For decades, CEOs have struggled to deliver on their innovation promises. While innovation remains on the top of the corporate agenda for many firms, organizational inertia and the challenges of scaling existing businesses often conspire to make innovation difficult.
Too many companies regard innovation as an activity for mavericks or geniuses only, not as an everyday activity that can contribute to the company’s bottom line.
According to evolutionary anthropologists, humans are evolved to solve problems and innovate through trial-and-error learning, and that innovation is a driving force of human evolution. Some companies effectively manage their employees in ways that allow them to act on their natural abilities to innovate.
Research clearly indicates that companies that prioritize innovation also benefit from high levels of employee engagement. When employees are encouraged to use the full range of their creative muscle, they are more fully actualized, engaged in their work, and more likely to remain in the job.
Take W.L. Gore, for example. Often ranked as one of the world’s most innovative companies, as well as one of the best places to work, Gore is an innovation machine. This results from tangible commitments the company makes to its employees.
The company has an internal program that’s referred to as dabble time. Employees are given around 10 percent of their work week (or one half-day) to pursue an independent innovation opportunity. Dabble time has resulted in hundreds of new products over the years, which contribute to the company’s consistent growth and financial success.
In the early 2000s, W.L Gore engineer Dave Myers was working on developing a plastic coating for his bike gears as part of his dabble time. The idea was to make gear changing and braking smoother. That project resulted in a new W.L. Gore product — Ride-On bike cables.
Myers was convinced that the new technology he developed might have other applications. He reached out to Chuck Hebestriet, another W.L. Gore employee, who was an avid guitar player. The two convinced a manager to green light a new idea and lab for how the plastic coating could be used to make acoustic guitar strings. They successfully created and launched Elixir guitar strings, and by 2004 Elixir had become the leading selling guitar strings on the market, with a full 35 percent market share.
Examples from the following leading companies adhere to a similar pattern of employee-led innovation and new product development. These innovative companies engage in the tangible practices described below to foster experimentation — none of which require significant commitments of time or money.
1. Cascade a growth mindset
Innovation isn’t possible unless it’s a priority among senior leaders. The radical financial turnaround at Microsoft under Satya Nadella is a case in point. He has made it clear that employees are allowed to take risks and to experiment — and that they won’t be punished if they fail as long as they learn from their experiences. Microsoft’s embrace of risk-taking and innovation under Nadella has contributed to Microsoft’s ascension as the second-most valuable company in the world, behind only Apple.
2. Provide time for experimentation
W.L. Gore employees are provided one half day a week to pursue their own innovation ideas, yet the results of this are quite impactful. Meanwhile, 3M has had an in-house innovation program in place since 1948, which grants employees 15 percent of their week to pursue innovation. Google’s famous 20-percent program was modeled on 3M’s strategy and has helped contribute to its long-standing track record of successful innovation. Without officially sanctioned time, employees will not trust that they’re innovative ideas will be free to flourish.
3. Establish a vetting/commercialization process
Marissa Mayer famously once oversaw Google’s 20-percent-time vetting process where intrapreneurs were given 15 minutes to pitch their ideas to an innovation panel. At W.L. Gore, Intuit, Haier and Google, new ideas are shepherded through an established process where the commercial viability is assessed. For example, Gmail and Google AdSense both came from this process. The Virgin Group of companies has a similar process for nurturing innovation in-house.
4. Rotate projects and capture the learning
At both W.L. Gore and Haier, employees are encouraged to regularly rotate project/product labs so they can continuously learn. Not only are individual employees exposed to new learning opportunities, they also share their insights and learning from project to project. Formal after action reviews (AAR) are often used to capture new knowledge and capabilities.
5. Start small
Companies that make an initial commitment to get the ball rolling will create a framework for shepherding innovative ideas forward. As with Microsoft’s Nadella, senior leadership should champion the effort, and middle management must be on board. Additionally, a budget — even a small one — will show employees that this is more than a die-on-the-vine exercise.
Companies that enable their employees to pursue experiments — releasing their inner innovator — not only have the opportunity to develop a continuous pipeline of new revenue, they also cultivate a more deeply engaged staff and are able to retain their top performers. Starting with a small amount of time to kick-start the process is an easy first step. One tangible step at a time.