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Podcast Length Icon 35:09 7 Nov 2020

Who is responsible for innovation?

In this episode of the WorkLife HUB podcast, we host Scott Anthony, Managing Director at Innosight. We touch upon the key insights from his most recent book Eat, Sleep, Innovate: How to Make Creativity an Everyday Habit Inside Your Organization, and also discuss how the current COVID-19 crises will change industries and the new reality of work.

What follows are snippets from our conversation with Scott Anthony - edited for length and clarity - make sure you listen to the entire conversation for the great insight!

Agnes Uhereczky: Thank you very much for joining the podcast from Singapore. One of the reasons we invited you is your new upcoming book which you have co-authored, Eat, Sleep, Innovate - How to make creativity everyday habit inside your organisation, published by Harvard Business Review desk. Before we go and discuss the book in detail, your research and experience on it, I wanted to ask you what made you zoom in on the smallest moving part of the innovation system, which is a focus on individuals.

Scott Anthony: I think that is a great question and you have accurately described the areas that we were focusing on in the book and some of the ways in which we are collectively thinking it and Innosight has shifted over time. By way of background, Innosight is a growth strategy consulting company that was founded back in 2000 by the late great Harvard Business School Professor Clayton Christensen. I have been part of the organisation since 2003. Those who don’t know Professor Christensen, he rose to fame when he wrote a book called 'The Innovator's Dilemma' back in 1997 that described how large organisations would struggle with something that he called a disruptive innovation that would upend even the best run market leaders. And what our mission is at Innosight is to empower forward thinking organisations to navigate disruptive change in the future.

We have been just trying to attack that problem from as many different perspectives as we can. So in the early days it is all about understanding what disruptive change actually is and helping organisations understand it, helping spot it, helping them determine the right strategies to respond. As we continue through the journey we had periods when we were thinking about investing in our incubating due to disruptive businesses so we can understand the dynamics more deeply. Then the natural question arose about what strategy do you need to follow if you really are to navigate disruptive change. How do you have to set up your organisation? When you get all of those different pieces in place you might say that "well we have to do the day-to-day work to manage this". And, of course, it is not just managing the disruptive changes, it's all the day-to-day things that have to happen in an organisation that is going from one stage to another stage, that is trying to deal with the world that keeps throwing change after change at people.

So, yes there is the capital 'I' innovation where you are launching a bold new platform, you are doing something transformational. And there is the lowercase 'i' innovation that is the kind of everyday stuff that happens to enable organisations to do the best that they can do. So as we have tried to look at this problem from as many perspectives as possible we keep finding new areas to explore, new challenges, and of course new opportunities. It seemed like the right time with this book to zoom in as you say that micro-level and say what exactly innovators do, and how do you create an environment to a culture that enables them to do this work as effectively as possible, as efficiently as possible, in a way where truly is a habit versus something that you have to force people to do. It is a rich and complicated area, there are no silver bullets, there are no simple answers, but our hope is as we continue to probe and think about this problem as holistically as possible, we come up with helpful tools, techniques and tips, that allow people to navigate through disruptive change on the future.

Agnes Uhereczky: What is innovation? And specifically from the perspective of today’s world, the COVID-19 pandemic, 2020 has certainly thrown major curveballs to individuals and entrepreneurs and corporations. Now, it seems like a critical time to be innovative and creative for survival and success. What is your definition of innovation in 2020? What is the fourth era of innovation?

Scott Anthony: I'll make three points here. I'll give the basic definition of innovation which we keep it simple. Then, I'll make it a little bit complicated by describing how any organisation will have different types of innovation to recognize some of the complexities. I'll also talk a little bit about this idea of the fourth era of innovation.

The good news is that the definition that we are using in 2020 is the same definition we used in 2010 just about. It is a reasonably fixed definition. We try to keep the basic definition as simple as possible.

Thus our definition is five words: something different that creates value.

Now, it is simple but it is a definition that was chosen carefully with some nuanced around each word. 'Something' is an intentionally vague word. A mistake people make is they assume innovation is all about new technologies which mean very few people do it. They are engineers, they work in labs and so on. But innovation comes in lots of different forms and flavours. Yes, it can be new technology, but it can be new marketing approaches, new ways to organise internally, new ways to communicate with employees etc.

The broadness of the word 'something' reminds us that innovation isn't the job of the few, it is the responsibility of the many.

