Can innovation be managed in corporate frameworks? Mostly not

Creativity, leadership and innovation have entered the lexicon as 'must-have' words in the management manifesto. No chairman's annual report is complete without them peppered into the text. Like "people are our most important asset" was in the 90s. 

It is fashionable and trendy for managers to drop these terms at every staff meeting. Every era has its buzzwords for organizations. These are ours at the turn of the 21st Century.


Industry forums, blogs and white papers discuss innovation as process improvements to design, speed, convenience, cost etc. or as derivative advancement of products and services.


What distinguishes true 'innovation' from product & process improvements?


Breakthrough innovation is disruptive. It renders current ways of solving problems obsolete. It redefines the problem and its solution. It creates a new product, service and market that never existed before.


Typically innovation leaves most consumers befuddled about what it is and why it was created. Early adopters explore the myriad ways in which it can be used, almost as a fan club.


The iPhone re-defined the mobile voice communication tool as an entertainment centre for music downloads, videos, broadcast news, social networks and email communication. 

It introduced touch-screen navigation of applications. It enabled a platform for developers to generate 'apps' for the Apple Store. Apple built a dynamic eco-system around the iPhone.


Here you can witness a breakthrough device designed to do much more than voice-connect, surrounded by a creative community of apps developers, a high-margin revenue share model and a growing library of games, apps and functionality from one trusted source. 

The strict Apple review process eliminates malware and immature submissions. Approval by Apple guarantees quality and integrity to consumers. It frees developers from the burden of marketing their products globally. Users can access a rich store of apps.

Is it any surprise that iPhone users have little reason to switch brands?


Can innovation be 'managed' within a corporate culture of conformity?


A typical enterprise is a hierarchy of managers, committees and approvals processes dedicated to preserving status-quo. Members work their way up the ladder by following orders and avoiding anything which may upset their superiors. They are rewarded for toiling in their groove.

An enterprise is 'efficient' to the extent that it has a high degree of predictability and shared behaviour. Any member of the organization who exhibits a questioning attitude to established procedures is considered a deviant and dangerous. 

The system is designed to promote conformity and penalize challengers. In that sense it shares similarity with gangs, cults and religious movements. There is retribution visited on any who question. 

That was how management as we know it evolved - from the dawn of the industrial revolution, to ensure factories mass-producing widgets could be efficient, consistent and scalable. It was a command-and-control logic that worked for widgets.


Alas, this is hardly an environment for creativity and innovation to flourish in a post-industrial, always-connected, digital world of information available to all. 

Even more bizarre is the idea that innovation can be managed within such a framework! It is comic to see naive CEOs and HR managers add creativity, leadership and innovation to their list of attributes to be rated in performance appraisal forms by managers trained to instinctively shoot all three on sight. 

In too many organizations, the annual appraisal process itself is a sick joke stoically implemented despite all evidence to the contrary. None below believe it to achieve anything other than pretend a scientific method to justify biased distribution of bonus, increments and promotions.


It gets so weird that an artificial bell-curve is force-fitted on small units of staff so that exactly 50% fall either side of the central measure. 


Normal bell curves occur only where data from sufficiently large populations can be randomly sampled. It is statistically impossible to have a 'normal' curve represent selective and small populations.

This statistical distortion is a classic stupidity implemented by otherwise intelligent managers. 

If anything, a competent sub-population of managers should show a positively skewed distribution or the enterprise is in deep pooh! 


The appraisal process is like a cult ritual at the alter of some deity. The terrified victims fall on their knees and pray for deliverance. The appraisal forms are carried about reverently by HR priests and preserved like the Buddha's Tooth in Sri Lanka.


Worse than the pointlessness of it all is the thousands of hours wasted by managers across the organization twice a year (yes a mid-term appraisal is mandatory).

How does a rigid hierarchy of conformists embrace the disruptive nature of innovation? Those being appraised know that any hint of innovation that may threaten the existing business model will be beaten down severely and the culprit marked down, if not expelled.


In the absence of real leadership, empowerment and creative challenge to innovate, business chiefs eagerly embrace the dead appraisal forms as proof of being "with-it". Nothing can be further from the truth. 

Management consulting witchdoctors have sold expensive performance-appraisal forms and statistical methodology at huge profit to simpleton CEOs looking for quick fixes to motivation and productivity.


Companies trapped in this self-delusion lack confident leaders and inspirational example from the top. It is futile to expect innovation to stand a chance in such mediocre outfits. 


An appraisal system is no substitute for inspiring leadership that provides clear direction and gets the best out of staff at all levels. 


It is not the panacea for absent leadership that management consultancies sell.


How does 3M, Proctor & Gamble, Google continue to stream innovative products?


These organizations live on innovation and do not fear making their own market leading products obsolete by design. 

They have existing operations running at full speed and a parallel R&D investment, separate from the operating business, whose mandate is to breakthrough and disrupt. 

The operating business has no overriding power to inhibit the R&D labs. They have a well-honed methodology to operationalize breakthroughs after field testing validates commercial viability.


They employ smart R&D talent to take on any area of the existing business and disrupt it with superior solutions or invent entirely new benefits. They co-exist distinctly apart from the mainstream. 

The R&D labs are supported with the latest tools and ample budgets. They are expected to invent and secure patents. They define tomorrow. They have no interest in yesterday.


It is wrong to think that these examples indicate disruptive innovation to be the sole preserve of men in white coats. 


Similar breakthroughs occur in all fields and functions. It is about problem-solving ideas that explode in all directions without inhibition, like an energetic mind-map. 


It needs leadership willing to accept fresh thinking. It champions managers everywhere to find new ways to solve persistent problems and initiate new functionalities not previously seen. It requires genuine openness to off-the-wall perspectives. 


Innovation in any organization waits for the CEO with a cool attitude to challenging existing business models ahead of the curve. It sharply separates leaders from managers. 


Perhaps organizations should pair a CEO (leader) and COO (manager) for complimentary value. 


And shred dysfunctional "performance-appraisal" tools which de-motivate talent and freeze creativity. The tragi-comedy of this is that weak CEOs have no guts to dismantle the failed exercise!


ENDS