The talent for innovation in Thailand
Innovation in Thailand is now a big deal.
CEOs are coming under increasing pressure to deliver more innovation from their organisations. But the sorry fact is that innovation is something many companies do not do particularly well.
This may come as a surprise to the casual observer, since many of these companies spend tens of millions of dollars in targeted recruitment every year – but fast forward to the year end, and the situation remains stubbornly the same. A lack of innovation.
The Big Deal about Innovation
Why should these companies care anyway? It’s a good question. Take Big Oil, for example. What could any of these companies possibly innovate that wuld make a measurable difference to their bottom line? Nothing in the ‘sunrise industries’ of Green Energy comes close to the profitability of refining and selling oil.
But even in this industry, nobody wants to lose out in the search for the ‘next big thing’ once oil stocks are gone. And there are plenty of examples where innovative thinking can literally create a silk purse from a sow’s ear.
Food is one area that may not strike us as offering stellar returns from innovation. Yet the Big Mac was created by a franchisee and remains, to this day, the most successful (and profitable) consumer product ever. Many of 3M’s most successful innovations came from employees not directly responsible for product innovation, while Apple’s ‘siloisation’ of its innovation (read ‘keep the beancounters out!’) arguably makes it the only company that can be called a brand in today’s mass consumer electronics industry.
At the top end, meanwhile, Bang and Olufsen defies gravity by placing all its chips in the hands of top designers. This strategy has served it well. In an indusry where products are often obsolete within two years, B&O still has items in its catalogue selling well that date back to the 1960s.
Survey after survey place innovation (or the lack of it) high up on the list of critical issues among CEOs in their companies.
Yet look at what companies do, and it’s little wonder why this is the case. A favourite approach is to have ‘innovation core values’, ‘innovation competencies’ and ‘innovation KPIs’. To the casual observer, this might make sense. Yet peel back the layers of the onion and we begin to question this approach.
First of all, companies usually don’t have a way of hiring candidates for innovation. In fact, most companies’ selection methods are remarkably uncorrelated to the kind of behaviours CEOs keep saying they want. Put simply, they boil down to two approaches.
Approach 1 is the popularity contest approach, where the most likeable person gets in. Likeability might be important in some areas, but it tends to be quite marginally correlated to innovation.
Approach 2 is the ‘trial by rigour approach’. Here it is more of a case of ‘Survivor’, where the most determined candidate hangs on through trials of form-filling, interviews and so on, as well as hopefully ticking the box in other areas which are also not necessarily correlated, for example which university the candidate went to, or how much experience he or she has had.
The trouble with these approaches is that, in themselves, they don’t assess innovation.
Worse, both these approaches tend to suit and breed conformism, which is usually a trait most innovators find frustrating.
All the above approaches form part of the architecture most companies use for their talent management. To summarise: 1. Core values. 2. Competencies. 3. KPIs, and 4. Conformity (and being a non-conformist myself I call the above the 4Cs). Let’s look at these in further detail:
1. Core values. Kouzes & Posner have discovered that having core values can actually be a negative factor if they are not congruent with those of the employee (because cynicism sets in). Having an ‘innovation’ core value is meaningless unles those in the organisation take the right actions to encourage a climate of innovation and, more importantly, a talent management system that attracts, nurtures and rewards innovators.
2. Competencies. These are unscientific and unnatural. No wonder they create confusion. Quick question: if you see a psychiatrist, does he or she diagnose your condition in terms of competencies? Of course not. This is because competencies are an artificial basket of skills, knowledge and behaviour that bear no scientific relation or use to the human being.
Still, senior management somehow seem to think that by having them employees will somehow acquire those traits. Nothing is further from the truth. Behaviours at work heavily derive from natural abilities, which are hardwired. I also find it remarkable when I see ‘innovation’ or ‘creativity’ competencies in companies when they do nothing to assess these traits at their selection process (often because they have no idea how to do so).
3. KPIs. Some companies have KPIs where they expect individuals, teams or business units to come up with ideas. This approach may have some merit to it, though I wonder how likely it is to expect a positive effect in some types of firms, for example auditing companies.
4. Conformism. Conformism is a real danger to innovation, is contagious, and costly.
Take Sony, for example. Its Walkman was a breakthrough product in the 80s and 90s and helped earn the company tens of billions of dollars in bottom-line profits. So why is it not a brand now? Simply becasue the engineering department pushed the ‘mini disk’ concept, even though that’s not what consumers wanted. The company continued to do so, with the result that when Apple eventually came along with its digital alternative (the IPOD), Sony effectively gifted this lucrative profit stream to their rival. All this because of the closed minds or ‘structural thinkers’ in one department.
‘Structural thinkers’ exist in many companies. Structural thinkers are very useful at processing repeated tasks (for example ensuring Walkmans are on the shelves in every retail outlet in a country), but change that task to ‘dream up an alternative to the Walkman’ and structural thinkers are at sea. That’s where non-structural thinkers (or innovators) come in handy. But often due to points 2 (competencies) and 4 (conformity) above, organisations unwittingly drive innovators away. Structural thinkers proliferate, and because there is no incentive to hire innovators, they will often in turn look for people who ‘fit’ (being structural themselves) so it’s not difficult to see how a creeping ‘genocide’ can take place in a company. Slowly but surely, you see structural thinkers filling the ranks of these cmpanies with innovators forced out.
Where Ideas Come From
Some say that ideation is a skill, and can be trained.
I agree, but this can happen only to a small degree.
To understand ideation, we need to start with the formation of the brain. As the brain grows, it makes synaptic connections which, as we mature, become like the hard wiring of the ‘electrical system’ in our ‘house’. All information in our brain is channelled through these wires, so how they have been ‘laid’ greatly determines our talents – and ideation is one of these.
This is supported by Research conducted by the Johnson O’Connor Institute which has shown that ideation is a natural ability – something that will change very little regardless of any amount of training. Training can make a person susceptible to ideas, but it’s unlikely to increase a person’s idea productivity by any meaningful amount.
This also explains the problem with competencies. No amount of them will lead to change in a area of talent (for example ideation), nor, try as they might, will they be able to make a rose grow blue petals.
What companies can do to nurture innovation
If the above strikes a chord, companies need to take only two actions to encourage innovation.
1. Use the Highlands Ability Battery for employee selection, with especial focus on those who score highly in Idea Productivity.
2. Scrap artificial constructs (like competencies) that get in the way of real innovation. Ensure your talent management system supports innovators at every stage of their career. Talent Technologies creates TMS’s for companies in a number of different industries which are innovation-friendly.
Companies often rely too much on directives when people are the true source of innovation. The more companies connect to their employees’ natural abilities, the more effectively will they be at building an ‘inno-culture’.
Talent Technologies :: Innovative Training