What the data reveals is not a surprise: If you want to accelerate innovation you have to loosen bureaucracy and control. Unfortunately, you cannot have both.
Faced with accelerated change leaders are calling for more innovation. But calling for innovation is not enough. Leaders need, to take off the brakes to let it happen. That is because nothing hampers speed and agility like top-down approvals or sign-offs, rigid plans and traditional reporting.
Easing up on visibility and control may sound like a recipe for chaos, but it is not an organizational ‘free for all’ that is required. Rather, what is needed is a focused approach – empowering those teams leading important projects and initiatives.
Think of the innovative potential of a group of 7 intelligent, experienced, and worldly-wise executives brought together from across the organization to drive an important project or Initiative. . Imagine the diversity of perspectives, the insightful conversations, the curiosity, and clever ideas that should naturally emerge. The question is:
The answers to the above questions reveals the extent to which the organization has its foot on the accelerator or the brake in respect to the project and team in question.
In a large organization you may have to give permission to innovate. Now that may sound strange but let me explain. In a virtual pitstop with managers from an operating division of a global corporation, one manager came straight out and asked: ‘Do we have permission to do that?’
For those unfamiliar with the organization’s bureaucratic ways, the question may have seemed strange, perhaps even child-like in its subservience. However, what the question revealed was how the group of long tenured managers had become cynical of the prospects of change and weary of fighting with corporate.
Of course, seeking permission does not sound very ‘corporate’, but needing to get sign-off or approval certainly does. There are a host of formal processes and procedures to be followed, as well as the informal norms to be adhered to.
The result is organizational rigidity in an age that demands speed and agility – at a time when innovation is paramount.
Thinking outside the box is a commonly used expression. In large organizations it has another deeper significance because more and more of the organization’s innovative work takes place outside the traditional organizational structure with its top-down hierarchy and functional lines of reporting.
Take for example a growth platform initiative aimed at enabling the next generation of products. Like most Strategic Initiatives, it spans functional boundaries involving IT, operations, finance, compliance, sales, marketing and so on.
The success of such complex cross-functional initiatives depends on the ability of executives from all these functions to work together effectively. That is, despite, working alongside people that they have not worked with before and may have little in common with. It also means that the person leading the project, may not be their boss.
Taking place outside the traditional structures, presents the possibility of bypassing traditional reporting lines, functional boundaries, and perhaps even the requirements of meeting short term performance targets. But side-stepping bureaucracy in this way is not easy.
Ensuring the peaceful co-existence of these new ‘business unusual’ initiatives and the traditional organization can be a real challenge. There is a certain amount of bureaucracy that is necessary, even essential. For example, while the trend is toward a more agile approach to project management, basic project rigor is still essential, including setting out the plan, timeline and budget.
‘…in more traditional businesses, the conflict between freedom (which allows creativity) and bureaucracy (which attempts to constrain the risk inherent in creativity) is more often resolved in favour of the certainty that comes from hierarchy, defined goals and targets. Innovation is appealing, even essential, but the conditions required to support it are too ambiguous and uncertain for corporate comfort.”
Our analysis is clear: the potential for innovation exists with most projects and teams. If innovation is not manifest, then there are likely to be reasons why. These often include the typical processes, systems and structures of a traditional top-down hierarchy. Called ‘bureaucracy’ it is not just manifest in the ‘hard’, but also in the ‘soft’ – that is the culture and norms of the organization.
Many of the obstacles and challenges faced by Strategic Initiatives are internal rather than external. These include getting the project approved and resources sanctioned, ongoing reporting, managing internal stakeholders, collaborating with other departments. Plus as a certain amount of internal politics and ‘show-boating’. This is a major drain on time and energy, with those running projects could be spending much of their time engaged in internal admin or bureaucracy2. The result is that for much of the time people are focused internally, rather than externally. As one of our colleagues puts it ‘they have their back to the customer’ while all this non-value adding activity is going on.