Category: innovation strategy

Innovative Research: How Innovation Varies Across Countries & Cultures

Have you ever wondered how different cultures view innovation? Why are some countries more willing to adopt new advances while others fight to keep old systems in place? In today’s article, we’ll be taking a look at two innovative research studies that reveal the impact of culture on people’s ability to innovate.  We’ll also show you how to use this information to create a work environment conducive to innovation. To begin, let’s jump right in to discuss how a country’s culture affects the early stages of innovation.

What Affects the Early Stages of Innovation?

In a study on innovation in European countries, innovation researchers wanted to see if understanding different national cultures could help them predict certain behavioral patterns when it came to initiating innovation [*]. To do this, they categorized cultures using four dimensions –– power distance, uncertainty avoidance, individualism-collectivism, and masculinity-femininity — and then tested the relationship between each dimension and innovation. Today, we’ll concentrate on the first two dimensions: power distance and uncertainty avoidance.

 

Power Distance Measures: Just How Much Power Lies in the Hierarchical Structure

 

Cultures with large power-distance measures are those with formal rules and a centralized decision-making system. These societies keep information-sharing to a select few — only those in power, know the master plan and everyone else remains in the dark. On the other hand, small power-distance cultures don’t rely so heavily on a rigid chain of command. There’s free-flowing communication between hierarchical levels. Both of these traits help foster an environment where creative thoughts and ideas can flourish, which may ultimately lead to breakthroughs. So, which culture do you think does better in the initiation phase of innovation…the one with small or large power distance? If you guessed small power distance cultures… you are correct! Countries in this category include the UK, USA, Germany, the Netherlands, and Nordic countries[*].

This innovative research shows that high power distance cultures, such as Belgium, France, Poland, and Portugal, may be unknowingly inhibiting their innovation efforts due to this trait. If people are more likely to feel confined and afraid to come up with new ideas for fear of disapproval, they won’t even try. This strategy will severely limit innovation initiation, according to the study. The next dimension may also greatly impact the early stages of innovation.

 

Uncertainty Avoidance in Innovative Research: Whether Tense Situations are Avoided or Tolerated

You may not think there’s a connection between uncertainty avoidance and innovation, but there is according to the research. See, cultures with high uncertainty avoidance adopt an attitude of “What’s different is dangerous.” People are encouraged to follow the rules to a T — without ever stepping out of line. When this type of environment is created, you’ll often see a workforce that’s unmotivated to think creatively. As a result, they may struggle to come up with new ideas and innovative solutions to existing problems.  Not only that, your team may be much more resistant to change. And as you can imagine, this way of thinking can negatively impact your innovation efforts. On the other hand, a low uncertainty avoidance culture constantly revises rules and makes allowances to bend existing ones, given the right circumstances. Cultures that rank low on this dimension also expect conflict and see it as just another part of life. Ambiguous situations are viewed the same way — since they’re inevitable, you must always be ready to adjust your plan and adapt accordingly, two things that work well when it comes to innovation. Now before we dive into the specific traits shown by innovative cultures, it’s important to understand a few fundamental findings first:

“Existing cultural conditions determine whether, when, how and in what form new innovation will be adopted,” as our next study shows[*].

Let’s explore this idea next.

 

Cultural Impacts on Innovation

Which characteristics do cultures with high innovation rank well on?

Researchers discovered that there’s a greater acceptance of innovation when the foundation is already ingrained in the culture.  For cultures built on long-standing traditions, innovation may seem as if it’s going against the societal norms that have been passed down for generations. Therefore, it may not be as well-received or encouraged. Yet, researchers discovered, and research revealed, that when societies are willing to take traditions and adjust them to fit modern times, innovation is much more likely to happen. To that end, there’s one more factor that may contribute to fostering an innovative culture: whether people believe they can make an impact.

Cultural or organizational “class systems” can become like shackles — with people unable to move and think freely.

And when applied to the work environment, it’s virtually impossible to motivate your team or community to work at their potential (or, as often required to innovate, to exceed their potential) when they don’t see their hard work paying off in some regard.

