A.G. Lafley, former CEO of Proctor & Gamble teamed up with management guru Ram Charan to write an excellent book on Innovation called The Game-Changer; How You can Drive Revenue and Profit with Innovation. Lafley immersed himself into innovation because he knew it could be a growth driver, but the percentage of innovations that had positive results had dropped to about 20%; when he finished the company transformation, the percentage was 50%!
Underlying the efforts, was his declaration that the Customer is Boss. This mean getting outside the lab and the focus-group rooms and meeting customers in their own settings (i.e., ethnography). Sometimes this meant living with the customers for a while, until the researcher could understand how the customer was making decisions that affected their purchase and use of products P&G and its competitors sold.
He also focused on involving potential strategic allies in the search for innovation. The concept of NIH – “Not invented Here” – was rejected. Potential allies involved anyone who could contribute – ranging from large retailers (e.g., Walmart & Target), smaller specialty research companies, companies producing complementary consumer products, and even retired employees who had something to offer. Indeed, almost half the new innovations came from such parties.
He concludes the book with a message to leaders who also want to unleash more innovation from their organizations, so let me summarize.
- Set the vision and convert it into long-term priorities
- Inspire people – redirect their emotional commitment from status quo to change
- Recognize that innovation is a Team sport. This means creating a culture that rewards being:
- Courageous: taking risks, learning from failure, relying on meaningful indicators;
- Connected and collaborative: work with people inside and outside your network and company
- Curious: explore, ask questions, challenge assumptions, stay naïve to see patterns others miss
- Open: to new ideas from anywhere, newly articulated needs and wants from customers, etc.
- Serve as a role model for these attributes to inspire everyone
- Develop supportive structures to encourage people to seek innovation – from providing time and resources to creating rewards and providing recognition
- Provide protective cover when the “status quo” tries to re-assert itself.
- Be decisive: encourage those projects most likely to succeed and kill those destined for failure
- Be an integrative thinker – seeing contradictions in what customers say and do, and finding solutions to break the tensions of opposing ideas
- Balance IQ and EQ skills; Don’t settle for superficial answers – dive deep to uncover unarticulated needs.
- Develop other innovation leaders through coaching, training and planning