Two fundamental things that managers should do to lead innovation in an organization are :
Firstly recognize that the world is changing .They should not only re-engineer their current business but also need to innovate in response to these changes. So understand what are the changes going around them –customers , technology, competition, demographic shifts etc. Think about how they need to adapt to these changes.
Secondly they need to understand that the change is less of a technical problem but more of a mindset –it’s an organizational issue. So they need to shift the attention to how to change the mindset of the organization in order to bring about this innovative change. Now changing the mindset of an organization cannot be done over night. It involves people .It’s about injecting new blood into the organization. One way to do this is to bring in new voices. By borrowing people from other units/departments from within same company or by hiring new people from outside. Also there can be talents inside the organization who can think differently, so these mavericks should be identified and encourage them to come up with new ideas.
So innovations require changes and changes often have resistance. Three important practices to be followed to overcome resistance :
Firstly recognize that the world is changing .They should not only re-engineer their current business but also need to innovate in response to these changes. So understand what are the changes going around them –customers , technology, competition, demographic shifts etc. Think about how they need to adapt to these changes.
Secondly they need to understand that the change is less of a technical problem but more of a mindset –it’s an organizational issue. So they need to shift the attention to how to change the mindset of the organization in order to bring about this innovative change. Now changing the mindset of an organization cannot be done over night. It involves people .It’s about injecting new blood into the organization. One way to do this is to bring in new voices. By borrowing people from other units/departments from within same company or by hiring new people from outside. Also there can be talents inside the organization who can think differently, so these mavericks should be identified and encourage them to come up with new ideas.
So innovations require changes and changes often have resistance. Three important practices to be followed to overcome resistance :
- Better performance measurement system: People respond to how they are measured and rewarded. So if you want them to behave and think differently with regard to innovation we must change the performance measurement system.
- Willingness to collaborate :Innovation is different from creativity. Creativity is an individual effort. Innovation is commercialization of creativity that requires organizational effort. Therefore the second thing that should be promoted is collaboration.
- Tolerance for failure : Some tolerance of failure culture should be developed because innovation by definition means doing something different ,something new , something path breaking, that means you are not going to succeed 100 percent of time .so unless we tolerate failure, people won’t be able to push innovation.
TATA is one such company that I would like to mention ,with their innovative product ‘Tata- Nano’, has reinvented the automobile market in India. They have concentrated on micro customers in the emerging Indian market, which requires Ultra low cost business models. These emerging markets of India and China are going to be the source for business model innovations.
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