“Most people work in the hope of reward,” and if they don’t see any insight, they’ll be less inclined to work hard. People need to feel like they can make a difference and that their ideas are not only heard but also used whenever possible. And they need to do this in an environment that fosters community and relationships.

For an innovative culture to flourish and thrive, the scientists learned, this form of social capital is needed.

Cultures that adopt these characteristics, plus the ones listed below, are considered high innovators[*]:

  • Focus on higher Individualism
  • More inclined to take risks
  • Willingness to accept and adapt to change
  • Future-focused
  • Low on Power/Status/Hierarchy (Low Power Distance)
  • Weak Uncertainty Avoidance
  • Open to new ideas and information
  • Willingness to travel frequently
  • Positive attitude towards science
  • Emphasis on higher education and creating a highly-educated society
  • Early adopters

How You Can Apply These Findings to Your Workplace

Now, you can consider how your business might rank in terms of these cultural tendencies.

For example, when it comes to scoring your company’s power distance, which statement do you agree with the most?

  • Power and information-sharing stem from the top of the organization. Only high-level employees have the ability to initiate change and innovation (high power distance).
  • Everyone on the team is heard equally and ideas are frequently exchanged and discussed fairly (low power distance).

If you want to build an innovative environment, you need to shift towards the cooperative, transparent nature shown by low power-distance cultures. In this type of organization,  everyone on the team knows what’s going on and can freely add their input without fear.

What about uncertainty avoidance?

Innovative cultures are willing to deviate from strict rules and guidelines whenever necessary. So, your approach should also be one that easily adapts to new situations and changing times. By setting up this kind of environment, you’ll foster innovative ideas, and you’ll create a motivated workforce at the same time. 

Now that you understand how culture can impact innovation efforts, check out this guide to learn more about the most common mistakes companies make when it comes to organizational innovation.

How to Embrace Failure Without Falling on Your Face

Published on: February 15, 2018 в 5:22 pm

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Categories: innovation strategy

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Many years ago, I presented what I considered to be a very cool project to an extremely smart VP of Marketing in a large B2C company on the East Coast of the US. Fortunately, she shared my enthusiasm, and the process of engaging us for the project was running along nicely. It was an ambitious and somewhat risky project in the sense that it required the involvement of about 20 high-level managers who were very skeptical about its chances of success. This put “my” VP in the stressful position of either ending up as the initiator of notable success or being forever remembered as the perpetrator of a huge mistake (could she embrace failure?).

At some point, she asked me: “Can we make absolutely sure this will succeed?”And, silly me, I answered with a big smile: “Of course not. Don’t you remember? One of our key messages in this project is that if you innovate you must embrace the risk of failure. So since we are designing such an innovative project, of course, there is a risk that it will fail.” Obviously, we didn’t get the project, because, regardless of the oft-quoted cliché, nobody really wants to “celebrate failures”. People want successes. And if there is one thing they will avoid at all costs, it is failure.

 

Embracing Failure, the Contradiction

 

There seems to be a contradiction: We want to think ahead. We want to try new things. We want to innovate and embrace failure as part of the inventive process. At the same time, we want to be in control of our outcomes. We cannot afford to make mistakes.

This leads to a dilemma: Companies encourage their employees to fail and learn. But they expect them not to fail.

Failures are at best unwanted – at worst systematically concealed, to avoid blame or punishment. Pressure is a means of control. The result: a fear of failure.

The prevalence of fear of failure in companies is alarming considering how paralyzing it can be for the companies’ development.

Three reasons for this troublesome effect:

1. Risk Aversion

Here is one cliché that is absolutely true: Failure is an essential part of innovation. When prototyping a new product, expect failure. That’s what prototypes are for, and that is why you will work on several consecutively, or even in parallel. Therefore, the maxim fails fast and try again.

But, if every failure is considered a mini-disaster, who wants to even consider risking it? Rather, the ultimate goal is to achieve full control of the process. Hence, any change or novel idea is treated as a potential threat.

2. Loser-phobia

If one strives to overcome one’s Cognitive Fixedness, a fundamental tool is the ability to reflect on one’s actions and to engage in metacognition (a reflection on one’s thinking processes). Every failure thus becomes a source of learning and a driver of change.

