6 common innovation misconceptions (and how HR can help address them)

The 6 most misconceptions around innovation (and how HR can help address them)

There are six common misconceptions around innovation, and organisations and their HR leaders need to rethink their approach in order to address these misconceptions and engender employee-driven innovation, according to an expert in the area.

How organisations treat their employees communicates a number of implicit assumptions about what innovation is (and what it is not), said Frederik Anseel, Professor of Management and Associate Dean of Research at UNSW Business School.

“How you treat people tells them something about what you find important in a company. Unfortunately, these assumptions are not always helpful,” said Anseel, who has undertaken some 30 years of psychological research into the theory and practice of innovation within organisations.

The role of HR in innovation
“The implicit ideas that are often promoted in organisations, might sabotage innovation rather than promote it,” said Anseel, who recommended HR leaders examine how their practices and norms, both explicit and implicit, help or hinder innovation.

HR is often focused on standardisation and uniform, efficient processes, however, he observed that innovation does not align very well with standardisation and efficiency.

“Innovation almost by definition needs to cross traditional ways of working,” said Anseel, who recently spoke at a UNSW conference in Sydney about the future of innovation.

“If the company has innovation in its strategy, HR needs to think carefully about how they contribute to this goal and how their processes help or hinder employee-driven innovation.”

Many of the administrative processes that are instigated by HR (such as rigid job descriptions, hierarchical reporting lines, bureaucratic budget procedures, static roles, narrow definitions of who is/who is not part of the organisation’s ecosystem) interfere with innovation, he explained.

“Rethink HR itself and be innovative in how it is approached,” he said.

“Where does HR add the most value – does HR prefer to be a guardian of administrative processes, or be a strategic force for innovation?”

If it is the latter, core HR processes (such as recruitment and on-boarding, training and development, performance management, rewarding and compensation, and job design) need to be redesigned to ensure they contribute to innovation.

“Where does HR add the most value – does HR prefer to be a guardian of administrative processes, or be a strategic force for innovation?”

“In each of these areas, a focus on innovation would require different solutions,” said Anseel, who explained that there are five common misconceptions around innovation.

Misconception #1: Innovation is fun.
Often people believe creativity and innovation are derived from an intrinsic drive, and that they come naturally and are enjoyable.

“We organise events that sound appealing and fun: a hackathon, a brainstorm, team building, a pitching contest,” said Anseel.

“However, innovation is a very difficult process. Working in an innovative place can be annoying and frustrating, or worse.”

The human tendency to be optimistic means most people believe they will be among a small percentage of talented individuals who have brilliant ideas and succeed.

“The more likely outcome of this, is that you or your company will be among the many casualties required so a few can survive and flourish,” said Anseel.

There are a number of reasons why creative ideas don’t cut it, including not being so creative or good in the first place, or because timing isn’t right, because no one stood up to defend them, or because they weren’t sold well enough.

“Some companies and people burn through huge amounts of money, devour decades of members’ lives, generate one promising idea after another, yet never succeed.”

This leads to disappointment and people shying away from innovation altogether, he said.

Companies need to be honest and realistic with their employees, and tell them that innovation is “hard, hard work” and that most ideas won’t make it.

“We need more than ideas; we need people to select and modify ideas and to get them through the organisation,” said Anseel.

“Innovation is a very difficult process. Working in an innovative place can be annoying and frustrating, or worse”

Misconception #2: Inspiring events encourage innovation
Fun-pitching contests, accelerators, talks and brainstorming sessions tend to be one-shot initiatives which can leave participants with a lot of energy – but then employees often go back to work and business as usual (until they receive the invitation to the next initiative).

“People quickly become cynical about these types of events,” he said.

“There’s nothing wrong with them, but they won’t change your business.”

Innovation is not a one-shot opportunity, but rather, it requires a systematic effort, Anseel explained.

“After coming up with a number of good ideas, you need to tinker with those ideas, select the best ideas, kill a number of good ideas, promote these ideas, find a supportive coalition to push it through the organisation,” he said.

“Find ways, time and money to overcome obstacles in the organisation.”

Misconception #3: Innovation is cherished in organisations
This particular misconception is probably the most paradoxical insight in innovation as business leaders often claim they need new ideas and technologies, but organisations are usually structured in such a way that they do everything possible to kill truly innovative ideas.

“Bureaucracy, KPIs and ROI analyses kill innovation,” he said.

“We have a bias against creativity; it is an unconscious aversion to all things original even if we consciously think we seek it.

