Cultivating & Maintaining a Culture of Innovation

Cultivating and Maintaining a Culture of Innovation Proven Principles and Best Practices Its a universally accepted fact of business: innovation is vital to every companys long-term success. Whats still wide open to debate is: How does an organization successfully foster, establish, and sustain a genuine culture of innovation? As Andrew J. Sherman, a noted expert on intellectual property management and business growth, shows in his new book, HARVESTING INTANGIBLE ASSETS (AMACOM, 2011), the answer can be found in the trusted principles and practices of highly successful innovative companies. They include: * Googles 70/20/10 rule. Each employee should spend 70 percent of his or her time working on the core business, 20 percent working on ways to extend or expand the core, and 10 percent thinking completely outside the box. At Google, the 20 percent window has been very productive, yielding many of the companys recent innovations, including Gmail, Google News, and AdServe. * 3Ms 30 percent/4 year rule. At 3M, 30 percent of total sales must result from products introduced within the past four years, forcing innovative products to have an almost immediate impact on the top and bottom lines. This rule is supported by the 15 percent rule, which allows technical personnel to spend 15 percent of their time on projects of their own choosing without any prior approvals. * Cast a wide net. Innovation can come from many sourcesboth inside and outside a company. Look to customers, vendors, and even competitors as sources for new ideas and guidance on improving existing products and service. Do not allow your culture to suffer from NIH (not invented here) syndrome, which assumes that ideas not generated by the leaders of the organization cannot possibly be worthy of consideration, Sherman urges. * Stay close to customer needs. Innovation doesnt pay unless theres a market for it. UPM, a Finnish paper manufacturer, has established a novel practice to ensure that its R&D teams keep focused on customer needs: brainstorming with value-chain players across the paper industry, from large commercial printers to paper wholesalers and retailers. * Embrace the headless tiger. Microsoft continued to do it without Bill Gates. Apple will continue to do it without Steve Jobs. Since visionary founders and leaders dont stay with their companies forever, the companys culture must be prepared to innovate with or without their day-to-day presence. Team-driven innovation works to create leaders at all levels that can sustain and strengthen the founders vision long after he or she steps down. Maintaining a culture of innovation depends on investments in training, commitments to empowerment and delegation, and the development of meaningful succession plans.

* Let the RATS in. An effective, ongoing innovation process requires a systematic approach and commitment to the deployment of RATS: Resources, including human capital, time, and supplies; Advocacy, from both internal and external advocates who will help secure resources and provide emotional support for innovative projects; Testing and evaluation to predict the financial return on the resources invested; and Sustainable demand, based on the identification of target customers, markets, channels, and potential strategic partners. * Make it funand remain open minded. Fun can be functional and productive. Game playing, role playing, experimenting, exercises, retreats, and parties can all facilitate creative thinking. Fun liberates the brain, allowing people to break down barriers and look beyond what theyre expected to see. For example, consider Viagra. In the early 1990s, Pfizer began testing a compound to treat certain cardiovascular diseases. One of the observed side effects was not at all what they expected. Needless to say, as Sherman observes, a little repackaging and repositioning, and the rest is history.