But, when your failures are perceived as a sign of being a “loser,” what are the chances that you will actually take the time to confront your failures, reflect on them, and draw useful conclusions?

3. Who? Me?

In cultures that do not truly accept failures, there is a strong incentive to underreport them and to avoid any public reference to them, let alone an open analysis.  This greatly increases, obviously, the probability that the same mistakes will be repeated. A good litmus test: Ask anyone who tells you that you should “embrace failure”, if they are willing to share a recent one of their own. Most chances are they won’t, and that tells you what you will be risking if you share yours.

You probably agree that it can be very beneficial to embrace failure in certain areas – in an honest and consistent manner. But in other areas, we cannot allow for mistakes. The point is, to make this distinction explicit and communicate it to everyone involved. Clarity is key.

Instead of pretending to universally embrace failure, you map out areas in which failing is acceptable. Then, you commit yourself to this map.

Here are some actions you may consider to embrace failure:

Mark your “control towers”

Imagine working in a control tower. There is obviously no way to embrace failures here. Imagine an airport with 5000 landings and take-offs per month. a mistake rate of 0.01% would imply 5 crashes per month.

There are such “control towers” in every company. In some areas, even if a leader doesn’t care to admit it, failure is not an option. Being explicit about your “control towers” is crucial, if you want people to avoid these specific mistakes at all costs. Only then, everyone is on the same page: We give our best to prevent failure and if it happens, we report it.

embrace failure

In other areas, the expectation might not be as clear. We suggest three mechanisms: define roles, draw lines and install safety nets.

When defining roles, you assign to a specific group of employees the role of innovators. It is then clear to everyone that this group will generate ideas, try new things – and occasionally fail. Your “innovators” will enjoy the freedom to explore and develop new ideas. At the same time, they will be accountable for their failures as part of the process.

Drawing lines means, defining which parts of a project are open to experimentation and those that are not. Within the defined lines, failure is acceptable. Innovation is welcome.

Safety nets are a similar idea, on a different level. To limit the impact of failures, you innovate in specific areas, e.g. those that are not part of your core business.

In defining roles, drawing lines and installing safety nets, we map out areas in which failures are acceptable. Only then we can truly claim: We embrace failure. Feel free to innovate.

In addition to the above actions, you can also utilize some advice from experts on the subject. 

Have a backup plan

Leon Ho says that it never hurts to have a back-up plan. The last thing you want to do is scramble for a solution when the worst has happened. “Hope for the best, prepare for the worst.” This old adage holds solid wisdom. Having a backup plan gives you more confidence to move forward and take calculated risks.

Perhaps you’ve applied for a grant to fund an initiative at work. In the worst-case scenario, if you don’t get the grant, are there other ways you could secure the funds? There are usually multiple ways to tackle a problem, so having a back-up plan is a great way to reduce anxiety about possible failure.

Leon Ho (https://www.lifehack.org/articles/lifehack/how-fear-of-failure-destroys-success.html)

Identify the consequences

Theo Tsaousides says that in order to attenuate fear of failure, first identify the consequences of failing that scare you the most and evaluate your ability to deal with these consequences. Instead of talking yourself out of the fear by hoping that nothing negative will happen, focus on building confidence to deal with the consequences.

Here are some questions to ask yourself:

  • Which of these consequences scare you the most?
  • How much impact will they have on you? Are they merely unpleasant or life-threatening? Will they just make you feel uncomfortable, or will they hurt you deeply and irreparably?
  • How quickly will you move on? Are the consequences permanent or reversible? Are they short-lived, or will they linger forever?
  • How well can you handle them? Can you exercise damage control, or will you hide and disappear?

Theo Tsaousides (https://www.psychologytoday.com/us/blog/smashing-the-brainblocks/201801/how-conquer-fear-failure)

Now that you’re equipped with the knowledge, it’s your turn: Tell us about YOUR experience in dealing with a Fear of Failure and check out one of our latest article on how to manage airtime!

