This is a repost of an article I wrote a few years back and have since updated.
Livin' the dream... from last year
Have you ever been a part of an organization that seems to believe that everything they are currently doing is the best and only way that particular thing should be done? Years ago, the company figured out how to build a particular product or deliver a particular service and make money at the same time. As time passed they began to believe that they were good at it. After a few successful years, they convinced themselves that they were the best at what they did and that customers were lucky to be able to do business with them. They stopped confronting reality and started listening to their own press releases. I think you know the rest of the story. Arrogance and hubris set in, and the organization begins a steady decline to mediocrity or non-existence as customers find other companies that are willing to serve them.
Organizational culture can kill innovation
Innovation is a fundamental aspect of our human nature. It is in our DNA to dream big dreams and create what only exists in our minds' eyes. Every company has people who are capable of innovation and it will happen whether the company promotes it or not. The question is whether the organization will benefit from it or if the competition will. While there are many ways to stifle and kill innovation in a company, having an organizational culture that refuses to let go of yesterday's successes is one way to pinch off the flow of innovative ideas. If new team members believe that their new idea will have to compete with, and defeat, long entrenched corporate ideology, they will lose interest in the debate fairly quickly. They get paid whether management accepts their new ideas or not. If they are shut down once, it is unlikely that you will be able to get them to open up again without additional effort. Xerox is an example of a company that was not able to capitalize on it's own innovations. Some of the company's' most notable inventions during the early 1970's were
The personal computer (PC)
Ethernet networking
The modern word processor with WYSIWYG editing
The Graphical User Interface (GUI) (What you see on your computer screen today)
The computer mouse
Computer generated bitmap graphics
There are many in the know who believe that the reason Xerox was never able to bring these innovations to market was because the company was in the copier business. It did not know how to make money with these technologies. It took a smaller more nimble group of people (Apple computer) to make the dream a reality.
Arrogance and hubris
As companies grow in size and market share, they tend to become more and more confident in their position in the marketplace. A sense of entitlement begins to infuse itself into the DNA of the company until employees start treating customers like they don't have a choice in suppliers. Customers naturally get upset and start looking for alternatives. The market hears the demand and produces another supplier who will deliver the product or service, cheaper, faster and with better service than you do. This cycle is repeated time and time again. It is no wonder why many successful businesses lose their winning position to the competition after an extended successful run.
Have you ever been part of a company that has been around for more than 10 years and has met with reasonable success. Often, these types of organizational cultures have management models that are intended to keep the streak going by doing the same thing over and over. This strategy simply doesn't work because the external environment changes. The ability to succeed becomes harder and harder. The company begins a slow and uneventful demise as both customers and talent leave. Jason Jennings wrote the book "Its not the big that eat the small... it's the fast that eat the slow". (It's a great read and I highly recommend it.) In it he presents the idea that quick thinking and appropriate action has taken the place of size and longevity as a competitive advantage. It is no longer sufficient to be the biggest and oldest company in the market. Companies that rely solely on what they did yesterday will find themselves left in the dust. Innovation has a shelf life and every year it gets shorter and shorter.
Some final thoughts
Making Yesterday Perfect is a term used by Gordon Sullivan and Michael Harper in their text "Hope is not a Method." According to Sullivan and Harper, a "Making Yesterday Perfect" leader is often aggressive in making change and demonstrating progress, but always in terms of the old paradigm. This type of resistance to change is especially bad because it gives the appearance that people are actually effectively working to address the situation.
If you are in an organization that seems to struggle with the reality of today's business environment you have options. You can be part of the problem, or you can be part of the solution. Be one of those leaders who focus on creating an organizational strategy that prioritizes learning and innovation. There are many texts, articles, and information on innovation. I would start with the classic works of Clayton M. Christensen and learn about Disruptive Innovation. If you are unable to create change in your organization, it may be time to look for a team that is willing to grow and learn, or maybe even start one yourself.
Do you have any suggestions on how to help your organization become more innovative? Have you been able to work with your management to get new ideas to take root? Please comment and let us know how.
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