We have the word 'different' to remind us that innovation isn't just about being breakthroughs. Sometimes people think it doesn't count unless it is a hypersonic plane or it is a word saving vaccine, or whatever Elon Musk is gonna come up with next. Those are all forms of innovation, no doubt, but sometimes again it can be everyday things taking something complicated and making it that much simpler, taking something expensive, and making it that much more affordable. Those are great ways to innovate as well. We have the word 'that' which is a transitional word, before you get to the two words of the definition that are the most important ones: create value.

This reminds us that innovation is different from its precursors, such as invention and creativity. Those are important, absolutely, but until you cape that spark of invention and turn it into whatever you are trying to create value around, more revenues, more profit, more employee engagement, more customer satisfaction etc. In our eyes, you have not innovated. This reminds us that innovation isn't an academic activity, it is a hands-on active activity. I remind people of the importance of these two words by asking them to "Tell me who invented the light bulb?" - the international symbol that we have for innovation. People will instantly say Thomas Edison. It is a bit of a trick question. The actual person who can claim to create the light bulb nobody knows for sure. The historical record is quite mixed. The reason why people say Edison is not because he was a great inventor, he was, he added more than 2000 patents to his name but they say him because he was an even better innovator. The world's first electrical generating facility was owned by the Edison Electric Company operating in lower Manhattan, that company merged with one of its rivals and created GE (General Electric) a company that lives on today. Never forget Edison's most pertaining quote about innovation: Genius - he once said - is 1% inspiration and 99% perspiration. If you are not sweating, if you are not obsessing about solving the customer's problem, about creating value, in our eyes, you are not innovating. So that's the definition we use: something different that creates value. You can see again some of the nuances in it.

Agnes Uhereczky: I love that the book is about behaviour and habit, innovation as a habit which almost seems too good to be true, something that can be unleashed in the right environment. How does that work especially when we think back to fear-based organisations? How can employees feel appreciated and safe enough to unleash innovation as behaviour and habit?

Scott Anthony: Let me say a couple of things here. First, as we talk about in the book, and what it takes to successfully innovate, we synthesize the fieldwork we have done in a bunch of other research and say great innovators do five things. They are curious, they question the status quo, they are not happy with the things they are, they want to do something different. They are customer-obsessed, you have to find the problem we are solving if you want to ultimately create value, so they try to figure out a problem they are solving. They are collaborative, they recognize that ultimately, to solve that problem they need to bring different forms of thinking together. They adopt ambiguity, they know that every idea is going to be a little bit wrong in the beginning, so they are going to get to success through trial and error, experimentation. And, they are empowered, they go and do something. After all, you can't do something that creates value unless you do something. So those are the behaviours that we describe.

Now, the reason why we think every organisation has the capabilities and capacity to successfully innovate is those behaviours are ingrained in human beings as species. I have got four kids, and the oldest is fourteen, the youngest is four. I don't have to teach them to be curious, to be externally obsessed, or nudge them to go and try different things. It is just the way kids are. So inside many organisations, it isn't about developing skills, it is about releasing constraints and empowering and enabling people to do more. Is that easy? No. It takes work inside any organisation. Is every environment capable of doing it? Of course not. You need to have leaders who act in the right way, they have to have a fundamental trust in their people. But the human capacity to follow those behaviours is there.

So if organisations want to bring the innovation energy out in their organisation, it is not a hard thing to do. It starts with the recognition from a leader that my people, my team, the people who work here, have the capabilities to do it if I create an environment that encourages and amplifies that latent innovation energy. A lot of it comes down to the fundamental mindset of the leader. A leader who says the people here are good, they have got capacity, they have got capabilities, and if we can sharpen, hone, amplify those our organisation can do great things together. Again, this isn't every organisation. There is plenty that is ruled by fear, there are plenty where there are very severe repercussions if you try to do anything different, and it doesn't work. But it did not have to be that way, and we have seen organisations that started at one state and got to another. As an example, in the book, we have a deep case study of DBS Bank in Singapore. Singapore has a well-earned reputation for being a very processed obsessed place, very rule-abiding. And DBS went from a bank that lagged in its local market to being globally recognized that this is a highly innovative, highly digital bank, where innovation is at its core. In my view, if a regulated bank in Singapore can do it any organisation can do it.