Old-Traditioned Early Adopters : The Diary of an Expat in Shanghai

Did you know that Fried Tomatoes and Eggs is the most popular dish in China? You can determine how well you know China according to how well you know Chinese food. So, if you associate Chinese food mainly with Sweet and Sour Pork with Rice… well, then your knowledge of China is very basic. If you already know that rice is more popular in the South of China while noodles are more popular in the North, then you are at the next level. If you know that Shenzen and Hong Kong are the right places for Cantonese Dim Sum; Shanghai’s cuisine is heavier and sweet; Sichuan’s is

the spicy choice and that in Beijing you should go for the Peking Duck, then you really know your way around!

But this week, I discovered a deeper layer in the Chinese food culture. At home, at every home, the most common dish is Fried Tomatoes and Eggs. People love to argue about the best way to make them; salty or sweet -with sugar (yes!), spicy or not, frying the eggs or the tomatoes first, etc. ICBC bank used this insight to target Chinese students studying abroad. They launched a campaign based on their love of this dish, which most of them associate with missing home, and it created a great buzz in Chinese social media.

So now you know! I have been living as an expat in China for over three years now, always trying to capture the learnings and insights I discover in my journey towards understanding the local culture. But whenever I feel I have grasped a new facet, I quickly discover something new that surprises me! To top it all, everything changes rapidly. The society that I am getting to know here in the big city is full of early adopters and trendsetters. When they do something, they do it full force – they do it big and fast. As an example, let’s take Mobike. Last year, Mobike introduced a new service that allows people to pick up a red bike anywhere in the city and drop it off anywhere – a station-less shared bike service. You can track the nearest bike by using their app on your phone and open the lock by scanning a code using a mobile payment app. The service is very cheap and allows hundreds of thousands of people around the

city to make short trips, such as the last mile from the metro to their final destination, quicker and more environmentally friendly. To make it attractive for customers, an abundance of bikes were scattered in the city. Very quickly, additional companies started offering the same service; OFO with yellow bikes, and then the green bikes, the blue bikes and then the electric bike. We are talking about around 1.5 million shared bikes around Shanghai!

The early-adopter culture in Shanghai and how it works:

As the competition is fierce, some companies give their service for free, and some pay you for using the bike and moving them around the city. As you can expect, challenges have risen. Now, for example, there are piles of bikes blocking sidewalks and entrances to buildings, creating the need for new solutions. These challenges have developed thanks to the rapid adoption and extensive use of the new service. Over 20 million rides a day in 50 cities around China. Trend-setters? Now the station-less bike-sharing service is spreading to an additional 160 cities around the world. So, they are “Early Adopters with old, traditional favorite dishes.”

This was the first observation I thought to share with you regarding the Chinese culture I’m striving to get to know. Want to hear more? Be sure to check my next post. But, in the meantime, read all about teleportation!

How To Optimize Your Innovation Strategy by Making Your Idea a Sweet Idea

Published on: January 25, 2018 в 1:11 pm

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Categories: Creativity,innovation,innovation strategy

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What’s the perfect New Year’s Resolution?

 

Hint: think re: innovation strategy

Well, if that wasn’t sufficient, here are two additional hints…

(1) It’s not only challenging but actually promises a significant change in your life;

(2) It’s not pie in the sky, but applicable to your daily life.

 

Let’s take a more practical approach…

If your goal is to get in shape, watching TV while standing is maybe not the most effective initiative. However, regular mountain climbing is probably a bit of a stretch if you are a fairly immobile city dweller.

This is the Near-Far-Sweet Idea Mapping Model as applied to your daily life.

Near – ideas that are pretty close to current practice. They are new, but probably not impactful enough to be worth your attention.

Far –  exciting ideas, but not viable. Either the market is not ready to accept them, or you will not be able to implement them.

When optimizing your innovation strategy you want your ideas to be neither too close to home (“Near”) nor too challenging to be implementable (“Far”). You want your ideas to be new and exciting but at the same time realistic and useful. This is your Innovation Sweet Spot.

