A recent BCG survey highlighted the fact innovation is among top three priorities of CEOs is up 10 percentage points in 2021 to 75%—the largest year-over-year increase since 2005. This should not come as a surprise though as all enterprises are actively looking to renew and reinvent themselves with all transformation happening across the world. There is already a great focus on enablers and tools of innovation; though the foundational elements are discussed less and might become a potential blocker.
Peter Drucker famously had said “Culture eats strategy for breakfast”, and this can easily hold for innovation too: While a good culture might survive a bad innovation strategy a time or two, a good innovation strategy never survives a bad culture. Why is that?
Looking enterprises across the world it becomes very clear that while leadership usually initiates enterprise innovation and corporate philosophy further steers it, culture is the one what ultimately nurtures and sustains it.
Organizations who understand this, are intentional about cultivating and nurturing not only a culture of innovation but more importantly a culture of relevance, in other words a culture that embraces change and uncertainty.
But still today, unfortunately this might be the exception to the rule in many organizations . For many organizations, the focus has been to apply the Modern Management Theory in a pursuit of efficiency, productivity and lean; all aimed ultimately at maximizing margins. This has produced cultures which have a strong assumption of that the world will go on working the way it currently does and that future can be extrapolated from the present. But recent pandemic challenged that assumption heavily and caused a strong paradigm shift. This is not the reality of the world we live in. Instead, technology, markets and societies are changing at rapid pace. The world will not go on -working the way it does currently; our futures cannot be predicted or extrapolated from our present.
Which brings us back to the question that what kind of approach we need to take. This requires the sort of mindset and nonlinear, exponential, combinatorial thinking that expects the world to change and is willing to embrace that reality and act on it. But this change in mindset wont come without a change in culture. Hence, the successful pursuit of enterprise innovation requires a shift in culture starting with executive leadership but eventually penetrating the whole organization. This culture must become one that fully embraces the uncertainty and changes, that desires to find offensive moves it needs to respond and openly fosters the exploration, experimentations and learning. This mindset and culture creates the environment welcoming the innovation’s discovery skills including observing, questioning, networking, experimenting and associating. This culture will be bringing the talent to the organization who look to live out a sense of purpose and meaning as they move forward to the future.
This sort of culture rooted in exponential, combinatorial and nonlinear thinking is absolutely necessary if the organization wants to create an environment that is conductive to creative innovation.
Planes have two wings. So does Innovation. If one wing is the strategy, the other one is culture. If we do not embed this culture deeply into the organization with the exponential, combinatorial and nonlinear thinking; it will be a tough game if even possible to fly into the bright days of the future.