“Research shows we don’t want creativity in our leaders, we don’t want creative people working for us and we don’t want them in our classrooms.”

This bias against creativity is strongest in times of uncertainty, and has a tendency to silently enter organisational structures in the way management selects and rejects ideas.

As a result, employees quickly learn that to get a new idea through the organisation, it can’t be too original or too out-of-the-box.

“Bureaucracy, KPIs and ROI analyses kill innovation”

Instead, organisations need to devise strategies to safeguard original ideas from being killed through organisational structures.

“We need idea champions or rescue teams to provide paths through the bureaucracy,” said Anseel.

Executives must also protect those doing creative work from a hostile environment and clear paths for them around obstacles.

“However, be warned; by creating the necessary structures, they might unwittingly create other forms of bureaucracy,” he said.

Misconception #4: Individuals are the main drivers of innovation
Most executives will agree that the way invention, innovation and change happens is through team effort.

“‘There is no I in team’ is one of the most heard platitudes in the business literature,” said Anseel, who said there are a number of important questions to ask around why individual achievement is celebrated as the main driver of innovation.

“Why do we have individual job descriptions, not team descriptions? Why do we have individual performance reviews, not team performance reviews?

“Why do we rank individuals in our companies relative to each other? Why do we have individual compensation systems and bonuses and not team compensation?

“Why do we require individuals to complete non-disclosure and no-compete agreements when we proudly proclaim that co-creation and information flow across organisational boundaries is so important?” he asked.

A culture of innovation is one in which individuals are celebrated and admired, and Anseel noted that individual awards are everywhere.

“Research shows time and time again that the main driver of innovation is information flow across individuals, both within and outside of a company”

For example, when Jeff Bezos recently explained that innovation is a team effort, business magazines headlined “Jeff Bezos’ innovation formula”, doing exactly the opposite of what he proclaimed.

“Research shows time and time again that the main drivers of innovation are information flows across individuals, both within and outside of a company.

One study even found that organisations can enhance their innovation by relying on ideas obtained through relationships with their former employees, long after these employees left to work for the competition.

“We need organisational policies that encourage collaboration to be able to put people with different perspectives and knowledge bases together to freely share information,” said Anseel.

“As long as we have structures that make people concerned about their individual evaluation, we won’t be able to do this. Teams are the currency of innovation, not individuals.”

Misconception #5: Good ideas are rare and the best ideas win
Companies are often inspired by Silicon Valley’s tech start-up movement and become preoccupied in their search for innovative ideas.

However, innovating does not necessarily require a killer idea as he said there are many good ideas, and sometimes incremental innovation (instead of radical innovation) can be better for a company.

“Adopting existing ideas and optimising them can be a better strategy,” he said.

“It’s often not the first mover that wins the market, but the faster second one who benefits from the mistakes the first mover has made.”

“The more digital we become, the more human we need to be”

Innovative companies might also want to focus more on implementation and execution.

Companies that are more flexible in tinkering with new services and products, and that can easily pivot to adapt to changing demands or circumstances, might be better equipped to innovate – rather than those looking for one breakthrough idea.

“The overemphasis on ideas also means we need to stop thinking the best idea will win in the long run. It is not true,” he said.

“The marketplace for ideas is very competitive, but there are many ideas that are not particularly good that linger around.”

Bad management practices, for instance, don’t die easily, according to Anseel, who said research shows that the best ideas are not always selected out of the available pool of ideas: “the idea we select is often not better than the average of all ideas available,” he said.

“That means we need to invest more time and be more systematic in selecting ideas than we do now.”

Trends in innovation
Anseel also observed that tech start-ups, which are known for their higher-than-average levels of innovation, will continue to affect how innovation is organised within companies.

“That’s not a bad thing [as] intrapreneurship can learn a lot from entrepreneurship,” he said.

Investing in R&D, innovation funnels, more risk-taking and opportunity recognition, accelerators and consolidators, valuing IP and patents, internal and external networks are all good practices, which have been inspired by looking at what happens in entrepreneurial environments.

However, there is a risk for companies which set up separate units through spin-outs and spin-offs, which can be seen as the only pathway to innovation – potentially losing sight of continuous employee-driven innovation which tends to happen in a more incremental way.

“Similarly, the current focus on tech, be it digitisation, AI or machine learning, might detract from the fact most innovation comes from people,” he said.

The main challenge over the next decade will be to reconcile these two perspectives: keeping up with technology while at the same time putting people at the centre.

“The more digital we become, the more human we need to be,” he said.

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