 

Learn How To Enhance Your Innovation Strategy By Making Your Ideas Sweet:

This all sounds pretty obvious and common sense. Surprisingly, the distinction is often overlooked, or at least not given systematic treatment. Categorizing the results of an ideation session or workshop into Near, Far and Sweet – as seen in the visual on the right – will give you an important indication as to the practicality of your ideas. It can also be a useful tool to improve the outcomes of your innovation strategies, by pushing some Nears and Fars into the Sweet Spot.

But before we share a quick guide to applying NFS to NPD, here are some thoughts of how it can serve as a practical tool to support the “Dual Innovation Approach” as defined by Ralph-Christian Ohr. Ohr cites research that shows that the Dual Innovation Approach is used by 70% of the most innovative companies:

innovation strategy
[With Dual Innovation] innovation management follows a balanced portfolio approach. The entire innovation portfolio is divided into exploitation-oriented and exploration-oriented innovation initiatives, where the following characterizations hold:

 

  • Exploitation-oriented initiatives are related to running the core business by executing and enhancing existing business models or technological capabilities. The primary direction of impact is valued capturing (commercialization). Examples: Product, service or process innovation, portfolio extension, innovation of selected business model components (e.g. channel or operations), market research.
  • Exploration-oriented initiatives are related to developing future business by searching for the novel, and often disruptive, business models or technological capabilities. The primary direction of impact is value creation (configuration). Examples: Business model development, platform/ecosystem innovation, basic technology research & development, startup engagement, innovation intelligence.

(https://dual-innovation.net/a-model-for-dual-corporate-innovation-management/) Ralph-Christian Ohr

 

Ralph-Christian further introduces three playing fields of dual innovation:

  • Optimize the Core (Optimization of existing business models and technologies)
  • Reshape the Core (Transformation of existing business models and/or scaling up new business models/technologies)
  • Create the New (Creation of new-to-the-company business models and Technologies)

(http://integrative-innovation.net/?p=1765) Ralph-Christian Ohr

 

Integrating Ideas

He then elaborates on the true challenge of dual innovation: neither developing extensions of the product/service portfolio within the existing business model, nor coming up with completely new ideas, but integrating new ideas into your existing innovation strategy:

When it comes to integration, most companies face huge problems. This is the space where two main activities need to be conducted to achieve business impact from innovation and to future-proof the existing business model:

  • Validated breakthrough or even disruptive innovation concepts need to be scaled up for achieving business impact. If a company does not master Scaling-Up there is a high chance that all ideation will remain only innovation theatre.
  • In the light of Digital Transformation, adapting the established core business models by innovating selected elements (e.g. platform strategies, x-as-a-service business models, bypassing the middle man or automatization of service processes) is mandatory. If a company does not master adaptation it risks to lose in Digital Transformation.

(http://integrative-innovation.net/?p=1765) Ralph-Christian Ohr

Ohr presents a challenge: strategic ideas ought to be transformed to have maximum impact – to be innovative enough but not too disruptive. Through the NFS model, the SIT (Systematic Inventive Thinking) methodology invites you to apply two principles that, together, cover both directions:

1. Qualitative Change. Very often, “near” ideas are generated by incrementally improving on existing offerings, making them “bigger, faster, better”, i.e a quantitative change. The QC principle calls you to observe the basic logic of your product or service but change a fundamental relationship in this logical structure. Example: don’t offer your product at a discount, but offer it for free, generating revenue by a totally different business model. This is easier said than done, of course, but using the right tools, it allows you to push Near ideas into the Sweet Spot.

2. Closed World. The second basic principle of SIT is rather counterintuitive: when innovating, try as much as possible to utilize only those elements that already exist in the system.

innovation strategy

Instead of reaching out of the box, innovate inside the box. Instead of searching for new elements, find new angles and possibilities in the existing ones. By applying several tools under this principle, you will be able to pull in some Far ideas, turning wishful thinking into viable options and improve your innovation strategy

So, here’s a NY’s resolution that hopefully resides within your Sweet Spot: Map your new ideas on an NFS diagram, consider whether enough of them are in the Sweet Spot, and then push and pull those that are not to create exciting but viable options for development of your innovation strategy. Enjoy.

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