organization stated that Six Sigma made her rethink the way she viewed HR -- it empowers you to want to make immediate and sustainable improvements to your organization. Using the strategies discussed in the book, she was able to reduce the average time to fill an open position by 58 percent and the cost of hire by 81 percent. The other view is from the VP of HR for a major trade association who told us that the material in the book (and the accompanying course) inspired her to think about additional training and professional practice of these concepts. She had already put some of the key concepts behind the DMAIC method to work.

The ultimate goal of Six Sigma and its associated tools is to enable you to see and feel the problem through the use of logical thinking processes and then to create a new normal by changing the corporate culture accordingly.

What do you think of Daniel's perspective regarding Six Sigma and the HR department? Have you incorporated Six Sigma techniques in your HR departments? If so, have the results been positive?


Just What is a "Meaningful Partnership"?

Recently, Seth R. Silver and Timothy M. Franz published a book entitled Meaningful Partnership at Work: How The Workplace Covenant Ensures Mutual Accountability and Success between Leaders and Teams -- It tackles some tough questions, such as: Why are some work partnerships exceptional while most are not? How can we establish and sustain an enhanced level of cohesion, connection, and collaboration in the most important work relationship, the one between a manager and team? What could remedy the high levels of isolation and anxiety so many feel at work these days?

When I spoke with Seth and Tim this past week, I asked them, "What is 'Meaningful Partnership' and how does it benefit organizations? Here is their complete answer:

In our book, we explore the concept of ‘meaningful partnership’ in the workplace.  We present meaningful partnership as a mindset where both leaders and their teams are fully committed to ensuring the support and success of the other.  Next, we describe a model called ‘ERTAP’, which stands for Empathy, Respect, Trust, Alignment, and Partnership, which are the key elements required for meaningful partnership.  Finally, we detail a practical yet transformative relationship-building process referred to as a workplace covenant.  This process enables leaders and teams to create mutual commitments with obligatory weight that help them to feel equally accountable for the success of the working relationship. These covenants, when reviewed routinely and used as the basis of mutual appreciation, helpful feedback, and adjustment, enhance ERTAP and create meaningful partnership. 

We define meaningful partnership as an elevated state of connection, cohesion, coordination, and collaboration.  It requires that all partners in a professional relationship feel fully supported, able to achieve, and accountable for the key goals and health of that relationship. 

Why is all this a big deal?  Because over time, workplace covenants have a way of improving mutual empathy, respect, trust, alignment, and partnership.  When these factors get stronger, the partnership becomes more satisfying and successful.  Further, managers become better leaders for their team because they are better attuned to the needs and feedback of their team. Teams become more self-correcting because they are frequently assessing themselves relative to their covenant/relationship with their manager. And the work culture improves because people are routinely exchanging helpful feedback, praise, and encouragement, and are focused on how to concretely support colleagues and help them achieve. When all of this is happening, partnerships will indeed become meaningful and the results to the organization will be extraordinary.

What do you think of Seth and Tim's view of a "meaningful partnership"? How do you define "meaningful partnership" in your organization?