Innovation: What has history taught us?

“It works” dooms companies to irrelevancy

It wasn’t that long ago that Toys “R” Us was a juggernaut. In the 1980s, the brand was a Wall Street darling. It was called an American Institution by the Washington Post. They were hailed as the “supermarket for toys,” with no equal in reach, and no competitor in variety. The company was legendary for its technology-driven operations, tracking products electronically and spotting sales trends weeks ahead of competitors.

And then something happened. In 1994, company founder Charles Lazarus stepped down as CEO. Around the same time, competitors like Walmart started to unlock the same operational magic and pricing models that had set Toys “R” Us apart.

Even worse, in 2000, Toys “R” Us essentially chose to opt out of its biggest opportunity to innovate, signing an agreement for Amazon to be the company’s exclusive online toy merchant. After a two-year court battle, Toys “R” Us managed to extract itself from the contract in 2006, but by then the company’s spirit of innovation was broken. And without a culture that fostered new ideas, the company finally closed its doors this June.

It’s risk takers who have shaped the world as we know it. Different versions of the story have played out countless times. Netflix turned video rental on its head, driving Blockbuster to ruin and forever changing customer expectations. Apple turned phones into mini computers that most people would be lost without. Tesla devoured market share from established manufacturers with only three car models and a radically new buying experience.

While these companies have been led by visionaries, they are also organizations where new ideas were celebrated and encouraged. Organizations that are content to keep the status quo because “it works” are doomed to fall behind or fail. Their workforces eventually become disillusioned with their stagnant work and employees will either jump ship while their careers are salvageable or resign themselves to stay at a company they aren’t excited to work for. Either way – the organization loses. To succeed in today’s ultra-competitive marketplace, companies must be willing to embrace new ideas, accept failure and provide a safe place for employees to be creative.

Remove the barriers

Organizations should build a rock climbing wall. 

Not literally, but hear me out. Innovation is daunting – much like a rock climbing wall. You can climb up a few feet, but without the safety of a harness and belayer (the person who stands at the bottom and tends your rope) you’ll likely get scared and climb back down. 

What does this have to do with innovation? A lot. When organizations build a metaphorical rock climbing wall and employees are told “Go forth and innovate!” great things can happen, but a few other things need to happen as well. 

First, employees need to know the rock climbing wall was built for them and they are encouraged to use it. Organizations need to be clear that time in the workweek can be allocated for employees to be innovative. Time is one of the biggest friction points that hinders innovation. Everyone agrees that innovation is critical to success, but too often we fail to make time for it. If innovation is seen as an extracurricular activity and unrelated to day-to-day job requirements, employees who feel overworked are not going to make the extra effort to innovate.

Equally important is the presence of safety measures to combat our fear of failure. Climbing is a risky sport. So is innovating. The higher you climb, the more it will hurt if you fall-- especially if you aren’t wearing a harness. Organizations should ensure that fear of failure is minimized as it does nothing but suffocate innovation and stifle creativity. Organizations must also acknowledge and get comfortable with the fact that some ideas will fail, and that is not only expected, it’s great! Organizations that embrace failure as part of the process are giving their employees the safety harness they need to take chances. When employees know it’s okay to fail, they can fail fast, recover quickly and learn something useful in the process. Employees shouldn’t be made to feel ashamed of failure. If they are, fewer people will be willing to try the ascent.

Five tips to foster innovation

Make innovation part of the culture and environment. Inspire your employees by providing innovative spaces. Perhaps an actual rock climbing wall, like Google. Or maybe something more mainstream like a technology lab, smart conference room or even just a colorful conference room dubbed “the innovation room.” Don’t allow excuses like floorplan space or limited budgets to constrain you.

Have a plan. Now that you have your space, you need to create some processes to organize and prioritize the ideas that will come. Be careful though. If your plan is too process heavy, it will discourage creativity. On the flip side, if you don’t have any guidance in place, be prepared to waste time and money wandering down innovation rabbit holes that produce nothing tangible. Give your employees enough blank space to explore their ideas but have a system of checks and balances in place to keep everyone on track. 

Incentivize. Don’t be surprised when people ask, “What’s in it for me?” Most organizations will lay claim to the products and IP generated during the innovation process. Embrace people’s desire to be compensated for their work by designing lucrative incentives. These could be monetary bonuses, an extra day of PTO, IP stake, etc. There are plenty of motivators but not everyone is motivated by the same thing, so mix it up.

Provide the resources and the support. Time and money are the bare essentials needed to support innovators. Innovation must also be supported by all levels of leadership at the organization. The projects and ideas that come out of the innovation process need to be treated as core projects, not side gigs or pet projects.

Be open to all and selective of few. All ideas should be accepted, but not all ideas can be approved for immediate action. To get traction, you’ll need to develop a method of funneling your organization’s ideas into a pipeline of approved ideas. If you approve every idea, the organization’s efforts toward innovation will be spread too thin and your innovation needle won’t move. If you label ideas as being “yes” or “no,” your pipeline won’t stay full. By being open to all ideas and selective of few, you’ll have more resources to put behind the ideas that can have the greatest impact for your organization.

Don’t be the next Toys “R” Us

When you keep the innovation water flowing within your organization, the pond scum can’t grow. By giving employees opportunities to innovate, they will have a stronger sense of commitment and ownership, which will directly impact your organization’s bottom-line. There is immense ROI for innovation and it doesn’t have to be a daunting or expensive endeavor to start a program at your organization. Even if they don’t come up with the next big idea, they are still creating real value for the organization. By adopting an innovator mindset, organizations are better positioned to see change on the horizon. 

Take it from me, the view is a lot better from the top of the rock climbing wall than it is at the bottom.

Mukesh Kumar is Managing Director at Slalom responsible for helping our clients use technology, data and innovation to transform their business. In today’s competitive market, companies increasingly need to combine data in new real-time ways to deliver against customer expectations through a variety of channels. Increasingly his passion is focused on helping bring the power of machine learning and artificial intelligence to our clients. Beyond technology and innovation, Mukesh is passionate about diversity and inclusion in the workplace and drives a number of initiatives to ensure diversity and inclusion is part of our ethos.

Maggie Hamilton is a designer at Slalom, she is curious about how our surroundings affect our creativity at work. Through her design thinking, she helps colleagues and clients find ways to realize the power of their ideas and give them life in the form of impactful stories. She is passionate about using storytelling as a mechanism to help everyday innovators succeed.